Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2021 | Apr. 30, 2021 | |
Cover [Abstract] | ||
Entity Registrant Name | AEMETIS, INC. | |
Entity Central Index Key | 0000738214 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2021 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Is Entity's Reporting Status Current? | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Emerging Growth Company | false | |
Entity Small Business | true | |
Entity Shell Company | false | |
Entity Interactive Data Current | Yes | |
Entity Incorporation, State or Country Code | NV | |
Entity File Number | 001-36475 | |
Entity Common Stock, Shares Outstanding | 31,414,465 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2021 |
CONSOLIDATED CONDENSED BALANCE
CONSOLIDATED CONDENSED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Current assets: | ||
Cash and cash equivalents ($1,102 and $235 respectively from VIE) | $ 15,787 | $ 592 |
Accounts receivable, net of allowance for doubtful accounts of $647 and $0 as of September 30, 2020 and December 31, 2019 | 1,755 | 1,821 |
Inventories | 4,210 | 3,969 |
Prepaid expenses ($135 and $192 respectively from VIE) | 2,141 | 750 |
Other current assets ($91 and $741 respectively from VIE) | 323 | 1,551 |
Total current assets | 24,216 | 8,683 |
Property, plant and equipment, net ($26,440 and $22,628 respectively from VIE) | 113,090 | 109,880 |
Operating lease right-of-use assets ($23 and $28 respectively from VIE) | 2,783 | 2,889 |
Other assets ($24 and $24 respectively from VIE) | 3,644 | 3,687 |
Total assets | 143,733 | 125,139 |
Current liabilities: | ||
Accounts payable ($6,988 and $6,271 respectively from VIE) | 17,574 | 20,739 |
Current portion of long term debt | 11,848 | 44,974 |
Short term borrowings | 13,559 | 14,541 |
Mandatorily redeemable Series B convertible preferred stock | 3,277 | 3,252 |
Accrued property taxes | 6,085 | 5,674 |
Accrued contingent litigation fees | 6,200 | 6,200 |
Current portion of operating lease liability ($10 and $10 respectively from VIE) | 325 | 316 |
Current portion of Series A preferred units ($3,000 and $2,015 respectively from VIE) | 3,000 | 2,015 |
Other current liabilities ($300 and $129 respectively from VIE) | 4,498 | 4,524 |
Total current liabilities | 66,366 | 102,235 |
Long term liabilities: | ||
Senior secured notes and revolving notes | 129,968 | 125,624 |
EB-5 notes | 32,500 | 32,500 |
Other long term debt | 11,540 | 11,980 |
Series A preferred units ($36,293 and $32,022 respectively from VIE) | 36,293 | 32,022 |
Operating lease liability ($8 and $11 respectively from VIE) | 2,502 | 2,578 |
Other long term liabilities ($77 and $74 respectively from VIE) | 2,931 | 2,944 |
Total long term liabilities | 215,734 | 207,648 |
Stockholders' deficit: | ||
Series B convertible preferred stock, $0.001 par value; 7,235 authorized; 1,323 shares issued and outstanding each period, respectively (aggregate liquidation preference of $3,969 for each period respectively) | 1 | 1 |
Common stock, $0.001 par value; 40,000 authorized; 29,851 and 22,830 shares issued and outstanding each period, respectively | 30 | 23 |
Additional paid-in capital | 157,933 | 93,426 |
Accumulated deficit | (292,192) | (274,080) |
Accumulated other comprehensive loss | (4,139) | (4,114) |
Total stockholders' deficit | (138,367) | (184,744) |
Total liabilities and stockholders' deficit | $ 143,733 | $ 125,139 |
CONSOLIDATED CONDENSED BALANC_2
CONSOLIDATED CONDENSED BALANCE SHEETS (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Allowance for doubtful accounts | $ 1,404 | $ 1,260 |
Series B preferred stock, par value | $ 65,000 | $ 65,000 |
Series B preferred stock, authorized (in thousands) | 1,323 | 1,323 |
Series B preferred stock, shares issued (in thousands) | 1,323 | 1,323 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in thousands) | 40,000 | 40,000 |
Common stock, shares issued (in thousands) | 29,851 | 22,830 |
Common stock, shares outstanding (in thousands) | 29,851 | 22,830 |
Series B Convertible Preferred Stock | ||
Series B preferred stock, par value | $ 0.001 | $ 0.001 |
Series B preferred stock, authorized (in thousands) | 7,235 | 7,235 |
Series B preferred stock, shares issued (in thousands) | 1,323 | 1,323 |
Series B preferred stock, shares outstanding (in thousands) | 1,323 | 1,323 |
Aggregate liquidation preference | $ 3,969 | $ 3,969 |
CONSOLIDATED CONDENSED STATEMEN
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Income Statement [Abstract] | ||
Revenues | $ 42,807 | $ 39,480 |
Cost of goods sold | 46,415 | 39,913 |
Gross profit | (3,608) | (433) |
Research and development expenses | 23 | 117 |
Selling, general and administrative expenses | 5,382 | 3,936 |
Operating income loss | (9,013) | (4,486) |
Interest expense | ||
Interest rate expense | 5,965 | 5,586 |
Debt related fees and amortization expense | 1,215 | 1,290 |
Accretion of Series A preferred units | 1,943 | 960 |
Other income | (31) | (63) |
Loss before income taxes | (18,105) | (12,259) |
Income tax expense (benefit) | 7 | (207) |
Net loss | (18,112) | (12,052) |
Other comprehensive income (loss) | ||
Foreign currency translation loss | (25) | (668) |
Comprehensive loss | $ (18,137) | $ (12,720) |
Net loss per common share attributable to Aemetis, Inc. | ||
Basic | $ (0.69) | $ (0.58) |
Diluted | $ (0.69) | $ (0.58) |
Weighted average shares outstanding | ||
Basic (in thousands) | 26,289 | 20,651 |
Diluted (in thousands) | 26,289 | 20,651 |
CONSOLIDATED CONDENSED STATEM_2
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Operating activities: | ||
Net loss | $ (18,112) | $ (12,052) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||
Share-based compensation | 835 | 310 |
Depreciation | 1,386 | 1,090 |
Debt related fees and amortization expense | 1,215 | 1,290 |
Intangibles and other amortization expense | 12 | 12 |
Accretion of Series A preferred units | 1,943 | 960 |
Deferred tax benefit | 0 | (215) |
Provision for bad debts | 144 | 0 |
Changes in operating assets and liabilities: | ||
Accounts receivable | (78) | 384 |
Inventories | (242) | 1,075 |
Prepaid expenses | (1,391) | (117) |
Other assets | 1,363 | 428 |
Accounts payable | (1,795) | 1,074 |
Accrued interest expense and fees | 571 | 5,440 |
Other liabilities | 76 | 931 |
Net cash provided by (used in) operating activities | (14,073) | 610 |
Investing activities: | ||
Capital expenditures | (6,560) | (2,372) |
Grant proceeds received for capital expenditures | 1,191 | 0 |
Net cash used in investing activities | (5,369) | (2,372) |
Financing activities: | ||
Proceeds from borrowings | 0 | 3,780 |
Repayments of borrowings | (31,631) | (3,645) |
Grant proceeds received for capital expenditures | 115 | 0 |
Payments on finance leases | (124) | 0 |
Proceeds from issuance of common stock in equity offering | 62,438 | 0 |
Proceeds from the exercise of stock options | 1,003 | 0 |
Proceeds from Series A preferred units financing | 3,130 | 1,285 |
Series A preferred financing redemption | (300) | 0 |
Net cash provided by financing activities | 34,631 | 1,420 |
Effect of exchange rate changes on cash and cash equivalents | 6 | (11) |
Net cash and cash equivalents for period | 15,195 | (353) |
Cash and cash equivalents at beginning of period | 592 | 656 |
Cash and cash equivalents at end of period | 15,787 | 303 |
Supplemental disclosures of cash flow information, cash paid: | ||
Cash paid for interest | 5,296 | 182 |
Income taxes paid | 7 | 8 |
Supplemental disclosures of cash flow information, non-cash transactions: | ||
Subordinated debt extension fees added to debt | 340 | 340 |
Fair value of warrants issued to subordinated debt holders | 281 | 93 |
TEC debt extension, waiver fees, promissory notes fees added to debt | 1,215 | 29 |
Capital expenditures in accounts payable | 4,556 | 2,289 |
Capital expenditures purchased on financing | $ 0 | $ 5,652 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY - USD ($) $ in Thousands | Series B Convertible Preferred Stock | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Accumulated Other Comprehensive Income/(Loss) | Total |
Beginning balance, shares (in thousands) at Dec. 31, 2019 | 1,323 | 20,570 | ||||
Beginning balance, amount at Dec. 31, 2019 | $ 1 | $ 21 | $ 86,852 | $ (237,421) | $ (3,825) | $ (154,372) |
Stock-based compensation | 310 | 310 | ||||
Issuance and exercise of warrants, shares (in thousands) | 113 | |||||
Issuance and exercise of warrants, amount | 93 | 93 | ||||
Foreign currency translation (loss) gain | (668) | (668) | ||||
Net income (loss) | (12,052) | (12,052) | ||||
Ending balance, shares (in thousands) at Mar. 31, 2020 | 1,323 | 20,683 | ||||
Ending balance, amount at Mar. 31, 2020 | $ 1 | $ 21 | 87,255 | (249,473) | (4,493) | (166,689) |
Beginning balance, shares (in thousands) at Dec. 31, 2020 | 1,323 | 22,830 | ||||
Beginning balance, amount at Dec. 31, 2020 | $ 1 | $ 23 | 93,426 | (274,080) | (4,114) | (184,744) |
Issuance of common stock, shares | 5,682 | |||||
Issuance of common stock, amount | $ 6 | 62,389 | $ 62,395 | |||
Stock options exercised, shares | 1,226 | 0 | ||||
Stock options exercised, amount | $ 1 | 1,002 | $ 1,003 | |||
Stock-based compensation | 835 | 835 | ||||
Issuance and exercise of warrants, shares (in thousands) | 113 | |||||
Issuance and exercise of warrants, amount | 281 | 281 | ||||
Foreign currency translation (loss) gain | (25) | (25) | ||||
Net income (loss) | (18,112) | (18,112) | ||||
Ending balance, shares (in thousands) at Mar. 31, 2021 | 1,323 | 29,851 | ||||
Ending balance, amount at Mar. 31, 2021 | $ 1 | $ 30 | $ 157,933 | $ (292,192) | $ (4,139) | $ (138,367) |
1. Nature of Activities and Sum
1. Nature of Activities and Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
1. Nature of Activities and Summary of Significant Accounting Policies | Nature of Activities Founded in 2006, we own and operate a 65 million gallon per year ethanol production facility located in Keyes, California (the “Keyes Plant”). In addition to low carbon renewable fuel ethanol, the Keyes Plant produces Wet Distillers Grains (“WDG”), Distillers Corn Oil (“DCO”), and Condensed Distillers Solubles (“CDS”), all of which are sold to local dairies and feedlots as animal feed. We also own and operate a 50 million gallon per year renewable chemical and advanced fuel production facility (“Kakinada Plant”) on the East Coast of India that produces high quality distilled biodiesel and refined glycerin for customers in India and Europe. We operate a research and development laboratory to develop efficient conversion technologies using waste feedstocks to produce biofuels and biochemicals. Additionally, we own a partially completed plant in Goodland, Kansas (the “Goodland Plant”) through our subsidiary Goodland Advanced Fuels, Inc., (“GAFI”), which was formed to acquire the Goodland Plant. On December 31, 2019 we exercised an option to acquire all capital stock of GAFI for $10 and consolidated assets, liabilities, and equity of GAFI are included as a wholly owned subsidiary from December 31, 2019. We lease a site in Riverbank, California, near the Keyes Plant, where we plan to utilize biomass-to-fuel technology that we have licensed from LanzaTech Technology (“LanzaTech”) and InEnTec Technology (“InEnTec”) to build a cellulosic ethanol production facility (the “Riverbank Cellulosic Ethanol Facility”). By producing ultra-low carbon renewable cellulosic ethanol, we expect to capture higher value D3 RINs and California’s LCFS credits. D3 RINs have a higher value in the marketplace than D6 RINs due to D3 RINs’ relative scarcity and mandated pricing formula from the United States EPA. We also own and operate the Kakinada Plant with a nameplate capacity of 150 thousand metric tons per year, or about 50 million gallons per year. We believe the Kakinada Plant is one of the largest biodiesel production facilities in India on a nameplate capacity basis. The Kakinada Plant is capable of processing a variety of vegetable oils and animal fat waste feedstocks into biodiesel that meet international product standards. The Kakinada Plant also distills the crude glycerin byproduct from the biodiesel refining process into refined glycerin, which is sold to the pharmaceutical, personal care, paint, adhesive and other industries. During 2018, Aemetis Biogas, LLC (“ABGL”) was formed to construct bio-methane anaerobic digesters at local dairies near the Keyes Plant, many of whom also purchase WDG produced at the Keyes Plant. The digesters are connected via a pipeline owned by ABGL to a gas cleanup and compression unit being built at the Keyes Plant to produce Renewable Natural Gas (“RNG”). During the third quarter of 2020, ABGL completed construction on the first two diary digesters along with the pipeline that carries bio-methane from these dairies to the Keyes Plant. Upon receiving the bio-methane from the dairies, impurities are removed, and the bio-methane is converted to RNG where it will be either injected into the local gas utility pipeline, supplied to a renewable compressed natural gas (“RCNG”) truck loading station that will service local trucking fleets, or used as renewable energy at the Keyes Plant. In December 2018, we acquired a 5.2-acre parcel of land for the construction of a gas-to-liquid CO₂ production facility by Messer. Aemetis sells carbon dioxide (“CO₂”) produced at the Keyes Plant (the “CO₂ Project”) to Messer for conversion and sale into the food processing, beverage, and technology sectors. We commenced operations in late April 2020 and started recognizing revenue from this project in the second quarter of 2020. On March 18, 2020, in order to address a worldwide shortage of hand sanitizer during the COVID-19 pandemic, the US Treasury Tobacco and Alcohol Tax and Trade Bureau (the “TTB”) provided emergency waivers allowing fuel ethanol plants to produce high-grade alcohol for use in the production of hand sanitizer. Immediately following the emergency waiver for ethanol producers in March, Aemetis began supplying high-grade alcohol for the production of hand sanitizer. During the first week of April 2020, Aemetis applied for and was approved by the TTB as a Distilled Spirits Producer (“DSP”), allowing the Company to produce fuel ethanol, high-grade alcohol for sanitizer, and other health care and sanitary products, as well as industrial alcohol and potable alcohol for beverage spirits. To further address this market, Aemetis began a series of capital projects at the Keyes Plant that will ultimately enable the Company to produce US Pharmacopeia (“USP”) grade alcohol for sale into these key medical, consumer, governmental and industrial alcohol markets. During June 2020, Aemetis renamed Biofuels Marketing, Inc. as Aemetis Health Products, Inc., and began a sales and marketing strategy of blending, bottling, and selling hand sanitizer into bulk, retail branded, and white label markets. Additionally, Aemetis Health Products, Inc. is developing sales and marketing channels for other personal protective equipment. In December 2020, Aemetis Properties Riverbank, Inc., acquired less than a 20% ownership in Nevo Motors, Inc. (“Nevo Motors”). Under this agreement, Nevo Motors will utilize certain of Aemetis’ existing and future manufacturing facilities and fueling stations, as well as renewable natural gas and renewable electricity produced by Aemetis. The investment has been recorded at zero value as of March 31, 2021 and December 31, 2020. During the first quarter of 2021, Aemetis announced its “Carbon Zero” biofuels production plants designed to produce biofuels, including renewable jet and diesel fuel utilizing cellulosic hydrogen and non-edible renewable oils sourced from existing Aemetis biofuels plants and other sources. The first plant, in Riverbank, California, “Carbon Zero 1”, is expected to utilize hydroelectric and other renewable power available onsite to produce 45 million gallons per year of jet fuel, renewable diesel, and other byproducts. The plant is expected to supply the aviation and truck markets with ultra-low carbon renewable fuels to reduce greenhouse gas (“GHG”) emissions and other pollutants associated with conventional petroleum-based fuels. On April 1, 2021, Aemetis established a new subsidiary named Aemetis Carbon Capture, Inc. that is expected to initially capture, dehydrate, compress, and sequester CO₂ from Aemetis Biogas dairy digester projects. Additional capacity for the capture and storage of CO₂ from other carbon emission sources is under development. Basis of Presentation and Consolidation All intercompany balances and transactions have been eliminated in consolidation. The accompanying consolidated condensed balance sheet as of March 31, 2021, the consolidated condensed statements of operations and comprehensive loss for the three months ended March 31, 2021 and 2020, the consolidated condensed statements of cash flows for the three months ended March 31, 2021 and 2020, and the consolidated condensed statements of stockholders’ deficit for the three months ended March 31, 2021 and 2020 are unaudited. The consolidated condensed balance sheet as of December 31, 2020 was derived from the 2020 audited consolidated financial statements and notes thereto. The consolidated condensed financial statements in this report should be read in conjunction with the 2020 audited consolidated financial statements and notes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, 2020. 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 Company’s management, the unaudited interim consolidated condensed financial statements for the three months ended March 31, 2021 and 2020 have been prepared on the same basis as the audited consolidated statements as of December 31, 2020 and reflect all adjustments, consisting primarily of normal recurring adjustments, necessary for the fair presentation of its statement of financial position, results of operations and cash flows. The results of operations for the three months ended March 31, 2021 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 North America: During the first quarter of 2020, Aemetis began selling high-grade alcohol for consumer applications directly to customers on the West Coast and Midwest using a variety of payment terms. These agreements and terms were evaluated according to ASC 606 guidance and such revenue is recognized upon satisfaction of the performance obligation by delivery of the product based on the terms of the agreement. Sales of high-grade alcohol represented less than 3% of quarterly revenue, and as such aggregated with ethanol sales for the three months ended March 31, 2020. The Company had no sales of high-grade alcohol in the three months ended March 31, 2021. The below table shows our sales in North America by product category: North America (in thousands) For the three months ended March 31, 2021 2020 Ethanol and high-grade alcohol sales $ 29,920 $ 25,322 Wet distiller's grains sales 11,035 8,374 Other sales 1,373 2,176 $ 42,328 $ 35,872 We have elected to adopt the practical expedient that allows for ignoring the significant financing component of a contract when estimating the transaction price when the transfer of promised goods to the customer and customer payment for such goods are expected to be within one year of contract inception. Further, we have elected to adopt the practical expedient in which incremental costs of obtaining a contract are expensed when the amortization period would otherwise be less than one year. We also assessed principal versus agent criteria as we buy our feedstock from our customers and process and sell finished goods to those customers in certain contractual agreements. In North America, we buy corn as feedstock for the production of ethanol, from our working capital partner J.D. Heiskell. Prior to May 13, 2020, we sold all our ethanol, WDG, and corn oil to J.D. Heiskell. Subsequent to May 13, 2020, we sold most of our fuel ethanol to one customer, Kinergy, and sold all WDG and corn oil to J.D. Heiskell. We consider the purchase of corn as a cost of goods sold and the sale of ethanol, upon transfer to the common carrier, as revenue on the basis that (i) we control and bear the risk of gain or loss on the processing of corn which is purchased at market prices into ethanol and (ii) we have legal title to the goods during the processing time. The pricing for both corn and ethanol is set independently. Revenues from sales of ethanol and its co-products are billed net of the related transportation and marketing charges. The transportation component is accounted for in cost of goods sold and the marketing component is accounted for in sales, general and administrative expense. Transportation and marketing charges are known within days of the transaction and are recorded at the actual amounts. The Company has elected an accounting policy under which these charges have been treated as fulfillment activities provided after control has transferred. As a result, these charges are recognized in cost of goods sold and selling, general and administrative expenses, respectively, when revenue is recognized. Revenues are recorded at the gross invoiced amount. Hence, we are the principal in North America sales scenarios where our customer and vendor may be the same. We have a contract liability of $0.2 million as of March 31, 2021 and December 31, 2020, in connection with a contract with a customer to sell carbon credit allowances. India: The below table shows our sales in India by product category: India (in thousands) For the three months ended March 31, 2021 2020 Biodiesel sales $ 358 $ 2,793 Refined glycerin sales 116 90 PFAD sales - 712 Other sales 5 13 $ 479 $ 3,608 In India, we also assessed principal versus agent criteria as we buy our feedstock from our customers and process and sell finished goods to those same customers in certain contractual agreements. In those cases, we receive the legal title to feedstock from our customers once it is on our premises. We control the processing and production of biodiesel based on contract terms and specifications. The pricing for both feedstock and biodiesel is set independently. We hold the title and risk to biodiesel according to agreements when we enter into in these situations. Hence, we are the principal in India sales scenarios where our customer and vendor may be the same. Cost of Goods Sold 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 receivables are charged against the allowance for doubtful accounts once un-collectability has been determined. The factors considered in reaching this determination are the apparent financial condition of the customer and the Company’s success in contacting and negotiating with the customer. If the financial condition of the Company’s customers were to deteriorate, additional allowances may be required. We reserved $1.4 million and $1.3 million in the allowances for doubtful accounts as of March 31, 2021 and December 31, 2020, respectively. Inventories Investments. Cost Method Investments Variable Interest Entities. Property, Plant and Equipment 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, California Energy Commission Low-Carbon Fuel Production Program California Department of Food and Agriculture Dairy Digester Research and Development Grant California Energy Commission Low Carbon Advanced Ethanol Grant Program. Basic and Diluted Net Loss per Share. The following table shows the number of potentially dilutive shares excluded from the diluted net loss per share calculation as of March 31, 2021 and 2020: As of March 31, 2021 March 31, 2020 Series B preferred (post split basis) 132 132 Common stock options and warrants 5,080 5,688 Debt with conversion feature at $30 per share of common stock 1,286 1,269 Total number of potentially dilutive shares excluded from the diluted loss per share calculation 6,498 7,089 Comprehensive Loss. Comprehensive Income Foreign Currency Translation/Transactions. Operating Segments. The “North America” operating segment includes the Company’s 65 million gallons per year capacity Keyes Plant in California, the cellulosic ethanol facility in Riverbank, the cluster of biogas digesters on dairies near Keyes, California, the Goodland Plant, Kansas and the research and development facility in Minnesota. The “India” operating segment includes the Company’s 50 million gallon per year capacity Kakinada Plant in 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 Commitments and Contingencies. Contingencies Convertible Instruments Debt Modification Accounting Debt–Modification and Extinguishments Recently Issued Accounting Pronouncements ASU 2016-13: Measurement of Credit Losses on Financial Instruments. For a complete summary of the Company’s significant accounting policies, please refer to the Company’s audited financial statements and notes thereto for the years ended December 31, 2020 and 2019 included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 15, 2021. |
2. Inventories
2. Inventories | 3 Months Ended |
Mar. 31, 2021 | |
Inventory Disclosure [Abstract] | |
2. Inventories | Inventories consist of the following: As of March 31, 2021 December 31, 2020 Raw materials $ 1,321 $ 1,382 Work-in-progress 1,938 1,266 Finished goods 951 1,321 Total inventories $ 4,210 $ 3,969 As of March 31, 2021 and December 31, 2020, the Company recognized a lower of cost or market impairment of $0.1 million and $0.7 million respectively, related to inventory. |
3. Property, Plant and Equipmen
3. Property, Plant and Equipment | 3 Months Ended |
Mar. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
3. Property, Plant and Equipment | Property, plant and equipment consist of the following: As of March 31, 2021 December 31, 2020 Land $ 4,091 $ 4,092 Plant and buildings 97,249 97,398 Furniture and fixtures 1,191 1,195 Machinery and equipment 5,272 5,188 Construction in progress 30,032 25,397 Property held for development 15,408 15,408 Finance lease right of use assets 2,308 2,308 Total gross property, plant & equipment 155,551 150,986 Less accumulated depreciation (42,461 ) (41,106 ) Total net property, plant & equipment $ 113,090 $ 109,880 For the three months ended March 31, 2021 and 2020, interest capitalized in property, plant and equipment was $0.6 and $0.1 million, respectively. Construction in progress contains incurred costs for the Biogas Project, Riverbank Project, and Zebrex equipment installation at the Keyes Plant. In the second quarter of 2020, CO₂ Project commenced operations and was placed in service at that time. In the third quarter of 2020, two diary digesters commenced operations and were placed in service at that time. Given there are several ongoing capital projects, their capital expenses have been accumulated in construction in progress and will be capitalized and depreciated once the capital projects are finished and are in service. Years Plant and buildings 20 - 30 Machinery and equipment 5 - 15 Furniture and fixtures 3 - 5 For the three months ended March 31, 2021 and 2020, the Company recorded depreciation expense of $1.4 and $1.1 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 was no impairment on the long-lived assets during the three months ended March 31, 2021 and 2020. |
4. Debt
4. Debt | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
4. Debt | Debt consists of the following: March 31, 2021 December 31, 2020 Third Eye Capital term notes $ 7,095 $ 7,066 Third Eye Capital revolving credit facility 85,105 80,310 Third Eye Capital revenue participation term notes 11,913 11,864 Third Eye Capital acquisition term notes 26,463 26,384 Third Eye Capital promissory note - 1,444 Cilion shareholder seller notes payable 6,311 6,274 Subordinated notes 12,973 12,745 Term loan on Equipment purchase 5,652 5,652 EB-5 promissory notes 42,769 43,120 PPP loans 1,134 1,134 GAFI Term and Revolving loans - 33,626 Total debt 199,415 229,619 Less current portion of debt 25,407 59,515 Total long term debt $ 174,008 $ 170,104 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 (the “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 (the “Revenue Participation Term Notes”); and (iv) senior secured term loans in an aggregate principal amount of $15.0 million (the “Acquisition Term Notes”) used to fund the cash portion of the acquisition of Cilion, Inc. (the Term Notes, Revolving Credit Facility, Revenue Participation Term Notes and Acquisition Term Notes are referred to herein collectively as the “Original Third Eye Capital Notes”). On April 1, 2020, the Company exercised the option to extend the maturity of Third Eye Capital Notes to April 1, 2021 for a fee of 1% of the outstanding note balance instead of agreed fee of 5% in Amendment No.14 to the Note Purchase Agreement. We have evaluated the reduction in extension fee to 1% in accordance with ASC 470-60 Troubled Debt Restructuring. According to the guidance, we considered the 1% extension fee to be a troubled debt restructuring. On August 11, 2020, Third Eye Capital agreed to Limited Waiver and Amendment No. 17 to the Note Purchase Agreement (“Amendment No. 17”), to (i) provide that the maturity date of the Third Eye Capital Notes may be further extended at our election to April 1, 2022 in exchange for an extension fee equal to 1% of the Note Indebtedness in respect to each Note, provided that such fee may be added to the outstanding principal balance of each Note on the effective date of each such extension, (ii) provide for a waiver of the ratio of note indebtedness covenant for the quarters ended March 31, 2021 and June 30, 2021. As consideration for such amendment and waivers, the borrowers also agreed to pay Third Eye Capital an amendment and waiver fee of $0.3 million in cash (the “Amendment No. 17 Fee”). On November 5, 2020, Third Eye Capital agreed to Limited Waiver and Amendment No. 18 to the Note Purchase Agreement (“Amendment No. 18”) to provide for a waiver of the ratio of note indebtedness covenant for the quarter ended September 30, 2021. As consideration for such amendment and waivers, the borrowers also agreed to pay Third Eye Capital an amendment fee of $50 thousand. We have evaluated the 1% extension fee in Amendment No. 17, and the $50 thousand waiver fee in Amendment No. 18 in accordance with ASC 470-60 Troubled Debt Restructuring According to the guidance, we considered the 1% extension fee in Amendment No.17 and the $50 thousand waiver fee in Amendment No. 18 to be troubled debt restructurings. In order to assess whether the creditor granted a concession, we calculated the post-restructuring effective interest rate by projecting cash flows on the new terms and calculated a discount rate equal to the carrying amount of pre-restructuring of debt, and by comparing this calculation to the terms of Amendment No. 15, we determined that Third Eye Capital provided a concession in accordance with the provisions of ASC 470-60 and thus applied troubled debt restructuring accounting, resulting in no gain or loss from the application of this accounting. Using the effective interest method of amortization, the 1% extension fee of $1.0 million and Amendment No. 17 Fee of $0.3 million are being amortized over the stated remaining life of the Third Eye Capital Notes. On February 27, 2019, a promissory note (the “February 2019 Note”, together with the Original Third Eye Capital Notes, the “Third Eye Capital Notes”) for $2.1 million was advanced by Third Eye Capital to Aemetis, Inc., as a short-term credit facility for working capital and other general corporate purposes with an interest rate of 14% per annum maturing on the earlier of (a) receipt of proceeds from any financing, refinancing, or other similar transaction, (b) extension of credit by payee, as lender or as agent on behalf of certain lenders, to the Company or its affiliates, or (c) April 30, 2019. In consideration of the February 2019 Note, $0.1 million of the total proceeds were paid to Third Eye Capital as financing charges. On April 30, 2019, the February 2019 Note was modified to remove the stated maturity date and instead be due on demand by Third Eye Capital. In third quarter of 2019, the February 2019 Note was modified to include additional borrowings of $0.7 million. In first quarter of 2020, the February 2019 Note was modified to include additional borrowings of $0.6 million. The February 2019 note was fully repaid in the first quarter of 2021. On March 14, 2021, Third Eye Capital agreed to Limited Waiver and Amendment No. 19 to the Note Purchase Agreement (“Amendment No. 19”), to (i) provide for a waiver of the ratio of note indebtedness covenant for the quarter ended December 31, 2021, (ii) provide for a waiver of the consolidated unfunded capital expenditures covenant for the quarters through March 31, 2021. As consideration for such amendment and waivers, the borrowers also agreed to pay Third Eye Capital an amendment and waiver fee of $0.1 million in cash (the “Amendment No. 19 Fee”). We gave the notice to extend the maturity date of the Notes to April 1, 2022 and the extension fee equal to 1% of the Note Indebtedness in respect to each Note, provided that half of such fee may be added to the outstanding principal balance of each Note on the effective date of each such extension and rest of the balance may be payable in cash or common stock within 60 days of the date of such relevant extension. We evaluated the terms of the Amendment No. 19 and the maturity date extension and applied modification accounting treatment in accordance with ASC 470-50 Debt – Modification and Extinguishment Based on prior amendments and Amendment No. 19, the ratio of note indebtedness covenant is waived for the quarters ended June 30, 2021 through December 31, 2021. In addition, the ratio of note indebtedness covenant is increased from 70% to 100% in the Amendment No. 19 effective March 31, 2022. According to ASC 470-10-45 Debt -Other Presentation Matters, if it is probable that the Company will not be able to cure the default at measurement dates within the next 12 months, the related debt needs to be classified as current. To assess this guidance, the Company performed ratio and cash flow analysis using its cash flow forecast and debt levels. The Company forecasted sufficient cash flows over the next 12 months to reduce debt levels of Third Eye Capital and meet operations of the Company. Based on this analysis, the Company believes that it is not probable that through a combination of cash flows from operations, sales from EB-5 investments, and proceeds from the sale of common stock, it will not be able to meet the ratio of the note indebtedness covenant over the next 12 months. As such, the notes are classified as long-term debt. On March 6, 2020, we and a subsidiary entered into a one-year reserve liquidity facility governed by a promissory note, payable to Third Eye Capital, in the principal amount of $18 million. We do not currently expect to draw upon the note. However, we determined that it was prudent to maintain a liquidity reserve in case of unforeseen needs. Borrowings under the facility are available from March 6, 2020 until maturity on April 1, 2021. Interest on borrowed amounts accrues at a rate of 30% per annum, paid monthly in arrears, or 40% if an event of default has occurred and continues. The outstanding principal balance of the indebtedness evidenced by the promissory note, plus any accrued but unpaid interest and any other sums due thereunder, shall be due and payable in full at the earlier to occur of (a) the closing of any new debt or equity financing, refinancing or other similar transaction between Third Eye Capital or any fund or entity arranged by them and the Company or its affiliates, (b) receipt by the Company or its affiliates of proceeds from any sale, merger, equity or debt financing, refinancing or other similar transaction from any third party and (c) April 1, 2021. The promissory note is secured by liens and security interests upon the property and assets of the Company as described in that certain Amended and Restated Note Purchase Agreement, dated as of July 6, 2012. If any amounts are drawn under the facility, the Company will pay a non-refundable fee in the amount of $500,000, payable from the proceeds of the first drawing under the facility. On March 14, 2021, Third Eye agreed to increase the amount available under the Liquidity facility to $70.0 million and extend the maturity date to April 1, 2022. Borrowings under the facility are available from March 14, 2021 until maturity on April 1, 2022. Interest on borrowed amounts accrues at a rate of 30% per annum, paid monthly in arrears and may be capitalized and due upon maturity, or 40% if an event of default has occurred and continues. The outstanding principal balance of the indebtedness evidenced by the promissory note, plus any accrued but unpaid interest and any other sums due thereunder, shall be due and payable in full at the earlier to occur of (a) receipt by the Company or its affiliates of proceeds from any sale, merger, equity or debt financing, refinancing or other similar transaction from any third party and (b) April 1, 2022. Any amounts may be re-borrowed up to repaid amounts up until the maturity date of April 1, 2022. The promissory note is secured by liens and security interests upon the property and assets of the Company. In return, the Company will pay a non-refundable standby fee at 2% per annum of the difference between the aggregate principal amount outstanding and the commitment, payable monthly in cash. In addition, if any initial advances are drawn under the facility, the Company will pay a non-refundable one-time fee in the amount of $0.5 million provided that such fee may be added to the principal amount of the promissory note on the date of such initial advance. Terms of Third Eye Capital Notes A. Term Notes B Revolving Credit Facility C. Revenue Participation Term Notes D. Acquisition Term Notes E. Reserve Liquidity Notes The Third Eye Capital Notes contain various covenants, including but not limited to, debt to plant value ratio, minimum production requirements, and restrictions on capital expenditures. The terms of the Third Eye Capital Notes allow the lender to accelerate the maturity in the occurrence of any event that could reasonably be expected to have a material adverse effect, such as any change in the business, operations, or financial condition. The terms of the notes allow interest to be capitalized. 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 the Company’s North American subsidiaries. The Third Eye Capital Notes all contain cross-collateral and cross-default provisions. McAfee Capital, LLC (“McAfee Capital”), owned by Eric McAfee, the Company’s Chairman and CEO, provided a guaranty of payment and performance secured by all of its Company shares. In addition, Eric McAfee provided a blanket lien on substantially all of his personal assets, and McAfee Capital provided a guarantee in the amount of $8.0 million. Cilion shareholder seller notes payable Subordinated Notes The Subordinated Notes were amended to extend the maturity date on January 1, 2020 and again on July 1, 2020 with six months extension for maturity until December 31, 2020. We evaluated these amendments and the refinancing terms of the notes and applied modification accounting treatment in accordance with ASC 470-50 Debt – Modification and Extinguishment On January 1, 2021, the Subordinated Notes were amended to extend the maturity date until the earlier of (i) June 30, 2021; (ii) completion of an equity financing by AAFK or Aemetis, Inc. in an amount of not less than $25.0 million; or (iii) 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 113 thousand shares of common stock were granted with a term of two years and an exercise price of $0.01 per share. We evaluated the January 1, 2021 amendment and the refinancing terms of the notes and applied modification accounting treatment in accordance with ASC 470-50 Debt – Modification and Extinguishment At March 31, 2021 and December 31, 2020, the Company had, in aggregate, the amount of $13.0 million and $12.7 million in principal and interest outstanding, respectively, net of $324 thousand and none of unamortized debt issuance costs, respectively, under the Subordinated Notes. EB-5 promissory notes Advanced BioEnergy, LP arranges investments with foreign investors, who each make loans to the Keyes Plant in increments of $0.5 million. The Company has sold an aggregate principal amount of $36.0 million of EB-5 Notes under the EB-5 Phase I funding since 2012 to the date of this filing. As of March 31, 2021, $35.5 million has been released from the escrow amount to the Company, with $0.5 million remaining to be funded to escrow. As of March 31, 2021, the Company paid principal amount of one of the EB-5 investors who obtained the green card approval under the program. As of March 31, 2021, $35.0 million in principal and $3.6 million in accrued interest was outstanding on the EB-5 Notes sold under the EB-5 Phase I funding. On October 16, 2016, the Company launched its EB-5 Phase II funding, with plans to issue $50.0 million in additional EB-5 Notes on substantially similar terms and conditions as those issued under the Company’s EB-5 Phase I funding, to refinance indebtedness and capital expenditures of Aemetis, Inc. and GAFI (the “EB-5 Phase II funding”). On November 21, 2019, the minimum investment was raised from $0.5 million per investor to $0.9 million per investor. The Company entered into a Note Purchase Agreement dated with Advanced BioEnergy II, LP, a California limited partnership authorized as a Regional Center to receive EB-5 Phase II funding investments, for the issuance of up to 100 EB-5 Notes bearing interest at 3%. On May 1, 2020 Supplement No. 3 amended the offering documents and lowered the total eligible new EB-5 Phase II funding investors to 60. Eight EB-5 investors have funded at the $0.5 million per investor amount, so 52 new EB-5 Phase II funding investors are eligible at the new $0.9 million per investor amount under the current offering. Job creation studies show it may be possible to add additional investors and increase the total offering amount in the future. Each new note will be issued in the principal amount of $0.9 million and due and payable five years from the date of each note, for a total aggregate principal amount of up to $50.8 million. Advanced BioEnergy II, LP arranges investments with foreign investors, who each make loans to the Riverbank Cellulosic Ethanol Facility in increments of $0.9 million after November 21, 2019. The Company has sold an aggregate principal amount of $4.0 million of EB-5 Notes under the EB-5 Phase II funding since 2016 to the date of this filing. As of March 31, 2021, $4.0 million has been released from escrow to the Company and $46.8 million remains to be funded to escrow. As of March 31, 2021, $4.2 million was outstanding on the EB-5 Notes under the EB-5 Phase II funding. Unsecured working capital loans In November 2008, the Company entered into an operating agreement with Secunderabad Oils Limited (“Secunderabad Oils”). The 2008 agreement provided the working capital and had the first priority lien on assets in return for 30% of the plant’s monthly net operating profit. These expenses were recognized as selling, general, and administrative expenses by the Company in the financials. All terms of the 2008 agreement with Secunderabad Oils were terminated to amend the agreement as below. On July 15, 2017, the agreement with Secunderabad Oils was amended to provide the working capital funds for British Petroleum business operations only in the form of inter-corporate deposit for an amount of approximately $2.3 million over a 95 day period at the rate of 14.75% per annum interest rate. The term of the agreement continues until either party terminates it. Secunderabad Oils has a second priority lien on the assets of the Company’s Kakinada Plant after this agreement. On April 15, 2018, the agreement was amended to purchase the raw material for business operations at 12% per annum interest rate. During the three months ended March 31, 2021 and 2020, the Company made principal and interest payments to Secunderabad Oils of none and approximately $34 thousand, respectively. As of March 31, 2021 and December 31, 2020 the Company had no outstanding balance under this agreement. GAFI Term loan and Revolving loan. On June 28, 2018, GAFI entered into Amendment No. 1 to the GAFI Term Loan with Third Eye Capital for an additional amount of $1.5 million with a fee of $75 thousand added to the loan from Third Eye Capital at a 10% interest rate. On December 20, 2018, $1.6 million from Amendment No. 1 was repaid. Pursuant to Amendment No. 1, Aemetis, Inc. entered into a Stock Appreciation Rights Agreement to issue 1,050,000 Stock Appreciation Rights (“SARs”) to Third Eye Capital on August 23, 2018, with an exercise date of one year from the issuance date with a call option for the Company at $2.00 per share during the first 11 months of the agreement either to pay $2.1 million in cash or issue common stock worth $2.1 million based on the 30-day weighted average price of the stock on the call date, and a put option for Third Eye Capital at $1.00 per share during the 11th month of the agreement where the Company can redeem the SARs for $1.1 million in cash. In the event that none of the above options is exercised, the SARs will be automatically exercised one year from the issuance date based upon the 30-day weighted average stock price and paid in cash and cash equivalents. On July 22, 2019, Third Eye Capital exercised the put option at $1.00 per share for $1.1 million. The exercise value of the SARs of $1.1 million was added to the GAFI Term Loan and the SARs fair value liability was released. The Company fully repaid the GAFI notes in the first quarter of 2021. As of March 31, 2021 and December 31, 2020, GAFI had none and $22.2 million net of debt issuance costs of none and $0.4 million outstanding on the Term Loan and none and $11.8 million on the Revolving Loan respectively, classified as current portion of long-term debt. Payroll Protection Program. The PPP Loans are evidenced by promissory notes, dated May 1, 2020 and April 30, 2020 (the “Notes”), between the Company, as borrower, and Bank of America, N.A., as lender (the “PPP Lender”). The interest rate on the Note is 1.00% per annum. No payments of principal or interest are due during the six-month period beginning on the funding date (the “Deferral Period”). If the SBA does not confirm forgiveness or only partly confirms forgiveness of the PPP Loans, or Borrower fails to apply for loan forgiveness, the Company will be obligated to repay to the PPP Lender the total outstanding balance remaining due under the PPP Loans, including principal and interest and in such case, the PPP Lender will establish the terms for repayment of the PPP Loans in a separate letter to be provided to the Company in which the letter will set forth the loan balance, the amount of each monthly payment, the interest rate (not in excess of a fixed rate of 1.00% per annum, the term of the PPP Loans, and the maturity date, which, if not established by the PPP Lender, shall be two years from the funding date of the PPP Loans. Financing Agreement for Equipment Purchase. Scheduled debt repayments for the Company’s loan obligations follow: Twelve months ended March 31, Debt Repayments 2022 $ 25,407 2023 160,624 2024 7,936 2025 4,496 2026 936 There after 1,324 Total debt 200,723 Debt issuance costs (1,308 ) Total debt, net of debt issuance costs $ 199,415 |
5. Commitments and Contingencie
5. Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
5. Commitments and Contingencies | Leases We have identified assets as the corporate office, warehouse, monitoring equipment and laboratory facilities over which we have control and obtain economic benefits fully. We classified these identified assets as operating leases after assessing the terms under classification guidance. We have entered into several leases for trailers and carbon units with purchase option at the end of the term. We have concluded that it is reasonably certain that we would exercise the purchase option at the end of the term, hence the leases were classified as finance leases. All of our leases have remaining term of less than a year to 8 years. When discount rates implicit in leases cannot be readily determined, the Company uses the applicable incremental borrowing rate at lease commencement to perform lease classification tests on lease components and measure lease liabilities and right-of-use (“ROU”) assets. The incremental borrowing rate used by the Company was based on weighted average baseline rates commensurate with the Company’s secured borrowing rate over a similar term. At each reporting period, when there is a new lease initiated, the rates established for that quarter will be used. The components of lease expense and sublease income was as follows: Three Months ended March 31, 2021 2020 Operating lease cost Operating lease expense $ 204 $ 177 Short term lease expense 39 14 Variable lease expense 33 34 Total operating lease cost $ 276 $ 225 Finance lease cost Amortization of right-of-use assets $ 55 $ - Interest on lease liabilities 21 - Total finance lease cost $ 76 $ - Cash paid for amounts included in the measurement of lease liabilities: Three Months ended March 31, 2021 2020 Operating cash flows used in operating leases $ 167 $ 179 Operating cash flows used in finance leases 21 - Financing cash flows used in finance leases $ 124 - Supplemental non-cash flow information related to ROU asset and lease liabilities was as follows for the three months ended March 31, 2021 and March 31, 2020: Three Months ended March 31, 2021 2020 Operating leases Accretion of the lease liability $ 99 $ 17 Amortization of right-of-use assets 105 160 Weighted Average Remaining Lease Term Operating leases 6.7 years Finance leases 3.0 years Weighted Average Discount Rate Operating leases 14.0 % Finance leases 5.5 % Supplemental balance sheet information related to leases was as follows: As of March 31, 2021 December 31, 2020 Operating leases Operating lease right-of-use assets $ 2,783 $ 2,889 Current portion of operating lease liability 325 316 Long term operating lease liability 2,502 2,578 Total operating lease liabilities 2,827 2,894 Finance leases Property and equipment, at cost $ 2,204 $ 2,308 Accumulated depreciation (200 ) (249 ) Property and equipment, net 2,004 2,059 Other current liability 422 417 Other long term liabilities 1,057 1,164 Total finance lease liabilities 1,479 1,581 Maturities of operating lease liabilities were as follows: Three Months ended March 31, Operating leases Finance leases 2021 $ 691 $ 577 2022 573 494 2023 577 494 2024 595 44 2025 612 - There after 1,393 - Total lease payments 4,441 1,609 Less imputed interest (1,614 ) (130 ) Total lease liability $ 2,827 $ 1,479 Property taxes The Company entered into a payment plan with Stanislaus County for unpaid property taxes for the Keyes Plant site on June 28, 2018 by paying $1.5 million as a first payment. Under the annual payment plan, the Company was set to pay 20% of the outstanding redemption amount, in addition to the current year property taxes and any interest incurred on the unpaid balance to date annually, on or before April 10 starting in 2019. After making one payment, Company defaulted on the payment plan and as of March 31, 2021 and December 31, 2020, the balance in property tax accrual was $6.1 million and $5.7 million, respectively. Stanislaus County agreed not to enforce collection actions and we are now in discussions with Stanislaus County regarding a payment plan. Legal Proceedings On August 31, 2016, the Company filed a lawsuit in Santa Clara County Superior Court against defendant EdenIQ, Inc. (“EdenIQ”). The lawsuit was based on EdenIQ’s wrongful termination of a merger agreement that would have effectuated the merger of EdenIQ into a new entity that would be primarily owned by Aemetis. The lawsuit asserted that EdenIQ had fraudulently induced the Company into assisting EdenIQ to obtain EPA approval for a new technology that the Company would not have done but for the Company’s belief that the merger would occur. The relief sought included EdenIQ’s specific performance of the merger, monetary damages, as well as punitive damages, attorneys’ fees, and costs. In response to the lawsuit, EdenIQ filed a cross-complaint asserting causes of action relating to the Company’s alleged inability to consummate the merger, the Company’s interactions with EdenIQ’s business partners, and the Company’s use of EdenIQ’s name and trademark in association with publicity surrounding the merger. Further, EdenIQ named Third Eye Capital Corporation (“TEC”) as a defendant in a second amended cross-complaint alleging that TEC had failed to disclose that its financial commitment to fund the merger included terms that were not disclosed. Finally, EdenIQ claimed that TEC and the Company concealed material information surrounding the financing of the merger. By way of its cross-complaint, EdenIQ sought monetary damages, punitive damages, injunctive relief, attorneys’ fees and costs. In November 2018, the claims asserted by the Company were dismissed on summary judgment and the Company filed a motion to amend its claims, which remains pending. In December 2018, EdenIQ dismissed all of its claims prior to trial. In February 2019, the Company and EdenIQ each filed motions seeking reimbursement of attorney fees and costs associated with the litigation. On July 24, 2019, the court awarded EdenIQ a portion of the fees and costs it had sought in the amount of approximately $6.2 million. The Company recorded the $6.2 million as loss contingency on litigation during the year ended December 31, 2019. The Company’s ability to amend its claims and present its claims to the court or a jury could materially affect the court’s decision to award EdenIQ its fees and costs. In addition to further legal motions and a potential appeal of the Court’s summary judgment order, the Company plans to appeal the court’s award of EdenIQ’s fees and costs. The Company intends to continue to vigorously pursue its legal claims and defenses against EdenIQ. |
6. Biogas LLC - Series A Prefer
6. Biogas LLC - Series A Preferred Financing | 3 Months Ended |
Mar. 31, 2021 | |
Stockholders' deficit: | |
6. Biogas LLC - Series A Preferred Financing | On December 20, 2018, Aemetis Biogas LLC entered into a Series A Preferred Unit Purchase Agreement (the “Preferred Unit Agreement”) by selling Series A Preferred Units to Protair-X Americas, Inc. (the “Purchaser”), with Third Eye Capital acting as an agent for the purchaser (the “Agent”). ABGL plans to construct and collect bio-methane from dairies located near the Keyes Plant. Bio-methane is a blend along with CO₂ and other impurities that can be captured from dairies, landfills and other sources. After a gas cleanup and compression process, bio-methane can be converted into renewable natural gas, which is a direct replacement of petroleum natural gas and can be transported in existing natural gas pipelines. ABGL is authorized to issue 11,000,000 common units, and up to 6,000,000 convertible, redeemable, secured, preferred membership units (the “Series A Preferred Units”). ABGL issued 6,000,000 common units to the Company. ABGL also issued 1,660,000 Series A Preferred Units to the Purchaser for $8,300,000 with the ability to issue an additional 4,340,000 Series A Preferred Units at $5.00 per Unit for a total of up to $30,000,000 in funding. Additionally, 5,000,000 common units of ABGL are held in reserve as potential conversion units issuable to the Purchaser upon certain triggering events discussed below. The Preferred Unit Agreement includes (i) preference payments of $0.50 per unit on the outstanding Series A Preferred Units commencing on the second anniversary, (ii) conversion rights for up to 1,200,000 common units or up to maximum number of 5,000,000 common units (also at a one Series A Preferred Unit to one common unit basis) if certain triggering events occur, (iv) one board seat of the three available to be elected by Series A Preferred Unit holders, (iii) mandatory redemption value at $15 per unit payable at an amount equal to 75% of free cash flow generated by ABGL, up to $90 million in the aggregate (if all units are issued), (iv) full redemption of the units on the sixth anniversary, (v) minimum cash flow requirements from each digester, and (vi) $0.9 million paid as fees to the Agent from the proceeds. Until paid, the obligations of ABGL under the Preferred Unit Agreement are secured by the assets of ABGL in an amount not to exceed the sum of (i) $30,000,000, plus (ii) all interest, fees, charges, expenses, reimbursement obligations and indemnification obligations of ABGL. Triggering events occur upon ABGL’s failure to redeem units, comply with covenants, any other defaults or cross defaults, or to perform representations or warranties. Upon a triggering event: (i) the obligation of the Purchaser to purchase additional Series A Preferred Units is terminated, (ii) cash flow payments for redemption payments increases from 75% to 100% of free cash flows, and (iii) total number of common units into which preferred units may be converted increases from 1,200,000 common units to 5,000,000 common units on a one for one basis. As of March 31, 2021, ABGL has not generated minimum quarterly operating cash flows by operating the dairies. As a result of the violation of this covenant, free cash flows, when they occur, may be applied for redemption payments at the increased rate of 100% instead of the initial rate of 75% of free cash flows. From inception of the agreement to date, ABGL issued 3,200,000 Series A Preferred Units on first tranche for a value of $16.0 million and also issued 2,800,000 of Series A Preferred Units on second tranche for a value of $14.0 million, reduced by a redemption of 20,000 Series A Preferred Units for $0.3 million. The Company is accreting these two tranches to the redemption value of $89.7 million over the estimated future cash flow periods of six years using the effective interest method. In addition, the Company identified freestanding future tranche rights and the accelerated redemption feature related to a change in control provision as derivatives which required bifurcation. These derivative features were assessed to have minimal value as of March 31, 2021 and December 31, 2020 based on the evaluation of the other conditions included in the agreement. During the three months ended March 31, 2021, ABGL issued 626,000 of Series A Preferred Units for incremental proceeds of $3.1 million and redeemed 20,000 of Series A Preferred Units for $0.3 million as part of the second tranche of the Preferred Unit Agreement. Consistent with the previous issuances, the units are treated as a liability as the conversion option was deemed to be non-substantive. The Company recorded Series A Preferred Unit liabilities, net of unit issuance costs and inclusive of accretive preference pursuant to this agreement, classified as other current liabilities, of $3.0 million and $2.0 million, and long-term liabilities of $36.3 million and $32.0 million as of March 31, 2021 and December 31, 2020, respectively. Variable interest entity assessment After consideration of ABGL’s operations and the above agreement, we concluded that ABGL did not have enough equity to finance its activities without additional subordinated financial support. ABGL is capitalized with Series A Preferred Units that are recorded as liabilities under U.S. GAAP. Hence, we concluded that ABGL is a VIE. Through the Company's ownership interest in all of the outstanding common stock, its current ability to control the board of directors, the management fee paid to Aemetis and control of subordinated financing decisions, Aemetis has been determined to be the primary beneficiary and accordingly, the assets, liabilities, and operations of ABGL are consolidated into those of the Company. Total assets of ABGL were $27.9 million primarily related to biodigesters at two dairies and a pipeline which serve as collateral for the Series A Preferred shares totaling $39.3 million. The Series A Preferred Shares are not collateralized by any other assets or guarantees from Aemetis or its subsidiaries. |
7. Stock-Based Compensation
7. Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2021 | |
Share-based Payment Arrangement, Noncash Expense [Abstract] | |
7. Stock Based Compensation | 2019 Plan On April 29, 2019, the Aemetis 2019 Stock Plan (the “2019 Stock Plan”) was approved by stockholders of the Company. This plan permits the grant of Incentive Stock Options, Non-Statutory Stock Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units, Performance Units, Performance Shares and other stock or cash awards as the administrator of 2019 Stock plan may determine in its discretion. The 2019 Stock Plan’s term is 10 years and supersedes all prior plans. The 2019 Stock Plan authorized the issuance of 200,000 shares of common stock for the 2019 calendar year, in addition to permitting the transfer and grant of any available and unissued or expired options under the prior Amended and Restated 2007 Stock Plan in an amount up to 177,246 options. With the approval of the 2019 Stock Plan, the Zymetis 2006 Stock Plan and the Amended and Restated 2007 Stock Plan (the “Prior Plans,” and together with the 2019 Stock Plan, the “Stock Plans”) are terminated for granting any options under either plan. However, any options granted before the 2019 Stock Plan was approved will remain outstanding and can be exercised, and any expired options issued pursuant to the Prior Plans can be granted under the 2019 Stock Plan. On January 7, 2021, 945,000 incentive stock option grants were issued for employees and directors under the 2019 Stock Plan. In addition, 5,200 restricted stock award grants were issued to the Company’s board of directors (“Board”) in place of board compensation fees. On January 9, 2020, 771,500 stock option grants were issued for employees and directors under the 2019 Stock Plan. On March 28, 2020, 1,075,500 stock options grant were approved by the Board for employees and directors under the 2019 Stock Plan. On April 3, 2020, 450,000 stock option grants were issued for employees under the 2019 Stock Plan with 10 year term and immediate vesting. Both grants on March and April were also approved by the stockholders in the 2019 Annual meeting. On June 4, 2020, 10,000 stock option grants were approved by the Board for a director under the 2019 Stock Plan with 10 year term and 2 year vesting. On August 27, 2020, 13,000 stock option grants were approved by the Board for new employees under the 2019 Stock Plan with 10 year term and 3 year vesting. As of March 31, 2021, 5.0 million options are outstanding under the Company Stock Plans. Common Stock Reserved for Issuance The following is a summary of awards granted under the Plans: Shares Available for Grant Number of Shares Outstanding Weighted-Average Exercise Price Balance as of December 31, 2020 380 5,327 $ 1.14 Authorized 816 - - Granted (950 ) 950 3.09 Exercised - (1,211 ) 1.49 Forfeited/expired 61 (61 ) 1.91 Balance as of March 31, 2021 307 5,005 $ 1.41 As of March 31, 2021, there were 2.9 million options vested under the Plans. Stock-based compensation for employees Stock-based compensation is accounted for in accordance with the provisions of ASC 718 Compensation-Stock Compensation For the three months ended March 31, 2021 and 2020, the Company recorded option expense in the amount of $835 thousand and $310 thousand, respectively. Valuation and Expense Information All issuances of stock options or other issuances of equity instruments to employees as the consideration for services received by us are accounted for based on the fair value of the equity instrument issued. The fair value of options granted to employees is estimated on the grant date using the Black-Scholes option valuation model. This valuation model for stock based compensation expense requires us to make assumptions and judgments about the variables used in the calculation, including the fair value of our common stock, the expected term (the period of time that the options granted are expected to be outstanding), the volatility of our common stock, a risk-free interest rate, and expected dividends. Under ASU 2016-09 Improvements to Employee Share-Based Payments Accounting There were 1.0 million options granted during the three months ended March 31, 2021. The weighted average fair value calculations for options granted during the three months ended March 31, 2021 and 2020 are based on the following assumptions: For the three months ended March 31, Description 2021 2020 Dividend-yield 0 % 0 % Risk-free interest rate 0.70 % 1.08 % Expected volatility 97.45 % 87.43 % Expected life (years) 6.51 6.93 Market value per share on grant date $ 3.09 $ 0.71 Fair value per share on grant date $ 2.44 $ 0.54 As of March 31, 2021, the Company had $2.3 million of total unrecognized compensation expense for employees, which the Company will amortize over the 2.43 years of weighted average remaining term. |
8. Agreements
8. Agreements | 3 Months Ended |
Mar. 31, 2021 | |
Agreements | |
8. Agreements | Working Capital Arrangement. The J.D. Heiskell sales and purchases activity associated with the J.D. Heiskell Purchase Agreement and J.D. Heiskell Procurement Agreement during the three months ended March 31, 2021 and 2020 were as follows: As of and for the three months ended March 31, 2021 2020 Ethanol sales $ - $ 24,383 Wet distiller's grains sales 11,035 8,374 Corn oil sales 1,042 928 Corn purchases 37,993 29,214 Accounts receivable 133 60 Accounts payable 415 1,749 Sales to Kinergy were $29.9 million and none for the three months ended March 31, 2021 and 2020. Accounts receivable associated with Kinergy was $1.2 million and $0.2 million as of March 31, 2021 and December 31, 2020, respectively. Ethanol and Wet Distillers Grains Marketing Arrangement. As of March 31, 2021, the Company has no forward sales commitments. |
9. Segment Information
9. Segment Information | 3 Months Ended |
Mar. 31, 2021 | |
Segment Reporting [Abstract] | |
9. Segment Information | Aemetis recognizes two reportable geographic segments: “North America” and “India.” The “North America” operating segment includes the Keyes Plant, the Riverbank Cellulosic Ethanol Facility, the Biogas Project, the Goodland Plant and the research and development facility in Minnesota. The “India” operating segment includes the Kakinada Plant, the administrative offices in Hyderabad, India, and the holding companies in Nevada and Mauritius. The Company’s biodiesel is marketed and sold primarily to customers in India through brokers and by the Company directly. Summarized financial information by reportable segment for the three months ended March 31, 2021 and 2020 follows: Three months ended March 31, 2021 Three Months ended March 31, 2020 North America India Total Consolidated North America India Total Consolidated Revenues $ 42,328 $ 479 $ 42,807 $ 35,872 $ 3,608 $ 39,480 Cost of goods sold 45,881 534 46,415 36,413 3,500 39,913 Gross (loss) profit (3,553 ) (55 ) (3,608 ) (541 ) 108 (433 ) Other Expenses Research and development expenses 23 - 23 117 - 117 Selling, general and administrative expenses 5,021 361 5,382 3,120 816 3,936 Interest expense 7,180 - 7,180 6,857 19 6,876 Accretion of Series A preferred units 1,943 - 1,943 960 - 960 Other (income) expense (10 ) (21 ) (31 ) (53 ) (10 ) (63 ) Loss before income taxes $ (17,710 ) $ (395 ) $ (18,105 ) $ (11,542 ) $ (717 ) $ (12,259 ) Capital expenditures $ 6,443 $ 117 $ 6,560 $ 1,298 $ 1,074 $ 2,372 Depreciation 1,202 184 1,386 933 157 1,090 North America. India Total assets by segment consist of the following: As of March 31, December 31, 2021 2020 North America $ 131,427 $ 112,312 India 12,306 12,827 Total Assets $ 143,733 $ 125,139 |
10. Related Party Transactions
10. Related Party Transactions | 3 Months Ended |
Mar. 31, 2021 | |
Related Party Transactions [Abstract] | |
10. Related Party Transactions | The Company owes Eric McAfee, the Company’s Chairman and CEO, and McAfee Capital LLC (“McAfee Capital”), owned by Eric McAfee, $0.4 million in connection with employment agreements and expense reimbursements previously accrued as salaries expense and accrued liabilities. For the three months ended March 31, 2021 and 2020, the Company did not incur any expenses by McAfee Capital and related entities. The Company previously prepaid $0.2 million to Redwood Capital, a company controlled by Eric McAfee, for the Company’s use of flight time on a corporate jet. As of March 31, 2021, $0.1 million remained as a prepaid expense. On May 7, 2020, the Audit Committee of the Company approved a guarantee fee of 0.1% quarterly on the outstanding balance of Third Eye Capital Notes for 2020 annual fee. The balance of $0.5 million and $0.8 million, for guaranty fees, remained as an accrued liability as of March 31, 2021 and December 31, 2020, respectively. The Company owes various members of the Board amounts totaling $1.0 million and $1.2 million as of March 31, 2021 and December 31, 2020, for each period, in connection with board compensation fees, which are included in accounts payable on the balance sheet. For the three months ended March 31, 2021 and 2020, the Company expensed $0.1 million respectively, in connection with board compensation fees. |
11. Subsequent Events
11. Subsequent Events | 3 Months Ended |
Mar. 31, 2021 | |
Subsequent Events [Abstract] | |
11. Subsequent Events | At-the-Market Offering The Company raised net proceeds of $23.9 million, after deducting issuance costs through its at-the-market (“ATM”) offering program subsequent to March 31, 2021. The proceeds were used to repay approximately $22.0 million of the Third Eye Capital Notes. |
12. Management's Plan
12. Management's Plan | 3 Months Ended |
Mar. 31, 2021 | |
Cilion shareholder Seller note payable | |
12. 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. As a result of negative capital and negative operating results, and collateralization of substantially all of the company assets, the Company has been reliant on its senior secured lender to provide additional funding and has been required to remit substantially all excess cash from operations to the senior secured lender. In order to meet its obligations during the next twelve months, the Company will need to either refinance the Company’s debt or receive the continued cooperation of its senior lender. This dependence on the senior lender raises substantial doubt about the Company’s ability to continue as a going concern. The Company plans to pursue the following strategies to improve the course of the business. For the Keyes plant, we plan to operate the plant and continue to improve financial performance by adopting new technologies or process changes that allow for energy efficiency, cost reduction or revenue enhancements, execute upon awarded grants that improve energy and operational efficiencies resulting in lower cost, lower carbon demands and overall margin improvement. For the biogas project, we plan to operate the biogas digesters to capture and monetize biogas as well as continue to build new dairy digesters and extend the existing pipeline in order to capture the higher carbon credits available in California. Funding for continued construction is based upon extending the existing Preferred Unit Purchase Agreement, obtaining government guaranteed loans and executing on existing and new state grant programs. For the Riverbank project, we plan to raise the funds necessary to construct and operate the Carbon Zero 1 plant and the Riverbank Cellulosic Ethanol Facility using loan guarantees and public financings based upon the licensed technology that generate federal and state carbon credits available for ultra-low carbon fuels utilizing lower cost, non-food advanced feedstocks to significantly increase margins. For the India plant, we plan to secure higher volumes of shipments of fuels at the India plant by developing the sales channels and expanding the existing domestic markets. In addition to the above we plan to continue to locate funding for existing and new business opportunities through a combination of working with our senior lender, restructuring existing loan agreements, selling equity through the ATM and otherwise, selling the current EB-5 Phase II offering, or by vendor financing arrangements. |
1. Nature of Activities and S_2
1. Nature of Activities and Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Nature of Activities | Headquartered in Cupertino, California, Aemetis, Inc. (collectively with its subsidiaries on a consolidated basis, “Aemetis,” the “Company,” “we,” “our” or “us”) is an international renewable natural gas, renewable fuels and byproducts company focused on the acquisition, development and commercialization of innovative negative carbon intensity products and technologies that replace traditional petroleum-based products. Founded in 2006, we own and operate a 65 million gallon per year ethanol production facility located in Keyes, California (the “Keyes Plant”). In addition to low carbon renewable fuel ethanol, the Keyes Plant produces Wet Distillers Grains (“WDG”), Distillers Corn Oil (“DCO”), and Condensed Distillers Solubles (“CDS”), all of which are sold to local dairies and feedlots as animal feed. We also own and operate a 50 million gallon per year renewable chemical and advanced fuel production facility (“Kakinada Plant”) on the East Coast of India that produces high quality distilled biodiesel and refined glycerin for customers in India and Europe. We operate a research and development laboratory to develop efficient conversion technologies using waste feedstocks to produce biofuels and biochemicals. Additionally, we own a partially completed plant in Goodland, Kansas (the “Goodland Plant”) through our subsidiary Goodland Advanced Fuels, Inc., (“GAFI”), which was formed to acquire the Goodland Plant. On December 31, 2019 we exercised an option to acquire all capital stock of GAFI for $10 and consolidated assets, liabilities, and equity of GAFI are included as a wholly owned subsidiary from December 31, 2019. We lease a site in Riverbank, California, near the Keyes Plant, where we plan to utilize biomass-to-fuel technology that we have licensed from LanzaTech Technology (“LanzaTech”) and InEnTec Technology (“InEnTec”) to build a cellulosic ethanol production facility (the “Riverbank Cellulosic Ethanol Facility”). By producing ultra-low carbon renewable cellulosic ethanol, we expect to capture higher value D3 RINs and California’s LCFS credits. D3 RINs have a higher value in the marketplace than D6 RINs due to D3 RINs’ relative scarcity and mandated pricing formula from the United States EPA. We also own and operate the Kakinada Plant with a nameplate capacity of 150 thousand metric tons per year, or about 50 million gallons per year. We believe the Kakinada Plant is one of the largest biodiesel production facilities in India on a nameplate capacity basis. The Kakinada Plant is capable of processing a variety of vegetable oils and animal fat waste feedstocks into biodiesel that meet international product standards. The Kakinada Plant also distills the crude glycerin byproduct from the biodiesel refining process into refined glycerin, which is sold to the pharmaceutical, personal care, paint, adhesive and other industries. During 2018, Aemetis Biogas, LLC (“ABGL”) was formed to construct bio-methane anaerobic digesters at local dairies near the Keyes Plant, many of whom also purchase WDG produced at the Keyes Plant. The digesters are connected via a pipeline owned by ABGL to a gas cleanup and compression unit being built at the Keyes Plant to produce Renewable Natural Gas (“RNG”). During the third quarter of 2020, ABGL completed construction on the first two diary digesters along with the pipeline that carries bio-methane from these dairies to the Keyes Plant. Upon receiving the bio-methane from the dairies, impurities are removed, and the bio-methane is converted to RNG where it will be either injected into the local gas utility pipeline, supplied to a renewable compressed natural gas (“RCNG”) truck loading station that will service local trucking fleets, or used as renewable energy at the Keyes Plant. In December 2018, we acquired a 5.2-acre parcel of land for the construction of a gas-to-liquid CO₂ production facility by Messer. Aemetis sells carbon dioxide (“CO₂”) produced at the Keyes Plant (the “CO₂ Project”) to Messer for conversion and sale into the food processing, beverage, and technology sectors. We commenced operations in late April 2020 and started recognizing revenue from this project in the second quarter of 2020. On March 18, 2020, in order to address a worldwide shortage of hand sanitizer during the COVID-19 pandemic, the US Treasury Tobacco and Alcohol Tax and Trade Bureau (the “TTB”) provided emergency waivers allowing fuel ethanol plants to produce high-grade alcohol for use in the production of hand sanitizer. Immediately following the emergency waiver for ethanol producers in March, Aemetis began supplying high-grade alcohol for the production of hand sanitizer. During the first week of April 2020, Aemetis applied for and was approved by the TTB as a Distilled Spirits Producer (“DSP”), allowing the Company to produce fuel ethanol, high-grade alcohol for sanitizer, and other health care and sanitary products, as well as industrial alcohol and potable alcohol for beverage spirits. To further address this market, Aemetis began a series of capital projects at the Keyes Plant that will ultimately enable the Company to produce US Pharmacopeia (“USP”) grade alcohol for sale into these key medical, consumer, governmental and industrial alcohol markets. During June 2020, Aemetis renamed Biofuels Marketing, Inc. as Aemetis Health Products, Inc., and began a sales and marketing strategy of blending, bottling, and selling hand sanitizer into bulk, retail branded, and white label markets. Additionally, Aemetis Health Products, Inc. is developing sales and marketing channels for other personal protective equipment. In December 2020, Aemetis Properties Riverbank, Inc., acquired less than a 20% ownership in Nevo Motors, Inc. (“Nevo Motors”). Under this agreement, Nevo Motors will utilize certain of Aemetis’ existing and future manufacturing facilities and fueling stations, as well as renewable natural gas and renewable electricity produced by Aemetis. The investment has been recorded at zero value as of March 31, 2021 and December 31, 2020. During the first quarter of 2021, Aemetis announced its “Carbon Zero” biofuels production plants designed to produce biofuels, including renewable jet and diesel fuel utilizing cellulosic hydrogen and non-edible renewable oils sourced from existing Aemetis biofuels plants and other sources. The first plant, in Riverbank, California, “Carbon Zero 1”, is expected to utilize hydroelectric and other renewable power available onsite to produce 45 million gallons per year of jet fuel, renewable diesel, and other byproducts. The plant is expected to supply the aviation and truck markets with ultra-low carbon renewable fuels to reduce greenhouse gas (“GHG”) emissions and other pollutants associated with conventional petroleum-based fuels. On April 1, 2021, Aemetis established a new subsidiary named Aemetis Carbon Capture, Inc. that is expected to initially capture, dehydrate, compress, and sequester CO₂ from Aemetis Biogas dairy digester projects. Additional capacity for the capture and storage of CO₂ from other carbon emission sources is under development. |
Basis of Presentation and Consolidation | These consolidated financial statements include the accounts of Aemetis. Additionally, we consolidate all entities in which we have a controlling financial. A controlling financial interest is usually obtained through ownership of a majority of the voting interests. However, an enterprise must consolidate a variable interest entity (“VIE”) if the enterprise is the primary beneficiary of the VIE, even if the enterprise does not own a majority of the voting interests. The primary beneficiary is the party that has both the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance, and the obligation to absorb losses or the right to receive benefits from the VIE that could potentially be significant to the VIE. ABGL was assessed to be a VIE and through the Company's ownership interest in all of the outstanding common stock, the Company has been determined to be the primary beneficiary and accordingly, the assets, liabilities, and operations of ABGL are consolidated into those of the Company. All intercompany balances and transactions have been eliminated in consolidation. The accompanying consolidated condensed balance sheet as of March 31, 2021, the consolidated condensed statements of operations and comprehensive loss for the three months ended March 31, 2021 and 2020, the consolidated condensed statements of cash flows for the three months ended March 31, 2021 and 2020, and the consolidated condensed statements of stockholders’ deficit for the three months ended March 31, 2021 and 2020 are unaudited. The consolidated condensed balance sheet as of December 31, 2020 was derived from the 2020 audited consolidated financial statements and notes thereto. The consolidated condensed financial statements in this report should be read in conjunction with the 2020 audited consolidated financial statements and notes thereto included in the Company’s annual report on Form 10-K for the year ended December 31, 2020. 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 Company’s management, the unaudited interim consolidated condensed financial statements for the three months ended March 31, 2021 and 2020 have been prepared on the same basis as the audited consolidated statements as of December 31, 2020 and reflect all adjustments, consisting primarily of normal recurring adjustments, necessary for the fair presentation of its statement of financial position, results of operations and cash flows. The results of operations for the three months ended March 31, 2021 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, revenues, and expenses during the reporting period. To the extent there are material differences between these estimates and actual results, the Company’s consolidated financial statements will be affected. |
Revenue Recognition | We derive revenue primarily from sales of ethanol and related co-products in North America, and biodiesel and refined glycerin in India pursuant to supply agreements and purchase order contracts. We assessed the following criteria under the Accounting Standards Codification (“ASC”) 606 guidance: (i) identify the contracts with customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations, and (v) recognize revenue when the entity satisfies the performance obligations. North America: During the first quarter of 2020, Aemetis began selling high-grade alcohol for consumer applications directly to customers on the West Coast and Midwest using a variety of payment terms. These agreements and terms were evaluated according to ASC 606 guidance and such revenue is recognized upon satisfaction of the performance obligation by delivery of the product based on the terms of the agreement. Sales of high-grade alcohol represented less than 3% of quarterly revenue, and as such aggregated with ethanol sales for the three months ended March 31, 2020. The Company had no sales of high-grade alcohol in the three months ended March 31, 2021. The below table shows our sales in North America by product category: North America (in thousands) For the three months ended March 31, 2021 2020 Ethanol and high-grade alcohol sales $ 29,920 $ 25,322 Wet distiller's grains sales 11,035 8,374 Other sales 1,373 2,176 $ 42,328 $ 35,872 We have elected to adopt the practical expedient that allows for ignoring the significant financing component of a contract when estimating the transaction price when the transfer of promised goods to the customer and customer payment for such goods are expected to be within one year of contract inception. Further, we have elected to adopt the practical expedient in which incremental costs of obtaining a contract are expensed when the amortization period would otherwise be less than one year. We also assessed principal versus agent criteria as we buy our feedstock from our customers and process and sell finished goods to those customers in certain contractual agreements. In North America, we buy corn as feedstock for the production of ethanol, from our working capital partner J.D. Heiskell. Prior to May 13, 2020, we sold all our ethanol, WDG, and corn oil to J.D. Heiskell. Subsequent to May 13, 2020, we sold most of our fuel ethanol to one customer, Kinergy, and sold all WDG and corn oil to J.D. Heiskell. We consider the purchase of corn as a cost of goods sold and the sale of ethanol, upon transfer to the common carrier, as revenue on the basis that (i) we control and bear the risk of gain or loss on the processing of corn which is purchased at market prices into ethanol and (ii) we have legal title to the goods during the processing time. The pricing for both corn and ethanol is set independently. Revenues from sales of ethanol and its co-products are billed net of the related transportation and marketing charges. The transportation component is accounted for in cost of goods sold and the marketing component is accounted for in sales, general and administrative expense. Transportation and marketing charges are known within days of the transaction and are recorded at the actual amounts. The Company has elected an accounting policy under which these charges have been treated as fulfillment activities provided after control has transferred. As a result, these charges are recognized in cost of goods sold and selling, general and administrative expenses, respectively, when revenue is recognized. Revenues are recorded at the gross invoiced amount. Hence, we are the principal in North America sales scenarios where our customer and vendor may be the same. We have a contract liability of $0.2 million as of March 31, 2021 and December 31, 2020, in connection with a contract with a customer to sell carbon credit allowances. India: The below table shows our sales in India by product category: India (in thousands) For the three months ended March 31, 2021 2020 Biodiesel sales $ 358 $ 2,793 Refined glycerin sales 116 90 PFAD sales - 712 Other sales 5 13 $ 479 $ 3,608 In India, we also assessed principal versus agent criteria as we buy our feedstock from our customers and process and sell finished goods to those same customers in certain contractual agreements. In those cases, we receive the legal title to feedstock from our customers once it is on our premises. We control the processing and production of biodiesel based on contract terms and specifications. The pricing for both feedstock and biodiesel is set independently. We hold the title and risk to biodiesel according to agreements when we enter into in these situations. Hence, we are the principal in India sales scenarios where our customer and vendor may be the same. |
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. |
Accounts Receivable | The Company sells ethanol and WDG through third-party marketing arrangements generally without requiring collateral and high-grade alcohol directly to customers on a variety of terms including advanced payment terms, based on the size and creditworthiness of the customer. DCO is marketed and sold to A.L. Gilbert and other customers under the J.D. Heiskell Purchasing Agreement. The Company sells CDS directly to customers on standard 30 day payment terms. 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. Usually, invoices are due within 30 days on net terms. Accounts receivables consist of product sales made to large creditworthy customers. Trade accounts receivable are presented at original invoice amount, net of any 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 receivables are charged against the allowance for doubtful accounts once un-collectability has been determined. The factors considered in reaching this determination are the apparent financial condition of the customer and the Company’s success in contacting and negotiating with the customer. If the financial condition of the Company’s customers were to deteriorate, additional allowances may be required. We reserved $1.4 million and $1.3 million in the allowances for doubtful accounts as of March 31, 2021 and December 31, 2020, respectively. |
Inventories | Finished goods, raw materials, and work-in-process inventories are valued using methods which approximate the lower of cost (first-in, first-out) or net realizable value (“NRV”). Distillers’ grains and related products are stated at NRV. In the valuation of inventories, NRV is determined as estimated selling price in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. |
Investments | The Company follows ASC 325-20, Cost Method Investments |
Variable Interest Entities | We determine at the inception of each arrangement whether an entity in which we have made an investment or in which we have other variable interests in is considered a variable interest entity (“VIE”). We consolidate VIEs when we are the primary beneficiary. The primary beneficiary of a VIE is the party that meets both of the following criteria: (1) has the power to make decisions that most significantly affect the economic performance of the VIE; and (2) has the obligation to absorb losses or the right to receive benefits that in either case could potentially be significant to the VIE. Periodically, we assess whether any changes in our interest or relationship with the entity affect our determination of whether the entity is still a VIE and, if so, whether we are the primary beneficiary. If we are not the primary beneficiary in a VIE, we account for the investment or other variable interests in a VIE in accordance with applicable GAAP. |
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, biogas dairy digesters, and the Keyes Plant, Goodland Plant and Kakinada Plant. The Goodland Plant is partially completed and is not ready for operation. The first two dairy digesters and pipeline in the Biogas Project were completed, commissioned and began to be depreciated during the third quarter of 2020. The CO₂ Project was completed and commenced operations in the second quarter of 2020. Accordingly, any assets under the CO₂ Project began being depreciated starting in May 2020. It is the Company’s policy to depreciate capital assets over their estimated useful lives using the straight-line method. 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, |
California Energy Commission Technology Demonstration Grant | The Company has been awarded $4.2 million in matching grants from the California Energy Commission Low-Carbon Fuel Production Program (“LCFPP”). The LCFPP grant reimburses the Company for costs to design, procure, and install processing facility to clean-up, measure and verify negative-carbon intensity dairy renewable natural gas fuel at the production facility in Keyes, California. The Company has received $875 thousand from the LCFPP as of March 31, 2021 as reimbursement for actual costs incurred. Due to the uncertainty associated with the approval process under the grant program, the Company recognizes the grant as a reduction of the costs in the period when approval is received. |
California Department of Food and Agriculture Dairy Digester Research and Development Grant | The Company has been awarded $3.2 million in matching grants from the California Department of Food and Agriculture (“CDFA”) Dairy Digester Research and Development program. The CDFA grant reimburses the Company for costs required to permit and construct two of the Company’s biogas capture systems under contract with central California dairies. The Company received $3.2 million as of March 31, 2021 as reimbursement for actual costs incurred. Due to the uncertainty associated with the approval process under the grant program, the Company recognizes the grant as a reduction of the costs in the period when approval is received. |
California Energy Commission Low Carbon Advanced Ethanol Grant Program | In May 2019, the Company was awarded the right to receive reimbursements from the California Energy Commission Community-Scale and Commercial-Scale Advanced Biofuels Production Facilities grant under the Alternative and Renewable Fuel and Vehicle Technology Program in an amount up to $5.0 million (the “CEC Reimbursement Program”) in connection with the Company’s expenditures toward the development of the Riverbank Cellulosic Ethanol Facility. To comply with the guidelines of the CEC Reimbursement Program, the Company must make a minimum of $7.9 million in matching contributions to the Riverbank Project. The Company receives funds under the CEC Reimbursement Program for actual expenses incurred up to $5.0 million as long as the Company makes the minimum matching contribution. Given that the Company has not made the minimum matching contribution, the grant for reimbursement of capital expenditures of $115 thousand received during the first quarter of 2021, and $1.7 million from prior years were recorded as other long term liabilities as of March 31, 2021. Due to the uncertainty associated with meeting the minimum matching contribution, the reimbursement will be recognized when the Company makes the minimum matching contribution. |
Basic and Diluted Net Loss per Share | Basic net loss per share is computed by dividing net loss attributable to common shareholders by the weighted average number of common shares outstanding for the period. Diluted net 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 losses for the three months ended March 31, 2021 and 2020, potentially dilutive securities have been excluded from the diluted net loss per share computations as their effect would be anti-dilutive. The following table shows the number of potentially dilutive shares excluded from the diluted net loss per share calculation as of March 31, 2021 and 2020: As of March 31, 2021 March 31, 2020 Series B preferred (post split basis) 132 132 Common stock options and warrants 5,080 5,688 Debt with conversion feature at $30 per share of common stock 1,286 1,269 Total number of potentially dilutive shares excluded from the diluted loss per share calculation 6,498 7,089 |
Comprehensive Loss | ASC 220 Comprehensive Income |
Foreign Currency Translation/Transactions | Assets and liabilities of the Company’s non-U.S. subsidiary that operates in a local currency environment, where that local currency is the functional currency, are translated into U.S. dollars at exchange rates in effect at the balance sheet date and 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. Transactional gains and losses from foreign currency transactions are recorded in other (income) loss, net. |
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 Company’s 65 million gallons per year capacity Keyes Plant in California, the cellulosic ethanol facility in Riverbank, the cluster of biogas digesters on dairies near Keyes, California, the Goodland Plant, Kansas and the research and development facility in Minnesota. The “India” operating segment includes the Company’s 50 million gallon per year capacity Kakinada Plant in India, the administrative offices in Hyderabad, India, and the holding companies in Nevada and Mauritius. |
Fair Value of Financial Instruments | Financial instruments include accounts receivable, accounts payable, accrued liabilities, current and non-current portion of subordinated debt, notes receivable, notes payable, series A preferred units, and long-term debt. Due to the unique terms of our notes payable and long-term debt and the financial condition of the Company, the fair value of the debt is not readily determinable. The fair value, determined using level 3 inputs, of all other current financial instruments is estimated to approximate carrying value due to the short-term nature of these instruments. |
Share-Based Compensation | The Company recognizes share-based compensation expense in accordance with ASC 718 Stock Compensation |
Commitments and Contingencies | The Company records and/or discloses commitments and contingencies in accordance with ASC 450 Contingencies |
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. |
Debt Modification Accounting | The Company evaluates amendments to its debt in accordance with ASC 470-50 Debt–Modification and Extinguishments |
Recently Issued Accounting Pronouncements | ASU 2016-13: Measurement of Credit Losses on Financial Instruments. For a complete summary of the Company’s significant accounting policies, please refer to the Company’s audited financial statements and notes thereto for the years ended December 31, 2020 and 2019 included in the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 15, 2021. |
1. Nature of Activities and S_3
1. Nature of Activities and Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Accounting Policies [Abstract] | |
Disaggregation of revenue | The below table shows our sales in North America by product category: North America (in thousands) For the three months ended March 31, 2021 2020 Ethanol and high-grade alcohol sales $ 29,920 $ 25,322 Wet distiller's grains sales 11,035 8,374 Other sales 1,373 2,176 $ 42,328 $ 35,872 The below table shows our sales in India by product category: India (in thousands) For the three months ended March 31, 2021 2020 Biodiesel sales $ 358 $ 2,793 Refined glycerin sales 116 90 PFAD sales - 712 Other sales 5 13 $ 479 $ 3,608 |
Schedule of dilutive securities | As of March 31, 2021 March 31, 2020 Series B preferred (post split basis) 132 132 Common stock options and warrants 5,080 5,688 Debt with conversion feature at $30 per share of common stock 1,286 1,269 Total number of potentially dilutive shares excluded from the diluted loss per share calculation 6,498 7,089 |
2. Inventories (Tables)
2. Inventories (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Inventory Disclosure [Abstract] | |
Schedule of inventories | As of March 31, 2021 December 31, 2020 Raw materials $ 1,321 $ 1,382 Work-in-progress 1,938 1,266 Finished goods 951 1,321 Total inventories $ 4,210 $ 3,969 |
3. Property, Plant and Equipm_2
3. Property, Plant and Equipment (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Property, Plant and Equipment [Abstract] | |
Schedule of property, plant and equipment | As of March 31, 2021 December 31, 2020 Land $ 4,091 $ 4,092 Plant and buildings 97,249 97,398 Furniture and fixtures 1,191 1,195 Machinery and equipment 5,272 5,188 Construction in progress 30,032 25,397 Property held for development 15,408 15,408 Finance lease right of use assets 2,308 2,308 Total gross property, plant & equipment 155,551 150,986 Less accumulated depreciation (42,461 ) (41,106 ) Total net property, plant & equipment $ 113,090 $ 109,880 |
Depreciation of property, plant, and equipment | Years Plant and buildings 20 - 30 Machinery and equipment 5 - 15 Furniture and fixtures 3 - 5 |
4. Debt (Tables)
4. Debt (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Debt Disclosure [Abstract] | |
Schedule of debt | March 31, 2021 December 31, 2020 Third Eye Capital term notes $ 7,095 $ 7,066 Third Eye Capital revolving credit facility 85,105 80,310 Third Eye Capital revenue participation term notes 11,913 11,864 Third Eye Capital acquisition term notes 26,463 26,384 Third Eye Capital promissory note - 1,444 Cilion shareholder seller notes payable 6,311 6,274 Subordinated notes 12,973 12,745 Term loan on Equipment purchase 5,652 5,652 EB-5 promissory notes 42,769 43,120 PPP loans 1,134 1,134 GAFI Term and Revolving loans - 33,626 Total debt 199,415 229,619 Less current portion of debt 25,407 59,515 Total long term debt $ 174,008 $ 170,104 |
Maturities of long-term debt | Twelve months ended March 31, Debt Repayments 2022 $ 25,407 2023 160,624 2024 7,936 2025 4,496 2026 936 There after 1,324 Total debt 200,723 Debt issuance costs (1,308 ) Total debt, net of debt issuance costs $ 199,415 |
5. Commitments and Contingenc_2
5. Commitments and Contingencies (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of lease expense and sublease income | Three Months ended March 31, 2021 2020 Operating lease cost Operating lease expense $ 204 $ 177 Short term lease expense 39 14 Variable lease expense 33 34 Total operating lease cost $ 276 $ 225 Finance lease cost Amortization of right-of-use assets $ 55 $ - Interest on lease liabilities 21 - Total finance lease cost $ 76 $ - |
Cash paid for amounts included in the measurement of lease liabilities | Three Months ended March 31, 2021 2020 Operating cash flows used in operating leases $ 167 $ 179 Operating cash flows used in finance leases 21 - Financing cash flows used in finance leases $ 124 - |
Supplemental non-cash flow information related to right-of-use asset and lease liabilities | Three Months ended March 31, 2021 2020 Operating leases Accretion of the lease liability $ 99 $ 17 Amortization of right-of-use assets 105 160 Weighted Average Remaining Lease Term Operating leases 6.7 years Finance leases 3.0 years Weighted Average Discount Rate Operating leases 14.0 % Finance leases 5.5 % |
Supplemental balance sheet information | As of March 31, 2021 December 31, 2020 Operating leases Operating lease right-of-use assets $ 2,783 $ 2,889 Current portion of operating lease liability 325 316 Long term operating lease liability 2,502 2,578 Total operating lease liabilities 2,827 2,894 Finance leases Property and equipment, at cost $ 2,204 $ 2,308 Accumulated depreciation (200 ) (249 ) Property and equipment, net 2,004 2,059 Other current liability 422 417 Other long term liabilities 1,057 1,164 Total finance lease liabilities 1,479 1,581 |
Maturities of operating and finance lease liabilities | Three Months ended March 31, Operating leases Finance leases 2021 $ 691 $ 577 2022 573 494 2023 577 494 2024 595 44 2025 612 - There after 1,393 - Total lease payments 4,441 1,609 Less imputed interest (1,614 ) (130 ) Total lease liability $ 2,827 $ 1,479 |
7. Stock-Based Compensation (Ta
7. Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Share-based Payment Arrangement, Noncash Expense [Abstract] | |
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, 2020 380 5,327 $ 1.14 Authorized 816 - - Granted (950 ) 950 3.09 Exercised - (1,211 ) 1.49 Forfeited/expired 61 (61 ) 1.91 Balance as of March 31, 2021 307 5,005 $ 1.41 |
Schedule of weighted average fair value calculations for options | For the three months ended March 31, Description 2021 2020 Dividend-yield 0 % 0 % Risk-free interest rate 0.70 % 1.08 % Expected volatility 97.45 % 87.43 % Expected life (years) 6.51 6.93 Market value per share on grant date $ 3.09 $ 0.71 Fair value per share on grant date $ 2.44 $ 0.54 |
8. Agreements (Tables)
8. Agreements (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Agreements | |
Schedule of working capital agreement activity | As of and for the three months ended March 31, 2021 2020 Ethanol sales $ - $ 24,383 Wet distiller's grains sales 11,035 8,374 Corn oil sales 1,042 928 Corn purchases 37,993 29,214 Accounts receivable 133 60 Accounts payable 415 1,749 |
9. Segment Information (Tables)
9. Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2021 | |
Segment Reporting [Abstract] | |
Schedule of segment information | Three months ended March 31, 2021 Three Months ended March 31, 2020 North America India Total Consolidated North America India Total Consolidated Revenues $ 42,328 $ 479 $ 42,807 $ 35,872 $ 3,608 $ 39,480 Cost of goods sold 45,881 534 46,415 36,413 3,500 39,913 Gross (loss) profit (3,553 ) (55 ) (3,608 ) (541 ) 108 (433 ) Other Expenses Research and development expenses 23 - 23 117 - 117 Selling, general and administrative expenses 5,021 361 5,382 3,120 816 3,936 Interest expense 7,180 - 7,180 6,857 19 6,876 Accretion of Series A preferred units 1,943 - 1,943 960 - 960 Other (income) expense (10 ) (21 ) (31 ) (53 ) (10 ) (63 ) Loss before income taxes $ (17,710 ) $ (395 ) $ (18,105 ) $ (11,542 ) $ (717 ) $ (12,259 ) Capital expenditures $ 6,443 $ 117 $ 6,560 $ 1,298 $ 1,074 $ 2,372 Depreciation 1,202 184 1,386 933 157 1,090 As of March 31, December 31, 2021 2020 North America $ 131,427 $ 112,312 India 12,306 12,827 Total Assets $ 143,733 $ 125,139 |
1. Nature of Activities and S_4
1. Nature of Activities and Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Sales | $ 42,807 | $ 39,480 |
North America | ||
Sales | 42,328 | 35,872 |
North America | Ethanol and high-grade alcohol sales | ||
Sales | 29,920 | 25,322 |
North America | Wet distiller's grains sales | ||
Sales | 11,035 | 8,374 |
North America | Other sales | ||
Sales | 1,373 | 2,176 |
India | ||
Sales | 479 | 3,608 |
India | Other sales | ||
Sales | 5 | 13 |
India | Biodiesel sales | ||
Sales | 358 | 2,793 |
India | Refined Glycerin sales | ||
Sales | 116 | 90 |
India | PFAD sales | ||
Sales | $ 0 | $ 712 |
1. Nature of Activities and S_5
1. Nature of Activities and Summary of Significant Accounting Policies (Details 1) - shares | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Total number of potentially dilutive shares excluded from the basic and diluted net loss per share calculation (in thousands) | 6,498 | 7,089 |
Series B preferred (post split basis) | ||
Total number of potentially dilutive shares excluded from the basic and diluted net loss per share calculation (in thousands) | 132 | 132 |
Common stock options and warrants | ||
Total number of potentially dilutive shares excluded from the basic and diluted net loss per share calculation (in thousands) | 5,080 | 5,688 |
Debt with conversion feature at $30 per share of common stock | ||
Total number of potentially dilutive shares excluded from the basic and diluted net loss per share calculation (in thousands) | 1,286 | 1,269 |
2. Inventories (Details)
2. Inventories (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 1,321 | $ 1,382 |
Work-in-progress | 1,938 | 1,266 |
Finished goods | 951 | 1,321 |
Total inventories | $ 4,210 | $ 3,969 |
2. Inventories (Details Narrati
2. Inventories (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2021 | Dec. 31, 2020 | |
Inventory Disclosure [Abstract] | ||
Lower cost of market impairment | $ 100 | $ 700 |
3. Property, Plant and Equipm_3
3. Property, Plant and Equipment (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Property, Plant and Equipment [Abstract] | ||
Land | $ 4,091 | $ 4,092 |
Plant and buildings | 97,249 | 97,398 |
Furniture and fixtures | 1,191 | 1,195 |
Machinery and equipment | 5,272 | 5,188 |
Construction in progress | 30,032 | 25,397 |
Property held for development | 15,408 | 15,408 |
Finance lease right of use assets | 2,308 | 2,308 |
Total gross property, plant & equipment | 155,551 | 150,986 |
Less accumulated depreciation | (42,461) | (41,106) |
Total net property, plant & equipment | $ 113,090 | $ 109,880 |
3. Property, Plant and Equipm_4
3. Property, Plant and Equipment (Details 1) | 3 Months Ended |
Mar. 31, 2021 | |
Plant and Buildings | Minimum | |
Depreciation (years) | 20 years |
Plant and Buildings | Maximum | |
Depreciation (years) | 30 years |
Machinery and Equipment | Minimum | |
Depreciation (years) | 5 years |
Machinery and Equipment | Maximum | |
Depreciation (years) | 15 years |
Furniture and Fixtures | Minimum | |
Depreciation (years) | 3 years |
Furniture and Fixtures | Maximum | |
Depreciation (years) | 5 years |
3. Property, Plant and Equipm_5
3. Property, Plant and Equipment (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation expense | $ 1,386 | $ 1,090 |
4. Debt (Details)
4. Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Total debt | $ 199,415 | $ 229,619 |
Less current portion of debt | 25,407 | 59,515 |
Total long term debt | 174,008 | 170,104 |
Third Eye Capital Term Notes | ||
Total debt | 7,095 | 7,066 |
Third Eye Capital Revolving Credit Facility | ||
Total debt | 85,105 | 80,310 |
Third Eye Capital Revenue Participation Term Notes | ||
Total debt | 11,913 | 11,864 |
Third Eye Capital Acquisition Term Notes | ||
Total debt | 26,463 | 26,384 |
Third Eye Capital Promissory Note | ||
Total debt | 0 | 1,444 |
Cilion Shareholder Seller Notes Payable | ||
Total debt | 6,311 | 6,274 |
Subordinated Notes | ||
Total debt | 12,973 | 12,745 |
Term Loan on Equipment Purchase | ||
Total debt | 5,652 | 5,652 |
EB-5 Promissory Notes | ||
Total debt | 42,769 | 43,120 |
PPP Loans | ||
Total debt | 1,134 | 1,134 |
GAFI Term and Revolving Loans | ||
Total debt | $ 0 | $ 33,626 |
4. Debt (Details 1)
4. Debt (Details 1) $ in Thousands | Mar. 31, 2021USD ($) |
Twelve months ended June 30, | |
2022 | $ 25,407 |
2023 | 160,624 |
2024 | 7,936 |
2025 | 4,496 |
2026 | 936 |
Thereafter | 1,324 |
Total debt | 200,723 |
Debt issuance costs | (1,308) |
Total debt, net of debt issuance costs | $ 199,415 |
5. Commitments and Contingenc_3
5. Commitments and Contingencies (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Operating Lease Cost | ||
Operating lease expense | $ 204 | $ 177 |
Short term lease expense | 39 | 14 |
Variable lease expense | 33 | 34 |
Total operating lease cost | 276 | 225 |
Finance Lease Cost | ||
Amortization of right-of-use-assets | 55 | 0 |
Interest on lease liabilities | 21 | 0 |
Total finance lease cost | $ 76 | $ 0 |
5. Commitments and Contingenc_4
5. Commitments and Contingencies (Details 1) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Operating cash flows used in operating leases | $ 167 | $ 179 |
Operating cash flows used in finance leases | 21 | 0 |
Financing cash flows used in finance leases | $ 124 | $ 0 |
5. Commitments and Contingenc_5
5. Commitments and Contingencies (Details 2) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Accretion of the lease liability | $ 99 | $ 17 | |
Amortization of right-of-use assets | $ 105 | $ 160 | |
Weighted Average Remaining Lease Term | |||
Operating leases | 6 years 8 months 12 days | ||
Finance leases | 3 years | ||
Weighted Average Discount Rate | |||
Operating leases | 14.00% | ||
Finance leases | 5.50% | ||
Operating Leases | |||
Operating lease right-of-use assets | $ 2,783 | $ 2,889 | |
Current portion of operating lease liability | 325 | 316 | |
Long term operating lease liability | 2,502 | 2,578 | |
Total operating lease liabilities | 2,827 | 2,894 | |
Finance Leases | |||
Property and equipment, at cost | 2,204 | 2,308 | |
Accumulated depreciation | (200) | (249) | |
Property and equipment, net | 2,004 | 2,059 | |
Other current liability | 422 | 417 | |
Long term other liability | 1,057 | 1,164 | |
Total finance lease liabilities | $ 1,479 | $ 1,581 |
5. Commitments and Contingenc_6
5. Commitments and Contingencies (Details 3) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Commitments and Contingencies Disclosure [Abstract] | ||
2021 | $ 691 | |
2022 | 573 | |
2023 | 577 | |
2024 | 595 | |
2025 | 612 | |
Thereafter | 1,393 | |
Total lease payments | 4,441 | |
Less: imputed interest | (1,614) | |
Total operating lease liability | 2,827 | $ 2,894 |
2021 | 577 | |
2022 | 494 | |
2023 | 494 | |
2024 | 44 | |
2025 | 0 | |
Thereafter | 0 | |
Total lease payments | 1,609 | |
Less: imputed interest | (130) | |
Total finance lease liability | $ 1,479 | $ 1,581 |
7. Stock-Based Compensation (De
7. Stock-Based Compensation (Details) | 3 Months Ended |
Mar. 31, 2021$ / sharesshares | |
Share-based Payment Arrangement, Noncash Expense [Abstract] | |
Shares available for grant, beginning (in thousands) | 380 |
Shares available for grant, authorized (in thousands) | 816 |
Shares available for grant, granted (in thousands) | (950) |
Shares available for grant, exercised (in thousands) | 0 |
Shares available for grant, forfeited/expired (in thousands) | 61 |
Shares available for grant, ending (in thousands) | 307 |
Number of outstanding, beginning (in thousands) | 5,327 |
Number of shares, granted (in thousands) | 950 |
number of shares, exercised (in thousands) | (1,211) |
Number of shares, forfeited/expired (in thousands) | (61) |
Number of outstanding, ending (in thousands) | 5,005 |
Weighted average exercise price outstanding, beginning | $ / shares | $ 1.14 |
Weighted average exercise price, granted | $ / shares | 3.09 |
Weighted average exercise price, exercised | $ / shares | 1.49 |
Weighted average exercise price, forfeited/expired | $ / shares | 1.91 |
Weighted average exercise price outstanding, ending | $ / shares | $ 1.41 |
7. Stock-Based Compensation (_2
7. Stock-Based Compensation (Details 1) - $ / shares | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Share-based Payment Arrangement, Noncash Expense [Abstract] | ||
Dividend-yield | 0.00% | 0.00% |
Risk-free interest rate | 0.70% | 1.08% |
Expected volatility | 97.45% | 87.43% |
Expected life (years) | 6 years 6 months 4 days | 6 years 11 months 5 days |
Market value per share on grant date | $ 3.09 | $ 0.71 |
Weighted average fair value per share of common stock | $ 2.44 | $ 0.54 |
7. Stock-Based Compensation (_3
7. Stock-Based Compensation (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Share-based Payment Arrangement, Noncash Expense [Abstract] | |||
Options outstanding | 5,005 | 5,327 | |
Options vested | 2,900 | ||
Stock compensation expense | $ 835 | $ 310 | |
Options granted | (950) | ||
Unrecognized compensation expense | $ 2,300 | ||
Unrecognized compensation expense, recognition period | 2 years 5 months 5 days |
8. Agreements (Details)
8. Agreements (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Agreements | ||
Ethanol sales | $ 0 | $ 24,383 |
Wet distiller's grains sales | 11,035 | 8,374 |
Corn oil sales | 1,042 | 928 |
Corn purchases | 37,993 | 29,214 |
Accounts receivable | 133 | 60 |
Accounts payable | $ 415 | $ 1,749 |
8. Agreements (Details Narrativ
8. Agreements (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Agreements | ||
Marketing costs | $ 400 | $ 600 |
9. Segment Information (Details
9. Segment Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2021 | Mar. 31, 2020 | |
Revenues | $ 42,807 | $ 39,480 |
Cost of goods sold | 46,415 | 39,913 |
Gross (loss) profit | (3,608) | (433) |
Expenses | ||
Research and development expenses | 23 | 117 |
Selling, general and administrative expenses | 5,382 | 3,936 |
Interest expense | 7,180 | 6,876 |
Accretion of Series A preferred units | 1,943 | 960 |
Other (income) expense | (31) | (63) |
Income (loss) before income taxes | (18,105) | (12,259) |
Capital expenditures | 6,560 | 2,372 |
Depreciation | 1,386 | 1,090 |
North America | ||
Revenues | 42,328 | 35,872 |
Cost of goods sold | 45,881 | 36,413 |
Gross (loss) profit | (3,553) | (541) |
Expenses | ||
Research and development expenses | 23 | 117 |
Selling, general and administrative expenses | 5,021 | 3,120 |
Interest expense | 7,180 | 6,857 |
Accretion of Series A preferred units | 1,943 | 960 |
Other (income) expense | (10) | (53) |
Income (loss) before income taxes | (17,710) | (11,542) |
Capital expenditures | 6,443 | 1,298 |
Depreciation | 1,202 | 933 |
India | ||
Revenues | 479 | 3,608 |
Cost of goods sold | 534 | 3,500 |
Gross (loss) profit | (55) | 108 |
Expenses | ||
Research and development expenses | 0 | 0 |
Selling, general and administrative expenses | 361 | 816 |
Interest expense | 0 | 19 |
Accretion of Series A preferred units | 0 | 0 |
Other (income) expense | (21) | (10) |
Income (loss) before income taxes | (395) | (717) |
Capital expenditures | 117 | 1,074 |
Depreciation | $ 184 | $ 157 |
9. Segment Information (Detai_2
9. Segment Information (Details 1) - USD ($) $ in Thousands | Mar. 31, 2021 | Dec. 31, 2020 |
Assets | $ 143,733 | $ 125,139 |
North America | ||
Assets | 131,427 | 112,312 |
India | ||
Assets | $ 12,306 | $ 12,827 |
10. Related Party Transactions
10. Related Party Transactions (Details Narrative) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2021 | Mar. 31, 2020 | Dec. 31, 2020 | |
Eric McAfee and McAfee Capital | |||
Related party debt | $ 400 | $ 400 | |
Various Board Members | |||
Related party debt | 1,000 | $ 1,200 | |
Related party transaction | $ 100 | $ 100 |