Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Mar. 31, 2015 | 1-May-15 | |
Document And Entity Information | ||
Entity Registrant Name | AEMETIS, INC. | |
Entity Central Index Key | 738214 | |
Document Type | 10-Q | |
Document Period End Date | 31-Mar-15 | |
Amendment Flag | FALSE | |
Current Fiscal Year End Date | -19 | |
Is Entity a Well-known Seasoned Issuer? | No | |
Is Entity a Voluntary Filer? | No | |
Is Entity's Reporting Status Current? | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 19,857,142 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2015 |
CONSOLIDATED_CONDENSED_BALANCE
CONSOLIDATED CONDENSED BALANCE SHEETS (Unaudited) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Current assets: | ||
Cash and cash equivalents | $5,509 | $332 |
Accounts receivable | 1,651 | 1,262 |
Inventories | 4,641 | 4,491 |
Prepaid expenses | 903 | 1,392 |
Other current assets | 414 | 456 |
Total current assets | 13,118 | 7,933 |
Property, plant and equipment, net | 74,764 | 75,810 |
Goodwill | 968 | 968 |
Intangible assets, net of accumulated amortization of $284 and $264, respectively | 1,516 | 1,536 |
Other assets | 2,948 | 2,929 |
Total assets | 93,314 | 89,176 |
Current liabilities: | ||
Accounts payable | 8,909 | 8,339 |
Current portion of long term debt | 6,318 | 6,032 |
Short term borrowings | 5,820 | 6,714 |
Mandatorily redeemable Series B convertible preferred stock | 2,665 | 2,641 |
Other current liabilities | 4,185 | 3,590 |
Total current liabilities | 27,897 | 27,316 |
Long term liabilities: | ||
Senior secured notes | 56,157 | 57,648 |
EB-5 notes | 19,075 | 1,534 |
Other long term | 5,784 | 5,650 |
Total long term liabilities | 81,016 | 64,832 |
Stockholders' deficit: | ||
Series B convertible preferred stock, $0.001 par value; 7,235 authorized; 1,558 and 1,665 shares issued and outstanding each period, respectively (aggregate liquidation preference of $4,675 and $4,995, respectively) | 2 | 2 |
Common stock, $0.001 par value; 40,000 authorized; 19,847 and 20,650 shares issued and outstanding, respectively | 20 | 21 |
Additional paid-in capital | 83,059 | 87,080 |
Accumulated deficit | -95,756 | -87,113 |
Accumulated other comprehensive loss | -2,924 | -2,962 |
Total stockholders' deficit | -15,599 | -2,972 |
Total liabilities and stockholders' deficit | $93,314 | $89,176 |
CONSOLIDATED_CONDENSED_BALANCE1
CONSOLIDATED CONDENSED BALANCE SHEETS (Unaudited) (Parenthetical) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, except Share data, unless otherwise specified | ||
Statement of Financial Position [Abstract] | ||
Intangible assets, accumulated amortization | $284 | $264 |
Series B Preferred stock, par value | $0.00 | $0.00 |
Series B Preferred stock, authorized | 7,235 | 7,235 |
Series B Preferred stock, shares issued | 1,558 | 1,665 |
Series B Preferred stock, shares outstanding | 1,558 | 1,665 |
Aggregate Liquidation Preference | $4,675 | $4,995 |
Common stock, par value | $0.00 | $0.00 |
Common stock, shares authorized | 40,000 | 40,000 |
Common stock, shares issued | 19,847 | 20,650 |
Common stock, shares outstanding | 19,847 | 20,650 |
CONSOLIDATED_CONDENSED_STATEME
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (Unaudited) (USD $) | 3 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Income Statement [Abstract] | ||
Revenues | $34,726 | $60,665 |
Cost of goods sold | 34,954 | 45,041 |
Gross profit (loss) | -228 | 15,624 |
Research and development expenses | 109 | 100 |
Selling, general and administrative expenses | 3,634 | 2,842 |
Operating income (loss) | -3,971 | 12,682 |
Interest expense | ||
Interest rate expense | -2,546 | -2,920 |
Amortization expense | -1,723 | -2,118 |
Loss on debt extinguishment | -330 | -115 |
Other income (expense) | -67 | 164 |
Income (loss) before income taxes | -8,637 | 7,693 |
Income tax expense | -6 | -6 |
Net income (loss) | -8,643 | 7,687 |
Other comprehensive income | ||
Foreign currency translation adjustment | 38 | 108 |
Comprehensive income (loss) | ($8,605) | $7,795 |
Net income(loss) per common share | ||
Basic | ($0.42) | $0.38 |
Diluted | ($0.42) | $0.34 |
Weighted average shares outstanding | ||
Basic | 20,595 | 20,007 |
Diluted | 20,595 | 22,657 |
CONSOLIDATED_CONDENSED_STATEME1
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (Unaudited) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Operating activities: | ||
Net income (loss) | ($8,643) | $7,687 |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activitites: | ||
Share-based compensation | 153 | 131 |
Depreciation | 1,195 | 1,152 |
Debt related amortization expense | 1,723 | 2,118 |
Intangibles and other amortization expense | 32 | 32 |
Change in fair value of warrant liability | -29 | 48 |
Loss on extinguishment of debt | 330 | 115 |
Changes in operating assets and liabilities: | ||
Accounts receivable | -385 | 468 |
Inventory | -117 | 50 |
Prepaid expenses | 490 | -18 |
Other current assets and other assets | 19 | -399 |
Accounts payable | 560 | -1,453 |
Accrued interest expense and fees, net of payments | 2,421 | 145 |
Other liabilities | 563 | 1,178 |
Net cash provided by (used in) operating activities | -1,688 | 11,254 |
Investing activities: | ||
Capital expenditures | -14 | -247 |
Net cash used in investing activities | -14 | -247 |
Financing activities: | ||
Proceeds from borrowings | 20,032 | 960 |
Repayments of borrowings | -13,173 | -9,581 |
Issuance of common stock for services, option and warrant exercises | 21 | |
Net cash provided by (used in) financing activities | 6,880 | -8,621 |
Effect of exchange rate changes on cash and cash equivalents | -1 | 6 |
Net cash and cash equivalents increase for period | 5,177 | 2,392 |
Cash and cash equivalents at beginning of period | 332 | 4,926 |
Cash and cash equivalents at end of period | 5,509 | 7,318 |
Supplemental disclosures of cash flow information, cash paid: | ||
Interest payments | 141 | 2,646 |
Income tax expense | 6 | 6 |
Supplemental disclosures of cash flow information, non-cash transactions: | ||
Proceeds from exercise of stock options applied to accounts payable | 21 | 16 |
Issuance of warrants to subordinated debt holders | 668 | 95 |
Transfer between debt and other liabilities | 438 | |
Stock issued in connection with services | 506 | |
Repurchase of common stock on revolver loan advance | $5,522 |
1_Nature_of_Activities_and_Sum
1. Nature of Activities and Summary of Significant Accounting Policies | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Accounting Policies [Abstract] | |||||||||
1. Nature of Activities and Summary of Significant Accounting Policies | Nature of Activities. These consolidated financial statements include the accounts of Aemetis, Inc. (formerly AE Biofuels, Inc.), a Nevada corporation, and its wholly owned subsidiaries (collectively, “Aemetis” or the “Company”): | ||||||||
● | Aemetis Americas, Inc., a Nevada corporation, and its subsidiary AE Biofuels, Inc., a Delaware corporation; | ||||||||
● | Biofuels Marketing, Inc., a Delaware corporation; | ||||||||
● | Aemetis International, Inc., a Nevada corporation, and its subsidiary International Biofuels, Ltd., a Mauritius corporation, and its subsidiary Universal Biofuels Private, Ltd., an India company; | ||||||||
● | Aemetis Technologies, Inc., a Delaware corporation; | ||||||||
● | Aemetis Biochemicals, Inc., a Nevada corporation; | ||||||||
● | Aemetis Biofuels, Inc., a Delaware corporation, and its subsidiary Energy Enzymes, Inc., a Delaware corporation; | ||||||||
● | AE Advanced Fuels, Inc., a Delaware corporation, and its subsidiaries Aemetis Advanced Fuels Keyes, Inc., a Delaware corporation, and Aemetis Facility Keyes, Inc., a Delaware corporation; | ||||||||
● | Aemetis Advanced Fuels, Inc., a Nevada corporation; and, | ||||||||
Aemetis is an advanced renewable fuels and biochemicals company focused on the acquisition, development and commercialization of innovative technologies that replace traditional petroleum-based products by the conversion of first generation ethanol and biodiesel plants into advanced biorefineries. The Company owns and operates a plant in Keyes, California where the Company manufactures and produces ethanol, wet distillers’ grain (WDG), condensed distillers solubles (CDS) and corn oil and a manufacturing and refining facility in Kakinada, India where the Company manufactures and produces fatty acid methyl ester (biodiesel), crude and refined glycerin and refined palm oil. In September 2013, the Company received approval by the US Environmental Protection Agency to produce ethanol using grain sorghum and biogas along with the Keyes plant existing combined heat and power systems to generate higher value D5 Advanced Biofuel Renewable Identification Numbers (RIN’s). In April 2014, the Company received the International Sustainability and Carbon Certification for the production of biodiesel at the India plant from certain oils and fats for sale into European markets. In addition, the Company is continuing research and development focused on microbial technologies for the commercialization of renewable industrial biofuels and biochemicals. | |||||||||
Use of Estimates. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the reporting period. To the extent there are material differences between these estimates and actual results, the Company’s consolidated financial statements will be affected. | |||||||||
Basis of Presentation and Consolidation. The consolidated condensed financial statements include the accounts of Aemetis, Inc. and its subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The accompanying consolidated condensed balance sheet as of March 31, 2015, the consolidated condensed statements of operations and comprehensive income (loss) for the three months ended March 31, 2015 and 2014, and the consolidated condensed statements of cash flows for the three months ended March 31, 2015 and 2014 are unaudited. The consolidated condensed balance sheet as of December 31, 2014 was derived from the 2014 audited consolidated financial statements and notes thereto. The consolidated condensed financial statements in this report should be read in conjunction with the 2014 audited consolidated financial statements and notes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, 2014. | |||||||||
The accompanying consolidated condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States (U.S. GAAP) and pursuant to the rules and regulations of the SEC. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. | |||||||||
In the opinion of management, the unaudited interim consolidated condensed financial statements for the three months ended March 31, 2015 and 2014 have been prepared on the same basis as the audited consolidated statements as of December 31, 2014 and reflect all adjustments, consisting primarily of normal recurring adjustments, necessary for the fair presentation of its statement of financial position, results of operations and cash flows. The results of operations for the three months ended March 31, 2015 are not necessarily indicative of the operating results for any subsequent quarter, for the full fiscal year or any future periods. | |||||||||
Revenue recognition. The Company recognizes revenue when there is persuasive evidence of an arrangement, delivery has occurred, the price is fixed or determinable and collection is reasonably assured. The Company records revenues based upon the gross amounts billed to its customers. Revenue from nonmonetary transactions, principally in-kind by-products received in exchange for material processing where the by-product is contemplated by contract to provide value, is recognized at the quoted market price of those goods received or by-products. | |||||||||
Cost of Goods Sold. Cost of goods sold includes those costs directly associated with the production of revenues, such as raw material consumed, factory overhead, and other direct production costs. During periods of idle plant capacity, costs otherwise charged to cost of goods sold are reclassified to selling, general and administrative expense. | |||||||||
Shipping and Handling Costs. Shipping and handling costs are classified as a component of cost of goods sold in the accompanying consolidated statements of operations. | |||||||||
Research and Development. Research and development costs are expensed as incurred, unless they have alternative future uses to the Company. | |||||||||
Cash and Cash Equivalents. The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. The Company maintains cash balances at various financial institutions domestically and abroad. The Federal Deposit Insurance Corporation (FDIC) insures domestic cash accounts. The Company’s accounts at these institutions may at times exceed federally insured limits. The Company has not experienced any losses in such accounts. | |||||||||
Accounts Receivable. The Company sells ethanol, wet distillers grains, corn syrup and corn oil through third-party marketing arrangements generally without requiring collateral. The Company sells biodiesel, glycerin, and processed natural oils to a variety of customers and may require advanced payment based on the size and creditworthiness of the customer. Accounts receivables consist of product sales made to large creditworthy customers. Trade accounts receivable are presented at original invoice amount, net of the allowance for doubtful accounts. | |||||||||
The Company maintains an allowance for doubtful accounts for balances that appear to have specific collection issues. The collection process is based on the age of the invoice and requires attempted contacts with the customer at specified intervals. If, after a specified number of days, the Company has been unsuccessful in its collection efforts, a bad debt allowance is recorded for the balance in question. Delinquent accounts receivable are charged against the allowance for doubtful accounts once uncollectibility has been determined. The factors considered in reaching this determination are the apparent financial condition of the customer and the Company’s success in contacting and negotiating with the customer. If the financial condition of the Company’s customers were to deteriorate additional allowances may be required. There is no allowance for doubtful accounts balance as of March 31, 2015 and December 31, 2014. | |||||||||
Inventories. Inventories are stated at the lower of cost, using the first-in and first-out (FIFO) method, or market. | |||||||||
Property, Plant and Equipment. Property, plant and equipment are carried at cost less accumulated depreciation after assets are placed in service and are comprised primarily of buildings, furniture, machinery, equipment, land, and the biodiesel plant in India. It is the Company’s policy to depreciate capital assets over their estimated useful lives using the straight-line method. | |||||||||
Goodwill and Intangible Assets. Intangible assets consist of intellectual property in the form of patents pending, in-process research and development and goodwill. Once the patents pending or in-process R&D have secured a definite life in the form of a patent or product, they will be carried at cost less accumulated amortization over their estimated useful life. Amortization commences upon the commercial application or generation of revenue and is amortized over the shorter of the economic life or patent protection period. | |||||||||
Company intangible assets such as goodwill have indefinite lives and as a result need to be evaluated at least annually, or more frequently, if impairment indicators arise. In the Company’s review, we determined the fair value of the reporting unit using market indicators and discounted cash flow modeling. The Company compares the fair value to the net book value of the reporting unit. An impairment loss would be recognized when the fair value is less than the related net book value, and an impairment expense would be recorded in the amount of the difference. Forecasts of future cash flows are judgments based on the Company’s experience and knowledge of the Company’s operations and the industries in which the Company operates. These forecasts could be significantly affected by future changes in market conditions, the economic environment, including inflation, and the purchasing decisions of the Company’s customers. | |||||||||
California Ethanol Producer Incentive Program. The Company was eligible to participate in the California Ethanol Producer Incentive Program (“CEPIP”). Under the CEPIP, an eligible California ethanol facility could receive up to $3 million in cash per plant per year of operations through 2013 when current production corn crush spreads, measured as the difference between specified ethanol and corn index prices, dropped below $0.55 per gallon. For any month in which a payment is made by the CEPIP, the Company may be required to reimburse the funds within the subsequent five years from each payment date, if the corn crush spreads exceed $1.00 per gallon. Since these funds are provided to subsidize current production costs and encourage eligible facilities to either continue production or start up production in low margin environments, the Company records the proceeds, if any, as a credit to cost of goods sold. With respect to CEPIP payments received and applied as reductions to cost of goods sold, the Company recorded none for the three months ended March 31, 2015 and 2014. During 2013 and 2014, the strength of the crush spread resulted in an obligation to repay CEPIP funding in the amount of $1.8 million, the entire amount of funds received from the program. As of March 31, 2015 and December 31, 2014, the Company carried a remaining liability of $0.5 million and $0.8 million, respectively, for repayment of funds received. | |||||||||
Warrant liability: The Company adopted guidance related to distinguishing liabilities from equity for certain warrants which contain a conditional obligation to repurchase feature. As of March 31, 2015 and December 31, 2014, there were 18,644 warrants outstanding with a conditional obligation to repurchase feature that require liability treatment. As a result, a warrant liability was recorded to recognize the fair value upon issuance of each warrant. The Company estimates the fair value of future liability on warrants using the Black-Scholes pricing model. Assumptions within the pricing model include: 1) the risk-free interest rate, which comes from the U.S. Treasury yield curve for periods within the contractual life of the warrants, 2) the expected life of the warrants which is assumed to be the contractual life of the warrants, and 3) the volatility which is estimated based on an average of the historical volatilities. | |||||||||
The Company computes the fair value of the warrant liability at each reporting period and the change in the fair value is recorded through earnings. The key component in the value of the warrant liability is the Company's stock price, which is subject to significant fluctuation and is not under the Company's control. The resulting effect on the Company's net loss is therefore subject to significant fluctuation and will continue to be so until the warrants are exercised, amended or expired. Assuming all other fair value inputs remain constant, the Company will record non-cash expense when the stock price increases and non-cash income when the stock price decreases. | |||||||||
Long - Lived Assets. The Company evaluates the recoverability of long-lived assets with finite lives in accordance with ASC Subtopic 360-10-35 Property Plant and Equipment –Subsequent Measurements, which requires recognition of impairment of long-lived assets whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. When events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable, based on estimated undiscounted cash flows, the impairment loss would be measured as the difference between the carrying amount of the assets and its estimated fair value. | |||||||||
Basic and Diluted Net income (Loss) per Share. Basic income (loss) per share is computed by dividing income or loss attributable to common shareholders by the weighted average number of common shares outstanding for the period. Diluted income (loss) per share reflects the dilution of common stock equivalents such as options, convertible preferred stock, debt and warrants to the extent the impact is dilutive. As the Company incurred net loss for the three months ended March 31, 2015, potentially dilutive securities have been excluded from the diluted net income per share computations as their effect would be anti-dilutive. As the Company incurred net income for the three months ended March 31, 2014, potentially dilutive securities have been included in the diluted net income per share computations and any potentially anti-dilutive shares have been excluded and are shown below. | |||||||||
The following table reconciles the number of shares utilized in the net income (loss) per share calculations for the three months ended March 31, 2015 and 2014: | |||||||||
Three months ended March 31, | |||||||||
2015 | 2014 | ||||||||
(In thousands, except per share amounts) | |||||||||
Net income (loss) | $ | (8,643 | ) | $ | 7,687 | ||||
Shares: | |||||||||
Weighted average shares outstanding—basic | 20,595 | 20,007 | |||||||
Weighted average dilutive share equivalents from preferred shares | - | 2,384 | |||||||
Weighted average dilutive share equivalents from stock options | - | 167 | |||||||
Weighted average dilutive share equivalents from common warrants | - | 94 | |||||||
Weighted average dilutive share equivalents from convertible promissory note | - | 5 | |||||||
Weighted average shares outstanding—diluted | 20,595 | 22,657 | |||||||
Earnings (loss) per share—basic | $ | (0.42 | ) | $ | 0.38 | ||||
Earnings (loss) per share—diluted | $ | (0.42 | ) | $ | 0.34 | ||||
The following table shows the number of potentially dilutive shares excluded from the diluted net income (loss) per share calculation as of March 31, 2015 and 2014: | |||||||||
As of | |||||||||
31-Mar-15 | 31-Mar-14 | ||||||||
Series B preferred (convertible on a 10 to 1 basis) | 1,558 | - | |||||||
Common stock options and warrants | 1,251 | 1,137 | |||||||
Total number of potentially dilutive shares excluded from the basic and diluted net income (loss) per share calculation | 2,809 | 1,137 | |||||||
Comprehensive Loss. ASC 220 Comprehensive Loss requires that an enterprise report, by major components and as a single total, the change in its net assets from non-owner sources. The Company’s other comprehensive income (loss) and accumulated other comprehensive loss consists solely of cumulative currency translation adjustments resulting from the translation of the financial statements of its foreign subsidiary. The investment in this subsidiary is considered indefinitely invested overseas, and as a result, deferred income taxes are not recorded related to the currency translation adjustments. | |||||||||
Foreign Currency Translation/Transactions. Assets and liabilities of the Company’s non-U.S. subsidiary that operates in a local currency environment, where that local currency is the functional currency, are translated into U.S. dollars at exchange rates in effect at the balance sheet date; with the resulting translation adjustments directly recorded to a separate component of accumulated other comprehensive loss. Income and expense accounts are translated at average exchange rates during the year. Gains and losses from foreign currency transactions are recorded in other income (loss). | |||||||||
Operating Segments. Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. Aemetis recognized two reportable geographic segments: “India” and “North America.” | |||||||||
The “North America” operating segment includes the Company’s 55 million gallons per year nameplate capacity ethanol plant in Keyes, California and the research facilities in College Park, Maryland. | |||||||||
The “India” operating segment encompasses the Company’s 50 million gallon per year nameplate capacity biodiesel plant in Kakinada, India, the administrative offices in Hyderabad, India, and the holding companies in Nevada and Mauritius. | |||||||||
Fair Value of Financial Instruments. The Company’s financial instruments include cash and cash equivalents, accounts receivable, accounts payable, other current liabilities, warrant liability, and debt. The fair value of current financial instruments was estimated to approximate carrying value due to the short term nature of these instruments. The carrying amount of debt obligations, including debt discount issuance costs, held by our senior lender, subordinated debt and seller note payable, at March 31, 2015 amounted to an aggregate of approximately $66.7 million in outstanding obligations. The debts were determined to have an estimated fair value of $67.7 million based on interest rates for comparable debt. The Company’s debt was valued using inputs from independent consultants evaluating external market inputs and internal financings to determine appropriate discount rates to determine fair value. The warrant liability fair value was estimated using the Black-Scholes valuation pricing model at the end of each reporting period. | |||||||||
Share-Based Compensation. The Company recognizes share based compensation expense in accordance with ASC 718 Stock Compensation requiring the Company to recognize expense related to the estimated fair value of the Company’s share-based compensation awards at the time the awards are granted adjusted to reflect only those shares that are expected to vest. | |||||||||
In valuing restricted common shares issued to consultants, debt holders, or affiliated investors, the Company estimates the discount for lack of marketability on restricted stock issued, using the Black-Scholes model for pricing call options, which assists in deriving the implied price of put options using the put-call parity principle. The price of the put option divided by the market price quoted on the NASDAQ market exchange implies the discount for lack of marketability. | |||||||||
Commitments and Contingencies. The Company records and/or discloses commitments and contingencies in accordance with ASC 450 Contingencies. ASC 450 applies to an existing condition, situation, or set of circumstances involving uncertainty as to possible loss that will ultimately be resolved when one or more future events occur or fail to occur. | |||||||||
Debt Modification Accounting. The Company evaluates amendments to its debt in accordance with ASC 540-50 Debt – Modification and Extinguishments for modification and extinguishment accounting. This evaluation includes comparing the net present value of cash flows of the new debt to the old debt to determine if changes greater than 10 percent occurred. In instances where the net present value of future cash flows changed more than 10 percent, the Company applies extinguishment accounting and determines the fair value of its debt based on factors available to the Company. | |||||||||
Convertible Instruments. The Company evaluates the impacts of convertible instruments based on the underlying conversion features. Convertible Instruments are evaluated for treatment as derivatives that could be bifurcated and recorded separately. Any beneficial conversion feature is recorded based on the intrinsic value difference at the commitment date. | |||||||||
Recently Issued Accounting Pronouncements. | |||||||||
In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), which supersedes all existing revenue recognition requirements, including most industry-specific guidance. The new standard requires a company to recognize revenue when it transfers goods or services to customers in an amount that reflects the consideration that the company expects to receive for those goods or services. The new standard will be effective for us on January 1, 2018. We are currently evaluating the potential impact that Topic 606 may have on our financial position and results of operations. |
2_Inventory
2. Inventory | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Inventory Disclosure [Abstract] | |||||||||
2. Inventory | Inventory consists of the following: | ||||||||
31-Mar-15 | 31-Dec-14 | ||||||||
Raw materials | $ | 1,262 | $ | 1,522 | |||||
Work-in-progress | 1,464 | 1,453 | |||||||
Finished goods | 1,915 | 1,516 | |||||||
Total inventory | $ | 4,641 | $ | 4,491 |
3_Property_Plant_and_Equipment
3. Property, Plant and Equipment | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Property, Plant and Equipment [Abstract] | |||||||||
3. Property, Plant and Equipment | Property, plant and equipment consist of the following: | ||||||||
31-Mar-15 | 31-Dec-14 | ||||||||
Land | $ | 2,760 | $ | 2,753 | |||||
Plant and Buildings | 82,496 | 82,338 | |||||||
Furniture and fixtures | 460 | 458 | |||||||
Machinery and equipment | 4,072 | 4,063 | |||||||
Construction in progress | 163 | 148 | |||||||
Total gross property, plant & equipment | 89,951 | 89,760 | |||||||
Less accumulated depreciation | (15,187 | ) | (13,950 | ) | |||||
Total net property, plant & equipment | $ | 74,764 | $ | 75,810 | |||||
For the three months ended March 31, 2015 and March 31, 2014, the Company recorded depreciation expense of $1.2 million for each period respectively. | |||||||||
Management is required to evaluate these long-lived assets for impairment whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. Management determined there were no triggering events on the long-lived assets during the three months ended March 31, 2015. | |||||||||
4_Intangible_Assets_and_Goodwi
4. Intangible Assets and Goodwill | 3 Months Ended | ||||
Mar. 31, 2015 | |||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||
4. Intangible Assets and Goodwill | Intangible assets and goodwill consist of $1.0 million in patents, $0.6 million in in-process research and development and $1.0 million in goodwill. Following ASC 350-20-35 guidance, goodwill and indefinite lived intangibles are tested annually in December for impairment at the Aemetis Technologies, Inc. reporting unit level. During the three months ended March 31, 2015 and 2014, the Company recognized amortization expense of $20 thousand each period, respectively, related to patents. | ||||
Future patent and in-process research and development amortization for the next five years and beyond consists of the following: | |||||
For the twelve months ending March 31, | Amortization | ||||
2016 | $ | 80 | |||
2017 | 88 | ||||
2018 | 112 | ||||
2019 | 134 | ||||
2020 | 180 | ||||
Thereafter | 922 | ||||
Total | $ | 1,516 |
5_Notes_Payable
5. Notes Payable | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Debt Disclosure [Abstract] | |||||||||
5. Notes Payable | Debt consists of the notes from our senior lender, Third Eye Capital, acting as Agent for the Purchasers (Third Eye Capital), other working capital lenders and subordinated lenders as follows: | ||||||||
31-Mar-15 | 31-Dec-14 | ||||||||
Third Eye Capital term note | $ | 7,300 | $ | 7,394 | |||||
Third Eye Capital revolving credit facility | 21,267 | 22,330 | |||||||
Third Eye Capital revenue participation term note | 10,065 | 10,195 | |||||||
Third Eye Capital acquisition term note | 17,525 | 17,728 | |||||||
Cilion shareholder seller note payable | 5,410 | 5,373 | |||||||
State Bank of India secured term loan | 6,318 | 6,032 | |||||||
Subordinated notes | 5,282 | 5,428 | |||||||
EB-5 long term promissory notes | 19,075 | 1,534 | |||||||
Unsecured working capital loans and short-term notes | 656 | 1,287 | |||||||
Total debt | 92,898 | 77,301 | |||||||
Less current portion of debt | 12,138 | 12,746 | |||||||
Total long term debt | $ | 80,760 | $ | 64,555 | |||||
Third Eye Capital Note Purchase Agreement | |||||||||
On July 6, 2012, Aemetis, Inc. and Aemetis Advanced Fuels Keyes, Inc. (“AAFK”), entered into an Amended and Restated Note Purchase Agreement with Third Eye Capital (the “Note Purchase Agreement”). Pursuant to the Note Purchase Agreement, Third Eye Capital extended credit in the form of (i) senior secured term loans in an aggregate principal amount of approximately $7.2 million to replace existing notes held by Third Eye Capital (the “Term Notes”); (ii) senior secured revolving loans in an aggregate principal amount of $18.0 million (“Revolving Credit Facility”); (iii) senior secured term loans in the principal amount of $10.0 million to convert the prior revenue participation agreement to a Note (“Revenue Participation Term Notes”); (iv) senior secured term loans in an aggregate principal amount of $15.0 million (“Acquisition Term Notes”) used to fund the cash portion of the acquisition of Cilion, Inc. After this financing transaction, Third Eye Capital obtained sufficient equity ownership in the Company to be considered a related party (the Term Notes, Revolving Credit Facility, Revenue Participation Term Notes and Acquisition Term Notes are referred to herein collectively as the “Notes”). The Notes mature on July 1, 2015*. On November 4, 2014, Third Eye Capital agreed to Amendment No. 8 to the Note Purchase Agreement to extend a line of credit in the amount of $6.0 million available for advance to Aemetis, such advance was added to the outstanding principal balance of the existing Notes under the Note Purchase Agreement. In addition, Third Eye Capital agreed to give Aemetis the right to extend the maturity date of the Notes to January 1, 2016 upon notice and payment of a 3% extension fee. | |||||||||
On March 12, 2015, Third Eye Capital agreed to Amendment No. 9 to the Note Purchase Agreement to allow for the repurchase of 1,000,000 shares of common stock of the Company at an average price of $5.52 per share for an aggregate purchase price of approximately $5.5 million. The repurchase price was added to the outstanding principal balance of the Revolving Credit Facility. Third Eye Capital also agreed to remove the covenant that the Company must complete an equity offering of its preferred stock for net proceeds of not less than $20 million with all of such net proceeds to be used to repay the principal outstanding under the Note Purchase Agreement. In addition, Third Eye Capital waived the free cash flow financial covenant under the Note Purchase Agreement for the three months ended March 31, 2015. We evaluated the amendment of the Notes and applied modification accounting treatment in accordance with ASC 470-50 Debt – Modification and Extinguishment. | |||||||||
On April 30, 2015, Third Eye Capital agreed to Amendment No. 10 to the Note Purchase Agreement to allow for the repurchase of 500,000 shares of common stock of the Company at a repurchase price of $5.00 per share for an aggregate purchase price of approximately $2.5 million. The repurchase price was added to the outstanding principal balance of the revolver notes under the Note Purchase Agreement. In addition, Third Eye Capital agreed to extend the maturity date of the Notes to April 1, 2016 upon notice and payment of a 3% extension fee. The existing guarantees were reaffirmed. As a result of the Company’s ability to extend the maturity of the Notes under Amendment No.10, the Note balances have been classified as long term debt in the accompanying March 31, 2015 balance sheet. | |||||||||
Further details regarding the terms of the Notes are set forth below under the heading “Terms of Third Eye Capital Notes.” | |||||||||
Terms of Third Eye Capital Notes | |||||||||
Details about each portion of the Third Eye Capital financing facility are as follows: | |||||||||
A. | Term Notes. As of March 31, 2015, AAFK had $7.3 million in principal and interest outstanding under the Term Notes, net of unamortized fair value discounts of $0.2 million. The Term Notes mature on July 1, 2015*. Interest on the Term Notes accrues at 14% per annum. The Term Notes contain various covenants, including but not limited to, minimum free cash flow and production requirements and restrictions on capital expenditures. | ||||||||
B. | Revolving Credit Facility. On July 6, 2012, AAFK entered into a Revolving Credit Facility with a commitment of $18.0 million. Through various amendments to increase the amount of the credit facility available for borrowings under the Note Purchase Agreement, the outstanding amount of the Revolving Loan Facility was at approximately $22.0 million at March 31, 2015. During the three months ended March 31, 2015, interest on the Revolving Credit Facility accrued at the prime rate plus 13.75% (17% as of March 31, 2015) payable monthly in arrears. The Revolving Credit Facility matures on July 1, 2015*. As of March 31, 2015, AAFK had $21.3 million in principal and interest outstanding, net of unamortized debt issuance costs of $0.7 million on the Revolving Credit Facility. | ||||||||
C. | Revenue Participation Term Notes. The Revenue Participation Term Note bears interest at 5% per annum and matures on July 1, 2015*. As of March 31, 2015, AAFK had $10.1 million in principal and interest outstanding, net of unamortized discounts of $0.3 million, on the Revenue Participation Term Note. | ||||||||
D. | Acquisition Term Notes. The Acquisition Term Notes accrue interest at prime rate plus 10.75% (14% per annum as of March 31, 2015) and mature on July 1, 2015*. As of March 31, 2015, Aemetis Facility Keyes had $17.5 million in principal and interest outstanding, net of unamortized discounts of $0.5 million, on the Acquisition Term Notes. | ||||||||
*The note maturity date can be extended by the Company to April 2016. As a condition to any such extension, the Company would be required to pay a fee of 3% of the carrying value of the debt. | |||||||||
The Third Eye Capital Notes are secured by first priority liens on all real and personal property, and assignment of proceeds from all government grants and guarantees from Aemetis, Inc. The Notes all contain cross-collateral and cross-default provisions. McAfee Capital, LLC (McAfee Capital), solely owned by Eric McAfee, the Company’s Chairman and CEO, provided a guaranty of payment and performance secured by all of its Company shares. In addition, Eric McAfee provided a blanket lien on substantially all of his personal assets, and McAfee Capital provided a guarantee in the amount of $8.0 million. | |||||||||
Cilion shareholder seller notes payable. In connection with the Company’s merger with Cilion on July 6, 2012, the Company issued $5.0 million in notes payable to Cilion shareholders as merger compensation subordinated to the senior secured Third Eye Capital Notes. The liability bears interest at 3% per annum and is due and payable after the Third Eye Capital Notes have been paid in full. As of March 31, 2015, Aemetis Facility Keyes, Inc. had $5.4 million in principal and interest outstanding under the Cilion shareholder seller notes payable. | |||||||||
State Bank of India secured term loan. On July 17, 2008, Universal Biofuels Private Limited (“UBPL”), the Company’s India operating subsidiary, entered into a six year secured term loan with the State Bank of India in the amount of approximately $6.0 million. The term loan matured in March 2014 and is secured by UBPL’s assets, consisting of the biodiesel plant and land in Kakinada. | |||||||||
In July 2008, the Company drew approximately $4.6 million against the secured term loan. The loan principal amount is repayable in 20 quarterly installments of approximately $0.3 million, using exchange rates corresponding to the date of payment, with the first installment due in June 2009 and the last installment payment due in March 2014. As of March 31, 2015, the 12% interest rate under this facility is subject to adjustment every two years, based on 0.25% above the Reserve Bank of India advance rate. The principal payments scheduled through March 2015 were not made. The term loan provides for liquidating damages at a rate of 2% per annum for the period of default. As of March 31, 2015 and December 31, 2014, the State Bank of India loan had $2.7 million and $2.6 million, respectively, in principal outstanding and accrued interest plus default interest of $3.6 million and $3.4 million, respectively. See Note 6 - Commitments and Contingencies for further details. | |||||||||
Subordinated Notes. On January 6 and January 9, 2012, AAFK entered into Note and Warrant Purchase Agreements with two accredited investors pursuant to which it issued $3.0 million in 5% annual interest rate notes to the investors (the “Sub Notes”). An additional $0.6 million and $0.8 million in Sub Notes were added to one of the existing accredited investor’s Sub Notes balance in May and December 2012, respectively. This same accredited investor received payments of $0.6 million in principal and $3 thousand in interest in July 2012. The Sub Notes included 2-year warrants exercisable for 170 thousand shares of Aemetis common stock at a price of $0.01 per share, subject to adjustment. Interest is due at maturity. Neither AAFK nor Aemetis may make any principal payments under the Sub Notes until all loans made by Third Eye Capital to AAFK are paid in full, except for a few exceptions where Sub Note investors will receive funds from EB-5 investments or sale of equipment. | |||||||||
The Company agreed to an Amendment No.1 to the Sub Notes to extend the maturity of the January 2012 Sub Notes to July 1, 2014 and refinanced the additional December 2012 Sub Note as two Sub Notes dated December 2012 and January 19, 2013, with principal amounts of $0.5 million and $0.1 million, respectively. Both the December 2012 Sub Note and the January 19, 2013 Sub Note had a maturity date of April 30, 2013. On January 24, 2013, an additional $0.3 million Sub Note was issued with a maturity date of April 30, 2013. On May 23, 2013, all Sub Notes above with a maturity date of April 30, 2013 were refinanced as a $1.0 million Sub Note (“May 2013 Note”) with a maturity date of December 31, 2013. On January 1, 2014, the May 2013 Sub Note was amended to extend the maturity date to June 30, 2014 in exchange for (i) a 10 percent cash extension fee paid by adding the fee to the balance of the new note and (ii) 30 thousand in common stock warrants with a term of two years and an exercise price of $0.01 per share. In March 2014, the Company received $0.5 million from EB-5 investments and paid to one of accredited investors holding a January 2012 Sub Note of $0.5 million. On July 1, 2014, the January 2014 Sub Note and two January 2013 Sub Notes with two accredited investors were amended to extend the maturity date to December 31, 2014 in exchange for (i) a 10 percent cash extension fee paid by adding the fee to the balance of the new note and 118 thousand in common stock warrants with a term of two years and an exercise price of $0.01 per share. | |||||||||
On January 1, 2015, the Sub Notes above were amended to extend the maturity date until the earlier of (i) June 30, 2015; (ii) completion of an equity financing by AAFK or Aemetis in an amount of not less than $25.0 million; (iii) the completion of an Initial Public Offering by AAFK or Aemetis; or (iv) after the occurrence of an Event of Default, including failure to pay interest or principal when due and breaches of note covenants. A 10 percent cash extension fee was paid by adding the fee to the balance of the new note and 116 thousand in common stock warrants were granted with a term of two years and an exercise price of $0.01 per share. We evaluated these January 1, 2015 amendments and the refinancing terms of the notes and determined in accordance with ASC 470-50 Debt – Modification and Extinguishment that the loans were extinguished and an extinguishment loss of $0.3 million recognized in the three months ended March 31, 2015. | |||||||||
On March 24, 2015, the Company paid off $180 thousand in subordinated note principal and interest held by one of the accredited investors with the money received from the EB-5 program. | |||||||||
On January 14, 2013, Laird Cagan, a related party, loaned $0.1 million through a promissory note maturing on April 30, 2013 with a five percent annualized interest rate and the right to exercise 5 thousand warrants exercisable at $0.01 per share. In February 2015, the Cagan related party promissory note was amended to extend the maturity date until the earlier of (i) December 31, 2016; (ii) completion of an equity financing by AAFK or Aemetis in an amount of not less than $25.0 million; (iii) the completion of an Initial Public Offering by AAFK or Aemetis; or (iv) after the occurrence of an Event of Default, including failure to pay interest or principal when due and breaches of note covenants. | |||||||||
At March 31, 2015 and December 31, 2014, the Company owed, in aggregate, subordinated notes in the amount of $5.3 million and $5.4 million in principal and interest outstanding, net of unamortized issuance and fair value discounts of $0.6 million and $0.2 million, respectively. | |||||||||
EB-5 long-term promissory notes. EB-5 is a US government program authorized by the Immigration and Nationality Act designed to foster employment-based visa preference for immigrant investors to encourage the flow of capital into the U.S. economy and to promote employment of U.S. workers. On March 4, 2011, and amended January 19, 2012 and July 24, 2012, the Company entered into a Note Purchase Agreement with Advanced BioEnergy, LP, a California limited partnership authorized as a Regional Center to receive EB-5 investments, for the issuance of up to 72 subordinated convertible promissory notes bearing interest at 3%, each note in the principal amount of $0.5 million is due and payable four years from the date of the note for a total aggregate principal amount of up to $36.0 million. The notes are convertible after three years at a conversion price of $30.00 per share. | |||||||||
Advanced BioEnergy, LP arranges investments with foreign investors, who each make investments in the Keyes plant project in investment increments of $0.5 million. The Company sold notes in the amount of $1.0 million during the first quarter of 2012, $0.5 million during the first quarter of 2014 and $17.5 million during the first quarter of 2015. As of March 31, 2015, $75 thousand in accrued interest remained outstanding on the notes. The availability of the remaining $17.0 million will be determined by the ability of Advanced BioEnergy, LP to attract additional qualified investors. | |||||||||
Unsecured working capital loans. In November 2008, the Company entered into an operating agreement with Secunderabad Oils Limited (“Secunderabad”). Under this agreement, Secunderabad agreed to provide the Company with working capital, on an as needed basis, to fund the purchase of feedstock and other raw materials for its Kakinada biodiesel facility. Working capital advances bear interest at the actual bank borrowing rate of Secunderabad of fifteen percent (15%). In return, the Company agreed to pay Secunderabad an amount equal to 30% of the plant’s monthly net operating profit. In the event that the Company’s biodiesel facility operates at a loss, Secunderabad owes the Company 30% of the losses. The agreement can be terminated by either party at any time without penalty. | |||||||||
During the three months ended March 31, 2015 and 2014, the Company made principal payments to Secunderabad of approximately $0.7 million and $1.5 million, respectively, under the agreement and interest payments of approximately $37 thousand and $51 thousand, respectively, for working capital funding. At March 31, 2015 and December 31, 2014, the Company had approximately $0.7 million and $1.3 million outstanding under this agreement, respectively. | |||||||||
Scheduled debt repayments for loan obligations follow: | |||||||||
Twelve months ended March 31, | Debt Repayments | ||||||||
2016 | $ | 12,138 | |||||||
2017 | 61,879 | ||||||||
2018 | 3,160 | ||||||||
2019 | 17,500 | ||||||||
Total debt | 94,677 | ||||||||
Discounts | (1,779) | ||||||||
Total debt, net of discounts | $ | 92,898 | |||||||
6_Commitments_and_Contingencie
6. Commitments and Contingencies | 3 Months Ended | ||||
Mar. 31, 2015 | |||||
Commitments and Contingencies Disclosure [Abstract] | |||||
6. Commitments and Contingencies | The Company, through its subsidiaries, has non-cancelable operating leases for office space in Cupertino and India. Future minimum operating lease payments as of March 31, 2015 are as follows: | ||||
Twelve months ended March 31, | Future Rent Payments | ||||
2016 | $ | 427 | |||
2017 | 451 | ||||
2018 | 466 | ||||
2019 | 483 | ||||
2020 | 500 | ||||
Thereafter | 84 | ||||
Total | $ | 2,411 | |||
For the three months ended March 31, 2015 and 2014, the Company recognized lease and rent expense of $107 thousand and $106 thousand, respectively, under existing operating leases. | |||||
Legal Proceedings | |||||
On March 10, 2011, UBPL received a demand notice from the State Bank of India under the Agreement of Loan for Overall Limit dated as of June 26, 2008. The notice informed UBPL that an event of default had occurred for failure to make an installment payment on the loan commencing June 2009 and demanded repayment of the entire outstanding indebtedness of 19.60 crore rupees (approximately $3.2 million) together with all accrued interest thereon and any applicable fees and expenses. Upon the occurrence and during the continuance of an Event of Default, interest accrues at the default interest rate of 2% above the State Bank of India Advance Rate. The default period began on July 1, 2009 when the principal payment was deemed past due; and we have accrued interest at the default rate since the beginning of the default period. In addition, since the bank demanded payment of the balance, we have classified the entire loan amount as current. On March 12, 2011, the State Bank of India filed a legal case before the Debt Recovery Tribunal (“DRT”), Hyderabad, for recovery of approximately $5.0 million against the Company and also impleaded Andhra Pradesh Industrial Infrastructure Corporation (“APIIC”) to expedite the process of registration of the factory land for which counter reply is yet to be filed by APIIC. UBPL asserts that the State Bank of India did not provide the committed funding of the working capital loan and only funded a portion of the term loan, thus requiring the Company to enter into a working capital facility at unfavorable terms which served to hinder the business from developing at the planned rate. The State Bank of India has additionally required the personal guarantee of our Executive Officer and the registration of the land underlying the factory as conditions prior to restructure of the loan. Payments have recently been made against the facility; however, the State Bank of India has rejected these payments as a good faith effort. In January 2014, the Company made payment of $162 thousand (1 crore rupees) against principal on the facility which was accepted by the State Bank of India. UBPL filed for a stay against further collection efforts pending the development of sufficient business in a domestic or international market that would allow UBPL to make meaningful repayments against the facility. In May 2014, the Company obtained an interim stay in exchange for payments of approximately $0.4 million. In the event that the Company is unable to prevail in the aforementioned legal case, DRT may pass a decree for recovery of the amount due, which could include seizing company property for recovery of amounts due. As of March 31, 2015 and December 31, 2014, the State Bank of India loan had $2.7 million and $2.6 million, respectively, in principal outstanding and accrued interest plus default interest of $3.6 million and $3.4 million respectively. | |||||
On August 4, 2013, GS Cleantech Corporation, a subsidiary of Greenshift Corporation (“Greenshift”), filed a complaint in the United States District for the Eastern District of California – Fresno Division against the Company and its subsidiary, AAFK. The case was transferred to the Southern District of Indiana and joined as tag-along defendants to a pending Multidistrict Litigation with over a dozen original defendants. The complaint alleges infringement of patent rights assigned to Greenshift that pertain to certain corn oil extraction processes that the Company employs and seeks royalties, damages, treble damages, and attorney’s fees, along with injunctions precluding the Company from infringing its patent rights. The corn oil extraction process we use is licensed to us by Valicor Separation Technologies LLC, formerly called Solution Recovery Services LLC (“SRS”). The process provider has no obligations to indemnify us. On September 12, 2013, the Company, along with its subsidiary, filed its answer and counterclaims. In response to a motion for summary judgment filed by the original defendants, on October 23, 2014, the Court ruled that all the claims of all the patents at issue in the case are invalid. Further, in a January 16, 2015 decision, the District Court for the Southern District of Indiana ruled in favor of a stipulated motion for partial summary judgment for the Company, along with its subsidiary, finding that all of the GS Cleantech patents in the suit were invalid and, therefore, not infringed. GS Cleantech has said it will appeal this decision when the remaining claim in the suit has been decided. Regardless of when it may be appealed, we believe that the likelihood of Greenshift succeeding on appeal with respect to patent invalidity findings is small since the Court’s findings included summary judgments on several grounds for each allegedly infringed patent. If Greenshift successfully appeals the District Court’s findings of invalidity, damages may be $1 million or more. | |||||
The only remaining claim alleges that GS Cleantech inequitably conducted itself before the United States Patent Office when obtaining the patents at issue. A trial in the District Court for the Southern District of Indiana on that single issue is anticipated but has not yet been scheduled. If the defendants, including the Company and its subsidiary, succeed in proving inequitable conduct, the patents at issue will be invalidated such that no damages will be awarded to GS Cleantech for infringement and the Court will be asked to determine whether GS Cleantech’s behavior makes this an “exceptional case”. A finding that this is an exceptional case would allow the Court to award to Company and its subsidiary the attorneys’ fees each has expended to date for defense in this case. It is unknown whether GS Cleantech would appeal such a ruling. |
7_Outstanding_Warrants
7. Outstanding Warrants | 3 Months Ended | ||||||
Mar. 31, 2015 | |||||||
Text Block [Abstract] | |||||||
7. Outstanding Warrants | During the three months ended March 31, 2015, the Company issued 116 thousand common stock warrants, which have the potential to enhance returns for accredited investors who entered into amendments to Notes and Warrant Purchase Agreements. | ||||||
The warrants, dated January 1, 2015, have a two year term and are exercisable at $0.01 per share. The fair value of the warrants granted was $668 thousand as determined in accordance with the Black-Scholes option pricing model based on the below assumptions: | |||||||
Expected dividend yield | 0 | % | |||||
Risk-free interest rate | 0.66 | % | |||||
Expected volatility | 76.71 | % | |||||
Expected Life (years) | 2 | ||||||
Exercise price | $ | 0.01 | |||||
Company Stock Price | $ | 5.79 | |||||
For the three months ended March 31, 2015, note investors exercised 116 thousand warrant shares at the weighted average exercise price of $0.01 per share. | |||||||
A summary of warrant activity for the three months ended March 31, 2015 follows: | |||||||
Warrants Outstanding & Exercisable | Weighted - Average Exercise Price | Average Remaining Term in Years | |||||
Outstanding December 31, 2014 | 351 | $ | 3.05 | 2.69 | |||
Granted | 116 | 0.01 | |||||
Exercised | -116 | 0.01 | |||||
Outstanding March 31, 2015 | 351 | $ | 3.05 | 2.45 |
8_Fair_Value_of_Warrants
8. Fair Value of Warrants | 3 Months Ended | ||||
Mar. 31, 2015 | |||||
Notes to Financial Statements | |||||
8. Fair Value of Warrants | The following tables summarize the assumptions used in computing the fair value of liability warrants subject to fair value accounting at the date of issue during the three months ended March 31, 2015: | ||||
Expected dividend yield | 0 | % | |||
Risk-free interest rate | 0. 56% - 0.73 | % | |||
Expected volatility | 78.34% - 79.43 | % | |||
Expected Life (years) | 2.2 - 2.8 | ||||
Exercise price | $ | 0.01 | |||
Company stock price | $ | 4.22 |
9_Fair_Value_Measurements
9. Fair Value Measurements | 3 Months Ended | ||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||
9. Fair Value Measurements | The Company complies with the fair value measurements and disclosures standard which defines fair value, establishes a framework for measuring fair value, and expands disclosure for those assets and liabilities carried on the balance sheet on a fair value basis. | ||||||||||||||||
The Company's balance sheet contains derivative financial instruments that are recorded at fair value on a recurring basis. Fair value measurements and disclosures require that assets and liabilities carried at fair value be classified and disclosed according to the process for determining fair value. There are three levels of determining fair value. | |||||||||||||||||
Level 1 uses quoted market prices in active markets for identical assets or liabilities. | |||||||||||||||||
Level 2 uses observable market based inputs or unobservable inputs that are corroborated by market data. | |||||||||||||||||
Level 3 uses unobservable inputs that are not corroborated by market data. | |||||||||||||||||
A description of the valuation methodologies used for instruments measured at fair value, as well as the general classification of such instruments pursuant to the valuation hierarchy, is set forth below. | |||||||||||||||||
Warrant liability: The warrant liability consists of stock warrants issued by the Company that contain a conditional obligation to repurchase feature. In accordance with accounting for warrants as liabilities, the Company calculated the fair value of warrants under Level 3 using the assumptions described in “Fair Value of Warrants”. Realized and unrealized gains and losses related to the change in fair value of the warrant liability are included in other income on the Statement of Operations. | |||||||||||||||||
The following table summarizes financial liabilities measured at fair value on a recurring basis as of March 31, 2015, segregated by the level of the valuation inputs within the fair value hierarchy utilized to measure fair value: | |||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | ||||||||||||||
Warrant liability | $ | 79 | $ | - | $ | - | $ | 79 | |||||||||
The following table reflects the activity for liabilities measured at fair value using Level 3 inputs for the three months ended March 31, 2015: | |||||||||||||||||
Balance as of December 31, 2014 | $ | 108 | |||||||||||||||
Issuances of warrant liabilities | - | ||||||||||||||||
Exercise of warrant liabilities | - | ||||||||||||||||
Related change in fair value | (29 | ) | |||||||||||||||
Balance as of March 31, 2015 | $ | 79 |
10_StockBased_Compensation
10. Stock-Based Compensation | 3 Months Ended | ||||||||||||
Mar. 31, 2015 | |||||||||||||
Stockholders' deficit: | |||||||||||||
10. Stock Based Compensation | Common Stock Reserved for Issuance | ||||||||||||
Aemetis authorized the issuance of 1.2 million shares of common stock under its Zymetis 2006 Stock Plan and Amended and Restated 2007 Stock Plan (together, the “Company Stock Plans”), which includes both incentive and non-statutory stock options. These options generally expire five years from the date of grant with a general vesting term of 1/12th every three months and are exercisable at any time after vesting subject to continuation of employment. | |||||||||||||
Non-Plan Stock Options | |||||||||||||
In November 2012, the Company issued 98 thousand stock options to board members and consultants outside of any Company stock option plan. None of the non-plan options have been exercised. As of March 31, 2015, all options were vested. 9 thousand options had been exercised at a weighted average exercise price of $5.50 and 89 thousand options were outstanding as of March 31, 2015. | |||||||||||||
Inducement Equity Plan Options | |||||||||||||
In March 2015, the Board of Directors of the Company approved an Inducement Equity Plan authorizing the issuance of 100,000 non-statutory stock options to purchase common stock. The Company issued 25 thousand options during March 2015 with a three year vesting period and five year term at a weighted average exercise price of $3.88. As of March 31, 2015, the 25 thousand options were outstanding. | |||||||||||||
The following is a summary of options granted under the all above stock plans: | |||||||||||||
Shares Available for Grant | Number of Shares Outstanding | Weighted-Average Exercise Price | |||||||||||
Balance as of December 31, 2014 | 5 | 1,015 | $ | 5.51 | |||||||||
Authorized | 200 | — | — | ||||||||||
Granted | (25 | ) | 25 | 3.88 | |||||||||
Exercised | - | (71 | ) | 2.12 | |||||||||
Forfeited/expired | 43 | (43 | ) | 2.12 | |||||||||
Balance as of March 31, 2015 | 223 | 926 | $ | 5.89 | |||||||||
Stock-based compensation for employees | |||||||||||||
Stock-based compensation is accounted for in accordance with the provisions of ASC 718, Compensation-Stock Compensation, which requires the measurement and recognition of compensation expense for all stock-based awards made to employees and directors based on estimated fair values on the grant date. We estimate the fair value of stock-based awards on the date of grant using the Black-Scholes option pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as expense over the requisite service periods using the straight-line method. | |||||||||||||
For the three months ended March 31, 2015 and 2014, the Company recorded stock compensation expense in the amount of $152 thousand and $128 thousand, respectively. | |||||||||||||
Valuation and Expense Information | |||||||||||||
All issuances of stock options or other issuances of equity instruments to employees as the consideration for services received by us are accounted for based on the fair value of the equity instrument issued. The fair value of options granted to employees is estimated on the grant date using the Black-Scholes option valuation model. This valuation model for stock based compensation expense requires us to make assumptions and judgments about the variables used in the calculation, including the fair value of our common stock, the expected term (the period of time that the options granted are expected to be outstanding), the volatility of our common stock, a risk-free interest rate, and expected dividends. We also estimate forfeitures of unvested stock options. To the extent actual forfeitures differ from the estimates, the difference will be recorded as a cumulative adjustment in the period estimates are revised. No compensation cost is recorded for options that do not vest. We use the simplified calculation of expected life described in the SEC’s Staff Accounting Bulletin No. 107, Share-Based Payment, and volatility is based on an average of the historical volatilities of the common stock of four entities with characteristics similar to those of the Company. The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of grant for periods corresponding with the expected life of the option. We use an expected dividend yield of zero, as we do not anticipate paying any dividends in the foreseeable future. Expected forfeitures are assumed to be zero due to the small number of plan participants and the plan. | |||||||||||||
The weighted-average fair value calculations for options granted to employees under the employee stock plans and the inducement equity plan within the period are based on the following weighted average assumptions: | |||||||||||||
For the quarter ended March 31 | |||||||||||||
2015 | 2014 | ||||||||||||
Dividend-yield | 0 | % | 0 | % | |||||||||
Risk-free interest rate | 0.89 | % | 0.74 | % | |||||||||
Expected volatility | 78.79 | % | 78.73 | % | |||||||||
Expected life (years) | 3 | 3 | |||||||||||
Market value per share on grant date | $ | 3.88 | $ | 4.2 | |||||||||
Weighted average fair value per share on grant date | $ | 1.99 | $ | 2.14 | |||||||||
As of March 31, 2015, the Company had $790 thousand of total unrecognized compensation expense for employees which the Company will amortize over the 3.41 years of weighted remaining term. | |||||||||||||
For non-employees under the stock plans and non-plan stock options, we account for stock-based compensation awards in accordance with ASC 505-50, Equity Based Payments to Non-Employees. Under ASC 505-50, we determine the fair value of the options using Black Scholes option pricing model on the grant date and we re-measure the fair value of these options to recognize expense for the portion of options which vest each quarter. We recognized the total expense on these non-employee options of $1 thousand and $2 thousand for the three months ended March 31, 2015 and 2014, respectively. As of March 31, 2015, the Company had $2 thousand of total unrecognized compensation expense for non-employees which the Company will amortize over the 3.41 years of weighted remaining term. |
11_Agreements
11. Agreements | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Agreements | |||||||||
11. Agreements | Working Capital Arrangement. In May 2013 we extended the annual Grain Procurement and Working Capital Agreement with J.D. Heiskell that has been in place since March 2011. Pursuant to the agreement we agreed to procure whole yellow corn and grain sorghum (also called “milo”) from J.D. Heiskell. The Company has the ability to obtain grain from other sources subject to certain conditions, however, in the past all of our grain purchases have been from J.D.Heiskell. Title and risk of loss of the corn pass to the Company when the corn is deposited into the weigh bin. The term of the Agreement expires on December 31, 2015 and is automatically renewed for additional one-year terms. J. D.Heiskell further agrees to sell all ethanol to Kinergy Marketing or another marketing purchaser designated by the Company and all WDG and condensed distillers solubles to A.L. Gilbert. Our relationships with J.D. Heiskell, Kinergy Marketing, and A.L. Gilbert are well established and the Company believes that the relationships are beneficial to all parties involved in utilizing the distribution logistics, reaching out to widespread customer base, managing inventory, and building working capital relationships. Revenue is recognized upon delivery of ethanol to J. D. Heiskell as revenue recognition criteria have been met and any performance required of the Company subsequent to the sale to J.D. Heiskell is inconsequential. These agreements are ordinary purchase and sale agency agreements for an ethanol plant. | ||||||||
The J.D. Heiskell sales activity associated with the Purchasing Agreement, Grain Procurement and Working Capital Agreements during the three months ended March 31, 2015 and 2014 as follows: | |||||||||
Three months ended March 31, | |||||||||
2015 | 2014 | ||||||||
Ethanol sales | $ | 22,612 | $ | 46,004 | |||||
Wet distiller's grains sales | 7,350 | 9,715 | |||||||
Corn oil sales | 865 | 901 | |||||||
Corn purchases | 25,959 | 33,328 | |||||||
Accounts receivable | 333 | 826 | |||||||
Accounts payable | 1,743 | 2,065 | |||||||
Ethanol and Wet Distillers Grains Marketing Arrangement. The Company entered into an Ethanol Marketing Agreement with Kinergy Marketing and a Wet Distillers Grains marketing agreement with A. L Gilbert. Under the terms of the agreements, subject to certain conditions, the agreements expire on August 31, 2014 with automatic one-year renewals thereafter. For the three months ended March 31, 2015 and 2014, the Company expensed marketing costs of $0.6 million and $0.8 million, respectively, under the terms of both ethanol and wet distiller’s grains agreements. |
12_Segment_Information
12. Segment Information | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Segment Reporting [Abstract] | |||||||||
12. Segment Information | Aemetis recognizes two reportable geographic segments: “North America” and “India.” The “North America” operating segment includes the Company’s owned ethanol plant in Keyes, California and its technology lab in College Park, Maryland. As the Company’s technology gains market acceptance, this business segment will include its domestic commercial application of cellulosic ethanol technology, its plant construction projects and any acquisitions of ethanol or ethanol related technology facilities in North America. | ||||||||
The “India” operating segment includes the Company’s 50 million gallon per year nameplate capacity biodiesel manufacturing plant in Kakinada, the administrative offices in Hyderabad, India, and the holding companies in Nevada and Mauritius. The Company’s biodiesel is marketed and sold primarily to customers in India through brokers and by the Company directly. | |||||||||
Summarized financial information by reportable segment for the three months ended March 31, 2015 and 2014 follows: | |||||||||
For the three months ended March 31, | |||||||||
2015 | 2014 | ||||||||
Revenues | |||||||||
North America | $ | 33,207 | $ | 59,081 | |||||
India | 1,519 | 1,584 | |||||||
Total revenues | $ | 34,726 | $ | 60,665 | |||||
Cost of goods sold | |||||||||
North America | $ | 33,369 | $ | 43,409 | |||||
India | 1,585 | 1,632 | |||||||
Total cost of goods sold | $ | 34,954 | $ | 45,041 | |||||
Gross profit (loss) | |||||||||
North America | $ | (162 | ) | $ | 15,672 | ||||
India | (66 | ) | (48 | ) | |||||
Total gross profit (loss) | $ | (228 | ) | $ | 15,624 | ||||
North America: During the three months ended March 31, 2015, the Company’s revenues from ethanol, WDG, and corn oil were made pursuant to the Grain Procurement and Working Capital Agreement established between the Company and J.D. Heiskell. Sales of ethanol, corn oil and WDG to J.D. Heiskell accounted for 93% of the Company’s North America segment revenues for the three months ended March 31, 2015. | |||||||||
During the three months ended March 31, 2014, all of the Company’s revenues from ethanol and WDG were made pursuant to the Corn Procurement and Working Capital Agreement established between the Company and J.D. Heiskell. Sales of ethanol and WDG to J.D. Heiskell accounted for 98% of the Company’s North America segment revenues for the three months ended March 31, 2014. | |||||||||
India. During the three months ended March 31, 2015, two customers in biodiesel accounted for 15% and 14%, and one customer in refined glycerin accounted for 15%, of the consolidated India segment revenues. During the three months ended March 31, 2014, two customers in biodiesel accounted for 21% and 19%, and two customers in Refined glycerin accounted for 14% and 11%, of the consolidated India segment revenues. | |||||||||
Total assets consist of the following: | |||||||||
As of | As of | ||||||||
March 31, | December 31, | ||||||||
2015 | 2014 | ||||||||
North America | $ | 79,987 | $ | 76,066 | |||||
India | 13,327 | 13,110 | |||||||
Total Assets | $ | 93,314 | $ | 89,176 |
13_Related_Party_Transactions
13. Related Party Transactions | 3 Months Ended |
Mar. 31, 2015 | |
Related Party Transactions [Abstract] | |
13. Related Party Transactions | The Company owes Eric McAfee and McAfee Capital, solely owned by Eric McAfee, amounts of $0.4 million each in connection with employment agreements and expense reimbursements, which are included in accrued expenses and accounts payable on the balance sheet as of March 31, 2015 and December 31, 2014. For the three months ended March 31, 2015 and 2014, the Company expensed $27 thousand and $34 thousand, respectively, to reimburse actual expenses incurred for McAfee Capital and related entities. |
14_Subsequent_Events
14. Subsequent Events | 3 Months Ended |
Mar. 31, 2015 | |
Subsequent Events [Abstract] | |
14. Subsequent Events | Third Eye Capital Debt Agreement Amendment |
On April 30, 2015, Third Eye Capital agreed to Amendment No. 10 to the note purchase agreement to allow for the repurchase of 500,000 shares of common stock of the Company effective as of the date of the amendment. Shares were repurchased at a price per share equal to $5.00 per share, for an aggregate purchase price of approximately $2.5 million. An extension of the credit facility allows for the repurchase price to be added to the outstanding principal balance of the existing notes. In addition, Third Eye Capital agreed to extend the maturity date of the notes to April 1, 2016 upon notice and payment of a 3% extension fee. |
15_Managements_Plan
15. Management's Plan | 3 Months Ended | |
Mar. 31, 2015 | ||
Notes to Financial Statements | ||
15. Management's Plan | The accompanying financial statements have been prepared contemplating the realization of assets and satisfaction of liabilities in the normal course of business. During 2015, the Company has been reliant on their senior secured lender to provide additional funding and has been required to remit substantially all excess cash from operations to the senior secured lender. Management’s plans for the Company include: | |
● | Operating the Keyes plant; | |
● | Continuing to incorporate lower-cost, non-food advanced biofuels feedstock at the Keyes plant when economical; | |
● | Attracting investors to financing arrangements including working with Advanced BioEnergy LP to issue up to $17.0 million of additional EB-5 notes at 3% interest rate; | |
● | Refinancing the senior debt with a lender who is able to offer terms conducive to the long term financing of the Keyes plant; | |
● | Restructuring or refinance the State Bank of India note to allow for additional working capital and reduce current financing costs; | |
● | Securing higher volumes of international shipments from the Kakinada, India biodiesel and refined glycerin facility; and | |
● | Continuing to expand in the India market as the subsidy on diesel was lifted and sales of biodiesel into the diesel market have been subject to deregulation. | |
Management believes that through the above mentioned actions it will be able to fund company operations and continue to operate the secured assets for the foreseeable future. There can be no assurance that the existing credit facilities and cash from operations will be sufficient nor that the Company will be successful at maintaining adequate relationships with the senior lenders or significant shareholders. Should the Company require additional financing, there can be no assurances that the additional financing will be available on terms satisfactory to the Company. |
1_Nature_of_Activities_and_Sum1
1. Nature of Activities and Summary of Significant Accounting Policies (Policies) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Proceeds from borrowing under secured debt facilities | |||||||||
Nature of Activities | Nature of Activities. These consolidated financial statements include the accounts of Aemetis, Inc. (formerly AE Biofuels, Inc.), a Nevada corporation, and its wholly owned subsidiaries (collectively, “Aemetis” or the “Company”): | ||||||||
● | Aemetis Americas, Inc., a Nevada corporation, and its subsidiary AE Biofuels, Inc., a Delaware corporation; | ||||||||
● | Biofuels Marketing, Inc., a Delaware corporation; | ||||||||
● | Aemetis International, Inc., a Nevada corporation, and its subsidiary International Biofuels, Ltd., a Mauritius corporation, and its subsidiary Universal Biofuels Private, Ltd., an India company; | ||||||||
● | Aemetis Technologies, Inc., a Delaware corporation; | ||||||||
● | Aemetis Biochemicals, Inc., a Nevada corporation; | ||||||||
● | Aemetis Biofuels, Inc., a Delaware corporation, and its subsidiary Energy Enzymes, Inc., a Delaware corporation; | ||||||||
● | AE Advanced Fuels, Inc., a Delaware corporation, and its subsidiaries Aemetis Advanced Fuels Keyes, Inc., a Delaware corporation, and Aemetis Facility Keyes, Inc., a Delaware corporation; | ||||||||
● | Aemetis Advanced Fuels, Inc., a Nevada corporation; and, | ||||||||
Aemetis is an advanced renewable fuels and biochemicals company focused on the acquisition, development and commercialization of innovative technologies that replace traditional petroleum-based products by the conversion of first generation ethanol and biodiesel plants into advanced biorefineries. The Company owns and operates a plant in Keyes, California where the Company manufactures and produces ethanol, wet distillers’ grain (WDG), condensed distillers solubles (CDS) and corn oil and a manufacturing and refining facility in Kakinada, India where the Company manufactures and produces fatty acid methyl ester (biodiesel), crude and refined glycerin and refined palm oil. In September 2013, the Company received approval by the US Environmental Protection Agency to produce ethanol using grain sorghum and biogas along with the Keyes plant existing combined heat and power systems to generate higher value D5 Advanced Biofuel Renewable Identification Numbers (RIN’s). In April 2014, the Company received the International Sustainability and Carbon Certification for the production of biodiesel at the India plant from certain oils and fats for sale into European markets. In addition, the Company is continuing research and development focused on microbial technologies for the commercialization of renewable industrial biofuels and biochemicals. | |||||||||
Basis of Presentation and Consolidation | Basis of Presentation and Consolidation. The consolidated condensed financial statements include the accounts of Aemetis, Inc. and its subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The accompanying consolidated condensed balance sheet as of March 31, 2015, the consolidated condensed statements of operations and comprehensive income (loss) for the three months ended March 31, 2015 and 2014, and the consolidated condensed statements of cash flows for the three months ended March 31, 2015 and 2014 are unaudited. The consolidated condensed balance sheet as of December 31, 2014 was derived from the 2014 audited consolidated financial statements and notes thereto. The consolidated condensed financial statements in this report should be read in conjunction with the 2014 audited consolidated financial statements and notes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, 2014. | ||||||||
The accompanying consolidated condensed financial statements have been prepared in accordance with accounting principles generally accepted in the United States (U.S. GAAP) and pursuant to the rules and regulations of the SEC. Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to such rules and regulations. | |||||||||
In the opinion of management, the unaudited interim consolidated condensed financial statements for the three months ended March 31, 2015 and 2014 have been prepared on the same basis as the audited consolidated statements as of December 31, 2014 and reflect all adjustments, consisting primarily of normal recurring adjustments, necessary for the fair presentation of its statement of financial position, results of operations and cash flows. The results of operations for the three months ended March 31, 2015 are not necessarily indicative of the operating results for any subsequent quarter, for the full fiscal year or any future periods. | |||||||||
Use of Estimates | Use of Estimates. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the reporting period. To the extent there are material differences between these estimates and actual results, the Company’s consolidated financial statements will be affected. | ||||||||
Revenue recognition | Revenue recognition. The Company recognizes revenue when there is persuasive evidence of an arrangement, delivery has occurred, the price is fixed or determinable and collection is reasonably assured. The Company records revenues based upon the gross amounts billed to its customers. Revenue from nonmonetary transactions, principally in-kind by-products received in exchange for material processing where the by-product is contemplated by contract to provide value, is recognized at the quoted market price of those goods received or by-products. | ||||||||
Cost of Goods Sold | Cost of Goods Sold. Cost of goods sold includes those costs directly associated with the production of revenues, such as raw material consumed, factory overhead, and other direct production costs. During periods of idle plant capacity, costs otherwise charged to cost of goods sold are reclassified to selling, general and administrative expense. | ||||||||
Shipping and Handling Costs | Shipping and Handling Costs. Shipping and handling costs are classified as a component of cost of goods sold in the accompanying consolidated statements of operations. | ||||||||
Research and Development | Research and Development. Research and development costs are expensed as incurred, unless they have alternative future uses to the Company. | ||||||||
Cash and Cash Equivalents | Cash and Cash Equivalents. The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. The Company maintains cash balances at various financial institutions domestically and abroad. The Federal Deposit Insurance Corporation (FDIC) insures domestic cash accounts. The Company’s accounts at these institutions may at times exceed federally insured limits. The Company has not experienced any losses in such accounts. | ||||||||
Accounts Receivable | Accounts Receivable. The Company sells ethanol, wet distillers grains, corn syrup and corn oil through third-party marketing arrangements generally without requiring collateral. The Company sells biodiesel, glycerin, and processed natural oils to a variety of customers and may require advanced payment based on the size and creditworthiness of the customer. Accounts receivables consist of product sales made to large creditworthy customers. Trade accounts receivable are presented at original invoice amount, net of the allowance for doubtful accounts. | ||||||||
The Company maintains an allowance for doubtful accounts for balances that appear to have specific collection issues. The collection process is based on the age of the invoice and requires attempted contacts with the customer at specified intervals. If, after a specified number of days, the Company has been unsuccessful in its collection efforts, a bad debt allowance is recorded for the balance in question. Delinquent accounts receivable are charged against the allowance for doubtful accounts once uncollectibility has been determined. The factors considered in reaching this determination are the apparent financial condition of the customer and the Company’s success in contacting and negotiating with the customer. If the financial condition of the Company’s customers were to deteriorate additional allowances may be required. There is no allowance for doubtful accounts balance as of March 31, 2015 and December 31, 2014. | |||||||||
Inventories | Inventories. Inventories are stated at the lower of cost, using the first-in and first-out (FIFO) method, or market. | ||||||||
Property, Plant and Equipment | Property, Plant and Equipment. Property, plant and equipment are carried at cost less accumulated depreciation after assets are placed in service and are comprised primarily of buildings, furniture, machinery, equipment, land, and the biodiesel plant in India. It is the Company’s policy to depreciate capital assets over their estimated useful lives using the straight-line method. | ||||||||
Goodwill and Intangible Assets | Goodwill and Intangible Assets. Intangible assets consist of intellectual property in the form of patents pending, in-process research and development and goodwill. Once the patents pending or in-process R&D have secured a definite life in the form of a patent or product, they will be carried at cost less accumulated amortization over their estimated useful life. Amortization commences upon the commercial application or generation of revenue and is amortized over the shorter of the economic life or patent protection period. | ||||||||
Company intangible assets such as goodwill have indefinite lives and as a result need to be evaluated at least annually, or more frequently, if impairment indicators arise. In the Company’s review, we determined the fair value of the reporting unit using market indicators and discounted cash flow modeling. The Company compares the fair value to the net book value of the reporting unit. An impairment loss would be recognized when the fair value is less than the related net book value, and an impairment expense would be recorded in the amount of the difference. Forecasts of future cash flows are judgments based on the Company’s experience and knowledge of the Company’s operations and the industries in which the Company operates. These forecasts could be significantly affected by future changes in market conditions, the economic environment, including inflation, and the purchasing decisions of the Company’s customers. | |||||||||
California Ethanol Producer Incentive Program | California Ethanol Producer Incentive Program. The Company was eligible to participate in the California Ethanol Producer Incentive Program (“CEPIP”). Under the CEPIP, an eligible California ethanol facility could receive up to $3 million in cash per plant per year of operations through 2013 when current production corn crush spreads, measured as the difference between specified ethanol and corn index prices, dropped below $0.55 per gallon. For any month in which a payment is made by the CEPIP, the Company may be required to reimburse the funds within the subsequent five years from each payment date, if the corn crush spreads exceed $1.00 per gallon. Since these funds are provided to subsidize current production costs and encourage eligible facilities to either continue production or start up production in low margin environments, the Company records the proceeds, if any, as a credit to cost of goods sold. With respect to CEPIP payments received and applied as reductions to cost of goods sold, the Company recorded none for the three months ended March 31, 2015 and 2014. During 2013 and 2014, the strength of the crush spread resulted in an obligation to repay CEPIP funding in the amount of $1.8 million, the entire amount of funds received from the program. As of March 31, 2015 and December 31, 2014, the Company carried a remaining liability of $0.5 million and $0.8 million, respectively, for repayment of funds received. | ||||||||
Warrant liability | Warrant liability: The Company adopted guidance related to distinguishing liabilities from equity for certain warrants which contain a conditional obligation to repurchase feature. As of March 31, 2015 and December 31, 2014, there were 18,644 warrants outstanding with a conditional obligation to repurchase feature that require liability treatment. As a result, a warrant liability was recorded to recognize the fair value upon issuance of each warrant. The Company estimates the fair value of future liability on warrants using the Black-Scholes pricing model. Assumptions within the pricing model include: 1) the risk-free interest rate, which comes from the U.S. Treasury yield curve for periods within the contractual life of the warrants, 2) the expected life of the warrants which is assumed to be the contractual life of the warrants, and 3) the volatility which is estimated based on an average of the historical volatilities. | ||||||||
The Company computes the fair value of the warrant liability at each reporting period and the change in the fair value is recorded through earnings. The key component in the value of the warrant liability is the Company's stock price, which is subject to significant fluctuation and is not under the Company's control. The resulting effect on the Company's net loss is therefore subject to significant fluctuation and will continue to be so until the warrants are exercised, amended or expired. Assuming all other fair value inputs remain constant, the Company will record non-cash expense when the stock price increases and non-cash income when the stock price decreases. | |||||||||
Long - Lived Assets | Long - Lived Assets. The Company evaluates the recoverability of long-lived assets with finite lives in accordance with ASC Subtopic 360-10-35 Property Plant and Equipment –Subsequent Measurements, which requires recognition of impairment of long-lived assets whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. When events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable, based on estimated undiscounted cash flows, the impairment loss would be measured as the difference between the carrying amount of the assets and its estimated fair value. | ||||||||
Basic and Diluted Net income (Loss) per Share | Basic and Diluted Net income (Loss) per Share. Basic income (loss) per share is computed by dividing income or loss attributable to common shareholders by the weighted average number of common shares outstanding for the period. Diluted income (loss) per share reflects the dilution of common stock equivalents such as options, convertible preferred stock, debt and warrants to the extent the impact is dilutive. As the Company incurred net loss for the three months ended March 31, 2015, potentially dilutive securities have been excluded from the diluted net income per share computations as their effect would be anti-dilutive. As the Company incurred net income for the three months ended March 31, 2014, potentially dilutive securities have been included in the diluted net income per share computations and any potentially anti-dilutive shares have been excluded and are shown below. | ||||||||
The following table reconciles the number of shares utilized in the net income (loss) per share calculations for the three months ended March 31, 2015 and 2014: | |||||||||
Three months ended March 31, | |||||||||
2015 | 2014 | ||||||||
(In thousands, except per share amounts) | |||||||||
Net income (loss) | $ | (8,643 | ) | $ | 7,687 | ||||
Shares: | |||||||||
Weighted average shares outstanding—basic | 20,595 | 20,007 | |||||||
Weighted average dilutive share equivalents from preferred shares | - | 2,384 | |||||||
Weighted average dilutive share equivalents from stock options | - | 167 | |||||||
Weighted average dilutive share equivalents from common warrants | - | 94 | |||||||
Weighted average dilutive share equivalents from convertible promissory note | - | 5 | |||||||
Weighted average shares outstanding—diluted | 20,595 | 22,657 | |||||||
Earnings (loss) per share—basic | $ | (0.42 | ) | $ | 0.38 | ||||
Earnings (loss) per share—diluted | $ | (0.42 | ) | $ | 0.34 | ||||
The following table shows the number of potentially dilutive shares excluded from the diluted net income (loss) per share calculation as of March 31, 2015 and 2014: | |||||||||
As of | |||||||||
31-Mar-15 | 31-Mar-14 | ||||||||
Series B preferred (convertible on a 10 to 1 basis) | 1,558 | - | |||||||
Common stock options and warrants | 1,251 | 1,137 | |||||||
Total number of potentially dilutive shares excluded from the basic and diluted net income (loss) per share calculation | 2,809 | 1,137 | |||||||
Comprehensive Loss | Comprehensive Loss. ASC 220 Comprehensive Loss requires that an enterprise report, by major components and as a single total, the change in its net assets from non-owner sources. The Company’s other comprehensive income (loss) and accumulated other comprehensive loss consists solely of cumulative currency translation adjustments resulting from the translation of the financial statements of its foreign subsidiary. The investment in this subsidiary is considered indefinitely invested overseas, and as a result, deferred income taxes are not recorded related to the currency translation adjustments. | ||||||||
Foreign Currency Translation/Transactions | Foreign Currency Translation/Transactions. Assets and liabilities of the Company’s non-U.S. subsidiary that operates in a local currency environment, where that local currency is the functional currency, are translated into U.S. dollars at exchange rates in effect at the balance sheet date; with the resulting translation adjustments directly recorded to a separate component of accumulated other comprehensive loss. Income and expense accounts are translated at average exchange rates during the year. Gains and losses from foreign currency transactions are recorded in other income (loss). | ||||||||
Operating Segments | Operating Segments. Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance. Aemetis recognized two reportable geographic segments: “India” and “North America.” | ||||||||
The “North America” operating segment includes the Company’s 55 million gallons per year nameplate capacity ethanol plant in Keyes, California and the research facilities in College Park, Maryland. | |||||||||
The “India” operating segment encompasses the Company’s 50 million gallon per year nameplate capacity biodiesel plant in Kakinada, India, the administrative offices in Hyderabad, India, and the holding companies in Nevada and Mauritius. | |||||||||
Fair Value of Financial Instruments | Fair Value of Financial Instruments. The Company’s financial instruments include cash and cash equivalents, accounts receivable, accounts payable, other current liabilities, warrant liability, and debt. The fair value of current financial instruments was estimated to approximate carrying value due to the short term nature of these instruments. The carrying amount of debt obligations, including debt discount issuance costs, held by our senior lender, subordinated debt and seller note payable, at March 31, 2015 amounted to an aggregate of approximately $66.7 million in outstanding obligations. The debts were determined to have an estimated fair value of $67.7 million based on interest rates for comparable debt. The Company’s debt was valued using inputs from independent consultants evaluating external market inputs and internal financings to determine appropriate discount rates to determine fair value. The warrant liability fair value was estimated using the Black-Scholes valuation pricing model at the end of each reporting period. | ||||||||
Share-Based Compensation | Share-Based Compensation. The Company recognizes share based compensation expense in accordance with ASC 718 Stock Compensation requiring the Company to recognize expense related to the estimated fair value of the Company’s share-based compensation awards at the time the awards are granted adjusted to reflect only those shares that are expected to vest. | ||||||||
In valuing restricted common shares issued to consultants, debt holders, or affiliated investors, the Company estimates the discount for lack of marketability on restricted stock issued, using the Black-Scholes model for pricing call options, which assists in deriving the implied price of put options using the put-call parity principle. The price of the put option divided by the market price quoted on the NASDAQ market exchange implies the discount for lack of marketability. | |||||||||
Commitments and Contingencies | Commitments and Contingencies. The Company records and/or discloses commitments and contingencies in accordance with ASC 450 Contingencies. ASC 450 applies to an existing condition, situation, or set of circumstances involving uncertainty as to possible loss that will ultimately be resolved when one or more future events occur or fail to occur. | ||||||||
Debt Modification Accounting | Debt Modification Accounting. The Company evaluates amendments to its debt in accordance with ASC 540-50 Debt – Modification and Extinguishments for modification and extinguishment accounting. This evaluation includes comparing the net present value of cash flows of the new debt to the old debt to determine if changes greater than 10 percent occurred. In instances where the net present value of future cash flows changed more than 10 percent, the Company applies extinguishment accounting and determines the fair value of its debt based on factors available to the Company. | ||||||||
Convertible Instruments | Convertible Instruments. The Company evaluates the impacts of convertible instruments based on the underlying conversion features. Convertible Instruments are evaluated for treatment as derivatives that could be bifurcated and recorded separately. Any beneficial conversion feature is recorded based on the intrinsic value difference at the commitment date. | ||||||||
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements. | ||||||||
In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), which supersedes all existing revenue recognition requirements, including most industry-specific guidance. The new standard requires a company to recognize revenue when it transfers goods or services to customers in an amount that reflects the consideration that the company expects to receive for those goods or services. The new standard will be effective for us on January 1, 2018. We are currently evaluating the potential impact that Topic 606 may have on our financial position and results of operations. |
1_Nature_of_Activities_and_Sum2
1. Nature of Activities and Summary of Significant Accounting Policies (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Proceeds from sale of land | |||||||||
Reconciles the number of shares utilized in the net income (loss) per share | The following table reconciles the number of shares utilized in the net income (loss) per share calculations for the three months ended March 31, 2015 and 2014: | ||||||||
Three months ended March 31, | |||||||||
2015 | 2014 | ||||||||
(In thousands, except per share amounts) | |||||||||
Net income (loss) | $ | (8,643 | ) | $ | 7,687 | ||||
Shares: | |||||||||
Weighted average shares outstanding—basic | 20,595 | 20,007 | |||||||
Weighted average dilutive share equivalents from preferred shares | - | 2,384 | |||||||
Weighted average dilutive share equivalents from stock options | - | 167 | |||||||
Weighted average dilutive share equivalents from common warrants | - | 94 | |||||||
Weighted average dilutive share equivalents from convertible promissory note | - | 5 | |||||||
Weighted average shares outstanding—diluted | 20,595 | 22,657 | |||||||
Earnings (loss) per share—basic | $ | (0.42 | ) | $ | 0.38 | ||||
Earnings (loss) per share—diluted | $ | (0.42 | ) | $ | 0.34 | ||||
Schedule of dilutive securities | The following table shows the number of potentially dilutive shares excluded from the diluted net income (loss) per share calculation as of March 31, 2015 and 2014: | ||||||||
As of | |||||||||
31-Mar-15 | 31-Mar-14 | ||||||||
Series B preferred (convertible on a 10 to 1 basis) | 1,558 | - | |||||||
Common stock options and warrants | 1,251 | 1,137 | |||||||
Total number of potentially dilutive shares excluded from the basic and diluted net income (loss) per share calculation | 2,809 | 1,137 |
2_Inventory_Tables
2. Inventory (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Schedule of Notes Payable | |||||||||
Schedule of Inventory | 31-Mar-15 | 31-Dec-14 | |||||||
Raw materials | $ | 1,262 | $ | 1,522 | |||||
Work-in-progress | 1,464 | 1,453 | |||||||
Finished goods | 1,915 | 1,516 | |||||||
Total inventory | $ | 4,641 | $ | 4,491 |
3_Property_Plant_and_Equipment1
3. Property, Plant and Equipment (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Statement of Operations Data | |||||||||
Schedule of Property, plant and equipment | 31-Mar-15 | 31-Dec-14 | |||||||
Land | $ | 2,760 | $ | 2,753 | |||||
Plant and Buildings | 82,496 | 82,338 | |||||||
Furniture and fixtures | 460 | 458 | |||||||
Machinery and equipment | 4,072 | 4,063 | |||||||
Construction in progress | 163 | 148 | |||||||
Total gross property, plant & equipment | 89,951 | 89,760 | |||||||
Less accumulated depreciation | (15,187 | ) | (13,950 | ) | |||||
Total net property, plant & equipment | $ | 74,764 | $ | 75,810 |
4_Intangible_Assets_and_Goodwi1
4. Intangible Assets and Goodwill (Tables) | 3 Months Ended | ||||
Mar. 31, 2015 | |||||
Intangible Assets And Goodwill Tables | |||||
Schedule of intangible assets and goodwill | For the twelve months ending March 31, | Amortization | |||
2016 | $ | 80 | |||
2017 | 88 | ||||
2018 | 112 | ||||
2019 | 134 | ||||
2020 | 180 | ||||
Thereafter | 922 | ||||
Total | $ | 1,516 |
5_Notes_Payable_Tables
5. Notes Payable (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Wet distiller's grains sales | |||||||||
Schedule of Notes Payable | 31-Mar-15 | 31-Dec-14 | |||||||
Third Eye Capital term note | $ | 7,300 | $ | 7,394 | |||||
Third Eye Capital revolving credit facility | 21,267 | 22,330 | |||||||
Third Eye Capital revenue participation term note | 10,065 | 10,195 | |||||||
Third Eye Capital acquisition term note | 17,525 | 17,728 | |||||||
Cilion shareholder seller note payable | 5,410 | 5,373 | |||||||
State Bank of India secured term loan | 6,318 | 6,032 | |||||||
Subordinated notes | 5,282 | 5,428 | |||||||
EB-5 long term promissory notes | 19,075 | 1,534 | |||||||
Unsecured working capital loans and short-term notes | 656 | 1,287 | |||||||
Total debt | 92,898 | 77,301 | |||||||
Less current portion of debt | 12,138 | 12,746 | |||||||
Total long term debt | $ | 80,760 | $ | 64,555 | |||||
Maturities of Long-term Debt | Twelve months ended March 31, | Debt Repayments | |||||||
2016 | $ | 12,138 | |||||||
2017 | 61,879 | ||||||||
2018 | 3,160 | ||||||||
2019 | 17,500 | ||||||||
Total debt | 94,677 | ||||||||
Discounts | (1,779) | ||||||||
Total debt, net of discounts | $ | 92,898 |
6_Commitments_and_Contingencie1
6. Commitments and Contingencies (Tables) | 3 Months Ended | ||||
Mar. 31, 2015 | |||||
Commitments And Contingencies Tables | |||||
Schedule of minimum operating lease payments | Twelve months ended March 31, | Future Rent Payments | |||
2016 | $ | 427 | |||
2017 | 451 | ||||
2018 | 466 | ||||
2019 | 483 | ||||
2020 | 500 | ||||
Thereafter | 84 | ||||
Total | $ | 2,411 |
7_Outstanding_Warrants_Tables
7. Outstanding Warrants (Tables) | 3 Months Ended | ||||||
Mar. 31, 2015 | |||||||
Outstanding Warrants Tables | |||||||
Fair value of the warrants, Black-Scholes option pricing model | Expected dividend yield | 0 | % | ||||
Risk-free interest rate | 0.66 | % | |||||
Expected volatility | 76.71 | % | |||||
Expected Life (years) | 2 | ||||||
Exercise price | $ | 0.01 | |||||
Company Stock Price | $ | 5.79 | |||||
Schedule of warrant activity | Warrants Outstanding & Exercisable | Weighted - Average Exercise Price | Average Remaining Term in Years | ||||
Outstanding December 31, 2014 | 351 | $ | 3.05 | 2.69 | |||
Granted | 116 | 0.01 | |||||
Exercised | -116 | 0.01 | |||||
Outstanding March 31, 2015 | 351 | $ | 3.05 | 2.45 |
8_Fair_Value_of_Warrants_Table
8. Fair Value of Warrants (Tables) | 3 Months Ended | ||||
Mar. 31, 2015 | |||||
Fair Value Of Warrants Tables | |||||
Schedule of fair value of liability warrants | Expected dividend yield | 0 | % | ||
Risk-free interest rate | 0. 56% - 0.73 | % | |||
Expected volatility | 78.34% - 79.43 | % | |||
Expected Life (years) | 2.2 - 2.8 | ||||
Exercise price | $ | 0.01 | |||
Company stock price | $ | 4.22 |
9_Fair_Value_Measurements_Tabl
9. Fair Value Measurements (Tables) | 3 Months Ended | ||||||||||||||||
Mar. 31, 2015 | |||||||||||||||||
Fair Value Measurements Tables | |||||||||||||||||
Schedule of financial liabilities measured at fair value | Total | Level 1 | Level 2 | Level 3 | |||||||||||||
Warrant liability | $ | 79 | $ | - | $ | - | $ | 79 | |||||||||
Schedule of activity for liabilities measured at fair value | Balance as of December 31, 2014 | $ | 108 | ||||||||||||||
Issuances of warrant liabilities | - | ||||||||||||||||
Exercise of warrant liabilities | - | ||||||||||||||||
Related change in fair value | (29 | ) | |||||||||||||||
Balance as of March 31, 2015 | $ | 79 |
10_StockBased_Compensation_Tab
10. Stock-Based Compensation (Tables) | 3 Months Ended | ||||||||||||
Mar. 31, 2015 | |||||||||||||
Stock-based Compensation Tables | |||||||||||||
Schedule of options granted under employee stock plans | Shares Available for Grant | Number of Shares Outstanding | Weighted-Average Exercise Price | ||||||||||
Balance as of December 31, 2014 | 5 | 1,015 | $ | 5.51 | |||||||||
Authorized | 200 | — | — | ||||||||||
Granted | (25 | ) | 25 | 3.88 | |||||||||
Exercised | - | (71 | ) | 2.12 | |||||||||
Forfeited/expired | 43 | (43 | ) | 2.12 | |||||||||
Balance as of March 31, 2015 | 223 | 926 | $ | 5.89 | |||||||||
Schedule of weighted average fair value calculations for options | For the quarter ended March 31 | ||||||||||||
2015 | 2014 | ||||||||||||
Dividend-yield | 0 | % | 0 | % | |||||||||
Risk-free interest rate | 0.89 | % | 0.74 | % | |||||||||
Expected volatility | 78.79 | % | 78.73 | % | |||||||||
Expected life (years) | 3 | 3 | |||||||||||
Market value per share on grant date | $ | 3.88 | $ | 4.2 | |||||||||
Weighted average fair value per share on grant date | $ | 1.99 | $ | 2.14 |
11_Agreements_Tables
11. Agreements (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Agreements Tables | |||||||||
Schedule of working capital agreement activity | Three months ended March 31, | ||||||||
2015 | 2014 | ||||||||
Ethanol sales | $ | 22,612 | $ | 46,004 | |||||
Wet distiller's grains sales | 7,350 | 9,715 | |||||||
Corn oil sales | 865 | 901 | |||||||
Corn purchases | 25,959 | 33,328 | |||||||
Accounts receivable | 333 | 826 | |||||||
Accounts payable | 1,743 | 2,065 |
12_Segment_Information_Tables
12. Segment Information (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2015 | |||||||||
Segment Information Tables | |||||||||
Schedule of segment information | For the three months ended March 31, | ||||||||
2015 | 2014 | ||||||||
Revenues | |||||||||
North America | $ | 33,207 | $ | 59,081 | |||||
India | 1,519 | 1,584 | |||||||
Total revenues | $ | 34,726 | $ | 60,665 | |||||
Cost of goods sold | |||||||||
North America | $ | 33,369 | $ | 43,409 | |||||
India | 1,585 | 1,632 | |||||||
Total cost of goods sold | $ | 34,954 | $ | 45,041 | |||||
Gross profit (loss) | |||||||||
North America | $ | (162 | ) | $ | 15,672 | ||||
India | (66 | ) | (48 | ) | |||||
Total gross profit (loss) | $ | (228 | ) | $ | 15,624 | ||||
As of | As of | ||||||||
March 31, | December 31, | ||||||||
2015 | 2014 | ||||||||
North America | $ | 79,987 | $ | 76,066 | |||||
India | 13,327 | 13,110 | |||||||
Total Assets | $ | 93,314 | $ | 89,176 |
1_Nature_of_Activities_and_Sum3
1. Nature of Activities and Summary of Significant Accounting Policies (Details) (USD $) | 3 Months Ended | |
In Thousands, except Share data, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Accounting Policies [Abstract] | ||
Net income (loss) | ($8,643) | $7,687 |
Shares: | ||
Weighted average shares outstanding-basic | 20,595 | 20,007 |
Weighted average dilutive share equivalents from preferred shares | 2,384 | |
Weighted average dilutive share equivalents from stock options | 167 | |
Weighted average dilutive share equivalents from common warrants | 94 | |
Weighted average dilutive share equivalents from convertible promissory note | 5 | |
Weighted average shares outstanding-diluted | 20,595 | 22,657 |
Earnings (loss) per share-basic | ($0.42) | $0.38 |
Earnings (loss) per share-diluted | ($0.42) | $0.34 |
1_Nature_of_Activities_and_Sum4
1. Nature of Activities and Summary of Significant Accounting Policies (Details 1) | Mar. 31, 2015 | Mar. 31, 2014 |
Accounting Policies [Abstract] | ||
Series B preferred (convertible on a 10 to 1 basis) | 1,558 | |
Common stock options and warrants | 1,251 | 1,137 |
Total number of potentially dilutive shares excluded from the basic and diluted net income (loss) per share calculation | 2,809 | 1,137 |
1_Nature_of_Activities_and_Sum5
1. Nature of Activities and Summary of Significant Accounting Policies (Details Narrative) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Disclosure1.NotesOfActivitiesAndSummaryOfSignificantAccountingPoliciesDetailsAbstract | ||
Repayment of funds received | $500 | $800 |
Carrying amount of debt obligations | 66,700 | |
Debt fair value | $67,700 |
2_Inventory_Details
2. Inventory (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
RepaymentsOfBorrowingsUnderShortTermFacilities | ||
Raw materials | $1,262 | $1,522 |
Work-in-progress | 1,464 | 1,453 |
Finished goods | 1,915 | 1,516 |
Total inventory | $4,641 | $4,491 |
3_Property_Plant_and_Equipment2
3. Property, Plant and Equipment (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Disclosure3.PropertyPlantAndEquipmentDetailsAbstract | ||
Land | $2,760 | $2,753 |
Plant and Buildings | 82,496 | 82,338 |
Furniture and fixtures | 460 | 458 |
Machinery and equipment | 4,072 | 4,063 |
Construction in progress | 163 | 148 |
Total gross property, plant & equipment | 89,951 | 89,760 |
Less accumulated depreciation | -15,187 | -13,950 |
Total net property, plant & equipment | $74,764 | $75,810 |
3_Property_Plant_and_Equipment3
3. Property, Plant and Equipment (Details Narrative) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Disclosure3.PropertyPlantAndEquipmentDetailsNarrativeAbstract | ||
Depreciation expense | $1,195 | $1,152 |
4_Intangible_Assets_and_Goodwi2
4. Intangible Assets and Goodwill (Details) (USD $) | Mar. 31, 2015 |
In Thousands, unless otherwise specified | |
Intangible Assets And Goodwill Details | |
2016 | $80 |
2017 | 88 |
2018 | 112 |
2019 | 134 |
2020 | 180 |
Thereafter | 922 |
Total | $1,516 |
4_Intangible_Assets_and_Goodwi3
4. Intangible Assets and Goodwill (Details Narrative) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Amortization expense | $32 | $32 |
Intangible assets | 1,516 | |
Goodwill | 1,000 | |
Patents | ||
Amortization expense | 20 | 20 |
Intangible assets | 1,000 | |
In-process research and development | ||
Intangible assets | $600 |
5_Notes_Payable_Details
5. Notes Payable (Details) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Total revenues | ||
Third Eye Capital term note | $7,300 | $7,394 |
Third Eye Capital revolving credit facility | 21,267 | 22,330 |
Third Eye Capital revenue participation term note | 10,065 | 10,195 |
Third Eye Capital acquisition term note | 17,525 | 17,728 |
Cilion shareholder Seller note payable | 5,410 | 5,373 |
State Bank of India secured term loan | 6,318 | 6,032 |
Subordinated notes | 5,282 | 5,428 |
EB-5 long term promissory notes | 19,075 | 1,534 |
Unsecured working capital loans and short-term notes | 656 | 1,287 |
Total debt | 92,898 | 77,301 |
Less current portion of debt | 12,138 | 12,746 |
Total long term debt | $80,760 | $64,555 |
5_Notes_Payable_Details_1
5. Notes Payable (Details 1) (USD $) | Mar. 31, 2015 |
In Thousands, unless otherwise specified | |
For the twelve months ending | |
2016 | $12,138 |
2017 | 61,879 |
2018 | 3,160 |
2019 | 17,500 |
Total debts | 94,677 |
Discounts | -1,779 |
Total debt, net of discounts | $92,898 |
5_Notes_Payable_Details_Narrat
5. Notes Payable (Details Narrative) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 |
Interest payments | $141 | $2,646 | |
Third Eye Capital Term Notes | |||
Principal and interest outstanding | 7,300 | ||
Unamortized discount | 200 | ||
Third Eye Capital Revolving Credit Facility | |||
Principal and interest outstanding | 21,300 | ||
Unamortized debt issuance costs | 700 | ||
Third Eye Capital Revenue Participation Term Notes | |||
Principal and interest outstanding | 10,100 | ||
Unamortized discount | 300 | ||
Third Eye Capital Acquisition Term Notes | |||
Principal and interest outstanding | 17,500 | ||
Unamortized discount | 500 | ||
Cilion shareholder Seller note payable | |||
Principal and interest outstanding | 5,400 | ||
State Bank of India secured term loan | |||
Principal and interest outstanding | 3,600 | 3,400 | |
Outstanding debt | 2,700 | 2,600 | |
Subordinated Notes | |||
Principal and interest outstanding | 5,300 | 5,400 | |
Unamortized discount | 600 | 200 | |
EB-5 long-term promissory notes | |||
Outstanding accrued interest | 75 | ||
Unsecured working capital loans | |||
Principal payments made | 7,000 | 1,500 | |
Interest payments | 37 | 51 | |
Outstanding debt | $7,000 | $1,300 |
6_Commitments_and_Contingencie2
6. Commitments and Contingencies (Details) (USD $) | Mar. 31, 2015 |
In Thousands, unless otherwise specified | |
Commitments And Contingencies Details | |
2016 | $427 |
2017 | 451 |
2018 | 466 |
2019 | 483 |
2020 | 500 |
Thereafter | 84 |
Total | $2,411 |
6_Commitments_and_Contingencie3
6. Commitments and Contingencies (Details Narrative) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Commitments And Contingencies Details Narrative | ||
Rent expense | $107 | $106 |
7_Outstanding_Warrants_Details
7. Outstanding Warrants (Details) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Dividend-yield | 0.00% | 0.00% |
Risk-free interest rate | 0.89% | 0.74% |
Expected volatility | 78.79% | 78.73% |
Expected life (years) | 3 years | 3 years |
Exercise price | $1.99 | $2.14 |
Company stock price | $3.88 | $4.20 |
Warrant [Member] | ||
Dividend-yield | 0.00% | |
Risk-free interest rate | 0.66% | |
Expected volatility | 76.71% | |
Expected life (years) | 2 years | |
Exercise price | $0.01 | |
Company stock price | $5.79 |
7_Outstanding_Warrants_Details1
7. Outstanding Warrants (Details 1) (Warrant [Member], USD $) | 3 Months Ended |
Mar. 31, 2015 | |
Warrant [Member] | |
Number of Warrants Outstanding, Beginning | 351 |
Number of Warrants Granted | 116 |
Number of Warrants Exercised | -116 |
Number of Warrants Outstanding, Ending | 351 |
Weighted Average Exercise Price Outstanding, Beginning | $3.05 |
Weighted Average Exercise Price Granted | $0.01 |
Weighted Average Exercise Price Exercised | $0.01 |
Weighted Average Exercise Price Outstanding, Ending | $3.05 |
Weighted Average Remaining Contractual Life (in years) Outstanding, Beginning | 2 years 8 months 9 days |
Weighted Average Remaining Contractual Life (in years) Outstanding, Ending | 2 years 5 months 12 days |
8_Fair_Value_of_Warrants_Detai
8. Fair Value of Warrants (Details) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Expected dividend yield | 0.00% | |
Exercise price | $0.01 | |
Company stock price | $3.88 | $4.20 |
Minimum [Member] | ||
Risk-free interest rate | 0.56% | |
Expected volatility | 78.34% | |
Expected Life (years), min | 2 years 2 months 12 days | |
Maximum [Member] | ||
Risk-free interest rate | 0.73% | |
Expected volatility | 79.43% | |
Expected Life (years), min | 2 years 9 months 18 days |
9_Fair_Value_Measurements_Deta
9. Fair Value Measurements (Details) (USD $) | Mar. 31, 2015 |
In Thousands, unless otherwise specified | |
Warranty liability | $79 |
Level 1 | |
Warranty liability | |
Level 2 | |
Warranty liability | |
Level 3 | |
Warranty liability | $79 |
9_Fair_Value_Measurements_Deta1
9. Fair Value Measurements (Details 1) (USD $) | 3 Months Ended |
In Thousands, unless otherwise specified | Mar. 31, 2015 |
Fair Value Measurements Details 1 | |
Beginning Balance | $108 |
Issuances of warrant liabilities | |
Exercise of warrant liabilities | |
Related change in fair value | -29 |
Ending Balance | $79 |
10_StockBased_Compensation_Det
10. Stock-Based Compensation (Details) (Employee Stock Plan, USD $) | 3 Months Ended |
Mar. 31, 2015 | |
Employee Stock Plan | |
Shares Available for Grant, Beginning | 5 |
Shares Available for Grant, Authorized | 200 |
Shares Available for Grant, Granted | -25 |
Shares Available for Grant, Exercised | 0 |
Shares Available for Grant, Forfeited/Expired | 43 |
Shares Available for Grant, Ending | 223 |
Number of Shares Outstanding, Beginning | 1,015 |
Number of Shares Authorized | 0 |
Number of Shares Granted | 25 |
Number of Shares Exercised | -71 |
Number of Shares Forfeited/Expired | -43 |
Number of Shares Outstanding, Ending | 926 |
Weighted Average Exercise Price Outstanding, Beginning | $5.51 |
Weighted Average Exercise Price Authorized | $0 |
Weighted Average Exercise Price Granted | $3.88 |
Weighted Average Exercise Price Exercised | $2.12 |
Weighted Average Exercise Price Forfeited/Expired | $2.12 |
Weighted Average Exercise Price Outstanding, Ending | $5.89 |
10_StockBased_Compensation_Det1
10. Stock-Based Compensation (Details 1) (USD $) | 3 Months Ended | |
Mar. 31, 2015 | Mar. 31, 2014 | |
Stock-based Compensation Details 1 | ||
Dividend-yield | 0.00% | 0.00% |
Risk-free interest rate | 0.89% | 0.74% |
Expected volatility | 78.79% | 78.73% |
Expected life (years) | 3 years | 3 years |
Company stock price | $3.88 | $4.20 |
Weighted average fair value per share on grant date | $1.99 | $2.14 |
11_Agreements_Details
11. Agreements (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Agreements Details | ||
Ethanol sales | $22,612 | $46,004 |
Wet distiller's grains sales | 7,350 | 9,715 |
Corn oil sales | 865 | 901 |
Corn purchases | 25,959 | 33,328 |
Accounts receivable | 333 | 826 |
Accounts payable | $1,743 | $2,065 |
11_Agreements_Details_Narrativ
11. Agreements (Details Narrative) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Agreements | ||
Marketing costs | $600 | $800 |
12_Segment_Information_Details
12. Segment Information (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 |
Revenues | ||
North America | $33,207 | $59,081 |
India | 1,519 | 1,584 |
Total revenues | 34,726 | 60,665 |
Cost of goods sold | ||
North America | 33,369 | 43,409 |
India | 1,585 | 1,632 |
Total cost of goods sold | 34,954 | 45,041 |
Gross profit (loss) | ||
North America | -162 | 15,672 |
India | -66 | -48 |
Total gross profit (loss) | ($228) | $15,624 |
12_Segment_Information_Details1
12. Segment Information (Details 1) (USD $) | Mar. 31, 2015 | Dec. 31, 2014 |
In Thousands, unless otherwise specified | ||
Segment Information Details 1 | ||
North America | $79,987 | $76,066 |
India | 13,327 | 13,110 |
Total Assets | $93,314 | $89,176 |
13_Related_Party_Transactions_
13. Related Party Transactions (Details Narrative) (Eric McAfee and McAfee Capital, USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2015 | Mar. 31, 2014 | Dec. 31, 2014 |
Eric McAfee and McAfee Capital | |||
Related party debt | $400 | $400 | |
Related party transaction | $27 | $34 |