Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Nov. 30, 2019 | Jan. 10, 2020 | |
Document And Entity Information | ||
Entity Registrant Name | GREYSTONE LOGISTICS, INC. | |
Entity Central Index Key | 0001088413 | |
Document Type | 10-Q | |
Document Period End Date | Nov. 30, 2019 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --05-31 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business Flag | true | |
Entity Emerging Growth Company | false | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 28,361,201 | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2020 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Nov. 30, 2019 | May 31, 2019 |
Current Assets: | ||
Cash | $ 1,580,845 | $ 1,255,408 |
Accounts receivable - Trade | 4,391,278 | 6,320,875 |
Accounts receivable - Related parties | 103,834 | 50,320 |
Inventory | 3,692,991 | 2,620,991 |
Prepaid expenses | 99,978 | 239,146 |
Total Current Assets | 9,868,926 | 10,486,740 |
Property, Plant and Equipment, net | 32,413,476 | 32,680,472 |
Total Assets | 42,282,402 | 43,167,212 |
Current Liabilities: | ||
Current portion of long-term debt | 3,442,269 | 3,030,630 |
Current portion of financing leases | 2,111,028 | 1,516,629 |
Current portion of operating leases | 72,144 | 58,236 |
Accounts payable and accrued liabilities | 7,442,317 | 6,520,721 |
Deferred revenue | 1,514,495 | 2,201,067 |
Preferred dividends payable | 102,637 | 112,192 |
Total Current Liabilities | 14,684,890 | 13,439,475 |
Long-Term Debt, net of current portion | 17,905,736 | 19,629,148 |
Financing Leases, net of current portion | 3,732,262 | 5,238,190 |
Operating Leases, net of current portion | 146,489 | 122,558 |
Deferred Tax Liability | 1,246,642 | 926,642 |
Equity: | ||
Preferred stock, $0.0001 par value, cumulative, 20,750,000 shares authorized, 50,000 shares issued and outstanding, liquidation preference of $5,000,000 | 5 | 5 |
Common stock, $0.0001 par value, 5,000,000,000 shares authorized, 28,361,201 shares issued and outstanding | 2,836 | 2,836 |
Additional paid-in capital | 53,790,764 | 53,790,764 |
Accumulated deficit | (50,361,999) | (51,108,677) |
Total Greystone Stockholders' Equity | 3,431,606 | 2,684,928 |
Non-controlling interest | 1,134,777 | 1,126,271 |
Total Equity | 4,566,383 | 3,811,199 |
Total Liabilities and Equity | $ 42,282,402 | $ 43,167,212 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) | Nov. 30, 2019 | May 31, 2019 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 20,750,000 | 20,750,000 |
Preferred stock, shares issued | 50,000 | 50,000 |
Preferred stock, shares outstanding | 50,000 | 50,000 |
Preferred stock, liquidation preference | $ 5,000,000 | $ 5,000,000 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 5,000,000,000 | 5,000,000,000 |
Common stock, shares issued | 28,361,201 | 28,361,201 |
Common stock, shares outstanding | 28,361,201 | 28,361,201 |
Consolidated Statements of Inco
Consolidated Statements of Income (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Nov. 30, 2019 | Nov. 30, 2018 | Nov. 30, 2019 | Nov. 30, 2018 | |
Income Statement [Abstract] | ||||
Sales | $ 19,503,462 | $ 14,733,130 | $ 38,167,971 | $ 32,939,240 |
Cost of Sales | 17,353,239 | 13,041,366 | 33,656,973 | 28,801,518 |
Gross Profit | 2,150,223 | 1,691,764 | 4,510,998 | 4,137,722 |
Selling, General and Administrative Expenses | 1,112,630 | 853,650 | 2,190,228 | 1,792,741 |
Operating Income | 1,037,593 | 838,114 | 2,320,770 | 2,344,981 |
Other Income (Expense): | ||||
Other income | 2,880 | 3,021 | 4,913 | 5,290 |
Interest expense | (432,788) | (435,690) | (913,699) | (848,318) |
Income before Income Taxes | 607,685 | 405,445 | 1,411,984 | 1,501,953 |
Provision for Income Taxes | 135,000 | 108,500 | 320,000 | 440,100 |
Net Income | 472,685 | 296,945 | 1,091,984 | 1,061,853 |
Income Attributable to Non-controlling Interest | (65,620) | (62,952) | (130,306) | (123,527) |
Preferred Dividends | (102,637) | (105,100) | (215,000) | (208,045) |
Net Income Attributable to Common Stockholders | $ 304,428 | $ 128,893 | $ 746,678 | $ 730,281 |
Income Per Share of Common Stock - Basic and Diluted | $ 0.01 | $ 0 | $ 0.03 | $ 0.03 |
Weighted Average Shares of Common Stock Outstanding - Basic | 28,361,201 | 28,361,201 | 28,361,201 | 28,361,201 |
Weighted Average Shares of Common Stock Outstanding - Diluted | 29,001,160 | 29,018,262 | 29,005,432 | 29,009,949 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Equity (Unaudited) - USD ($) | Preferred Stock [Member] | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Total Greystone Stockholders' Equity [Member] | Non-controlling Interest [Member] | Total |
Balance at May. 31, 2018 | $ 5 | $ 2,836 | $ 53,790,764 | $ (52,485,313) | $ 1,308,292 | $ 1,085,155 | $ 2,393,447 |
Balance, shares at May. 31, 2018 | 50,000 | 28,361,201 | |||||
Cash distributions | (51,000) | (51,000) | |||||
Preferred dividends | (102,945) | (102,945) | (102,945) | ||||
Net income | 704,333 | 704,333 | 60,575 | 764,908 | |||
Balance at Aug. 31, 2018 | $ 5 | $ 2,836 | 53,790,764 | (51,883,925) | 1,909,680 | 1,094,730 | 3,004,410 |
Balance, shares at Aug. 31, 2018 | 50,000 | 28,361,201 | |||||
Balance at May. 31, 2018 | $ 5 | $ 2,836 | 53,790,764 | (52,485,313) | 1,308,292 | 1,085,155 | 2,393,447 |
Balance, shares at May. 31, 2018 | 50,000 | 28,361,201 | |||||
Net income | 1,061,853 | ||||||
Balance at Nov. 30, 2018 | $ 5 | $ 2,836 | 53,790,764 | (51,755,032) | 2,038,573 | 1,106,682 | 3,145,255 |
Balance, shares at Nov. 30, 2018 | 50,000 | 28,361,201 | |||||
Balance at Aug. 31, 2018 | $ 5 | $ 2,836 | 53,790,764 | (51,883,925) | 1,909,680 | 1,094,730 | 3,004,410 |
Balance, shares at Aug. 31, 2018 | 50,000 | 28,361,201 | |||||
Cash distributions | (51,000) | (51,000) | |||||
Preferred dividends | (105,100) | (105,100) | (105,100) | ||||
Net income | 233,993 | 233,993 | 62,952 | 296,945 | |||
Balance at Nov. 30, 2018 | $ 5 | $ 2,836 | 53,790,764 | (51,755,032) | 2,038,573 | 1,106,682 | 3,145,255 |
Balance, shares at Nov. 30, 2018 | 50,000 | 28,361,201 | |||||
Balance at May. 31, 2019 | $ 5 | $ 2,836 | 53,790,764 | (51,108,677) | 2,684,928 | 1,126,271 | 3,811,199 |
Balance, shares at May. 31, 2019 | 50,000 | 28,361,201 | |||||
Cash distributions | (52,200) | (52,200) | |||||
Preferred dividends | (112,363) | (112,363) | (112,363) | ||||
Net income | 554,613 | 554,613 | 64,686 | 619,299 | |||
Balance at Aug. 31, 2019 | $ 5 | $ 2,836 | 53,790,764 | (50,666,427) | 3,127,178 | 1,138,757 | 4,265,935 |
Balance, shares at Aug. 31, 2019 | 50,000 | 28,361,201 | |||||
Balance at May. 31, 2019 | $ 5 | $ 2,836 | 53,790,764 | (51,108,677) | 2,684,928 | 1,126,271 | 3,811,199 |
Balance, shares at May. 31, 2019 | 50,000 | 28,361,201 | |||||
Net income | 1,091,984 | ||||||
Balance at Nov. 30, 2019 | $ 5 | $ 2,836 | 53,790,764 | (50,361,999) | 3,431,606 | 1,134,777 | 4,566,383 |
Balance, shares at Nov. 30, 2019 | 50,000 | 28,361,201 | |||||
Balance at Aug. 31, 2019 | $ 5 | $ 2,836 | 53,790,764 | (50,666,427) | 3,127,178 | 1,138,757 | 4,265,935 |
Balance, shares at Aug. 31, 2019 | 50,000 | 28,361,201 | |||||
Cash distributions | (69,600) | (69,600) | |||||
Preferred dividends | (102,637) | (102,637) | (215,000) | ||||
Net income | 407,065 | 407,065 | 65,620 | 472,685 | |||
Balance at Nov. 30, 2019 | $ 5 | $ 2,836 | $ 53,790,764 | $ (50,361,999) | $ 3,431,606 | $ 1,134,777 | $ 4,566,383 |
Balance, shares at Nov. 30, 2019 | 50,000 | 28,361,201 |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Equity (Unaudited) (Parenthetical) - $ / shares | 3 Months Ended | |||
Nov. 30, 2019 | Aug. 31, 2019 | Nov. 30, 2018 | Aug. 31, 2018 | |
Statement of Stockholders' Equity [Abstract] | ||||
Preferred dividends per share | $ 2.05 | $ 2.25 | $ 2.10 | $ 2.06 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 6 Months Ended | |
Nov. 30, 2019 | Nov. 30, 2018 | |
Cash Flows from Operating Activities: | ||
Net income | $ 1,091,984 | $ 1,061,853 |
Adjustments to reconcile net income to net cash provided by operating activities - | ||
Depreciation and amortization | 2,560,516 | 2,178,499 |
Deferred tax expense | 320,000 | 440,100 |
Decrease in trade accounts receivable | 1,929,597 | 2,591,083 |
Increase in related party receivables | (53,514) | (41,262) |
Increase in inventory | (1,072,000) | (2,298,739) |
Decrease in prepaid expenses | 139,168 | 159,246 |
Increase in accounts payable and accrued liabilities | 687,310 | 2,272,400 |
Decrease in deferred revenue | (686,572) | (2,846,745) |
Net cash provided by operating activities | 4,916,489 | 3,516,435 |
Cash Flows from Investing Activities: | ||
Purchases of property and equipment | (2,018,815) | (5,308,802) |
Cash Flows from Financing Activities: | ||
Proceeds from long-term debt | 672,000 | 3,514,265 |
Principal payments on long-term debt and financing leases | (2,390,138) | (2,321,590) |
Proceeds from revolving loan | 690,000 | 2,421,000 |
Principal payments on revolving loan | (972,000) | (1,300,000) |
Principal payments on related party note payable and financing lease | (222,384) | (122,501) |
Payments for debt issuance costs | (3,360) | |
Dividends paid on preferred stock | (224,555) | (102,945) |
Distributions paid by non-controlling interest | (121,800) | (102,000) |
Net cash provided by (used in) financing activities | (2,572,237) | 1,986,229 |
Net Increase in Cash | 325,437 | 193,862 |
Cash, beginning of period | 1,255,408 | 379,632 |
Cash, end of period | 1,580,845 | 573,494 |
Non-cash Activities: | ||
Acquisition of equipment by capital lease | 2,333,333 | |
Capital expenditures in accounts payable | 507,851 | 110,182 |
Preferred dividend accrual | 102,637 | 105,100 |
Supplemental information: | ||
Interest paid | $ 913,992 | $ 828,706 |
Basis of Financial Statements
Basis of Financial Statements | 6 Months Ended |
Nov. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Financial Statements | Note 1. Basis of Financial Statements In the opinion of Greystone Logistics, Inc. (“Greystone”), the accompanying unaudited consolidated financial statements contain all adjustments and reclassifications, which are of a normal recurring nature, necessary to present fairly its financial position as of November 30, 2019 and the results of its operations and cash flows for the six months and three months ended November 30, 2019 and 2018. These consolidated financial statements should be read in conjunction with the audited consolidated financial statements as of and for the fiscal year ended May 31, 2019 and the notes thereto included in Greystone’s Form 10-K for such period. The results of operations for the six months and three months ended November 30, 2019 and 2018 are not necessarily indicative of the results to be expected for the full fiscal year. The consolidated financial statements of Greystone include its wholly-owned subsidiaries, Greystone Manufacturing, L.L.C. (“GSM”) and Plastic Pallet Production, Inc. (“PPP”), and the variable interest entity, Greystone Real Estate, L.L.C. (“GRE”). GRE owns two buildings located in Bettendorf, Iowa which are leased to GSM. All material intercompany accounts and transactions have been eliminated in the consolidated financial statements. |
Earnings Per Share
Earnings Per Share | 6 Months Ended |
Nov. 30, 2019 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Note 2. Earnings Per Share Basic earnings per share is based on the weighted-average effect of all common shares issued and outstanding and is calculated by dividing net income attributable to common stockholders by the weighted-average shares outstanding during the period. Diluted earnings per share is calculated by dividing net income attributable to common stockholders by the weighted-average number of common shares used in the basic earnings per share calculation plus the number of common shares that would be issued assuming exercise or conversion of all potentially dilutive common shares outstanding. Greystone excludes equity instruments from the calculation of diluted earnings per share if the effect of including such instruments is anti-dilutive. Instruments which have an anti-dilutive effect for the six months and three months ended November 30 are as follows: 2019 2018 Preferred stock convertible into common stock 3,333,333 3,333,333 The following tables set forth the computation of basic and diluted earnings per share: For the six months ended November 30, 2019 and 2018: 2019 2018 Numerator - Net income attributable to common stockholders $ 746,678 $ 730,281 Denominator - Weighted-average shares outstanding - basic 28,361,201 28,361,201 Incremental shares from assumed conversion of options and warrants 644,231 648,748 Diluted shares 29,005,432 29,009,949 Income per share - Basic and Diluted $ 0.03 $ 0.03 For the three months ended November 30, 2019 and 2018: 2019 2018 Numerator - Net income attributable to common stockholders $ 304,428 $ 128,893 Denominator - Weighted-average shares outstanding - basic 28,361,201 28,361,201 Incremental shares from assumed conversion of options and warrants 639,959 657,061 Diluted shares 29,001,160 29,018,262 Income per share - Basic and Diluted $ 0.01 $ 0.00 |
Inventory
Inventory | 6 Months Ended |
Nov. 30, 2019 | |
Inventory Disclosure [Abstract] | |
Inventory | Note 3. Inventory Inventory consists of the following: November 30, 2019 May 31, 2019 Raw materials $ 1,701,839 $ 1,295,991 Finished goods 1,991,152 1,325,000 Total inventory $ 3,692,991 $ 2,620,991 |
Property, Plant and Equipment
Property, Plant and Equipment | 6 Months Ended |
Nov. 30, 2019 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Note 4. Property, Plant and Equipment A summary of property, plant and equipment for Greystone is as follows: November 30, 2019 May 31, 2019 Production machinery and equipment $ 47,323,256 $ 45,645,910 Plant buildings and land 6,724,513 6,336,855 Leasehold improvements 1,129,474 979,890 Furniture and fixtures 601,586 563,074 Right-to-use assets under operating leases 218,634 180,794 55,997,463 53,706,523 Less: Accumulated depreciation and amortization (23,583,987 ) (21,026,051 ) Net Property, Plant and Equipment $ 32,413,476 $ 32,680,472 Production machinery and equipment includes right-to-use equipment capitalized pursuant to financing leases in the amount of $7,861,233 at November 30, 2019 and May 31, 2019. The financing leases all include an option to purchase which management anticipates exercising and, accordingly, the related equipment is being amortized over the estimated useful life using the straight-line method over 3.5 years for pallet molds and 12 years for injection molding machines. Production machinery includes deposits on equipment in the amount of $923,063 at November 30, 2019 which have not been placed into service. Two plant buildings and land are owned by GRE, a variable interest entity (“VIE”), having a net book value of $2,838,613 at November 30, 2019. Depreciation expense, including amortization expense related to right-to-use assets under financing leases, for the six months ended November 30, 2019 and 2018 was $2,557,936 and $2,131,971, respectively. |
Related Party Transactions_Acti
Related Party Transactions/Activity | 6 Months Ended |
Nov. 30, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions/Activity | Note 5. Related Party Transactions/Activity Yorktown Management & Financial Services, LLC Yorktown Management & Financial Services, LLC (“Yorktown”), an entity wholly-owned by Greystone’s CEO and President, owns and rents to Greystone (1) grinding equipment used to grind raw materials for Greystone’s pallet production and (2) extruders for pelletizing recycled plastic into pellets for resale and for use as raw material in the manufacture of pallets. GSM pays weekly rental fees to Yorktown of $27,500 for use of Yorktown’s grinding equipment and pelletizing equipment. Rental fees were $715,000 for the each of the six months ended November 30, 2019 and 2018. Effective January 1, 2017, Greystone and Yorktown entered into a five-year lease for office space at a monthly rental of $4,000 per month. Total rent expense was $24,000 for each of the six months ended November 30, 2019 and 2018. At November 30, 2019, future minimum payments under the non-cancelable operating lease for the remaining three years are $48,000, $48,000, and $4,000. TriEnda Holdings, L.L.C. TriEnda Holdings, L.L.C. (“TriEnda”) is a manufacturer of plastic pallets, protective packing and dunnage utilizing thermoform processing for which Warren Kruger, Greystone’s President and CEO, serves TriEnda as the non-executive Chairman of the Board and is a partner in a partnership which has a majority ownership interest in TriEnda. Greystone periodically purchases material and pallets from TriEnda. Purchases for the six months ended November 30, 2019 and 2018 totaled $5,400 and $42,349, respectively. Green Plastic Pallets Greystone sells plastic pallets to Green Plastic Pallets (“Green”), an entity that is owned by James Kruger, brother to Warren Kruger, Greystone’s President and CEO. Greystone had sales to Green of $271,320 and $167,400 for the six months ended November 30, 2019 and 2018, respectively. The account receivable due from Green at November 30, 2019 was $96,900. |
Long-Term Debt
Long-Term Debt | 6 Months Ended |
Nov. 30, 2019 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Note 6. Long-term Debt Debt as of November 30, 2019 and May 31, 2019 is as follows: November 30, 2019 May 31, 2019 Term loan A payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 4.0%, maturing April 30, 2023 $ 2,861,716 $ 3,234,947 Term loan C payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 4.0%, maturing August 4, 2024 1,287,485 1,399,490 Term loan D payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 4.75%, maturing January 10, 2022 1,447,506 1,744,235 Term loan E payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 4.75%, maturing January 10, 2022 814,945 927,199 Term loan F payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 5.25%, maturing February 8, 2021 3,082,407 3,398,247 Term loan G payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 5.25%, maturing April 30, 2024 858,375 876,934 Term loan H payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 5.25%, maturing January 1, 2022 564,067 - Revolving loan payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 5.5%, due January 31, 2021 2,923,000 3,205,000 Note payable to First Bank, prime rate of interest plus 1.45% but not less than 4.95%, monthly principal and interest payment of $30,628, due August 21, 2021, secured by production equipment 643,089 800,488 Term loan payable by GRE to International Bank of Commerce, interest rate of 5.5%, monthly principal and interest payment of $27,688, due April 30, 2023 2,362,662 2,461,116 Note payable to Robert Rosene, 7.5% interest, due January 15, 2021 4,340,285 4,426,631 Other 200,934 223,177 Total long-term debt 21,386,471 22,697,464 Debt issuance costs, net of amortization (38,466 ) (37,686 ) Total debt, net of debt issuance costs 21,348,005 22,659,778 Less: Current portion of long-term debt (3,442,269 ) (3,030,630 ) Long-term debt, net of current portion $ 17,905,736 $ 19,629,148 The prime rate of interest as of November 30, 2019 was 4.75%. Loan Agreement between Greystone and IBC The Loan Agreement (“IBC Loan Agreement”), dated January 31, 2014 and as amended from time to time, among Greystone and GSM (the “Borrowers”) and International Bank of Commerce (“IBC”) provides for certain term loans and a revolver loan. Effective July 1, 2019, the Borrowers and IBC entered into the Tenth Amendment to the IBC Loan Agreement providing for Term Loan H in the amount of $672,000 with a maturity date of January 1, 2022, for the procurement of production equipment. The IBC term loans make equal monthly payments of principal and interest in such amounts sufficient to amortize the principal balance as follows: (i) Term Loan A over a seven-year period beginning February 29, 2016 (currently $77,550 per month), (ii) Term Loan C over a seven-year period beginning November 30, 2017 (currently $25,205 per month) and (iii) Term Loan D over a four-year period beginning February 10, 2019 (currently $57,469 per month), (iv) Term Loan E over a four-year period beginning February 10, 2019 (currently $23,060 per month), (v) Term Loan F over a five-year period beginning February 28, 2019 (currently $68,849 per month), (vi) Term Loan G over a fifteen-year period beginning April 30, 2019 (currently $7,466 per month) and (vii) Term Loan H over 30 months beginning August 1, 2019 (currently $24,203 per month). The monthly payments of principal and interest on the IBC term loans may vary as a result of changes in the prime rate of interest. The IBC Loan Agreement, as amended, provides a revolving loan in an aggregate principal amount of up to $4,000,000 (the “Revolving Loan”). The amount which can be borrowed from time to time is dependent upon the amount of the borrowing base not to exceed $4,000,000. The Revolving Loan bears interest at the greater of the prime rate of interest plus 0.5%, or 5.50% and matures January 31, 2021. The Borrowers are required to pay all interest accrued on the outstanding principal balance of the Revolving Loan on a monthly basis. Any principal on the Revolving Loan that is prepaid by the Borrowers does not reduce the original amount available to the Borrowers. The IBC Loan Agreement, among other things, requires a quarterly affirmation that the Borrowers have maintained a debt service coverage ratio of 1:25 to 1:00. As of November 30, 2019, Greystone was not in compliance with this debt service coverage ratio. IBC has issued a waiver, dated January 14, 2020, with respect to this event of noncompliance. The IBC Loan Agreement includes customary events of default, including events of default relating to non-payment of principal and other amounts owing under the IBC Loan Agreement from time to time, inaccuracy of representations, violation of covenants, defaults under other agreements, bankruptcy and similar events, the death of a guarantor, certain material adverse changes relating to a Borrower or guarantor, certain judgments or awards against a Borrower, or government action affecting a Borrower’s or guarantor’s ability to perform under the IBC Loan Agreement or the related loan documents. Among other things, a default under the IBC Loan Agreement would permit IBC to cease lending funds under the IBC Loan Agreement, and require immediate repayment of any outstanding notes with interest and any unpaid accrued fees. The IBC Loan Agreement is secured by a lien on substantially all of the assets of the Borrowers. In addition, the IBC Loan Agreement is secured by a mortgage granted by GRE on the real property owned by GRE in Bettendorf, Iowa (the “Mortgage”). GRE is owned by Warren Kruger, Greystone’s President and CEO, and Robert B. Rosene, Jr., a director of Greystone. Messrs. Kruger and Rosene have provided a combined limited guaranty of the Borrowers’ obligations under the IBC Loan Agreement, with such guaranty being limited to a combined amount of $6,500,000 (the “Guaranty”). The Mortgage and the Guaranty also secure or guaranty, as applicable, the obligations of GRE under the Loan Agreement between GRE and IBC dated January 31, 2014 as discussed in the following paragraph. Loan Agreement between GRE and IBC On August 10, 2018, GRE and IBC entered into an amended agreement to extend the maturity of the note to April 30, 2023 and increase the interest rate to 5.5%. The note is secured by a mortgage on the two buildings in Bettendorf, Iowa, which are leased to Greystone. Note Payable between Greystone and Robert B. Rosene, Jr. Effective December 15, 2005, Greystone entered into an agreement with Robert B. Rosene, Jr., a member of Greystone’s board of directors, to convert $2,066,000 of advances into an unsecured note payable at 7.5% interest. Effective June 1, 2016, the note was restated (the “Restated Note”) to combine the outstanding principal, $2,066,000, and accrued interest, $2,475,690, into an unsecured note payable of $4,541,690 with an extended maturity date of January 15, 2021. The Restated Note provides that accrued interest is payable monthly and allows Greystone to use commercially reasonable efforts to pay such amounts as allowed by the IBC Loan Agreement against the interest accrued prior to the restatement. The balance of the note at November 30, 2019 was $4,340,285. Maturities Maturities of Greystone’s long-term debt for the five years subsequent to November 30, 2019 are $3,442,269, $12,683,643, $1,919,583, $2,416,434 and $924,542. |
Leases
Leases | 6 Months Ended |
Nov. 30, 2019 | |
Leases [Abstract] | |
Leases | Note 7. Leases Financing Leases Financing leases as of November 30, 2019 and May 31, 2019: November 30, 2019 May 31, 2019 Non-cancellable financing leases $ 5,843,290 $ 6,754,819 Less: Current portion (2,111,028 ) (1,516,629 ) Non-cancellable financing leases, net of current portion $ 3,732,262 $ 5,238,190 Greystone and an unrelated private company entered into three lease agreements for certain production equipment with a total cost of approximately $6.9 million which were effective February 24, 2018, August 2, 2018 and December 21, 2018, respectively, with five-year terms and a capitalized interest rate of 7.4%. Each of the lease agreements include a bargain purchase option to acquire the production equipment at the end of the lease term. The leased equipment is principally used to produce pallets for the private company. Lease payments are made as a credit on the sales invoice at the rate of $3.32 for each pallet produced and shipped from the respective leased equipment. The estimated aggregate monthly rental payments are approximately $178,000. The rent payments can vary each month depending on the quantity of pallets produced from each machine. Due to improvements in the production process, pallet production has increased since May 31, 2019 thereby resulting in an increase in the estimated aggregate future rental payments. The lease agreements provide for minimum monthly lease rental payments based upon the total pallets sold in excess of a specified amount not to exceed the monthly productive capacity of the leased machines. Effective December 28, 2018, Yorktown purchased certain production equipment from Greystone at net book value of $968,168 and entered into a lease agreement with Greystone for the equipment with a monthly rent of $27,915 for the initial thirty-six months and $7,695 for the following twelve months and maturing December 27, 2022. The lease agreement has a $10,000 purchase option at the end of the lease. The production equipment under the non-cancelable financing leases has a gross carrying amount of $7,861,233 at November 30, 2019. Amortization of the carrying amount of approximately $416,000 and $449,000 was included in depreciation expense for the six months ended November 30, 2019 and 2018, respectively. Operating Leases Greystone recognize a lease liability for each lease based on the present value of remaining minimum fixed rental payments, using a discount rate that approximates the rate of interest for a collateralized loan over a similar term. A right-of-use asset, reported in property, plant and equipment on the consolidated balance sheets, is recognized for each lease, valued at the lease liability. Minimum fixed rental payments are recognized on a straight-line basis over the life of the lease as costs and expenses on the consolidated statement of income. Variable and short-term rental payments are recognized as costs and expenses as they are incurred. Greystone has three non-cancellable operating leases for (i) equipment with a fifty-two month term and a forty-eight month term and a discount rate of 5.40% and (ii) office space on a sixty month term and a discount rate of 5.0%. The leases are single-term with constant monthly rental rates. Lease Summary Information For the six months ended November 30, 2019 and 2018: 2019 2018 Lease Expense Financing lease expense - Amortization of right-of-use assets $ 416,000 $ 449,000 Interest on lease liabilities 220,255 126,514 Operating lease expense 39,650 24,000 Short-term lease expense 797,835 749,843 Total $ 1,473,740 $ 1,349,357 Other Information Cash paid for amounts included in the measurement of lease liabilities for finance leases - Operating cash flows $ 220,255 $ 126,514 Financing cash flows $ 911,529 $ 1,333,699 Cash paid for amounts included in the measurement of lease liabilities for operating leases - Operating cash flows $ 39,650 $ 24,000 Right-of-use assets obtained in exchange for lease liabilities - Financing leases $ - $ 2,333,333 Operating leases $ 67,750 $ - Weighted-average remaining lease term (in years) - Financing leases 3.2 3.4 Operating leases 3.5 3.1 Weighted-average discount rate - Financing leases 7.1 % 7.0 % Operating leases 5.3 % 5.0 % Future minimum lease payments under non-cancelable leases as of November 30, 2019, are approximately: Financing Leases Operating Leases Twelve months ended November 30, 2020 $ 2,471,000 $ 81,881 Twelve months ended November 30, 2021 2,471,000 81,881 Twelve months ended November 30, 2022 1,506,000 37,881 Twelve months ended November 30, 2023 - 27,751 Twelve months ended November 30, 2024 - 9,037 Total future minimum lease payments 6,448,000 238,431 Present value discount 604,710 19,798 Present value of minimum lease payments $ 5,843,290 $ 218,633 |
Deferred Revenue
Deferred Revenue | 6 Months Ended |
Nov. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Deferred Revenue | Note 8. Deferred Revenue Advances from a customer pursuant to a contract for the sale of plastic pallets is recognized as deferred revenue. Revenue is recognized by Greystone as pallets are shipped to the customer(s). Customer advances totaled $-0- and $3,280,500 during the six months ended November 30, 2019 and 2018, respectively. Revenue recognition from customer advances during the six months ended November 30, 2019 was $686,572. The unrecognized balance of deferred revenue at November 30, 2019 and May 31, 2019, was $1,514,495 and $2,201,067, respectively. |
Revenue and Revenue Recognition
Revenue and Revenue Recognition | 6 Months Ended |
Nov. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenue and Revenue Recognition | Note 9. Revenue and Revenue Recognition Revenue is recognized at the time a good or service is transferred to a customer and the customer obtains control of that good or receives the service performed. Sales arrangements with customers are short-term in nature involving single performance obligations related to the delivery of goods and generally provide for transfer of control at the time of shipment. In limited circumstances, where acceptance of the goods is subject to approval by the customer, revenue is recognized upon approval by the customer unless, historically, there have been insignificant rejections of goods by the customer. Contract liabilities associated with sales arrangements primarily relate to deferred revenue on prepaid sales of goods. Greystone generally permits returns of product due to defects; however, product returns are historically insignificant. Greystone’s principal product is plastic pallets produced from recycled plastic resin. Sales are primarily to customers in the continental United States of America. International sales are made to customers in Canada and Mexico which totaled approximately $1,803,000 and $291,000 in fiscal years 2020 and 2019, respectively. Greystone’s customers include stocking and non-stocking distributors and direct sales to end-user customers. Sales to the following categories of customers for the six months ended November 30, 2019 and 2018, respectively, were as follows: Category 2019 2018 End Users – Major Customers 88 % 84 % End Users - Other 1 % 2 % Distributors 11 % 14 % |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 6 Months Ended |
Nov. 30, 2019 | |
Investments, All Other Investments [Abstract] | |
Fair Value of Financial Instruments | Note 10. Fair Value of Financial Instruments The following methods and assumptions are used in estimating the fair-value disclosures for financial instruments: Debt: The carrying amount of notes with floating rates of interest approximate fair value. Fixed rate notes are valued based on cash flows using estimated rates of comparable notes. The carrying amounts reported on the balance sheets approximate fair value. |
Concentrations, Risks and Uncer
Concentrations, Risks and Uncertainties | 6 Months Ended |
Nov. 30, 2019 | |
Risks and Uncertainties [Abstract] | |
Concentrations, Risks and Uncertainties | Note 11. Concentrations, Risks and Uncertainties Greystone derived approximately 88% and 84% of its total sales from four customers (three in fiscal year 2019) in fiscal years 2020 and 2019, respectively. The loss of a material amount of business from one or more of these customers could have a material adverse effect on Greystone. Greystone purchases damaged pallets from its customers at a price based on the value of the raw material content in the pallet. A majority of these purchases, totaling $1,019,279 and $814,764 in fiscal years 2020 and 2019, respectively, is from one of its major customers. Robert B. Rosene, Jr., a Greystone director, has provided financing and guarantees on Greystone’s bank debt. As of November 30, 2019, Greystone is indebted to Mr. Rosene in the amount of $4,340,285 for a note payable due January 15, 2021. There is no assurance that Mr. Rosene will renew the note as of the maturity date. |
Commitments
Commitments | 6 Months Ended |
Nov. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments | Note 12. Commitments At November 30, 2019, Greystone had commitments totaling $2,468,000 toward the purchase of production equipment. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 6 Months Ended |
Nov. 30, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of Anti-Dilutive Instruments of Earnings Per Share | Instruments which have an anti-dilutive effect for the six months and three months ended November 30 are as follows: 2019 2018 Preferred stock convertible into common stock 3,333,333 3,333,333 |
Schedule of Basic and Diluted Earnings Per Share | The following tables set forth the computation of basic and diluted earnings per share: For the six months ended November 30, 2019 and 2018: 2019 2018 Numerator - Net income attributable to common stockholders $ 746,678 $ 730,281 Denominator - Weighted-average shares outstanding - basic 28,361,201 28,361,201 Incremental shares from assumed conversion of options and warrants 644,231 648,748 Diluted shares 29,005,432 29,009,949 Income per share - Basic and Diluted $ 0.03 $ 0.03 For the three months ended November 30, 2019 and 2018: 2019 2018 Numerator - Net income attributable to common stockholders $ 304,428 $ 128,893 Denominator - Weighted-average shares outstanding - basic 28,361,201 28,361,201 Incremental shares from assumed conversion of options and warrants 639,959 657,061 Diluted shares 29,001,160 29,018,262 Income per share - Basic and Diluted $ 0.01 $ 0.00 |
Inventory (Tables)
Inventory (Tables) | 6 Months Ended |
Nov. 30, 2019 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventory | Inventory consists of the following: November 30, 2019 May 31, 2019 Raw materials $ 1,701,839 $ 1,295,991 Finished goods 1,991,152 1,325,000 Total inventory $ 3,692,991 $ 2,620,991 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 6 Months Ended |
Nov. 30, 2019 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant and Equipment | A summary of property, plant and equipment for Greystone is as follows: November 30, 2019 May 31, 2019 Production machinery and equipment $ 47,323,256 $ 45,645,910 Plant buildings and land 6,724,513 6,336,855 Leasehold improvements 1,129,474 979,890 Furniture and fixtures 601,586 563,074 Right-to-use assets under operating leases 218,634 180,794 55,997,463 53,706,523 Less: Accumulated depreciation and amortization (23,583,987 ) (21,026,051 ) Net Property, Plant and Equipment $ 32,413,476 $ 32,680,472 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 6 Months Ended |
Nov. 30, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of Long-Term Debt | Debt as of November 30, 2019 and May 31, 2019 is as follows: November 30, 2019 May 31, 2019 Term loan A payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 4.0%, maturing April 30, 2023 $ 2,861,716 $ 3,234,947 Term loan C payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 4.0%, maturing August 4, 2024 1,287,485 1,399,490 Term loan D payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 4.75%, maturing January 10, 2022 1,447,506 1,744,235 Term loan E payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 4.75%, maturing January 10, 2022 814,945 927,199 Term loan F payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 5.25%, maturing February 8, 2021 3,082,407 3,398,247 Term loan G payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 5.25%, maturing April 30, 2024 858,375 876,934 Term loan H payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 5.25%, maturing January 1, 2022 564,067 - Revolving loan payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 5.5%, due January 31, 2021 2,923,000 3,205,000 Note payable to First Bank, prime rate of interest plus 1.45% but not less than 4.95%, monthly principal and interest payment of $30,628, due August 21, 2021, secured by production equipment 643,089 800,488 Term loan payable by GRE to International Bank of Commerce, interest rate of 5.5%, monthly principal and interest payment of $27,688, due April 30, 2023 2,362,662 2,461,116 Note payable to Robert Rosene, 7.5% interest, due January 15, 2021 4,340,285 4,426,631 Other 200,934 223,177 Total long-term debt 21,386,471 22,697,464 Debt issuance costs, net of amortization (38,466 ) (37,686 ) Total debt, net of debt issuance costs 21,348,005 22,659,778 Less: Current portion of long-term debt (3,442,269 ) (3,030,630 ) Long-term debt, net of current portion $ 17,905,736 $ 19,629,148 |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Nov. 30, 2019 | |
Leases [Abstract] | |
Schedule of Financing Lease | Financing leases as of November 30, 2019 and May 31, 2019: November 30, 2019 May 31, 2019 Non-cancellable financing leases $ 5,843,290 $ 6,754,819 Less: Current portion (2,111,028 ) (1,516,629 ) Non-cancellable financing leases, net of current portion $ 3,732,262 $ 5,238,190 |
Schedule of Lease Cost | For the six months ended November 30, 2019 and 2018: 2019 2018 Lease Expense Financing lease expense - Amortization of right-of-use assets $ 416,000 $ 449,000 Interest on lease liabilities 220,255 126,514 Operating lease expense 39,650 24,000 Short-term lease expense 797,835 749,843 Total $ 1,473,740 $ 1,349,357 Other Information Cash paid for amounts included in the measurement of lease liabilities for finance leases - Operating cash flows $ 220,255 $ 126,514 Financing cash flows $ 911,529 $ 1,333,699 Cash paid for amounts included in the measurement of lease liabilities for operating leases - Operating cash flows $ 39,650 $ 24,000 Right-of-use assets obtained in exchange for lease liabilities - Financing leases $ - $ 2,333,333 Operating leases $ 67,750 $ - Weighted-average remaining lease term (in years) - Financing leases 3.2 3.4 Operating leases 3.5 3.1 Weighted-average discount rate - Financing leases 7.1 % 7.0 % Operating leases 5.3 % 5.0 % |
Schedule of Future Minimum Lease Payments | Future minimum lease payments under non-cancelable leases as of November 30, 2019, are approximately: Financing Leases Operating Leases Twelve months ended November 30, 2020 $ 2,471,000 $ 81,881 Twelve months ended November 30, 2021 2,471,000 81,881 Twelve months ended November 30, 2022 1,506,000 37,881 Twelve months ended November 30, 2023 - 27,751 Twelve months ended November 30, 2024 - 9,037 Total future minimum lease payments 6,448,000 238,431 Present value discount 604,710 19,798 Present value of minimum lease payments $ 5,843,290 $ 218,633 |
Revenue and Revenue Recogniti_2
Revenue and Revenue Recognition (Tables) | 6 Months Ended |
Nov. 30, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Sale of Revenues for Customer Categories | Sales to the following categories of customers for the six months ended November 30, 2019 and 2018, respectively, were as follows: Category 2019 2018 End Users – Major Customers 88 % 84 % End Users - Other 1 % 2 % Distributors 11 % 14 % |
Earnings Per Share - Schedule o
Earnings Per Share - Schedule of Anti-Dilutive Instruments of Earnings Per Share (Details) - shares | 6 Months Ended | |
Nov. 30, 2019 | Nov. 30, 2018 | |
Convertible Preferred Stock [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Anti-Dilutive Instruments of Earnings per Share | 3,333,333 | 3,333,333 |
Earnings Per Share - Schedule_2
Earnings Per Share - Schedule of Basic and Diluted Earnings Per Share (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Nov. 30, 2019 | Nov. 30, 2018 | Nov. 30, 2019 | Nov. 30, 2018 | |
Earnings Per Share [Abstract] | ||||
Net income attributable to common stockholders | $ 304,428 | $ 128,893 | $ 746,678 | $ 730,281 |
Weighted-average shares outstanding - basic | 28,361,201 | 28,361,201 | 28,361,201 | 28,361,201 |
Incremental shares from assumed conversion of options and warrants | 639,959 | 657,061 | 644,231 | 648,748 |
Diluted shares | 29,001,160 | 29,018,262 | 29,005,432 | 29,009,949 |
Income per share - Basic and Diluted | $ 0.01 | $ 0 | $ 0.03 | $ 0.03 |
Inventory - Schedule of Invento
Inventory - Schedule of Inventory (Details) - USD ($) | Nov. 30, 2019 | May 31, 2019 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 1,701,839 | $ 1,295,991 |
Finished goods | 1,991,152 | 1,325,000 |
Total inventory | $ 3,692,991 | $ 2,620,991 |
Property, Plant and Equipment_2
Property, Plant and Equipment (Details Narrative) - USD ($) | 6 Months Ended | ||
Nov. 30, 2019 | Nov. 30, 2018 | May 31, 2019 | |
Property, Plant and Equipment [Line Items] | |||
Machinery and equipment | $ 7,861,233 | $ 7,861,233 | |
Estimated useful life | 3 years 6 months | ||
Carrying value of assets | $ 42,282,402 | $ 43,167,212 | |
Depreciation expense | 2,557,936 | $ 2,131,971 | |
Two Plant Buildings and Land [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Carrying value of assets | 2,838,613 | ||
Service [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Machinery and equipment | $ 923,063 | ||
Molding Machines [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful life | 12 years |
Property, Plant and Equipment -
Property, Plant and Equipment - Schedule of Property, Plant and Equipment (Details) - USD ($) | Nov. 30, 2019 | May 31, 2019 |
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment, gross | $ 55,997,463 | $ 53,706,523 |
Less: Accumulated depreciation and amortization | (23,583,987) | (21,026,051) |
Net Property, Plant and Equipment | 32,413,476 | 32,680,472 |
Production Machinery and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment, gross | 47,323,256 | 45,645,910 |
Plant Buildings and Land [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment, gross | 6,724,513 | 6,336,855 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment, gross | 1,129,474 | 979,890 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment, gross | 601,586 | 563,074 |
Right-to-use Assets Under Operating Leases [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property plant and equipment, gross | $ 218,634 | $ 180,794 |
Related Party Transactions_Ac_2
Related Party Transactions/Activity (Details Narrative) - USD ($) | Jan. 01, 2017 | Nov. 30, 2019 | Nov. 30, 2018 |
Related Party Transaction [Line Items] | |||
Rent expense | $ 1,473,740 | $ 1,349,357 | |
Future minimum payments under operating lease 2020 | 81,881 | ||
Future minimum payments under operating lease 2021 | 81,881 | ||
Future minimum payments under operating lease 2022 | 37,881 | ||
Non-Cancelable Operating Lease [Member] | |||
Related Party Transaction [Line Items] | |||
Future minimum payments under operating lease 2020 | 48,000 | ||
Future minimum payments under operating lease 2021 | 48,000 | ||
Future minimum payments under operating lease 2022 | 4,000 | ||
Office Space [Member] | |||
Related Party Transaction [Line Items] | |||
Rent expense | $ 24,000 | 24,000 | |
Lease term | 60 months | ||
Monthly [Member] | Office Space [Member] | |||
Related Party Transaction [Line Items] | |||
Rent expense | $ 4,000 | ||
Lease term | 5 years | ||
Yorktown's Grinding and Pelletizing Equipment [Member] | |||
Related Party Transaction [Line Items] | |||
Rent expense | $ 715,000 | 715,000 | |
Yorktown's Grinding and Pelletizing Equipment [Member] | Weekly [Member] | |||
Related Party Transaction [Line Items] | |||
Payments of rental fees | 27,500 | ||
TriEnda Holdings, L.L.C [Member] | |||
Related Party Transaction [Line Items] | |||
Related party transaction purchases | 5,400 | 42,349 | |
Green Plastic Pallets [Member] | |||
Related Party Transaction [Line Items] | |||
Revenue from service | 271,320 | $ 167,400 | |
Account receivable | $ 96,900 |
Long-Term Debt (Details Narrati
Long-Term Debt (Details Narrative) - USD ($) | Jul. 01, 2019 | Aug. 10, 2018 | Jun. 02, 2016 | Nov. 30, 2019 | Nov. 30, 2018 | Dec. 15, 2005 |
Debt Instrument [Line Items] | ||||||
Proceeds from long-term debt | $ 672,000 | $ 3,514,265 | ||||
Note payable | 4,340,285 | |||||
Maturities long term debt current | 3,442,269 | |||||
Maturities long term debt year two | 12,683,643 | |||||
Maturities long term debt year three | 1,919,583 | |||||
Maturities long term debt year four | 2,416,434 | |||||
Maturities long term debt year five | $ 924,542 | |||||
Restated Note [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument principal amount | $ 2,066,000 | |||||
Note payable | 4,541,690 | |||||
Debt accrued interest | $ 2,475,690 | |||||
Extended maturity date | Jan. 15, 2021 | |||||
Robert B. Rosene, Jr. [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument interest rate | 7.50% | |||||
Note payable | $ 2,066,000 | |||||
IBC Loan Agreement [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Borrowers maintain coverage ratio description | Borrowers are required to maintain a debt service coverage ratio of 1:25 to 1:00. | |||||
Revolving Loan [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument maturity date | Jan. 31, 2021 | |||||
GRE and IBC [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument interest rate | 5.50% | |||||
Debt instrument maturity date | Apr. 30, 2023 | |||||
Term Loan H [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Proceeds from long-term debt | $ 672,000 | |||||
Debt instrument maturity date | Jan. 1, 2022 | |||||
Note term | 30 months | |||||
Debt monthly payment | $ 24,203 | |||||
Term Loan A [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Note term | 7 years | |||||
Debt monthly payment | $ 77,550 | |||||
Term Loan C [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Note term | 7 years | |||||
Debt monthly payment | $ 25,205 | |||||
Term Loan D [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Note term | 4 years | |||||
Debt monthly payment | $ 57,469 | |||||
Term Loan E [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Note term | 4 years | |||||
Debt monthly payment | $ 23,060 | |||||
Term Loan F [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Note term | 5 years | |||||
Debt monthly payment | $ 68,849 | |||||
Term Loan G [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Note term | 15 years | |||||
Debt monthly payment | $ 7,466 | |||||
Revolving Loan [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument interest rate | 5.50% | |||||
Revolving Loan [Member] | IBC Loan Agreement [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument principal amount | $ 4,000,000 | |||||
Line of credit maximum borrowing capacity | 4,000,000 | |||||
Guaranty [Member] | IBC Loan Agreement [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Borrowing combined amount | $ 6,500,000 | |||||
Prime Rate [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument interest rate | 4.75% | |||||
Prime Rate [Member] | Revolving Loan [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument interest rate | 0.50% |
Long-Term Debt - Schedule of Lo
Long-Term Debt - Schedule of Long-Term Debt (Details) - USD ($) | Nov. 30, 2019 | May 31, 2019 |
Debt Instrument [Line Items] | ||
Total long-term debt | $ 21,386,471 | $ 22,697,464 |
Debt issuance costs, net of amortization | (38,466) | (37,686) |
Total debt, net of debt issuance costs | 21,348,005 | 22,659,778 |
Less: Current portion of long-term debt | (3,442,269) | (3,030,630) |
Long-term debt, net of current portion | 17,905,736 | 19,629,148 |
Term Loan A Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.0%, Maturing April 30, 2023 [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 2,861,716 | 3,234,947 |
Term Loan C Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.0%, Maturing August 4, 2024 [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 1,287,485 | 1,399,490 |
Term Loan D Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.75%, Maturing January 10, 2022 [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 1,447,506 | 1,744,235 |
Term Loan E Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.75%, Maturing January 10, 2022 [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 814,945 | 927,199 |
Term Loan F Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 5.25%, Maturing February 8, 2021 [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 3,082,407 | 3,398,247 |
Term Loan G Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 5.25%, Maturing April 30, 2024 [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 858,375 | 876,934 |
Term Loan H Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 5.25%, Maturing January 1, 2022 [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 564,067 | |
Revolving Loan Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 5.5%, Due January 31, 2021 [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 2,923,000 | 3,205,000 |
Note Payable to First Bank, Prime Rate of Interest Plus 1.45% But Not Less Than 4.95%, Monthly Principal and Interest Payment of $30,628, Due August 21, 2021, Secured by Production Equipment [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 643,089 | 800,488 |
Term Loan Payable by GRE to International Bank of Commerce, Interest Rate of 5.5%, Monthly Principal and Interest Payment of $27,688, Due April 30, 2023 [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 2,362,662 | 2,461,116 |
Note Payable to Robert Rosene, 7.5% Interest, Due January 15, 2021 [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term debt | 4,340,285 | 4,426,631 |
Other [Member] | ||
Debt Instrument [Line Items] | ||
Total long-term debt | $ 200,934 | $ 223,177 |
Long-Term Debt - Schedule of _2
Long-Term Debt - Schedule of Long-Term Debt (Details) (Parenthetical) - USD ($) | 6 Months Ended | 12 Months Ended |
Nov. 30, 2019 | May 31, 2019 | |
Term Loan A Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.0%, Maturing April 30, 2023 [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 0.50% | 0.50% |
Debt instrument maturity date | Apr. 30, 2023 | Apr. 30, 2023 |
Term Loan A Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.0%, Maturing April 30, 2023 [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 4.00% | 4.00% |
Term Loan C Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.0%, Maturing August 4, 2024 [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 0.50% | 0.50% |
Debt instrument maturity date | Aug. 4, 2024 | Aug. 4, 2024 |
Term Loan C Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.0%, Maturing August 4, 2024 [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 4.00% | 4.00% |
Term Loan D Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.75%, Maturing January 10, 2022 [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 0.50% | 0.50% |
Debt instrument maturity date | Jan. 10, 2022 | Jan. 10, 2022 |
Term Loan D Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.75%, Maturing January 10, 2022 [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 4.75% | 4.75% |
Term Loan E Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.75%, Maturing January 10, 2022 [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 0.50% | 0.50% |
Debt instrument maturity date | Jan. 10, 2022 | Jan. 10, 2022 |
Term Loan E Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.75%, Maturing January 10, 2022 [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 4.75% | 4.75% |
Term Loan F Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 5.25%, Maturing February 8, 2021 [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 0.50% | 0.50% |
Debt instrument maturity date | Feb. 8, 2021 | Feb. 8, 2021 |
Term Loan F Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 5.25%, Maturing February 8, 2021 [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 5.25% | 5.25% |
Term Loan G Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 5.25%, Maturing April 30, 2024 [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 0.50% | 0.50% |
Debt instrument maturity date | Apr. 30, 2024 | Apr. 30, 2024 |
Term Loan G Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 5.25%, Maturing April 30, 2024 [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 5.25% | 5.25% |
Term Loan H Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 5.25%, Maturing January 1, 2022 [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 0.50% | 0.50% |
Debt instrument maturity date | Jan. 1, 2022 | Jan. 1, 2022 |
Term Loan H Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 5.25%, Maturing January 1, 2022 [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 5.25% | 5.25% |
Revolving Loan Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 5.5%, Due January 31, 2021 [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 0.50% | 0.50% |
Debt instrument maturity date | Jan. 31, 2021 | Jan. 31, 2021 |
Revolving Loan Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 5.5%, Due January 31, 2021 [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 5.50% | 5.50% |
Note Payable to First Bank, Prime Rate of Interest Plus 1.45% But Not Less Than 4.95%, Monthly Principal and Interest Payment of $30,628, Due August 21, 2021, Secured by Production Equipment [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 1.45% | 1.45% |
Debt instrument maturity date | Aug. 21, 2021 | Aug. 21, 2021 |
Debt instrument principal and interest amount | $ 30,628 | $ 30,628 |
Note Payable to First Bank, Prime Rate of Interest Plus 1.45% But Not Less Than 4.95%, Monthly Principal and Interest Payment of $30,628, Due August 21, 2021, Secured by Production Equipment [Member] | Maximum [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 4.95% | 4.95% |
Term Loan Payable by GRE to International Bank of Commerce, Interest Rate of 5.5%, Monthly Principal and Interest Payment of $27,688, Due April 30, 2023 [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 5.50% | 5.50% |
Debt instrument maturity date | Apr. 30, 2023 | Apr. 30, 2023 |
Debt instrument principal and interest amount | $ 27,688 | $ 27,688 |
Note Payable to Robert Rosene, 7.5% Interest, Due January 15, 2021 [Member] | ||
Debt Instrument [Line Items] | ||
Debt instrument interest rate | 7.50% | 7.50% |
Debt instrument maturity date | Jan. 15, 2021 | Jan. 15, 2021 |
Leases (Details Narrative)
Leases (Details Narrative) - USD ($) | 6 Months Ended | ||
Nov. 30, 2019 | Nov. 30, 2018 | May 31, 2019 | |
Lessee, Lease, Description [Line Items] | |||
Production equipment gross carrying amount | $ 7,861,233 | $ 7,861,233 | |
Amortization | $ 416,000 | $ 449,000 | |
Equipment One [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Operating Lease term | 52 months | ||
Operating lease discount rate | 5.40% | ||
Equipment Two [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Operating Lease term | 48 months | ||
Operating lease discount rate | 5.40% | ||
Office Space [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Operating Lease term | 60 months | ||
Operating lease discount rate | 5.00% | ||
Production Equipment [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Production equipment gross carrying amount | $ 7,861,233 | ||
Sale and Leaseback Agreement [Member] | Yorktown Production Equipment [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Payments of monthly rental amount | 7,695 | ||
Value of production equipment purchased | $ 968,168 | ||
Lease maturity date | Dec. 27, 2022 | ||
Bargain purchase option amount | $ 10,000 | ||
Sale and Leaseback Agreement [Member] | Yorktown Production Equipment [Member] | Initial Thirty Six Months [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Payments of monthly rental amount | 27,915 | ||
Three Five-Year Lease Agreements [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Leased equipment | $ 6,900,000 | ||
Finance Lease term | 5 years | ||
Lease interest rate | 7.40% | ||
Lease payment per invoice rate | $ 3.32 | ||
Payments of monthly rental amount | $ 178,000 |
Leases - Schedule of Financing
Leases - Schedule of Financing Lease (Details) - USD ($) | Nov. 30, 2019 | May 31, 2019 |
Leases [Abstract] | ||
Non-cancellable financing leases | $ 5,843,290 | $ 6,754,819 |
Less: Current portion | (2,111,028) | (1,516,629) |
Non-cancellable financing leases, net of current portion | $ 3,732,262 | $ 5,238,190 |
Leases - Schedule of Lease Cost
Leases - Schedule of Lease Cost (Details) - USD ($) | 6 Months Ended | |
Nov. 30, 2019 | Nov. 30, 2018 | |
Leases [Abstract] | ||
Financing lease expense - Amortization of right-of-use assets | $ 416,000 | $ 449,000 |
Financing lease expense - Interest on lease liabilities | 220,255 | 126,514 |
Operating lease expense | 39,650 | 24,000 |
Short-term lease expense | 797,835 | 749,843 |
Total | 1,473,740 | 1,349,357 |
Cash paid for amounts included in the measurement of lease liabilities for finance leases - Operating cash flows | 220,255 | 126,514 |
Cash paid for amounts included in the measurement of lease liabilities for finance leases - Financing cash flows | 911,529 | 1,333,699 |
Cash paid for amounts included in the measurement of lease liabilities for operating leases - Operating cash flows | 39,650 | 24,000 |
Right-of-use assets obtained in exchange for lease liabilities - Financing leases | 2,333,333 | |
Right-of-use assets obtained in exchange for lease liabilities - Operating leases | $ 67,750 | |
Weighted-average remaining lease term (in years) - Financing leases | 3 years 2 months 12 days | 3 years 4 months 24 days |
Weighted-average remaining lease term (in years) - Operating leases | 3 years 6 months | 3 years 1 month 6 days |
Weighted-average discount rate - Financing leases | 7.10% | 7.00% |
Weighted-average discount rate - Operating leases | 5.30% | 5.00% |
Leases - Schedule of Future Min
Leases - Schedule of Future Minimum Lease Payments (Details) - USD ($) | Nov. 30, 2019 | May 31, 2019 |
Leases [Abstract] | ||
Twelve months ended November 30, 2020 | $ 2,471,000 | |
Twelve months ended November 30, 2021 | 2,471,000 | |
Twelve months ended November 30, 2022 | 1,506,000 | |
Twelve months ended November 30, 2023 | ||
Twelve months ended November 30, 2024 | ||
Total future minimum lease payments | 6,448,000 | |
Present value discount | 604,710 | |
Present value of minimum lease payments | 5,843,290 | $ 6,754,819 |
Twelve months ended November 30, 2020 | 81,881 | |
Twelve months ended November 30, 2021 | 81,881 | |
Twelve months ended November 30, 2022 | 37,881 | |
Twelve months ended November 30, 2023 | 27,751 | |
Twelve months ended November 30, 2024 | 9,037 | |
Total future minimum lease payments | 238,431 | |
Present value discount | 19,798 | |
Present value of minimum lease payments | $ 218,633 |
Deferred Revenue (Details Narra
Deferred Revenue (Details Narrative) - USD ($) | 6 Months Ended | ||
Nov. 30, 2019 | May 31, 2019 | Nov. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | |||
Customer advances | $ 0 | $ 3,280,500 | |
Revenue recognition from customer advances | 686,572 | ||
Unrecognized deferred revenue | $ 1,514,495 | $ 2,201,067 |
Revenue and Revenue Recogniti_3
Revenue and Revenue Recognition (Details Narrative) - Canada and Mexico [Member] | 6 Months Ended |
Nov. 30, 2019USD ($) | |
Fiscal Year 2020 [Member] | |
Disaggregation of Revenue [Line Items] | |
Sales revenue | $ 1,803,000 |
Fiscal Year 2019 [Member] | |
Disaggregation of Revenue [Line Items] | |
Sales revenue | $ 291,000 |
Revenue and Revenue Recogniti_4
Revenue and Revenue Recognition - Schedule of Sale of Revenues for Customer Categories (Details) | 6 Months Ended | |
Nov. 30, 2019 | Nov. 30, 2018 | |
End Users - Major Customers [Member] | ||
Concentration Risk [Line Items] | ||
Total | 88.00% | 84.00% |
End Users - Other [Member] | ||
Concentration Risk [Line Items] | ||
Total | 1.00% | 2.00% |
Distributors [Member] | ||
Concentration Risk [Line Items] | ||
Total | 11.00% | 14.00% |
Concentrations, Risks and Unc_2
Concentrations, Risks and Uncertainties (Details Narrative) | 6 Months Ended |
Nov. 30, 2019USD ($) | |
Concentration Risk [Line Items] | |
Notes payable | $ 4,340,285 |
Mr. Rosene [Member] | |
Concentration Risk [Line Items] | |
Notes payable | $ 4,340,285 |
Notes payable due date | Jan. 15, 2021 |
Fiscal Year 2020 [Member] | |
Concentration Risk [Line Items] | |
Customer purchases amount | $ 1,019,279 |
Fiscal Year 2019 [Member] | |
Concentration Risk [Line Items] | |
Customer purchases amount | $ 814,764 |
Sales Revenue, Net [Member] | Four Customers [Member] | Fiscal Year 2020 [Member] | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 88.00% |
Sales Revenue, Net [Member] | Three Customers [Member] | Fiscal Year 2019 [Member] | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 84.00% |
Commitments (Details Narrative)
Commitments (Details Narrative) | Nov. 30, 2019USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Purchase obligation on acquisition of equipment | $ 2,468,000 |