Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2015 | Oct. 30, 2015 | |
Document And Entity Information | ||
Entity Registrant Name | AEMETIS, INC. | |
Entity Central Index Key | 738,214 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2015 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
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 | 19,580,427 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2,015 |
CONSOLIDATED CONDENSED BALANCE
CONSOLIDATED CONDENSED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Current assets: | ||
Cash and cash equivalents | $ 2,516 | $ 332 |
Accounts receivable | 2,229 | 1,262 |
Inventories | 3,771 | 4,491 |
Prepaid expenses | 694 | 1,392 |
Other current assets | 350 | 456 |
Total current assets | 9,560 | 7,933 |
Property, plant and equipment, net | 71,934 | 75,810 |
Goodwill | 968 | 968 |
Intangible assets, net of accumulated amortization of $324 and $264, respectively | 1,476 | 1,536 |
Other assets | 3,029 | 2,929 |
Total assets | 86,967 | 89,176 |
Current liabilities: | ||
Accounts payable | 7,725 | 8,339 |
Current portion of long term debt | 5,555 | 6,032 |
Short term borrowings | 7,075 | 6,714 |
Mandatorily redeemable Series B convertible preferred stock | 2,716 | 2,641 |
Other current liabilities | 4,048 | 3,590 |
Total current liabilities | 27,119 | 27,316 |
Long term liabilities: | ||
Senior secured notes | 59,558 | 57,648 |
EB-5 notes | 23,500 | 1,534 |
Other long term | 5,818 | 5,650 |
Total long term liabilities | 88,876 | 64,832 |
Stockholders' deficit: | ||
Series B convertible preferred stock, $0.001 par value; 7,235 authorized; 1,408 and 1,665 shares issued and outstanding each period, respectively (aggregate liquidation preference of $4,224 and $4,995, respectively) | 1 | 2 |
Common stock, $0.001 par value; 40,000 authorized; 19,575 and 20,650 shares issued and outstanding, respectively | 20 | 21 |
Additional paid-in capital | 81,861 | 87,080 |
Accumulated deficit | (107,798) | (87,113) |
Accumulated other comprehensive loss | (3,112) | (2,962) |
Total stockholders' deficit | (29,028) | (2,972) |
Total liabilities and stockholders' deficit | $ 86,967 | $ 89,176 |
CONSOLIDATED CONDENSED BALANCE3
CONSOLIDATED CONDENSED BALANCE SHEETS (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Statement of Financial Position [Abstract] | ||
Intangible assets, accumulated amortization | $ 324 | $ 264 |
Series B Preferred stock, par value | $ 0.001 | $ 0.001 |
Series B Preferred stock, authorized | 7,235 | 7,235 |
Series B Preferred stock, shares issued | 1,408 | 1,665 |
Series B Preferred stock, shares outstanding | 1,408 | 1,665 |
Aggregate Liquidation Preference | $ 4,224 | $ 4,995 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 40,000 | 40,000 |
Common stock, shares issued | 19,575 | 20,650 |
Common stock, shares outstanding | 19,575 | 20,650 |
CONSOLIDATED CONDENSED STATEMEN
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Income Statement [Abstract] | ||||
Revenues | $ 38,510 | $ 48,348 | $ 111,303 | $ 166,208 |
Cost of goods sold | 37,476 | 40,633 | 108,548 | 131,516 |
Gross profit (loss) | 1,034 | 7,715 | 2,755 | 34,692 |
Research and development expenses | 117 | 101 | 330 | 342 |
Selling, general and administrative expenses | 2,774 | 2,972 | 9,556 | 9,263 |
Operating income (loss) | (1,857) | 4,642 | (7,131) | 25,087 |
Interest expense | ||||
Interest rate expense | (2,610) | (2,287) | (7,641) | (7,737) |
Amortization expense | (1,258) | (741) | (5,386) | (5,361) |
Loss on debt extinguishment | 0 | (1,231) | (330) | (1,346) |
Loss on sale or disposal or assets | 0 | 0 | 0 | (119) |
Other income (expense) | (30) | 81 | (191) | 355 |
Income (loss) before income taxes | (5,755) | 464 | (20,679) | 10,879 |
Income tax expense | 0 | 0 | (6) | (6) |
Net income (loss) | (5,755) | 464 | (20,685) | 10,873 |
Other comprehensive income | ||||
Foreign currency translation adjustment | (104) | (98) | (150) | 10 |
Comprehensive income (loss) | $ (5,859) | $ 366 | $ (20,835) | $ 10,883 |
Net income(loss) per common share | ||||
Basic | $ (0.29) | $ 0.02 | $ (1.04) | $ 0.54 |
Diluted | $ (0.29) | $ 0.02 | $ (1.04) | $ 0.52 |
Weighted average shares outstanding | ||||
Basic | 19,521 | 20,555 | 19,898 | 20,284 |
Diluted | 19,521 | 21,476 | 19,898 | 20,946 |
CONSOLIDATED CONDENSED STATEME5
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Operating activities: | ||
Net income (loss) | $ (20,685) | $ 10,873 |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activitites: | ||
Share-based compensation | 694 | 447 |
Stock issued in connection with consultant services | 204 | 0 |
Depreciation | 3,560 | 3,486 |
Debt related amortization expense | 5,386 | 5,361 |
Intangibles and other amortization expense | 96 | 95 |
Change in fair value of warrant liability | (57) | 102 |
Loss on extinguishment of debt | 330 | 1,346 |
Loss on sale or disposal or assets | 0 | 119 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (988) | 2,330 |
Inventory | 650 | (1,112) |
Prepaid expenses | 698 | 432 |
Other current assets and other assets | (49) | (341) |
Accounts payable | (481) | (308) |
Accrued interest expense and fees, net of payments | 7,446 | 667 |
Other liabilities | 384 | (1,487) |
Net cash provided by (used in) operating activities | (2,812) | 22,010 |
Investing activities: | ||
Capital expenditures | (22) | (1,834) |
Proceeds from the sale of assets | 0 | 99 |
Net cash used in investing activities | (22) | (1,735) |
Financing activities: | ||
Proceeds from borrowings | 28,987 | 8,070 |
Repayments of borrowings | (23,900) | (27,721) |
Issuance of common stock for services, option and warrant exercises | 23 | 5 |
Net cash provided by (used in) financing activities | 5,110 | (19,646) |
Effect of exchange rate changes on cash and cash equivalents | (92) | (61) |
Net cash and cash equivalents increase for period | 2,184 | 568 |
Cash and cash equivalents at beginning of period | 332 | 4,926 |
Cash and cash equivalents at end of period | 2,516 | 5,494 |
Supplemental disclosures of cash flow information, cash paid: | ||
Interest payments | 356 | 6,751 |
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 | 1,087 | 1,301 |
Transfer between debt and other liabilities | 0 | 438 |
Stock issued in connection with services and for interest on debt | 432 | 715 |
Repurchase of common stock on revolver loan advance | 8,218 | 0 |
Exercise of conversion feature on note to equity | $ 0 | $ 47 |
1. Nature of Activities and Sum
1. Nature of Activities and Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
1. Nature of Activities and Summary of Significant Accounting Policies | Nature of Activities ● 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; ● Aemetis Advanced Products Keyes, Inc., a Delaware corporation; and, ● Aemetis Advanced Fuels Goodland, Inc., a Delaware corporation. Headquartered in Cupertino, California, Aemetis is an advanced renewable fuels and renewable chemicals 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. Founded in 2006, Aemetis owns and operates a 60 million gallon per year ethanol production facility in the California Central Valley. Aemetis also owns and operates a 50 million gallon per year renewable chemical and advanced fuel production facility on the East Coast of India, producing high quality distilled biodiesel and refined glycerin for customers in India and Europe and plans expansion of capacity to 100 million gallons per year. Aemetis operates a research and development laboratory at the Maryland Biotech Center, and holds a portfolio of patents and related technology licenses for the production of renewable fuels and biochemicals. Basis of Presentation and Consolidation. 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 and nine months ended September 30, 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 and nine months ended September 30, 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 Revenue recognition Cost of Goods Sold Shipping and Handling Costs Research and Development. Cash and Cash Equivalents Accounts Receivable. 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 Companys success in contacting and negotiating with the customer. If the financial condition of the Companys customers were to deteriorate, additional allowances may be required. There is no allowance for doubtful accounts balance as of September 30, 2015 and December 31, 2014. Inventories Property, Plant and Equipment Goodwill and Intangible Assets. 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 Companys 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 Companys experience and knowledge of the Companys 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 Companys customers. California Ethanol Producer Incentive Program Warrant liability 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. Property Plant and Equipment Subsequent Measurements, Basic and Diluted 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 and nine months ended September 30, 2015 and 2014: Three months ended Nine months ended September 30, 2015 September 30, 2014 September 30, 2015 September 30, 2014 (In thousands, except per share amounts) (In thousands, except per share amounts) Net income (loss) $ (5,755 ) $ 464 $ (20,685 ) $ 10,873 Shares: Weighted average shares outstandingbasic 19,521 20,555 19,898 20,284 Weighted average dilutive share equivalents from preferred shares - 217 - 231 Weighted average dilutive share equivalents from stock options - 460 - 242 Weighted average dilutive share equivalents from common warrants - 244 - 189 Weighted average shares outstandingdiluted 19,521 21,476 19,898 20,946 Earnings (loss) per sharebasic $ (0.29 ) $ 0.02 $ (1.04 ) $ 0.54 Earnings (loss) per sharediluted $ (0.29 ) $ 0.02 $ (1.04 ) $ 0.52 The following table shows the number of potentially dilutive shares excluded from the diluted net income (loss) per share calculation as of September 30, 2015 and 2014: As of September 30, 2015 September 30, 2014 Series B preferred (1:10 post split basis) 141 - Common stock options and warrants 1,307 30 EB-5 debt convertible to Common stock at $30 per share 783 - Total number of potentially dilutive shares excluded from the diluted net income (loss) per share calculation 2,231 30 Comprehensive Loss. Comprehensive Income Foreign Currency Translation/Transactions. Operating Segments. The North America operating segment includes the Companys 60 million gallons per year capacity ethanol plant in Keyes, California and the research facilities in College Park, Maryland. The India operating segment encompasses the Companys 50 million gallon per year 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. Share-Based Compensation. Stock Compensation 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. Contingencies Debt Modification Accounting Debt Modification and Extinguishments Convertible Instruments 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, 2017. We are currently evaluating the potential impact that Topic 606 may have on our financial position and results of operations. |
2. Inventory
2. Inventory | 9 Months Ended |
Sep. 30, 2015 | |
Inventory Disclosure [Abstract] | |
2. Inventory | Inventory consists of the following: September 30, 2015 December 31, 2014 Raw materials $ 1,316 $ 1,522 Work-in-progress 1,217 1,453 Finished goods 1,238 1,516 Total inventory $ 3,771 $ 4,491 |
3. Property, Plant and Equipmen
3. Property, Plant and Equipment | 9 Months Ended |
Sep. 30, 2015 | |
Property, Plant and Equipment [Abstract] | |
3. Property, Plant and Equipment | Property, plant and equipment consist of the following: September 30, 2015 December 31, 2014 Land $ 2,734 $ 2,753 Plant and Buildings 81,929 82,338 Furniture and fixtures 493 458 Machinery and equipment 4,043 4,063 Construction in progress 124 148 Total gross property, plant & equipment 89,323 89,760 Less accumulated depreciation (17,389 ) (13,950 ) Total net property, plant & equipment $ 71,934 $ 75,810 Depreciation on the components of property, plant and equipment is calculated using the straight-line method to allocate their depreciable amounts over their estimated useful lives as follows: Years Plant and Buildings 20 - 30 Machinery & Equipment 5 - 7 Furniture & Fixtures 3 - 5 For the both three months ended September 30, 2015 and 2014, the Company recorded depreciation expense of $1.2 million. For the nine months ended September 30, 2015 and 2014, the Company recorded depreciation expense of $3.6 million and $3.5 million, 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 and nine months ended September 30, 2015. |
4. Intangible Assets and Goodwi
4. Intangible Assets and Goodwill | 9 Months Ended |
Sep. 30, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
4. Intangible Assets and Goodwill | Intangible assets and goodwill consist of $0.9 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 each of the three months ended September 30, 2015 and 2014, the Company recognized amortization expense of $20 thousand related to patents. During each of the nine months ended September 30, 2015 and 2014, the Company recognized amortization expense of $60 thousand 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 September 30, Amortization 2016 $ 80 2017 104 2018 112 2019 180 2020 134 Thereafter 866 Total $ 1,476 |
5. Notes Payable
5. Notes Payable | 9 Months Ended |
Sep. 30, 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: September 30, 2015 December 31, 2014 Third Eye Capital term note 6,164 $ 7,394 Third Eye Capital revolving credit facility 25,061 22,330 Third Eye Capital revenue participation term note 10,352 10,195 Third Eye Capital acquisition term note 17,981 17,728 Cilion shareholder seller note payable 5,485 5,373 State Bank of India secured term loan 5,292 6,032 Subordinated notes 5,813 5,428 EB-5 long term promissory notes 23,762 1,534 Unsecured working capital loans 1,383 1,287 Total debt 101,293 77,301 Less current portion of debt 12,630 12,746 Total long term debt 88,663 $ 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); and (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 April 1, 2016*. 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 Revolving Credit Facility. 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. On May 29, 2015, the Company gave notice to extend the maturity date of the Notes to April 1, 2016 and added the 3% fee to the Notes. On August 6, 2015, Third Eye Capital agreed to Amendment No. 11 to the Note Purchase Agreement to allow for the extension of the maturity date of the Notes to April 1, 2017 upon election by the Company provided that the Company i) has $11.5 million in EB-5 funds in escrow as of August 31, 2015, ii) enters into an investment banking engagement by October 1, 2015 to complete a capital markets transaction for the sale of shares of its India subsidiary, and iii) repurchases 100,000 shares of common stock from Third Eye Capital at the greater of $4.00 and the closing price on the date of the amendment. In addition, Third Eye Capital waived the free cash flow financial covenant under the Note Purchase Agreement for the three months ended June 30, 2015 and for the three months ending September 30, 2015, and revised the market value to note indebtedness covenant to 65%. As consideration, Third Eye Capital charged an amendment fee of $1.0 million to be added to the outstanding principal balance of the Revolving Credit Facility and an extension fee equal to 5% of the Note indebtedness to be charged at the time of exercise of the option to extend the maturity date of the Notes. We met the above conditions of EB-5 funds of $11.5 million in escrow as of August 31, 2015 and we signed an investment banking engagement to complete a capital markets transaction for the sale of shares in the India subsidiary in September 2015 and we repurchased 100,000 shares of common stock from Third Eye Capital at $4.00 per share in order for us to classify our senior debt as long term debt. In addition, as consideration for Amendment No. 11, the unconditional personal guaranty from Chairman of the Company, the guaranties from Company parties and McAfee Capital, LLC owned by Mr. Eric McAfee were all affirmed. The Company also agreed to pay a fee of $0.2 million to McAfee Capital, LLC for the loss of liquidity from this arrangement. 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 B. Revolving Credit Facility C. Revenue Participation Term Notes D. Acquisition Term Notes *The note maturity date can be extended by the Company to April 2017. As a condition to any such extension, the Company would be required to pay a fee of 5% of the carrying value of the debt. The Third Eye Capital Notes are secured by first priority liens on all real and personal property of, 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), owned by Eric McAfee, the Companys 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 State Bank of India secured term loan 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 September 30, 2015, the 12% interest rate under this facility is subject to adjustment every two years, based on 0.25% above the State Bank of India advance rate. No principal payments were made except for payments of $0.2 million each in May 2014 and June 2014 to obtain an interim stay. The term loan provides for liquidating damages at a rate of 2% per annum for the period of default. On August 22, 2015, UBPL and the State Bank of India agreed to a One Time Settlement Sanction Letter allowing for, among other things, four payments over a 360 day period amounting to $4.3 million, an interest rate holiday for 15 days after which the interest rate is payable at 13.7% per annum, and certain releases by both parties. Upon performance under the agreement, including the payment of all stipulated amounts, UBPL will receive relief for prior accrued interest in the amount of approximately $2.1 million. We paid the first payment under the settlement on August 23, 2015 and the second payment under the settlement on October 22, 2015. The two remaining payments under the settlement are due one in February 2016 and one in August 2016. As of September 30, 2015 and December 31, 2014, the State Bank of India loan had $1.5 million and $2.6 million in principal outstanding along with accrued and default interest of $3.8 million and $3.4 million, respectively. See Note 6 - Commitments and Contingencies for further details. Subordinated Notes 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 issued 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 a 10 % cash extension fee paid by adding the fee to the balance of the new note and 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 repaid one of the accredited investors holding a January 2012 Sub Note of $0.5 million. On July 1, 2014 and again on January 1, 2015, 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 and June 30, 2015, respectively in exchange for a 10 % 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 March 24, 2015, the Company paid off $180 thousand in Sub Note principal and interest held by one of the accredited investors with the money received from the EB-5 program. On July 1, 2015, the Sub Notes above were amended to extend the maturity date until the earlier of (i) December 31, 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 % cash extension fee was paid by adding the fee to the balance of the new note and warrants to purchase 116 thousand shares of common stock were granted with a term of two years and an exercise price of $0.01 per share. On January 14, 2013, Laird Cagan, a related party, loaned $0.1 million through a promissory note maturing on April 30, 2013 with a 5% 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 September 30, 2015 and December 31, 2014, the Company owed, in aggregate, subordinated notes in the amount of $5.8 million and $5.4 million in principal and interest outstanding, net of unamortized issuance and fair value discounts of $0.4 million and $0.2 million, respectively. EB-5 long-term promissory notes 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, $17.5 million during the first quarter of 2015, $2.5 million in the second quarter of 2015, and $2.0 million in the third quarter of 2015. As of September 30, 2015, $23.5 million in principal and $262 thousand in accrued interest remained outstanding on the notes. The escrow account holds an additional $11.5 million representing 23 investors. The availability of the remaining $12.5 million (including the $11.5 million in escrow) will be determined by the ability of Advanced BioEnergy, LP to attract the last two qualified investors, and for the United States Citizenship and Immigration Service to approve those investors who have made escrow deposits. Unsecured working capital loans During the three and nine months ended September 30, 2015, the Company made principal payments to Secunderabad of approximately $2.3 million and $3.3 million, respectively, under the agreement and interest payments of approximately $73 thousand and $177 thousand, respectively, for working capital funding. During the three and nine months ended September 30, 2014, the Company made principal payments to Secunderabad of approximately $1.8 million and $4.2 million, respectively, under the agreement and interest payments of approximately $48 thousand and $127 thousand respectively, for working capital funding. At September 30, 2015 and December 31, 2014, the Company had approximately $1.4 million and $1.3 million outstanding under this agreement, respectively. Scheduled debt repayments for loan obligations follow: Twelve months ended September 30, Debt Repayments 2016 $ 12,630 2017 63,749 2018 3,500 2019 23,235 Total debt 103,114 Discounts (1,821) Total debt, net of discounts $ 101,293 |
6. Commitments and Contingencie
6. Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
6. Commitments and Contingencies | Operating Leases The Company, through its subsidiaries, has non-cancelable operating leases for office space in Cupertino and India. Future minimum operating lease payments as of September 30, 2015 are as follows: Twelve months ended September 30, Future Rent Payments 2016 $ 443 2017 458 2018 475 2019 491 2020 335 Total $ 2,202 For the three months ended September 30, 2015 and 2014, the Company recognized lease and rent expense of $134 thousand and $108 thousand, respectively, under existing operating leases. For the nine months ended September 30, 2015 and 2014, the Company recognized lease and rent expense of $356 thousand and $320 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. On August 22, 2015, UBPL received from the State Bank of India, a One Time Settlement Sanction Letter allowing for, among other things, four payments over a 360 day period amounting to $4.3 million, an interest rate holiday for 15 days after which the interest rate is payable at 13.7% per annum, and certain releases by both parties. Upon performance under the agreement, including the payment of all stipulated amounts, UBPL will receive relief for prior accrued interest in the amount of approximately $2.1 million. On August 4, 2013, GS Cleantech Corporation, a subsidiary of Greenshift Corporation (Greenshift), filed a complaint in the United States District Court 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 to a pending Multidistrict Litigation. The complaint alleges infringement of patent rights assigned to Greenshift and pertaining to corn oil extraction processes the Company employs, and seeks royalties, treble damages, attorneys fees, and injunctions precluding the Company from further infringement. The corn oil extraction process we use is licensed to us by Valicor Separation Technologies LLC. Valicor has no obligations to indemnify us. On October 23, 2014, the Court ruled that all the claims of all the patents at issue in the case are invalid and, therefore, not infringed and adopted this finding in our case on January 16, 2015. GS Cleantech has said it will appeal this decision when the remaining claim in the suit has been decided. We believe the likelihood of Greenshift succeeding on appeal of the invalidity findings is small since the Courts findings included several grounds for invalidity of each allegedly infringed patent. If Greenshift successfully appeals the findings of invalidity, damages may be $1 million or more. The only remaining claim in the suit alleges that GS Cleantech obtained the patents at issue by inequitably conducting itself before the United States Patent Office. A trial in the District Court for the Southern District of Indiana on that issue was concluded and awaits judicial decision. If the patents at issue are found invalid due to GS Cleantechs inequitable conduct, it would receive no damage award. If the Court determines this is an exceptional case it may award the Company and its subsidiary the attorneys fees expended to date for defense in this case. It is unknown whether GS Cleantech would appeal such a ruling. The Company is a named defendant in the lawsuit filed by Gibraltar SSI, LLC. In addition to the Company, the lawsuit names McAfee Capital, LLC, P2 Capital, LLC, Eric McAfee and Marguerite McAfee as defendants. Plaintiff Gibraltar SSI, LLC alleges causes of action for fraudulent conveyances and related claims alleging that the Company participated in a scheme to issue at least 6 million shares of Company stock to McAfee Capital without consideration and so as to put the shares outside the reach of Gibraltar, SSI. The lawsuit alleges damages of over $6.5 million. This lawsuit was filed in April 2014 but was not pursued by Gibraltar and was effectively dormant until this quarter. The allegations are vigorously disputed by the Company. |
7. Outstanding Warrants
7. Outstanding Warrants | 9 Months Ended |
Sep. 30, 2015 | |
Text Block [Abstract] | |
7. Outstanding Warrants | During the three months ended September 30, 2015 the Company issued 113 thousand common stock warrants. During the nine months ended September 30, 2015, the Company issued 229 thousand common stock warrants. All issuances during 2015 were made to accredited investors who entered into amendments to Note and Warrant Purchase Agreements. For the nine months ended September 30, 2015, note investors and employees exercised 235 thousand warrant shares at the weighted average exercise price of $0.04 per share. A summary of warrant activity for the three months ended March 31, 2015, June 30, 2015, and September 30, 2015 follows: Warrants Outstanding & Exercisable Weighted - Average Exercise Price Average Remaining Term in Years Outstanding December 31, 2014 351 $ 3.05 2.69 Expired - - Granted 116 0.01 Exercised (116 ) 0.01 Outstanding March 31, 2015 351 $ 3.05 2.45 Expired - - - Granted - - - Exercised - - - Outstanding June 30, 2015 351 $ 3.05 2.20 Expired (3 ) 1.30 Granted 113 0.01 Exercised (119 ) 0.08 Outstanding September 30, 2015 342 $ 3.10 1.99 |
8. Fair Value of Warrants
8. Fair Value of Warrants | 9 Months Ended |
Sep. 30, 2015 | |
Notes to Financial Statements | |
8. Fair Value of Warrants | The following table summarizes the assumptions used in computing the fair value of warrants subject to liability and fair value accounting at September 30, 2015: Expected dividend yield 0 % Risk-free interest rate 0.49% - 0.78 % Expected volatility 77.37% - 82.25 % Expected Life (years) 1.7 - 2.3 Exercise price $ 0.01 Company stock price $ 2.75 |
9. Fair Value Measurements
9. Fair Value Measurements | 9 Months Ended |
Sep. 30, 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 following table summarizes financial liabilities measured at fair value on a recurring basis as of September 30, 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 $ 51 $ - $ - $ 51 The following table reflects the activity for liabilities measured at fair value using Level 3 inputs for each of the three month periods ended March 31, 2015, June 30, 2015, and September 30, 2015 follows: Balance as of December 31, 2014 $ 108 Related change in fair value (29 ) Balance as of March 31, 2015 $ 79 Related change in fair value (12 ) Balance as of June 30, 2015 $ 67 Related change in fair value (16 ) Balance as of September 30, 2015 $ 51 |
10. Stock-Based Compensation
10. Stock-Based Compensation | 9 Months Ended |
Sep. 30, 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 and restricted stock awards. The options generally expire five years from the date of grant for all options granted before May 2015 and the expiration term of the options granted from May 2015 is seven years from the date of grant. The options have 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. As of September 30, 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. 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 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 September 30, 2015, the 25 thousand options were outstanding. The following is a summary of options granted under the employee stock plans and the inducement equity plan: 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 (173 ) 173 4.28 Exercised - (137 ) 3.79 Forfeited/expired 85 (85 ) 3.23 Balance as of September 30, 2015 117 966 $ 5.88 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 September 30, 2015 and 2014, the Company recorded stock compensation expense in the amount of $161 thousand and $157 thousand, respectively. For the nine months ended September 30, 2015 and 2014, the Company recorded stock compensation expense in the amount of $694 thousand and $447 thousand, respectively. Valuation and Expense Information All issuances of stock options or other issuances of equity instruments to employees as 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 SECs 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. No stock options or restricted stock awards were issued during the three months ended September 30, 2015. As of September 30, 2015, the Company had $653 thousand of total unrecognized compensation expense for employees which the Company will amortize over the 1.85 years of weighted remaining term. |
11. Agreements
11. Agreements | 9 Months Ended |
Sep. 30, 2015 | |
Agreements | |
11. Agreements | Working Capital Arrangement. The J.D. Heiskell sales activity associated with the Purchasing Agreement, Grain Procurement and Working Capital Agreements during the three and nine months ended September 30, 2015 and 2014 are as follows: Three months ended September 30, Nine months ended September 30, 2015 2014 2015 2014 Ethanol sales $ 23,906 $ 33,641 $ 70,765 $ 121,388 Wet distiller's grains sales 5,609 8,175 19,568 30,970 Corn oil sales 835 1018 2,771 3,263 Corn purchases 24,056 27,616 74,949 94,563 Milo Purchases - - - - Accounts receivable 312 - 312 - Accounts payable 1,539 1,904 1,539 1,904 Ethanol and Wet Distillers Grains Marketing Arrangement. |
12. Segment Information
12. Segment Information | 9 Months Ended |
Sep. 30, 2015 | |
Segment Reporting [Abstract] | |
12. Segment Information | Aemetis recognizes two reportable geographic segments: North America and India. The North America operating segment includes the Companys 60 million gallon per year capacity ethanol manufacturing plant in Keyes, California and its technology lab in College Park, Maryland. As the Companys technology becomes commercialized, this business segment will include its domestic commercial application of second generation 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 Companys 50 million gallon per year capacity biodiesel manufacturing plant in Kakinada, the administrative offices in Hyderabad, India, and the holding companies in Nevada and Mauritius. The Companys 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 and nine months ended September 30, 2015 and 2014 follows: For the three months ended September 30, For the nine months ended September 30, 2015 2014 2015 2014 Revenues North America $ 32,444 $ 42,886 $ 99,795 $ 155,966 India 6,066 5,462 11,508 10,242 Total revenues $ 38,510 $ 48,348 $ 111,303 $ 166,208 Cost of goods sold North America $ 31,603 $ 35,632 $ 97,489 $ 121,754 India 5,873 5,001 11,059 9,762 Total cost of goods sold $ 37,476 $ 40,633 $ 108,548 $ 131,516 Gross profit North America $ 841 $ 7,254 $ 2,306 $ 34,212 India 193 461 449 480 Total gross profit $ 1,034 $ 7,715 $ 2,755 $ 34,692 North America. During the three and nine months ended September 30, 2014, the Companys 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 and WDG to J.D. Heiskell accounted for 97% and 99% of the Companys North America segment revenues for the three and nine months ended September 30, 2014. India During the nine months ended September 30, 2015, one customer in biodiesel accounted for 55% of the consolidated India segment revenues compared to three customers in biodiesel who accounted for 49%, 17%, and 9%, of the consolidated India segment revenues during the nine months ended September 30, 2014. Total assets consist of the following: As of September 30, December 31, 2015 2014 North America $ 74,908 $ 76,066 India 12,059 13,110 Total Assets $ 86,967 $ 89,176 |
13. Related Party Transactions
13. Related Party Transactions | 9 Months Ended |
Sep. 30, 2015 | |
Related Party Transactions [Abstract] | |
13. Related Party Transactions | The Company owes Eric McAfee and McAfee Capital, owned by Eric McAfee, $0.4 million in connection with employment agreements and expense reimbursements, which are included in accrued expenses and accounts payable on the balance sheet as of September 30, 2015 and December 31, 2014. For the three months ended September 30, 2015 and 2014, the Company expensed $16 thousand and $23 thousand, respectively, to reimburse actual expenses incurred by McAfee Capital and related entities. For the nine months ended September 30, 2015 and 2014, the Company expensed $54 thousand and $142 thousand, respectively, to reimburse actual expenses incurred by McAfee Capital and related entities. The Company prepaid $150 thousand to Redwood Capital, a Company controlled by Eric McAfee, for the Companys use of flight time on of corporate jet. As of September 30, 2015, $138 thousand remained as a prepaid expense. In connection with Amendment No. 11 to the Note Purchase Agreement with Third Eye Capital, the Company agreed to pay a fee od $0.2 million to McAfee Capital, LLC for the loss of liquidity resulting from the guaranties provided by McAfee Capital, LLC to Third Eye Capital for the Companys debt arrangements. |
14. Management's Plan
14. Management's Plan | 9 Months Ended |
Sep. 30, 2015 | |
Notes to Financial Statements | |
14. 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 and EB-5 funds to provide additional funding and has been required to remit substantially all excess cash from operations to the senior secured lender. Managements 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 $12.5 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 refinancing the State Bank of India note to allow for additional working capital and reduce current financing costs; and ● Securing higher volumes of shipments from the Kakinada, India biodiesel and refined glycerin facility. 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 S20
1. Nature of Activities and Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2015 | |
Proceeds from borrowing under secured debt facilities | |
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; ● Aemetis Advanced Products Keyes, Inc., a Delaware corporation; and, ● Aemetis Advanced Fuels Goodland, Inc., a Delaware corporation. Headquartered in Cupertino, California, Aemetis is an advanced renewable fuels and renewable chemicals 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. Founded in 2006, Aemetis owns and operates a 60 million gallon per year ethanol production facility in the California Central Valley. Aemetis also owns and operates a 50 million gallon per year renewable chemical and advanced fuel production facility on the East Coast of India, producing high quality distilled biodiesel and refined glycerin for customers in India and Europe. Aemetis operates a research and development laboratory at the Maryland Biotech Center, and holds a portfolio of patents and related technology licenses for the production of renewable fuels and biochemicals. |
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 September 30, 2015, the consolidated condensed statements of operations and comprehensive income (loss) for the three and nine months ended September 30, 2015 and 2014, and the consolidated condensed statements of cash flows for the nine months ended September 30, 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 Companys 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 and nine months ended September 30, 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 and nine months ended September 30, 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 | The preparation of financial statements in conformity with U.S. GAAP 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 Companys consolidated financial statements will be affected. |
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 or by-products received. |
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 Companys 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 Companys success in contacting and negotiating with the customer. If the financial condition of the Companys customers were to deteriorate, additional allowances may be required. There is no allowance for doubtful accounts balance as of September 30, 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 Companys 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 Companys 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 Companys experience and knowledge of the Companys 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 Companys customers. |
California Ethanol Producer Incentive Program | The Company participated 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 was 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. The Company qualified for and received grants in the amount of $1.8 million. 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 December 31, 2014, the Company carried a remaining liability of $0.8 million for repayment of funds received. During the three months ended September 30, 2015 the Company returned all cash plus accrued interest on amounts obtained from the CEPIP program. |
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 September 30, 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, |
Basic and Diluted Net income (Loss) per Share | Basic net income (loss) per share is computed by dividing net income or loss attributable to common shareholders by the weighted average number of common shares outstanding for the period. Diluted net 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 and nine months ended September 30, 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 and nine months ended September 30, 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 and nine months ended September 30, 2015 and 2014: Three months ended Nine months ended September 30, 2015 September 30, 2014 September 30, 2015 September 30, 2014 (In thousands, except per share amounts) (In thousands, except per share amounts) Net income (loss) $ (5,755 ) $ 464 $ (20,685 ) $ 10,873 Shares: Weighted average shares outstandingbasic 19,521 20,555 19,898 20,284 Weighted average dilutive share equivalents from preferred shares - 217 - 231 Weighted average dilutive share equivalents from stock options - 460 - 242 Weighted average dilutive share equivalents from common warrants - 244 - 189 Weighted average shares outstandingdiluted 19,521 21,476 19,898 20,946 Earnings (loss) per sharebasic $ (0.29 ) $ 0.02 $ (1.04 ) $ 0.54 Earnings (loss) per sharediluted $ (0.29 ) $ 0.02 $ (1.04 ) $ 0.52 The following table shows the number of potentially dilutive shares excluded from the diluted net income (loss) per share calculation as of September 30, 2015 and 2014: As of September 30, 2015 September 30, 2014 Series B preferred (1:10 post split basis) 141 - Common stock options and warrants 1,307 30 EB-5 debt convertible to Common stock at $30 per share 783 - Total number of potentially dilutive shares excluded from the diluted net income (loss) per share calculation 2,231 30 |
Comprehensive Loss | ASC 220 Comprehensive Loss |
Foreign Currency Translation/Transactions | Assets and liabilities of the Companys 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: North America and India. The North America operating segment includes the Companys 60 million gallons per year capacity ethanol plant in Keyes, California and the research facilities in College Park, Maryland. The India operating segment encompasses the Companys 50 million gallon per year 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 Companys 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 September 30, 2015 amounted to an aggregate of approximately $70.7 million in outstanding obligations. The above debts were determined to have an estimated fair value of $71.6 million based on interest rates for comparable debt. The Companys 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. Due to the unique terms of our notes payable under the EB-5 program, the State Bank of India secured term loan and our unsecured working capital loans and other short-term notes, the fair value of such debt is not determinable. |
Share-Based Compensation | The Company recognizes share based compensation expense in accordance with ASC 718 Stock Compensation 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 |
Debt Modification Accounting | The Company evaluates amendments to its debt in accordance with ASC 540-50 Debt Modification and Extinguishments |
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, 2017. 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 S21
1. Nature of Activities and Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Proceeds from sale of land | |
Reconciles the number of shares utilized in the net income (loss) per share | Three months ended Nine months ended September 30, 2015 September 30, 2014 September 30, 2015 September 30, 2014 (In thousands, except per share amounts) (In thousands, except per share amounts) Net income (loss) $ (5,755 ) $ 464 $ (20,685 ) $ 10,873 Shares: Weighted average shares outstandingbasic 19,521 20,555 19,898 20,284 Weighted average dilutive share equivalents from preferred shares - 217 - 231 Weighted average dilutive share equivalents from stock options - 460 - 242 Weighted average dilutive share equivalents from common warrants - 244 - 189 Weighted average shares outstandingdiluted 19,521 21,476 19,898 20,946 Earnings (loss) per sharebasic $ (0.29 ) $ 0.02 $ (1.04 ) $ 0.54 Earnings (loss) per sharediluted $ (0.29 ) $ 0.02 $ (1.04 ) $ 0.52 |
Schedule of dilutive securities | As of September 30, 2015 September 30, 2014 Series B preferred (1:10 post split basis) 141 - Common stock options and warrants 1,307 30 EB-5 debt convertible to Common stock at $30 per share 783 - Total number of potentially dilutive shares excluded from the diluted net income (loss) per share calculation 2,231 30 |
2. Inventory (Tables)
2. Inventory (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Schedule of Notes Payable | |
Schedule of Inventory | September 30, 2015 December 31, 2014 Raw materials $ 1,316 $ 1,522 Work-in-progress 1,217 1,453 Finished goods 1,238 1,516 Total inventory $ 3,771 $ 4,491 |
3. Property, Plant and Equipm23
3. Property, Plant and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Statement of Operations Data | |
Schedule of Property, plant and equipment | September 30, 2015 December 31, 2014 Land $ 2,734 $ 2,753 Plant and Buildings 81,929 82,338 Furniture and fixtures 493 458 Machinery and equipment 4,043 4,063 Construction in progress 124 148 Total gross property, plant & equipment 89,323 89,760 Less accumulated depreciation (17,389 ) (13,950 ) Total net property, plant & equipment $ 71,934 $ 75,810 |
Depreciation of property, plant, and equipment | Years Plant and Buildings 20 - 30 Machinery & Equipment 5 - 7 Furniture & Fixtures 3 - 5 |
4. Intangible Assets and Good24
4. Intangible Assets and Goodwill (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Intangible Assets And Goodwill Tables | |
Schedule of intangible assets and goodwill | For the twelve months ending September 30, Amortization 2016 $ 80 2017 104 2018 112 2019 180 2020 134 Thereafter 866 Total $ 1,476 |
5. Notes Payable (Tables)
5. Notes Payable (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Wet distiller's grains sales | |
Schedule of Notes Payable | September 30, 2015 December 31, 2014 Third Eye Capital term note 6,164 $ 7,394 Third Eye Capital revolving credit facility 25,061 22,330 Third Eye Capital revenue participation term note 10,352 10,195 Third Eye Capital acquisition term note 17,981 17,728 Cilion shareholder seller note payable 5,485 5,373 State Bank of India secured term loan 5,292 6,032 Subordinated notes 5,813 5,428 EB-5 long term promissory notes 23,762 1,534 Unsecured working capital loans 1,383 1,287 Total debt 101,293 77,301 Less current portion of debt 12,630 12,746 Total long term debt 88,663 $ 64,555 |
Maturities of Long-term Debt | Twelve months ended September 30, Debt Repayments 2016 $ 12,630 2017 63,749 2018 3,500 2019 23,235 Total debt 103,114 Discounts (1,821) Total debt, net of discounts $ 101,293 |
6. Commitments and Contingenc26
6. Commitments and Contingencies (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Commitments And Contingencies Tables | |
Schedule of minimum operating lease payments | Twelve months ended September 30, Future Rent Payments 2016 $ 443 2017 458 2018 475 2019 491 2020 335 Total $ 2,202 |
7. Outstanding Warrants (Tables
7. Outstanding Warrants (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Outstanding Warrants Tables | |
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 Expired - - Granted 116 0.01 Exercised (116 ) 0.01 Outstanding March 31, 2015 351 $ 3.05 2.45 Expired - - - Granted - - - Exercised - - - Outstanding June 30, 2015 351 $ 3.05 2.20 Expired (3 ) 1.30 Granted 113 0.01 Exercised (119 ) 0.08 Outstanding September 30, 2015 342 $ 3.10 1.99 |
8. Fair Value of Warrants (Tabl
8. Fair Value of Warrants (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Fair Value Of Warrants Tables | |
Schedule of fair value of liability warrants | Expected dividend yield 0 % Risk-free interest rate 0. 49% - 0.78 % Expected volatility 77.37% - 82.25 % Expected Life (years) 1.7 - 2.3 Exercise price $ 0.01 Company stock price $ 2.75 |
9. Fair Value Measurements (Tab
9. Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Fair Value Measurements Tables | |
Schedule of financial liabilities measured at fair value | Total Level 1 Level 2 Level 3 Warrant liability $ 51 $ - $ - $ 51 |
Schedule of activity for liabilities measured at fair value | Balance as of December 31, 2014 $ 108 Related change in fair value (29 ) Balance as of March 31, 2015 $ 79 Related change in fair value (12 ) Balance as of June 30, 2015 $ 67 Related change in fair value (16 ) Balance as of September 30, 2015 $ 51 |
10. Stock-Based Compensation (T
10. Stock-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 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 (173 ) 173 4.28 Exercised - (137 ) 3.79 Forfeited/expired 85 (85 ) 3.23 Balance as of September 30, 2015 117 966 $ 5.88 |
11. Agreements (Tables)
11. Agreements (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Agreements Tables | |
Schedule of working capital agreement activity | Three months ended September 30, Nine months ended September 30, 2015 2014 2015 2014 Ethanol sales $ 23,906 $ 33,641 $ 70,765 $ 121,388 Wet distiller's grains sales 5,609 8,175 19,568 30,970 Corn oil sales 835 1018 2,771 3,263 Corn purchases 24,056 27,616 74,949 94,563 Milo Purchases - - - - Accounts receivable 312 - 312 - Accounts payable 1,539 1,904 1,539 1,904 |
12. Segment Information (Tables
12. Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Segment Information Tables | |
Schedule of segment information | For the three months ended September 30, For the nine months ended September 30, 2015 2014 2015 2014 Revenues North America $ 32,444 $ 42,886 $ 99,795 $ 155,966 India 6,066 5,462 11,508 10,242 Total revenues $ 38,510 $ 48,348 $ 111,303 $ 166,208 Cost of goods sold North America $ 31,603 $ 35,632 $ 97,489 $ 121,754 India 5,873 5,001 11,059 9,762 Total cost of goods sold $ 37,476 $ 40,633 $ 108,548 $ 131,516 Gross profit North America $ 841 $ 7,254 $ 2,306 $ 34,212 India 193 461 449 480 Total gross profit $ 1,034 $ 7,715 $ 2,755 $ 34,692 |
Schedule of segment assets | Total assets consist of the following: As of September 30, December 31, 2015 2014 North America $ 74,908 $ 76,066 India 12,059 13,110 Total Assets $ 86,967 $ 89,176 |
1. Nature of Activities and S33
1. Nature of Activities and Summary of Significant Accounting Policies (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Accounting Policies [Abstract] | ||||
Net income (loss) | $ (5,755) | $ 464 | $ (20,685) | $ 10,873 |
Shares: | ||||
Weighted average shares outstanding-basic | 19,521 | 20,555 | 19,898 | 20,284 |
Weighted average dilutive share equivalents from preferred shares | 0 | 217 | 0 | 231 |
Weighted average dilutive share equivalents from stock options | 0 | 460 | 0 | 242 |
Weighted average dilutive share equivalents from common warrants | 0 | 244 | 0 | 189 |
Weighted average shares outstanding-diluted | 19,521 | 21,476 | 19,898 | 20,946 |
Earnings (loss) per share-basic | $ (0.29) | $ 0.02 | $ (1.04) | $ 0.54 |
Earnings (loss) per share-diluted | $ (0.29) | $ 0.02 | $ (1.04) | $ 0.52 |
1. Nature of Activities and S34
1. Nature of Activities and Summary of Significant Accounting Policies (Details 1) - shares | Sep. 30, 2015 | Sep. 30, 2014 |
Accounting Policies [Abstract] | ||
Series B preferred (convertible on a 10 to 1 basis) | 141 | 0 |
Common stock options and warrants | 1,307 | 30 |
EB-5 debt convertible to Common stock at $30 per share | 783 | 0 |
Total number of potentially dilutive shares excluded from the basic and diluted net income (loss) per share calculation | 2,231 | 30 |
1. Nature of Activities and S35
1. Nature of Activities and Summary of Significant Accounting Policies (Details Narrative) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Disclosure1.NotesOfActivitiesAndSummaryOfSignificantAccountingPoliciesDetailsAbstract | ||
Repayment of funds received | $ 800 | |
Carrying amount of debt obligations | $ 70,700 | |
Debt fair value | $ 71,600 |
2. Inventory (Details)
2. Inventory (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
RepaymentsOfBorrowingsUnderShortTermFacilities | ||
Raw materials | $ 1,316 | $ 1,522 |
Work-in-progress | 1,217 | 1,453 |
Finished goods | 1,238 | 1,516 |
Total inventory | $ 3,771 | $ 4,491 |
3. Property, Plant and Equipm37
3. Property, Plant and Equipment (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Disclosure3.PropertyPlantAndEquipmentDetailsAbstract | ||
Land | $ 2,734 | $ 2,753 |
Plant and Buildings | 81,929 | 82,338 |
Furniture and fixtures | 493 | 458 |
Machinery and equipment | 4,043 | 4,063 |
Construction in progress | 124 | 148 |
Total gross property, plant & equipment | 89,323 | 89,760 |
Less accumulated depreciation | (17,389) | (13,950) |
Total net property, plant & equipment | $ 71,934 | $ 75,810 |
3. Property, Plant and Equipm38
3. Property, Plant and Equipment (Details 1) | 9 Months Ended |
Sep. 30, 2015 | |
Plant and Buildings | Minimum | |
Depreciation (years) | 20 years |
Plant and Buildings | Maximum [Member] | |
Depreciation (years) | 30 years |
Machinery and Equipment | Minimum | |
Depreciation (years) | 5 years |
Machinery and Equipment | Maximum [Member] | |
Depreciation (years) | 7 years |
Furniture and Fixtures | Minimum | |
Depreciation (years) | 3 years |
Furniture and Fixtures | Maximum [Member] | |
Depreciation (years) | 5 years |
3. Property, Plant and Equipm39
3. Property, Plant and Equipment (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Disclosure3.PropertyPlantAndEquipmentDetailsNarrativeAbstract | ||||
Depreciation expense | $ 1,200 | $ 1,200 | $ 3,560 | $ 3,486 |
4. Intangible Assets and Good40
4. Intangible Assets and Goodwill (Details) $ in Thousands | Sep. 30, 2015USD ($) |
Intangible Assets And Goodwill Details | |
2,016 | $ 80 |
2,017 | 104 |
2,018 | 112 |
2,019 | 180 |
2,020 | 134 |
Thereafter | 866 |
Total | $ 1,476 |
4. Intangible Assets and Good41
4. Intangible Assets and Goodwill (Details Narrative) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Amortization expense | $ 96 | $ 95 |
Intangible assets | 1,476 | |
Goodwill | 1,000 | |
Patents | ||
Amortization expense | 60 | $ 60 |
Intangible assets | 900 | |
In-process research and development | ||
Intangible assets | $ 600 |
5. Notes Payable (Details)
5. Notes Payable (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Total revenues | ||
Third Eye Capital term note | $ 6,164 | $ 7,394 |
Third Eye Capital revolving credit facility | 25,061 | 22,330 |
Third Eye Capital revenue participation term note | 10,352 | 10,195 |
Third Eye Capital acquisition term note | 17,981 | 17,728 |
Cilion shareholder Seller note payable | 5,485 | 5,373 |
State Bank of India secured term loan | 5,292 | 6,032 |
Subordinated notes | 5,813 | 5,428 |
EB-5 long term promissory notes | 23,762 | 1,534 |
Unsecured working capital loans and short-term notes | 1,383 | 1,287 |
Total debt | 101,293 | 77,301 |
Less current portion of debt | 12,630 | 12,746 |
Total long term debt | $ 88,663 | $ 64,555 |
5. Notes Payable (Details 1)
5. Notes Payable (Details 1) $ in Thousands | Sep. 30, 2015USD ($) |
For the twelve months ending | |
2,016 | $ 12,630 |
2,017 | 63,749 |
2,018 | 3,500 |
2,019 | 23,235 |
Total debts | 103,114 |
Discounts | (1,821) |
Total debt, net of discounts | $ 101,293 |
5. Notes Payable (Details Narra
5. Notes Payable (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Interest payments | $ 356 | $ 6,751 | |||
Third Eye Capital Term Notes | |||||
Principal and interest outstanding | $ 6,200 | 6,200 | |||
Unamortized discount | 200 | 200 | |||
Third Eye Capital Revolving Credit Facility | |||||
Principal and interest outstanding | 25,100 | 25,100 | |||
Unamortized discount | 700 | 700 | |||
Third Eye Capital Revenue Participation Term Notes | |||||
Principal and interest outstanding | 10,400 | 10,400 | |||
Unamortized discount | 700 | 700 | |||
Third Eye Capital Acquisition Term Notes | |||||
Principal and interest outstanding | 18,000 | 18,000 | |||
Unamortized discount | 500 | 500 | |||
Cilion shareholder Seller note payable | |||||
Principal and interest outstanding | 5,500 | 5,500 | |||
State Bank of India secured term loan | |||||
Principal and interest outstanding | 1,500 | 1,500 | $ 2,600 | ||
Default interest payable | 3,800 | 3,800 | 3,400 | ||
Subordinated Notes | |||||
Principal and interest outstanding | 5,800 | 5,800 | 5,400 | ||
Unamortized discount | 400 | 400 | 200 | ||
EB-5 long-term promissory notes | |||||
Principal and interest outstanding | 36,000 | 36,000 | |||
Unsecured working capital loans | |||||
Principal and interest outstanding | 1,400 | 1,400 | $ 1,300 | ||
Principal payments made | 2,300 | $ 1,800 | 3,300 | 4,200 | |
Interest payments | $ 73 | $ 48 | $ 177 | $ 127 |
6. Commitments and Contingenc45
6. Commitments and Contingencies (Details) $ in Thousands | Sep. 30, 2015USD ($) |
Commitments And Contingencies Details | |
2,016 | $ 443 |
2,017 | 458 |
2,018 | 475 |
2,019 | 491 |
2,020 | 335 |
Total | $ 2,202 |
6. Commitments and Contingenc46
6. Commitments and Contingencies (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Commitments And Contingencies Details Narrative | ||||
Rent expense | $ 134 | $ 108 | $ 356 | $ 320 |
7. Outstanding Warrants (Detail
7. Outstanding Warrants (Details) - $ / shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Sep. 30, 2015 | |
Outstanding Warrants Details | ||||
Number of Warrants Outstanding, Beginning | 351 | 351 | 351 | 351 |
Number of Warrants Expired | (3) | 0 | 0 | |
Number of Warrants Granted | 113 | 0 | 116 | |
Number of Warrants Exercised | (119) | 0 | (116) | |
Number of Warrants Outstanding, Ending | 342 | 351 | 351 | 342 |
Weighted Average Exercise Price Outstanding, Beginning | $ 3.05 | $ 3.05 | $ 3.05 | $ 3.05 |
Weighted Average Exercise Price Expired | 1.30 | 0 | 0 | |
Weighted Average Exercise Price Granted | 0.01 | 0 | .01 | |
Weighted Average Exercise Price Exercised | 0.08 | 0 | .01 | |
Weighted Average Exercise Price Outstanding, Ending | $ 3.10 | $ 3.05 | $ 3.05 | $ 3.10 |
Weighted Average Remaining Contractual Life (in years) Outstanding, Beginning | 2 years 2 months 12 days | 2 years 5 months 12 days | 2 years 8 months 8 days | |
Weighted Average Remaining Contractual Life (in years) Outstanding, Ending | 1 year 11 months 26 days | 2 years 2 months 12 days | 2 years 5 months 12 days |
8. Fair Value of Warrants (Deta
8. Fair Value of Warrants (Details) | 9 Months Ended |
Sep. 30, 2015$ / shares | |
Expected dividend yield | 0.00% |
Exercise price | $ 0.01 |
Company stock price | $ 2.75 |
Minimum | |
Risk-free interest rate | 0.49% |
Expected volatility | 77.37% |
Expected Life (years) | 1 year 8 months 12 days |
Maximum [Member] | |
Risk-free interest rate | 0.78% |
Expected volatility | 82.25% |
Expected Life (years) | 2 years 3 months 18 days |
9. Fair Value Measurements (Det
9. Fair Value Measurements (Details) $ in Thousands | Sep. 30, 2015USD ($) |
Warranty liability | $ 51 |
Level 1 | |
Warranty liability | 0 |
Level 2 | |
Warranty liability | 0 |
Level 3 | |
Warranty liability | $ 51 |
9. Fair Value Measurements (D50
9. Fair Value Measurements (Details 1) - USD ($) $ in Thousands | 3 Months Ended | ||
Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | |
Fair Value Measurements Details 1 | |||
Beginning Balance | $ 67 | $ 79 | $ 108 |
Related change in fair value | (16) | (12) | (29) |
Ending Balance | $ 51 | $ 67 | $ 79 |
10. Stock-Based Compensation (D
10. Stock-Based Compensation (Details) - $ / shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Sep. 30, 2015 | |
Number of Shares Granted | 113 | 0 | 116 | |
Number of Shares Forfeited/Expired | 3 | 0 | 0 | |
Weighted Average Exercise Price Outstanding, Beginning | $ 3.05 | $ 3.05 | $ 3.05 | $ 3.05 |
Weighted Average Exercise Price Granted | 0.01 | 0 | .01 | |
Weighted Average Exercise Price Exercised | 0.08 | 0 | .01 | |
Weighted Average Exercise Price Outstanding, Ending | $ 3.10 | $ 3.05 | $ 3.05 | $ 3.10 |
Employee Stock Plan | ||||
Shares Available for Grant, Beginning | 5 | 5 | ||
Shares Available for Grant, Authorized | 200 | |||
Shares Available for Grant, Granted | (173) | |||
Shares Available for Grant, Exercised | 0 | |||
Shares Available for Grant, Forfeited/Expired | 85 | |||
Shares Available for Grant, Ending | 117 | 117 | ||
Number of Shares Outstanding, Beginning | 1,015 | |||
Number of Shares Authorized | 0 | |||
Number of Shares Granted | 173 | |||
Number of Shares Exercised | (137) | |||
Number of Shares Forfeited/Expired | (85) | |||
Number of Shares Outstanding, Ending | 966 | |||
Weighted Average Exercise Price Outstanding, Beginning | $ 5.51 | $ 5.51 | ||
Weighted Average Exercise Price Authorized | 0 | |||
Weighted Average Exercise Price Granted | 4.28 | |||
Weighted Average Exercise Price Exercised | 3.79 | |||
Weighted Average Exercise Price Forfeited/Expired | 3.23 | |||
Weighted Average Exercise Price Outstanding, Ending | $ 5.88 | $ 5.88 |
11. Agreements (Details)
11. Agreements (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Agreements Details | ||||
Ethanol sales | $ 23,906 | $ 33,641 | $ 70,765 | $ 121,388 |
Wet distiller's grains sales | 5,609 | 8,175 | 19,568 | 30,970 |
Corn oil sales | 835 | 1,018 | 2,771 | 3,263 |
Corn purchases | 24,056 | 27,616 | 74,949 | 94,563 |
Milo purchases | 0 | 0 | 0 | 0 |
Accounts receivable | 312 | 0 | 312 | 0 |
Accounts payable | $ 1,539 | $ 1,904 | $ 1,539 | $ 1,904 |
11. Agreements (Details Narrati
11. Agreements (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Agreements | ||||
Marketing costs | $ 600 | $ 700 | $ 1,800 | $ 2,300 |
12. Segment Information (Detail
12. Segment Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Revenues | ||||
North America | $ 32,444 | $ 42,886 | $ 99,795 | $ 155,966 |
India | 6,066 | 5,462 | 11,508 | 10,242 |
Total revenues | 38,510 | 48,348 | 111,303 | 166,208 |
Cost of goods sold | ||||
North America | 31,603 | 35,632 | 97,489 | 121,754 |
India | 5,873 | 5,001 | 11,059 | 9,762 |
Total cost of goods sold | 37,476 | 40,633 | 108,548 | 131,516 |
Gross profit (loss) | ||||
North America | 841 | 7,254 | 2,306 | 34,212 |
India | 193 | 461 | 449 | 480 |
Total gross profit (loss) | $ 1,034 | $ 7,715 | $ 2,755 | $ 34,692 |
12. Segment Information (Deta55
12. Segment Information (Details 1) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Segment Information Details 1 | ||
North America | $ 74,908 | $ 76,066 |
India | 12,059 | 13,110 |
Total Assets | $ 86,967 | $ 89,176 |
13. Related Party Transactions
13. Related Party Transactions (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Related party transaction | $ 16 | $ 23 | |||
Eric McAfee and McAfee Capital | |||||
Related party debt | $ 400 | $ 400 | $ 400 | ||
Related party transaction | $ 54 | $ 142 |