The sole asset of AIP is its permit from the Federal Energy Regulatory Commission (“FERC”) for AIP to explore, evaluate and file an environmental impact report and application for the construction and operation of the Verde Pumped Storage Project in Maricopa County, Arizona. The pumped storage system is a renewable green energy electrical power source similar to others already operating in the United States and around the world. The exploration and licensing phase could take six to nine months from funding and the construction phase could be as long as five years with an aggregate construction cost in excess of $1.2 billion.
AIP has no employees, has had no sales or revenue, and no assets other than the permit. The estimated cost of the studies and licensing process is estimated at $50 to $80 million. The Company is currently working to secure this financing.
Note 2 - Basis of Presentation and Significant Accounting Policies
The unaudited condensed consolidated financial statements presented herein have been prepared in accordance with accounting principles generally accepted in the United States of America for interim financial information and in accordance with the instructions to Form 10-Q. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted. In our opinion, the accompanying condensed consolidated financial statements include all adjustments necessary for a fair presentation of such condensed consolidated financial statements. Such necessary adjustments consist of normal recurring items and the elimination of all significant intercompany balances and transactions. These interim condensed
consolidated financial statements should be read in conjunction with the Company's March 31, 2011 Annual Report filed on Form 10-K. Interim results are not necessarily indicative of results for a full year.
Consolidation
- The condensed consolidated financial statements include the accounts of Green Planet Group, Inc. and its consolidated subsidiaries and wholly-owned limited liability company
, except that as discussed in Notes 1 and 16, as of August 18, 2011 the consolidated financial statements no longer contain Lumea Staffing, Inc. and Lumea Staffing of CA, Inc. in accordance with GAAP as a result of their filing for protection under Chapter 11 of the United States Bankruptcy Code.
All significant intercompany transactions and balances have been eliminated.
Use of Estimates
- The preparation of financial statements in conformity with United States generally accepted accounting principles requires the Company to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosure of contingent assets and liabilities. The more significant estimates relate to revenue recognition, contractual allowances and uncollectible accounts, accrued liabilities, derivative liabilities, income taxes, litigation and contingencies
and the fair value of the Company’s investment in the deconsolidated entities
. Estimates are based on historical experience and on
various other assumptions that the Company believes to be reasonable under the circumstances, the results of which form the basis for judgments about results and the carrying values of assets and liabilities. Actual results and values may differ significantly from these estimates.
Cash Equivalents
- The Company invests its excess cash in short-term investments with various banks and financial institutions. Short-term investments are cash equivalents, as they are part of the cash management activities of the company and are comprised of investments having maturities of three months or less at inception.
Allowance for Doubtful Accounts
- The Company provides an allowance for doubtful accounts when management estimates collectability to be uncertain. Accounts receivable are continually reviewed to determine which, if any, accounts are doubtful of collection. In making the determination of the appropriate allowance amount, the Company considers current economic and industry conditions, relationships with each significant customer, overall customer credit-worthiness and historical experience. The allowance for doubtful
accounts was
$1,503,550
(unaudited
) and $2,034,760 at
September 30, 2011 and March 31, 2011, respectively.
Inventories
- Inventories are stated at the lower of cost or market value. Cost of inventories is determined by the first-in, first-out (FIFO) method. Obsolete or abandoned inventories are charged to operations in the period that it is determined that the items are no longer viable sales products. The Company did not deem an allowance for slow moving and obsolete inventory to be necessary as of September 30, 2011 and March 31, 2011.
Property, Plant, and Equipment
- Property, plant and equipment are carried at cost. Repair and maintenance costs are charged against operations while renewals and betterments are capitalized as additions to the related assets. The Company depreciates its property, plant and equipment and computers on a straight line basis. Estimated useful life of the plant is 31 years and the equipment ranges from 3 to 10 years.
Intangible Assets
- Intangible assets consisted of patents, trademarks, government approvals and customer relationships (including client contracts). During the year ended March 31, 2011, the Company recognized impairment losses of $2,365,372 on amortizable intangibles.
Goodwill
- Goodwill represented the excess of the purchase price over the fair value of the net assets acquired by Lumea. Goodwill and other intangible assets having an indefinite useful life were not amortized for financial statement purposes. The Company performs an annual impairment test each year and in the event that facts and circumstances indicate that goodwill and other identifiable intangible assets may be impaired, an interim impairment test would be required. The Company’s testing approach utilized a discounted cash flow analysis to determine the fair value of its reporting units for comparison to their corresponding book values. If the book value exceeds the estimated fair value for a
reporting unit, a potential impairment is indicated. ASC 350-10 and ASC 360-10 prescribes the approach for determining the impairment amount, if any. During the year ended March 31, 2011, the Company recognized an impairment loss of $4,624,271 in conjunction with goodwill valuation for the period.
Impairment of Long-Lived Assets
- In accordance with ASC 360-10, the Company reviews long-lived assets, including, but not limited to, property and equipment, and other assets, for impairment annually or whenever events or changes in circumstances indicate the carrying amounts of assets may not be recoverable. The carrying value of long-lived assets is assessed for impairment by evaluating operating performance and future undiscounted cash flows of the underlying assets. If the sum of the expected future cash flows of an asset is less than its carrying value, an impairment measurement is required. Impairment charges are recorded to the extent that an asset’s carrying value exceeds fair value. During the year ended
March 31, 2011 the Company recognized impairment valuations on the amortizable intangibles of customer relationships and EPA licenses of $2,111,928 and $253,444, respectively, based on the income approach using the estimated discounted cash flows related to these activities.
Fair Value Disclosures
- The carrying values of accounts receivable, deposits, prepaid expenses, accounts payable and accrued expenses generally approximate the respective fair values of these instruments due to their current nature.
The fair values of debt instruments for disclosure purposes only are estimated based upon the present value of the estimated cash flows at interest rates applicable to similar instruments.
The Company generally does not use derivative financial instruments to hedge exposures to cash flow or market risks. However, certain other financial instruments, such as warrants and embedded conversion features that are indexed to the Company’s common stock, are classified as liabilities when either (a) the holder possesses rights to net-cash settlement or (b) physical or net-share settlement is not within the control of the Company. In such instances, net-cash settlement is assumed for financial accounting and reporting, even when the terms of the underlying contracts do not provide for net-cash settlement. Such financial instruments are initially recorded at fair value and subsequently adjusted to fair value at the close of each reporting period.
Derivative Financial Instruments
- The Company accounts for derivative instruments and debt instruments in accordance with the interpretative guidance of ASC 815 which codified SFAS No. 133, “Accounting for Derivative Instruments and Hedging Activities” (“SFAS 133”), EITF 00-19, “Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock,” APB No. 14, “Accounting for Convertible Debt and Debt Issued with Stock Purchase Warrants,” EITF 98-5, “Accounting for Convertible Securities with Beneficial Conversion Features or Contingently Adjustable Conversion Ratios”
(“EITF 98-5”), and EITF 00-27, “Application of Issue No. 98-5 to Certain Convertible Instruments” (“EITF 00-27”), and associated pronouncements related to the classification and measurement of warrants and instruments with conversion features. It is necessary for the Company to make certain assumptions and estimates to value derivatives and debt instruments.
Revenue Recognition
- Revenues are recognized at the time of shipment of products to customers, or at the time of transfer of title, if later, and when collection is reasonably assured. All amounts in a sales transaction billed to a customer related to shipping and handling are reported as revenues. Staffing revenue is recognized at the completion of each billing cycle to the customer after completion of the work. The billing cycle is generally weekly.
Provisions for sales discounts and rebates to customers are recorded, based upon the terms of sales contracts, in the same period the related sales are recorded, as a deduction to the sale. Sales discounts and rebates are offered to certain customers to promote customer loyalty and encourage greater product sales. As a general rule, the Company does not charge interest on its accounts receivables and the accounts receivable are generally unsecured.
Components of Cost of Sales
- Cost of sales is comprised of raw material costs including freight and duty, inbound handling costs associated with the receipt of raw materials, contract manufacturing costs, third party bottling and packaging, maintenance and storage costs, plant and engineering overhead allocation, terminals and other warehousing costs, and handling costs. The components of cost of sales of the staffing business are primarily the personnel costs of labor, payroll taxes, and other direct costs of maintaining employees, excluding workers’ compensation expense.
Selling Expenses
- Included in selling, general and administrative expenses are the commission expenses for both employees and outside sales representatives ranging from 1.5% to 11.5% per dollar of sales. Our staffing sales representatives are paid a commission on new sales. The Company expends amounts to advertise and distinguish its products from those of its competitors through the use of in-store advertising, printed media, internet and broadcast media. Advertising expenses for the three and six months ended September 30, 2011 and 2010 wer
e
$11,752
and
$29,354, and
$23,637
and $39,359 respectively, and are expensed as incurred.
Research, Testing and Development
- Research, testing and development costs are expensed as incurred. Research and development expenses, including testing, for the three and six months ended September 30, 2011 and 2010 (unaudited) was $0 for all periods. Costs to acquire in-process research and development (IPR&D) projects that have no alternative future use and that have not yet reached technological feasibility at the date of acquisition are expensed upon acquisition.
Income Taxes
- We provide for income taxes in accordance with ASC 740, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the financial statement carrying amounts and the tax bases of the assets and liabilities.
The recording of a net deferred tax asset assumes the realization of such asset in the future; otherwise a valuation allowance must be recorded to reduce this asset to its net realizable value. The Company considers future pretax income and, if necessary, ongoing prudent and feasible tax planning strategies in assessing the need for such a valuation allowance. In the event that the Company determines that it may not be able to realize all or part of the net deferred tax asset in the future, a valuation allowance for the deferred tax asset is charged against income in the period such determination is made. The Company has recorded full valuation allowances as of September 30, 2011 and March 31, 2011.
Concentrations of Credit Risks
- Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of accounts receivable. With respect to accounts receivable, such receivables are primarily from customers located in the United States. The Company extends credit based on an evaluation of the customer’s financial condition, generally without requiring collateral. Exposure to losses on receivables is dependent on each customer’s financial condition. At September 30, 2011 and 2010, the amounts due from foreign distributors
were
$1,269,156
and $1,363,756 (unaudited), respectively. These balances were fully reserved at September 30, 2011 and 2010. At September 30, 2011, the staffing business had one customer that accounted for approximately 22.5
%
and 18.5
%
of gross sales for the three and six months then ended and for the same periods in 2010 had two customers that contributed greater than 10% of sales. The percentages were 12.3%, 10.3%, 12.3% and 1
1.8%, respectively. In the staffing business, customer volume fluctuates with the seasons, the customers’ lines of business and other factors.
Stock-Based Compensation
- We account for stock-based awards to employees and non-employees using the accounting provisions of ASC 718-10, which provides for the use of the fair value based method to determine compensation for all arrangements where shares of stock or equity instruments are issued for compensation. Shares of common stock issued in connection with acquisitions are also recorded at their estimated fair values based on the Hull-White enhanced option-pricing model. The standard establishes the accounting of transactions in which an entity exchanges its equity instruments for goods or services, particularly transactions in which an entity obtains employee services in share-based payment transactions. The
statement also requires a public entity to measure the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award. That cost is recognized over the period during which the employee is required to provide service in exchange for the award. All stock-based awards to employees and non-employees expired on March 25, 2011.
Loss per share
- Basic
loss per share is calculated using the weighted average number of shares outstanding during the year. The Company has adopted ASC 260-10,
Earnings per Share - Overall
, and uses the treasury stock method to compute the dilutive effect of warrants and similar instruments. Under this method, the dilutive effect on loss per share is recognized on the use of the proceeds that could be obtained upon exercise of options, warrants and similar instruments. It assumes that the proceeds would be used to purchase common shares at the average market
price during the period. The warrants as disclosed in
Note
12
of the financial statements or other convertible instruments discussed in
Note
15
were not included in the computation of loss per share as their inclusion would be anti-dilutive.
Segment Information
- We operate in two industry segments, the development, manufacture and sale of private and commercial vehicle energy efficient enhancement products, and employee staffing services. The enhancement products are designed to extend engine life, promote fuel efficiency and reduce emissions. These products are being marketed by the Company and sales were predominantly in the United States of America, Canada, Mexico and Africa. During the three and six months ended September 30, 2011, the states of AZ, CA, FL and IL
accounted for 76.9% and 84.3
%
,
respectively
. During the three and six months ended September 30, 2010, the same states accounted for 81.7% and 84.3%, respectively.
Litigation
- The Company is and may become a party in routine legal actions or proceedings in the ordinary course of its business. Management does not believe that the outcome of these routine matters will have a material adverse effect on the Company’s consolidated financial position or results of operations.
Environmental
- The Company’s enhancement products and related operations are subject to extensive federal, state and local laws, regulations and ordinances in the United States relating to the generation, storage, handling, emission, transportation and discharge of certain materials, substances and waste into the environment, and various other health and safety matters. Governmental authorities have the power to enforce compliance with their regulations, and violators may be subject to fines, injunctions or both. The Company must devote substantial financial resources to ensure compliance, and it believes that it is in substantial compliance with all the applicable laws and regulations. As a result, the Company
does not believe it has any environmental remediation liability at September 30, 2011.
New accounting pronouncements
:
FASB Accounting Standards Update (“ASU”) No. 2010-13 was issued in April 2010, and amends and clarifies ASC 718 with respect to the classification of an employee share based payment award with an exercise price denominated in the currency of a market in which the underlying security trades. This ASU was effective for the fourth quarter of 2011 and did not have a material effect on the Company.
In January 2010, ASU No. 2010-06 “Fair Value Measurements and Disclosures (Topic 820) Improving Disclosures about Fair Value Measurement” was issued, which provides amendments to Subtopic 820-10 that requires new disclosures as follows:
|
1.
|
Transfers in and out of Levels 1 and 2. A reporting entity should disclose separately the amounts of significant transfers in and out of Level 1 and Level 2 fair value measurements and describe the reasons for the transfers.
|
|
2.
|
Activity in Level 3 fair value measurements. In the reconciliation for fair value measurements using significant unobservable inputs (Level 3), a reporting entity should present separately information about purchases, sales, issuances, and settlements (that is, on a gross basis rather than as one net number).
|
This Update provides amendments to Subtopic 820-10 that clarify existing disclosures as follows:
|
1.
|
Level of disaggregation. A reporting entity should provide fair value measurement disclosures for each class of assets and liabilities. A class is often a subset of assets or liabilities within a line item in the statement of financial position. A reporting entity needs to use judgment in determining the appropriate classes of assets and liabilities.
|
|
2.
|
Disclosures about inputs and valuation techniques. A reporting entity should provide disclosures about the valuation techniques and inputs used to measure fair value for both recurring and nonrecurring fair value measurements. Those disclosures are required for fair value measurements that fall in either Level 2 or Level 3.
|
This Update also includes conforming amendments to the guidance on employers’ disclosures about postretirement benefit plan assets (Subtopic 715-20). The conforming amendments to Subtopic 715-20 change the terminology from major categories of assets to classes of assets and provide a cross reference to the guidance in Subtopic 820-10 on how to determine appropriate classes to present fair value disclosures. The new disclosures and clarifications of existing disclosures are effective for interim and annual reporting periods beginning after December 15, 2009, except for the disclosures about purchases, sales, issuances, and settlements in the roll forward of activity in Level 3 fair value measurements. Those disclosures were effective for fiscal years beginning after December 15, 2010, and for interim periods within
those fiscal years. This ASU was effective for the first quarter of 2012 and did not have a material effect on the Company.
In December 2010, the FASB issued the FASB Accounting Standards Update No. 2010-28 “Intangibles – Goodwill and Other (Topic 350): When to Perform Step 2 of the Goodwill Impairment Test For Reporting Units With Zero or Negative Carrying Amounts” (“ASU 2010-28”).Under ASU 2010-28, if the carrying amount of a reporting unit is zero or negative, an entity must assess whether it is more likely than not that goodwill impairment exists. To make that determination, an entity should consider whether there are adverse qualitative factors that could impact the amount of goodwill, including those listed in ASC 350-20-35-30. As a result of the new guidance, an entity can no longer assert that a reporting unit is not required to perform the second step of the goodwill impairment test because the carrying
amount of the reporting unit is zero or negative, despite the existence of qualitative factors that indicate goodwill is more likely than not impaired. ASU 2010-28 is effective for public entities for fiscal years, and for interim periods within those years, beginning after December 15, 2010, with early adoption prohibited. This ASU was effective for the first quarter of 2012 and did not have a material effect on the Company.
In December 2010, the FASB issued the FASB Accounting Standards Update No. 2010-29 “Business Combinations (Topic 805): Disclosure of Supplementary Pro Forma Information for Business Combinations” (“ASU 2010-29”). ASU 2010-29 specifies that if a public entity presents comparative financial statements, the entity should disclose revenue and earnings of the combined entity as though the business combination(s) that occurred during the current year had occurred as of the beginning of the comparable prior annual reporting period only. The amendments in this Update also expand the supplemental pro forma disclosures under Topic 805 to include a description of the nature and amount of material, nonrecurring pro forma adjustments directly attributable to the business combination included in the reported pro
forma revenue and earnings. The amended guidance is effective prospectively for business combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after December 15, 2010. This ASU was effective for the first quarter of 2012 and did not have a material effect on the Company.
ASU No. 2011-04 was issued May 2011, and amends ASC 820, Fair Value Measurement. This amendment is meant to improve the comparability of fair value measurements presented and disclosed in financial statements prepared in accordance with U.S. Generally Accepted Accounting Principles and International Financial Reporting Standards. This ASU will be effective during interim and annual periods beginning after December 15, 2011.
In June 2010, accounting guidance was amended to change the presentation of comprehensive income. These changes give an entity the option to present the total of comprehensive income, the components of net income, and the components of other comprehensive income either in a single continuous statement of comprehensive income or in two separate but consecutive statements. The option to present components of other comprehensive income as part of the statement of changes in stockholders’ equity was eliminated. The items that must be reported in other comprehensive income or when an item of the comprehensive income must be reclassified to net income were not changed. Additionally, no changes were made to the calculations and presentation of earning per share. These changes become effective for fiscal years beginning
after December 15, 2011. The Company has determined that these changes will not have an effect on the consolidated financial results.
Management does not believe that any other recently issued, but not yet effective accounting pronouncements, if adopted, would have a material effect on the accompanying condensed consolidated financial statements.
Note 3 – Inventories
Inventory consists of finished goods and raw material as follows:
|
|
|
September 30,
2011
|
|
|
March 31,
2011
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Finished goods
|
|
$
|
83,283
|
|
|
$
|
55,797
|
|
|
Raw material
|
|
|
260,392
|
|
|
|
199,189
|
|
|
|
|
$
|
348,675
|
|
|
$
|
254,986
|
|
Note 4 – Property, Plant and Equipment
Property, plant and equipment and computers consisted of the following:
|
|
|
September 30,
2011
|
|
|
March 31,
2011
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Property and plant
|
|
$
|
1,452,146
|
|
|
$
|
1,452,146
|
|
|
Equipment and computers
|
|
|
670,430
|
|
|
|
703,272
|
|
|
Less accumulated depreciation
|
|
|
(719,608
|
)
|
|
|
(670,081
|
)
|
|
Net property, plant and equipment
|
|
$
|
1,402,968
|
|
|
$
|
1,485,337
|
|
During the three and six months ended September 30, 2011 and 2010 depreciation expense was
$35,187
and $42,282, for the three months periods and
$71,163
and $84,565 for the six month periods, respectively.
Note 5 – Intangible Assets and Goodwill
At March 31, 2011, the Company fully impaired its production and license rights under the Environmental Protection Agency, customer relationships and goodwill in the aggregate amount of $6,990,097. For the three and six months ended September 30, 2010 the Company recognized $178,820 and $357,639, respectively.
|
|
Weighted
|
|
March 31, 2011
|
|
|
|
Average
|
|
Gross Carrying
|
|
|
Accumulated
|
|
|
Net Carrying
|
|
|
|
Useful Life
|
|
Amount
|
|
|
Amortization
|
|
|
Amount
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Intangible assets subject to amortization:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EPA licenses
|
7 years
|
|
$
|
887,055
|
|
|
$
|
887,055
|
(1)
|
|
$
|
–
|
|
|
Customer Relationships
|
5 years
|
|
|
3,579,391
|
|
|
|
3,576,391
|
(2)
|
|
|
–
|
|
|
|
|
|
$
|
4,463,446
|
|
|
$
|
4,463,446
|
|
|
$
|
–
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Goodwill not subject to amortization:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Goodwill
|
|
|
$
|
8,979,822
|
|
|
$
|
8,979,822
|
(3)
|
|
$
|
–
|
|
|
|
|
|
$
|
8,979,822
|
|
|
$
|
4,355,151
|
|
|
$
|
–
|
|
_______________
|
(1)
|
Includes impairment valuation of $253,444 during the year ended March 31, 2011.
|
|
(2)
|
Includes impairment valuation of $2,111,982 during the year ended March 31, 2011.
|
|
(3)
|
Impairment valuation of goodwill of $4,624,671 for the year ended March 31, 2011.
|
Note 6 – Accrued Liabilities
Accrued liabilities consist of the following as of September 30, 2011 and March 31, 2011:
|
|
|
September 30,
2011
|
|
|
March 31,
2011
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
Accrued contingent liabilities
|
|
$
|
300,000
|
|
|
$
|
300,000
|
|
|
Accrued penalties and interest
|
|
|
2,570,747
|
|
|
|
2,598,977
|
|
|
Other accrued expenses and workers’ compensation claims
|
|
|
280,581
|
|
|
|
1,333,206
|
|
|
|
|
$
|
3,151,328
|
|
|
$
|
4,232,183
|
|
Note 7 – Accrued Payroll, Taxes and Benefits
Accrued payroll, taxes and benefits was $1,010,465 and $16,666,660 at September 30, 2011 and March 31, 2011, respectively.
At September 30, 2011, substantially all of the accrued payroll and taxes represent current obligations for payroll and the related payroll taxes and payments coming due in the near term. In accordance with GAAP requirements the Company has accrued penalties and interest up to the date of the deconsolidation of the two entities described in Note 1.
Note 8 – Notes Payable
As of September 30, 2011 and March 31, 2011 notes payable consist of the following:
|
|
|
September 30,
|
|
|
March 31,
|
|
|
|
|
2011
|
|
|
2011
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revolving line of credit against factored Lumea receivables (1)
|
|
$
|
840,626
|
|
|
$
|
2,124,641
|
|
|
Bank loans, payable in installments
|
|
|
221,937
|
|
|
|
227,345
|
|
|
Mortgage loan payable, monthly payments of principal and interest at 3 month LIBOR plus 4.7%
|
|
|
784,427
|
|
|
|
802,550
|
|
|
Payments due seller of XenTx Lubricants
|
|
|
254,240
|
|
|
|
254,240
|
|
|
Loan from Dyson
|
|
|
60,000
|
|
|
|
60,000
|
|
|
Notes payable
|
|
|
1,254,709
|
|
|
|
1,254,709
|
|
|
Loans from individuals, due within one year
|
|
|
453,038
|
|
|
|
461,645
|
|
|
Purchase Note 1
|
|
|
–
|
|
|
|
4,647,970
|
|
|
Purchase Note 2
|
|
|
–
|
|
|
|
1,078,871
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
3,868,977
|
|
|
|
10,911,971
|
|
|
Less current portion
|
|
|
3,087,573
|
|
|
|
8,838,922
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term debt
|
|
$
|
781,404
|
|
|
$
|
2,073,049
|
|
____________
|
(1)
|
The Company maintains a $5 million line of credit relating to its factored accounts receivable.
|
Bank Loan
consists of a loan due in July, 2012 with monthly payments of $5,500 per month with balance due at maturity. The loan is secured by receivables, inventory and equipment in Durant, Oklahoma. The loan bears interest at
8.0%
per annum.
The payments on purchase notes due sellers bear interest at a rate of 8.0% and was due on March 31, 2011, and is currently in default.
Substantially all of the staffing receivables are pledged as collateral for the revolving line of credit. At September 30, 2011 and March 31, 2011, the Company had pledged receivables of
$949,921
and $2,417,724, respectively. This line of credit has been renewed through 2012.
Note payable consists of the loan from Shelter Island Opportunity Fund (“Shelter Island”) with interest at 12.25% per annum and secured by the plant, equipment and inventory in Durant, Oklahoma. The Note payable matured on December 31, 2010, and is due and payable. The Company has accrued additional default interest at 18% per annum on this note and is attempting to work out a restructuring or refinancing of this amount. Certain liquidated damages terms are included in this note, however, none were recorded as the Company does not believe that any such damages have been incurred. On August 20, 2011 Shelter Island filed suit against the Company seeking payment of its debt or delivery of the underlying property securing the loan. The assets securing the loan are subject to
first liens by banks. The Company believes that it will reach an agreement with the Shelter Island for the resolution of this case.
The Loans from lenders and individuals includes seven loans which are commercial loans and personal loans in the normal course of business and bear interest from 9% to 12%, with maturity dates ranging from March 2012 to April 2015.
Substantially all of the Company’s assets are pledged as collateral for our debt obligations at September 30, 2011.
Maturities for the remainder of the loans are as follows:
|
2013
|
|
$
|
24,423
|
|
|
2014
|
|
$
|
26,591
|
|
|
2015
|
|
$
|
25,814
|
|
|
2016
|
|
$
|
23,200
|
|
|
Thereafter
|
|
$
|
681,376
|
|
Note 9 – Income Taxes
Through
September 30, 2011, we recorded a valuation allowance of approximately
$17,200,000
against deferred income tax assets primarily associated with tax loss carry forwards. Our significant operating losses experienced in prior years establishes a presumption that realization of these income tax benefits does not meet a “more likely than not” standard.
We have net operating loss carry forwards of approximately
$42,100,000
. Our net operating loss carry forwards will expire between 2025 and 2032 for federal purposes and approximately 10 years earlier for state purposes.
The deconsolidated entities continue to be members of the consolidated group for tax purposes.
Significant components of our deferred tax assets and liabilities at the balance sheet dates were as follows:
|
|
|
September 30,
|
|
|
|
|
2011
|
|
|
2010
|
|
|
Deferred Tax Assets and Liabilities
|
|
(Unaudited)
|
|
|
(Unaudited)
|
|
|
Deferred tax assets:
|
|
|
|
|
|
|
|
|
|
Net operating loss carryforwards
|
|
$
|
16,100,000
|
|
|
$
|
11,500,000
|
|
|
Allowance for doubtful accounts
|
|
|
1,000,000
|
|
|
|
900,000
|
|
|
Total
|
|
|
17,100,000
|
|
|
|
12,400,000
|
|
|
Less: Valuation allowance
|
|
|
(17,100,000
|
)
|
|
|
(12,400,000
|
)
|
|
Total deferred tax assets
|
|
|
–
|
|
|
|
–
|
|
|
Total deferred tax liabilities
|
|
|
–
|
|
|
|
–
|
|
|
Net deferred tax liabilities
|
|
$
|
–
|
|
|
$
|
–
|
|
A reconciliation of the federal statutory rate to the effective tax rate is as follows:
|
|
|
For the six months ended
September 30,
|
|
|
|
|
2011
|
|
|
2010
|
|
|
|
|
(Unaudited)
|
|
|
(Unaudited)
|
|
|
Reconciliation:
|
|
|
|
|
|
|
|
|
|
Income tax credit at statutory rate
|
|
$
|
690,000
|
|
|
$
|
731,000
|
|
|
Effect of state income taxes
|
|
|
94,000
|
|
|
|
150,000
|
|
|
Valuation allowance
|
|
|
(784,000
|
)
|
|
|
(881,000
|
)
|
|
Income taxes (credit)
|
|
$
|
–
|
|
|
$
|
–
|
|
Future realization of the net operating losses is dependent on generating sufficient taxable income prior to their expiration. Tax effects are based on a 34% Federal income tax rate. The net federal operating losses expire as follows:
|
|
|
Amount
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
2025
|
|
$
|
1,500,000
|
|
|
2026
|
|
|
5,100,000
|
|
|
2027
|
|
|
3,100,000
|
|
|
2028
|
|
|
2,300,000
|
|
|
2029
|
|
|
2,300,000
|
|
|
2030
|
|
|
12,400,000
|
|
|
2031
|
|
|
13,000,000
|
|
|
2032
|
|
|
2,000,000
|
|
|
Total net operating loss available
|
|
$
|
41,700,000
|
|
The Company is subject to various state income tax laws. The carryover of net operating losses in the various states range from five (5) years to fifteen (15) years based on the actual business activities within each state.
Note 10 – Fair Value Measurements
The Company adopted ASC 820-10 as of April 1, 2010. ASC 820-10 applies to certain assets and liabilities that are being measured and reported on a fair value basis. ASC 820-10 defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles, and expands disclosure about fair value measurements. This ASC enables the reader of the financial statements to assess the inputs used to develop those measurements by establishing a hierarchy for ranking the quality and reliability of the information used to determine fair values. ASC 820-10 requires that assets and liabilities carried at fair value will be classified and disclosed in one of the following three categories:
Level 1: Quoted market prices in active markets for identical assets or liabilities.
Level 2: Observable market based inputs or unobservable inputs that are corroborated by market data.
Level 3: Unobservable inputs that are not corroborated by market data.
The Company records liabilities related to its derivative liability (
See
Note 12
– Derivative
Financial Instruments) and the cashless warrant liability, both consisting of warrants and options outstanding, at their fair market values as provided by ASC 820-10.
The following table provides fair market measurements of the derivative liability and cashless warrant liability as of September 30, 2011:
|
|
|
Fair Value Measurements at Reporting Date Using Significant Unobservable Inputs (Level 3)
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
Warrant liabilities
|
|
$
|
105,073
|
|
|
Cashless warrant liability
|
|
|
1,264
|
|
|
|
|
$
|
106,337
|
|
The change in fair market value of the derivative liability and cashless warrant liability is included in interest expense in the Condensed Consolidated Statements of Operations.
The following table provides a reconciliation of the beginning and ending balances of the derivative liability and cashless warrant liability as of September 30, 2011:
|
|
|
Warrant Liability
|
|
|
Cashless Warrant Liability
|
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Beginning balance April 1, 2011
|
|
$
|
166,133
|
|
|
$
|
3,531
|
|
|
$
|
169,664
|
|
|
Change in fair market value of derivative liability and cashless warrant liability
|
|
|
(61,060)
|
|
|
|
(2,267)
|
|
|
|
(63,327)
|
|
|
Ending balance September 30, 2011
(Unaudited)
|
|
$
|
105,073
|
|
|
$
|
1,264
|
|
|
$
|
106,337
|
|
Certain financial instruments are carried at cost on the condensed consolidated balance sheets, which approximates fair value due to their short-term, highly liquid nature. These instruments include cash and cash equivalents, accounts receivable, accounts payable and accrued expenses, other short-term liabilities.
Note 11 – Convertible Debt
The Company entered into a Convertible Loan Agreement which also entitled the lenders to warrants and to convert the loans, at their option, to common stock of the Company. The debt is convertible at a rate of 50% of the then current market price at the time of conversion. At September 30, 2011, the value of the 6% Convertible Notes, with interest accrued quarterly, was as follows:
|
Maturity
|
|
Face Amount
|
|
|
Conversion Derivative
|
|
|
Balance
|
|
|
|
|
(Unaudited)
|
|
|
(Unaudited)
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
April 28, 2009
|
|
$
|
293,300
|
|
|
$
|
293,300
|
|
|
$
|
586,600
|
|
|
August 17, 2009
|
|
|
700,000
|
|
|
|
700,000
|
|
|
|
1,400,000
|
|
|
October 28, 2009
|
|
|
300,000
|
|
|
|
300,000
|
|
|
|
600,000
|
|
|
November 10, 2009
|
|
|
1,200,000
|
|
|
|
1,200,000
|
|
|
|
2,400,000
|
|
|
Total
|
|
$
|
2,493,300
|
|
|
$
|
2,493,300
|
|
|
$
|
4,986,600
|
|
Interest expense for the three and six months ended September 30, 2011 and
2010 was
$93,499
and $93,440 for the three month periods and
$186,998
and $186
,880 for the six month periods, respectively.
The notes have matured and the conversion features have expired. These loans are subordinate to the Shelter Island Opportunity Fund (“SIOF”) loan, which prevents collection or enforcement without either the full payment of the SIOF loans or the consent of that loan holder. The Company is attempting to negotiate an agreeable settlement with the convertible note holders for a loan extension and fixed payment terms over several years. The debt is in default and accrues interest at the default rate of 15% per annum. The debt agreements include provisions for certain liquidated damages, however, the Company does not believe that it has incurred any such liquidated damages, and accordingly, none have been recorded as of September 30, 2011 or March 31, 2011.
Note 12 – Derivative Financial Instruments
In connection with various financings through November 10, 2006, the Company has issued warrants to purchase shares of common stock in conjunction with the convertible notes to purchase 12,000,000 shares of common stock at an exercise price of $2.50 per share. The Company also issued warrants to a broker in the transaction for the exercise of 640,000 outstanding shares of common stock at an exercise price of $2.50. These warrants expire if not exercised at various dates in 2013 through November 10, 2013. At September 30, 2011, all of the 12,640,000 outstanding warrants have been issued entitling the lender to one share for each warrant at an exercise price of $2.50 per share.
The agreements include registration rights and certain other terms and conditions related to share settlement of the embedded conversion features and the warrants. In this instance, ASC 815-10, “Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Company’s Own Stock”, requires allocation of the proceeds between the various instruments and the derivative elements carried at fair values.
In addition, in conjunction with financings, purchases and consulting transactions, between April 1, 2007 and March 31, 2009 the Company issued additional warrants, net of expirations, to purchase 6,294,750 shares of the Company’s common stock at an exercise price $0.75 per share. No warrants have been exercised.
At September 30, 2011 there were 18,934,750 shares subject to warrants at a weighted average exercise price of $1.92.
|
Exercise Price
|
|
Number of Shares
Subject to Outstanding
Warrants and Options
and Exercisable
|
|
Weighted Average
Remaining
Contractual Life
(years)
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
$ 0.75
|
|
6,294,750
|
|
0.75
|
|
$ 2.50
|
|
12,640,000
|
|
1.76
|
|
|
|
18,934,750
|
|
|
In addition to the spot price of the stock and remaining term of the warrant, other factors used in the binomial model included in the fair value analysis at September 30, 2011 were the volatility of 227.1%, risk free rate of between 0.13% and 1.43% and a dividend rate of $0 per period.
Note 13 – Commitments and Contingencies
Concentration of Credit Risk
Financial instruments, which potentially subject the Company to concentrations of credit risk, consist of cash. The Company periodically evaluates the credit worthiness of financial institutions, and maintains cash accounts only in large high quality financial institutions, thereby minimizing exposure for deposits in excess of federally insured amounts.
Lease Commitments
The Company has lease agreements for office space in Scottsdale, Arizona
and for
11
offices throughout the United States. The remaining lease commitment for the two Scottsdale offices are 5.25 years each and the other offices are year to year or month-to-month. The following table sets forth the aggregate minimum future annual lease commitments at September 30, 2011 under all non-cancelable leases for the twelve months:
|
|
|
Amount
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
2012
|
|
$
|
187,000
|
|
|
2013
|
|
|
203,000
|
|
|
2014
|
|
|
162,000
|
|
|
2015
|
|
|
135,000
|
|
|
2016
|
|
|
96,000
|
|
|
Thereafter
|
|
|
21,000
|
|
|
|
|
$
|
804,000
|
|
Lease expense for the quarters ended September 30, 2011 and 2010 was
$72,388
and $78,330, respectively. Lease expense for the six months ended September 30, 2011 and 2010 was
$149,157
and $203,650, respectively. The total of all scheduled lease payments, assuming all locations are continued at the same rates, is approximately
$194,000
per year.
Workers’ Compensation Claims
In conjunction with our staffing business, in states other than those that require participation in state funded programs, we maintain a workers' compensation policy to cover claims by employees. The Company retains the first portion of each such claim and then funds the amount to the insurance carrier on a current basis. The Company uses estimates to accrue workers' compensation costs based on medical, legal and actuarial experts and state law information available at the time of evaluation. By the nature of the personal injury claims, these estimates are subject to continual revision until each claim is settled, closed or adjudicated. Should our claims experience increase in frequency and/or severity our claims losses would increase substantially.
Litigation
On January 20, 2010, Ace American Insurance Company (“ACE”) filed in the Superior Court of Arizona, County of Maricopa, case number CV2009-030709, a writ of garnishment on Lumea, Inc. (“Lumea”) seeking payment of amounts totalling approximately $6 million due the Sellers of Easy Staffing Services, Inc. be made to ACE. Our subsidiary, Lumea, has stopped all payments to the Sellers based on its pending lawsuit against the Sellers in conjunction with the acquisition of the staffing business in March, 2009. Lumea continues to defend its position.
In relation to the Company's acquisition of Industrial Staffing Concepts Corporation ("ISCC") during January 2010, the seller has claimed amounts due by the Company of $165,275 for damages related to breach of obligations and $37,000 for Earn-Out payments. Management believes the claims are baseless and the likelihood of the incurrence of a liability to be remote. Accordingly, no accrual was deemed necessary at March 31, 2011.
The Company is subject to normal recurring litigation as a result of its normal business lines. The Company attempts to provide for all losses as known. There may be losses or claims that the Company is not currently aware of or has not been provided information as to the claims or the nature of the claim as of the financial statement review date.
Note 14 – Company Stock
Preferred Stock
At September 30, 2011, the Company had 1,000,000 shares of $0.001 par value preferred stock authorized and issued 100,000 of its Convertible Series A Preferred Stock in exchange for an outstanding debt of the Company. The shares have a dividend rate of 6%, or approximately $8,000 per month commencing in April 2011, are convertible by the holder at any time that the quoted stock price of the common stock is equal to or greater than $0.32 per share. The shares are convertible at a rate of 49.24 shares of common stock for each share of preferred stock.
Common Stock
At September 30, 2011, the Company had 250,000,000 shares authorized of $0.001 par value common stock, of which issued and outstanding shares were 185,881,129 shares.
During the six months ended September 30, 2011, the Company issued an aggregate of 4,100,000 common shares as compensation to employees and for interest payments recognizing an aggregate addition to stockholders’ equity of $78,750 based on the market price of the stock at the date of the agreements, issued 4,500,000 shares to insiders above the market price as payment for amounts owed these insiders of $135,000, issued 450,000 shares in conjunction with debt conversions of $67,050 and 2,000,000 shares in conjunction with acquisitions of Arizona Independent Power, Inc. and a block of staffing business with the stock valued at a market price of $60,000.
Warrants
No warrants have been exercised.
At September 30, 2011 the status of the outstanding warrants is as follows:
|
Issue Date
|
|
Shares Exercisable
|
|
Weighted Average
Exercise Price
|
|
Expiration Date
|
|
|
|
|
|
|
|
|
|
|
April 29, 2006
|
|
1,866,667
|
|
$
|
2.50
|
|
April 28, 2013
|
|
June 28, 2006
|
|
5,000,000
|
|
$
|
2.50
|
|
August 10, 2013
|
|
August 17, 2006
|
|
1,633,333
|
|
$
|
2.50
|
|
August 17, 2013
|
|
October 28, 2006
|
|
700,000
|
|
$
|
2.50
|
|
October 28, 2013
|
|
November 10, 2006
|
|
2,800,000
|
|
$
|
2.50
|
|
November 10, 2013
|
|
July 1, 2007
|
|
5,775,000
|
|
$
|
.75
|
|
June 30, 2012
|
|
Cashless April 20 – November 10, 2006
|
|
640,000
|
|
$
|
2.50
|
|
April 29 – November 10, 2011
|
|
Cashless July 1, 2007
|
|
519,750
|
|
$
|
.75
|
|
June 30, 2012
|
The warrants have no intrinsic value at September 30, 2011.
Note 15 – Gain/(Loss) Per Share
Basic income (loss) per common share is computed by dividing the results of operations by the weighted average number of shares outstanding during the period. For purposes of the determining the number of shares outstanding the shares received by the acquirer in the reverse acquisition are treated as outstanding for all periods prior to the transaction.
Diluted loss per common share adjusts basic loss per common share for the effects of convertible securities, stock options, warrants and other potentially dilutive financial instruments only in periods in which such effect is dilutive. No instruments were dilutive at September 30, 2011 or 2010. The diluted loss per common share excludes the dilutive effect of approximately 18,934,750 and 22,740,000 warrants at September 30, 2011 and 2010, respectively, and Convertible Preferred Stock, which is convertible into 4,924,134 common shares when the common stock price reaches or exceeds $0.32 per share, since such instruments have an exercise price in excess of the average market value of the Company’s common stock during the respective periods.
Note 16 –
Reorganization Proceedings of Certain Subsidiaries
General – Lumea Staffing, Inc. and Lumea Staffing of CA, Inc. filed for protection under Chapter 11 of the Bankruptcy Code of the U.S. Bankruptcy Court for the District of Arizona in August 18, 2011. The filing entities took this action to resolve all pending tax and workers’ compensation claims. As a result of the filings, actions against these entities has been stayed due to the automatic imposition of an automatic stay applicable to bankruptcy cases. At this time it is not possible to predict how long the proceedings will last, the form of any ultimate resolution or when an ultimate resolution might occur.
Debtor-in-Possession (“DIP”) Activities – In connection with the bankruptcy filing, the entities’ factoring entity has been extended with the approval of the Court. As a result of their bankruptcy filings, these two entities are precluded from paying dividends to shareholders and from making payments on any pre-bankruptcy filing accounts or notes payable that are due and owing to any related entity or other pre-petition creditor during the pendency of the bankruptcy case, without the Bankruptcy Court’s approval.
These entities are supposed to submit a plan of reorganization to the Bankruptcy Court detailing the entities’ plan of reorganization. The exclusivity period under which these entities are the only entities permitted to file such a plan is currently set to expire on December 15, 2011.
When the entities emerge from the jurisdiction of the Bankruptcy Court, the subsequent accounting will be determined based upon the applicable circumstances and facts at such time, including the terms of any plan or reorganization.
Financial Results
The condensed combined financial information of the two entities is set forth below, presented on a historical cost basis:
Lumea Staffing, Inc. and Lumea Staffing of CA, Inc.
(Debtors-in-Possession)
Condensed Combined Balance Sheet (Unaudited)
(in thousands, at historical cost)
|
|
|
September 30, 2011
|
|
|
Assets:
|
|
|
|
|
Current assets
|
|
$
|
2,334
|
|
|
Property and equipment
|
|
|
11
|
|
|
Total assets
|
|
$
|
2,345
|
|
|
|
|
|
|
|
|
Liabilities and Stockholder’s Equity/(Deficit):
|
|
|
|
|
|
Current liabilities
|
|
$
|
1,075
|
|
|
Other Liabilities
|
|
|
–
|
|
|
Liabilities subject to compromise (a)
|
|
|
29,393
|
|
|
Total liabilities
|
|
|
30,468
|
|
|
Stockholder’s equity/(deficit)
|
|
|
(28,123
|
|
|
Total liabilities and stockholder’s equity
|
|
$
|
2,345
|
|
_______________
|
(a)
|
Liabilities subject to compromise include pre-petition liabilities which may be settled at amounts which differ from those recorded in the condensed combined balance sheets. Liabilities subject to compromise consist principally of payroll tax liabilities and workers’ compensation obligations.
|
Lumea Staffing, Inc. and Lumea Staffing of CA, Inc.
Condensed Combined Statement of Operations (Unaudited)
(in thousands, at historical cost)
|
|
|
September 30, 2011
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
|
2,705
|
|
|
Cost of sales
|
|
|
2,390
|
|
|
Gross profit
|
|
|
315
|
|
|
|
|
|
|
|
|
Operating expenses:
|
|
|
|
|
|
Selling, general and admiinistrative
|
|
|
376
|
|
|
Depreciation
|
|
|
1
|
|
|
|
|
|
377
|
|
|
Operating income/(loss)
|
|
|
(62
|
)
|
|
Interest expense
|
|
|
212
|
|
|
Loss before reorganization expenses
|
|
|
(274
|
|
|
Reorganization expenses
|
|
|
80
|
|
|
Loss
before taxes
|
|
|
(354
|
)
|
|
Income taxes
|
|
|
–
|
|
|
Net Loss
|
|
$
|
(354
|
)
|
Lumea Staffing, Inc. and Lumea Staffing of CA, Inc.
Condensed Combined Statement of Cash Flows (Unaudited)
(in thousands, at historical cost)
|
|
|
September 30, 2011
|
|
|
|
|
|
|
|
Net cash flows from operating activities
|
|
$
|
(385
|
)
|
|
Net cash provided from financing activities
|
|
|
301
|
|
|
Net decrease in cash
|
|
|
(84
|
)
|
|
Cash and cash equivalents at beginning of period
|
|
|
328
|
|
|
Cash and cash equivalents at end of period
|
|
$
|
244
|
|
Note 17 – Segment Reporting
Green Planet Group, Inc. has two reportable segments: the engine, fuel additives and green energy products and the industrial staffing segments. The first segment is comprised of the XenTx Lubricants, EMTA Corp. and White Sands entities and the staffing segment is comprised of Lumea, Inc. and its operating subsidiaries. AIP has not commenced operations nor had any revenue.
The accounting policies of the segments are the same as those described in the summary of significant accounting policies. Interest expense related to the individual entities is paid by or charged to those entities and the related debt is included as that entity’s liability. Green Planet management evaluates performance based on profit or loss before income taxes not including nonrecurring gains and losses.
There have been no significant intersegment sales or costs.
Green Planet’s business is conducted through separate legal entities that are wholly owned subsidiaries. Each entity has a specific set of business objectives and line of business.
The Company analyzes the result of the operations of the individual entities and the segments. Green Planet does not allocate income taxes and unusual items to the segments. The segment information for the three months and six months ended September 30, 2011 and September 30, 2010 are presented below.
|
For the three months ended
|
|
Additives &
|
|
|
|
|
|
Corporate
|
|
|
|
|
|
September 30, 2011 (Unaudited)
|
|
Green Energy
|
|
|
Staffing
|
|
|
& Eliminations
|
|
|
Consolidated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income statement information:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
|
|
$
|
235,784
|
|
|
$
|
6,025,461
|
|
|
$
|
–
|
|
|
$
|
6,261,245
|
|
|
Depreciation and amortization
|
|
|
32,670
|
|
|
|
2,517
|
|
|
|
–
|
|
|
|
35,187
|
|
|
Interest expense
|
|
|
31,035
|
|
|
|
588,194
|
|
|
|
(352,559)
|
|
|
|
266,670
|
|
|
Gain from deconsolidation
|
|
|
|
|
|
|
17,605,037
|
|
|
|
|
|
|
|
|
|
|
Loss before income taxes
|
|
|
(50,334
|
)
|
|
|
17,870,909
|
|
|
|
(215,538)
|
|
|
|
|
|
|
Net loss
|
|
|
(50,334
|
)
|
|
|
|
|
|
|
(215,538)
|
|
|
|
|
|
|
|
|
Additives &
|
|
|
|
|
|
Corporate
|
|
|
|
|
|
September 30, 2010 (Unaudited)
|
|
Green Energy
|
|
|
Staffing
|
|
|
& Eliminations
|
|
|
Consolidated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income statement information:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
|
|
$
|
313,175
|
|
|
$
|
9,997,275
|
|
|
$
|
–
|
|
|
$
|
10,310,450
|
|
|
Depreciation and amortization
|
|
|
64,350
|
|
|
|
188,433
|
|
|
|
–
|
|
|
|
252,783
|
|
|
Interest expense
|
|
|
12,494
|
|
|
|
2,417,120
|
|
|
|
108,395
|
|
|
|
2,538,009
|
|
|
Loss before income taxes
|
|
|
(64,768
|
)
|
|
|
(2,463,974
|
)
|
|
|
(346,175
|
)
|
|
|
(2,874,917
|
)
|
|
Net loss
|
|
|
(64,768
|
)
|
|
|
(2,463,974
|
)
|
|
|
(346,175
|
)
|
|
|
(2,874,917
|
)
|
|
For the six months ended
|
|
Additives &
|
|
|
|
|
|
Corporate
|
|
|
|
|
|
September 30, 2011 (Unaudited)
|
|
Green Energy
|
|
|
Staffing
|
|
|
& Eliminations
|
|
|
Consolidated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income statement information:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
|
|
$
|
571,634
|
|
|
$
|
14,797,864
|
|
|
$
|
–
|
|
|
$
|
15,369,498
|
|
|
Depreciation and amortization
|
|
|
64,340
|
|
|
|
5,823
|
|
|
|
–
|
|
|
|
71,163
|
|
|
Interest expense
|
|
|
59,973
|
|
|
|
1,097,440
|
|
|
|
4,139
|
|
|
|
1,161,552
|
|
|
Gain from deconsolidation
|
|
|
|
|
|
|
18,472 331
|
|
|
|
|
|
|
|
|
|
|
Income/(Loss) before income taxes
|
|
|
(131,416
|
)
|
|
|
16,839,834
|
|
|
|
(824,587)
|
|
|
|
15,883,831
|
|
|
Net Income/(Loss)
|
|
$
|
(131,416
|
)
|
|
$
|
|
|
|
$
|
(824,587)
|
|
|
$
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance sheet information:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
|
1,909,836
|
|
|
|
1,779,274
|
|
|
|
21,814
|
|
|
$
|
3,907,257
|
|
|
|
|
Additives &
|
|
|
|
|
|
Corporate
|
|
|
|
|
|
September 30, 2010 (Unaudited)
|
|
Green Energy
|
|
|
Staffing
|
|
|
& Eliminations
|
|
|
Consolidated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income statement information:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales
|
|
$
|
656,162
|
|
|
$
|
19,679,885
|
|
|
$
|
–
|
|
|
$
|
20,336,047
|
|
|
Depreciation and amortization
|
|
|
128,700
|
|
|
|
376,865
|
|
|
|
–
|
|
|
|
505,565
|
|
|
Interest expense
|
|
|
33,893
|
|
|
|
3,199,477
|
|
|
|
232,762
|
|
|
|
3,466,132
|
|
|
Loss before income taxes
|
|
|
(137,164
|
)
|
|
|
(3,813,395
|
)
|
|
|
(903,032
|
)
|
|
|
(4,853,591
|
)
|
|
Net loss
|
|
|
(137,164
|
)
|
|
|
(3,813,395
|
)
|
|
|
(903,032
|
)
|
|
|
(4,853,591
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance sheet information:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
|
2,173,763
|
|
|
|
10,877,328
|
|
|
|
745,318
|
|
|
|
13,796,409
|
|