10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-Q

(Mark One)

[X]	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED February 28, 2017
[  ]	TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM ______ TO ________

Commission file number 000-26331

GREYSTONE LOGISTICS, INC.

(Exact name of registrant as specified in its charter)

Oklahoma	75-2954680
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer   Identification No.)

1613 East 15^th Street, Tulsa, Oklahoma 74120

(Address of principal executive offices) (Zip Code)

(918) 583-7441

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [  ]

Indicate by check mark whether the registrant has submitted electronically and posted on its Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to post and submit such files). Yes [X] No [  ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer [  ]	Accelerated filer [  ]
Non-accelerated filer [  ] (Do not check if a smaller reporting company)	Smaller reporting company [X]

Indicate by checkmark whether the registrant is a shell company (as defined in rule 12b-2 of the Exchange Act). Yes [  ] No [X]

Applicable only to corporate issuers:

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:April 10, 2017 - 28,361,201

GREYSTONE LOGISTICS, INC.

FORM 10-Q

For the Period Ended February 28, 2017

		Page
PART I.	FINANCIAL INFORMATION
Item 1. Financial Statements		1
	Consolidated Balance Sheets (Unaudited) As of February 28, 2017 and May 31, 2016	1
	Consolidated Statements of Operations (Unaudited) For the Nine Months Ended February 28(29), 2017 and 2016	2
	Consolidated Statements of Operations (Unaudited) For the Three Months Ended February 28(29), 2017 and 2016	3
	Consolidated Statements of Cash Flows (Unaudited) For the Nine Months Ended February 28(29), 2017 and 2016	4
	Notes to Consolidated Financial Statements (Unaudited)	5
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	13
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	18
Item 4.	Controls and Procedures	18
PART II.	OTHER INFORMATION
Item 1.	Legal Proceedings	19
Item 1A.	Risk Factors	19
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	19
Item 3.	Defaults Upon Senior Securities	19
Item 4.	Mine Safety Disclosures	19
Item 5.	Other Information	19
Item 6.	Exhibits	19
SIGNATURES		20

Part I. FINANCIAL INFORMATION

Item 1. Financial Statements

Greystone Logistics, Inc. and Subsidiaries

Consolidated Balance Sheets

(Unaudited)

	February 28, 2017			May 31, 2016
Assets
Current Assets:
Cash	$	483,027		$	897,377
Accounts receivable -
Trade, net of allowance for doubtful accounts of $31,660 and $13,260, respectively		393,657			3,536,574
Related party receivable		121,577			150,113
Inventory		3,551,442			1,304,495
Prepaid expenses		157,501			70,058
Total Current Assets		4,707,204			5,958,617
Property and Equipment, net of accumulated depreciation		20,110,110			12,565,319
Deferred Tax Asset		726,982			1,283,682
Other Assets		11,841			23,405
Total Assets	$	25,556,137		$	19,831,023
Liabilities and Equity
Current Liabilities:
Current portion of long-term debt	$	4,629,186		$	2,088,327
Accounts payable and accrued expenses		2,949,117			2,642,112
Accrued interest payable – related party		-			2,475,690
Preferred dividends payable		26,850			60,005
Total Current Liabilities		7,605,153			7,266,134
Long-Term Debt, net of current portion		17,783,137			13,289,236
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 and 27,886,201 shares  issued and outstanding		2,836			2,789
Additional paid-in capital		53,790,764			53,613,811
Accumulated deficit		(54,688,575	)		(55,385,912	)
Total Greystone Stockholders’ Deficit		(894,970	)		(1,769,307	)
Non-controlling interest		1,062,817			1,044,960
Total Equity (Deficit)		167,847			(724,347	)
Total Liabilities and Equity (Deficit)	$	25,556,137		$	19,831,023

The accompanying notes are an integral part of these consolidated financial statements.

1

Greystone Logistics, Inc. and Subsidiaries

Consolidated Statements of Operations

For the Nine Months Ended February 28(29),

(Unaudited)

	2017			2016
Sales	$	25,759,823		$	15,270,671
Cost of Sales		21,103,691			12,743,989
Gross Profit		4,656,132			2,526,682
General, Selling and Administrative Expenses		2,133,228			1,840,574
Operating Income		2,522,904			686,108
Other Expense:
Interest expense		(832,887	)		(619,481	)
Income before Income Taxes		1,690,017			66,627
Provision for (Benefit from) Income Taxes		556,700			(39,100	)
Net Income		1,133,317			105,727
Income Attributable to Variable Interest Entities		(180,466	)		(175,249	)
Preferred Dividends		(255,514	)		(244,741	)
Net Income (Loss) Attributable to Common Stockholders	$	697,337		$	(314,263	)
Income (Loss) Per Share of Common Stock -
Basic and Diluted	$	0.02		$	(0.01	)
Weighted Average Shares of Common Stock Outstanding -
Basic		28,309,003			27,640,033
Diluted		28,888,170			27,640,033

The accompanying notes are an integral part of these consolidated financial statements.

2

Greystone Logistics, Inc. and Subsidiaries

Consolidated Statements of Operations

For the Three Months Ended February 28(29),

(Unaudited)

	2017			2016
Sales	$	8,693,851		$	5,280,480
Cost of Sales		6,234,807			4,574,839
Gross Profit		2,459,044			705,641
General, Selling and Administrative Expenses		745,924			601,106
Operating Income		1,713,120			104,535
Other Expense:
Interest expense		(290,087	)		(232,105	)
Income (Loss) before Income Taxes		1,423,033			(127,570	)
Provision for (Benefit from) Income Taxes		502,150			(67,750	)
Net Income (Loss)		920,883			(59,820	)
Income Attributable to Variable Interest Entities		(60,914	)		(58,912	)
Preferred Dividends		(86,302	)		(81,796	)
Net Income (Loss) Attributable to Common Stockholders	$	773,667		$	(200,528	)
Income (Loss) Per Share of Common Stock -
Basic and Diluted	$	0.03		$	(0.01	)
Weighted Average Shares of Common Stock Outstanding -
Basic		28,361,201			27,886,201
Diluted		28,935,114			27,886,201

The accompanying notes are an integral part of these consolidated financial statements.

3

Greystone Logistics, Inc. and Subsidiaries

Consolidated Statements of Cash Flows

For the Nine Months Ended February 28(29),

(Unaudited)

	2017			2016
Cash Flows from Operating Activities:
Net income	$	1,133,317		$	105,727
Adjustments to reconcile net income to net cash provided  by operating activities:
Depreciation and amortization		1,997,334			1,043,365
Decrease (Increase) in deferred tax asset		556,700			(39,100	)
Stock based compensation		-			40,068
Changes in trade accounts receivable		3,142,917			(82,097	)
Changes in related party receivable		28,536			(23,492	)
Changes in inventory		(2,246,947	)		(2,362,667	)
Changes in prepaid expenses		(87,243	)		(82,762	)
Changes in accounts payable and accrued expenses		307,005			2,865,698
Net cash provided by operating activities		4,831,619			1,464,740
Cash Flows from Investing Activities:
Purchase of property and equipment		(2,242,366	)		(3,394,268	)
Cash Flows from Financing Activities:
Proceeds from long-term debt		-			2,530,072
Proceeds from revolving loan		500,000			1,200,000
Payments on long-term debt and capitalized lease		(2,704,325	)		(1,249,557	)
Payments on revolving loan		(275,000	)		(300,000	)
Debt issue costs		(130,000	)		-
Proceeds from exercised stock options		57,000			57,000
Dividends paid on preferred stock		(288,669	)		(245,631	)
Dividends paid by variable interest entity		(162,609	)		(153,000	)
Net cash provided by (used in) financing activities		(3,003,603	)		1,838,884
Net Decrease in Cash		(414,350	)		(90,644	)
Cash, beginning of period		897,377			598,887
Cash, end of period	$	483,027		$	508,243
Non-Cash Activities:
Acquisition of equipment pursuant to capital lease	$	5,450,474		$	-
Acquisition of equipment from related party -
Through issuance of note payable	$	1,469,713		$	688,296
Through decrease in related party receivable		-		$	449,569
Acquisition of building with long-term debt	$	318,750		$	-
Conversion of accrued interest to long-term debt	$	2,475,690		$	-
Warrants issued	$	120,000		$	-
Preferred dividend accrual	$	26,850		$	890
Supplemental Information:
Interest paid	$	832,887		$	351,988

The accompanying notes are an integral part of these consolidated financial statements.

4

GREYSTONE LOGISTICS, INC.

Notes to Consolidated Financial Statements

(Unaudited)

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 February 28, 2017, the results of its operations for the nine-month and three-month periods ended February 28(29), 2017 and 2016, and its cash flows for the nine-month periods ended February 28(29), 2017 and 2016. 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, 2016 and the notes thereto included in Greystone’s Form 10-K for such period. The results of operations for the nine-months and three-month periods ended February 28(29), 2017 and 2016 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.

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 (loss) available to common stockholders by the weighted-average shares outstanding during the period. Diluted earnings per share is calculated by dividing net income (loss) available 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, as follows:

	2017		2016
Nine-month periods ended February 28(29):
Options to purchase common stock		-		675,000
Preferred stock convertible into common stock		3,333,333		3,333,333
Total		3,333,333		4,008,333
Three-month periods ended February 28(29):
Options to purchase common stock		-		675,000
Preferred stock convertible into common stock		3,333,333		3,333,333
Total		3,333,333		4,008,333

The following tables set forth the computation of basic and diluted earnings per share for the following periods:

	2017		2016
Nine-month periods ended February 28(29):
Numerator -
Net income (loss) available to common stockholders	$	697,337	$	(314,263	)
Denominator -
Weighted-average shares outstanding - basic		28,309,003		27,640,033
Incremental shares from assumed conversion of options and warrants		579,167		-
Diluted shares		28,888,170		27,640,033
Loss per share -
Basic and Diluted	$	0.02	$	(0.01	)
Three-month periods ended February 28(29):
Numerator -
Net income (loss) available to common   stockholders	$	773,667	$	(200,528	)
Denominator -
Weighted-average shares outstanding - basic		28,361,201		27,886,201
Incremental shares from assumed   conversion of options and warrants		573,913		-
Diluted shares		28,935,114		27,886,201
Loss per share -
Basic and Diluted	$	0.03	$	(0.01	)

5

Note 3. Inventory

Inventory consists of the following:

	February 28, 2017		May 31, 2016
Raw materials	$	1,162,324	$	536,350
Finished goods		2,389,118		768,145
Total inventory	$	3,551,442	$	1,304,495

Note 4. Related Party Transactions

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 $22,500 for use of Yorktown’s grinding equipment and $5,000 for the use of Yorktown’s pelletizing equipment for which GSM paid Yorktown rental fees of $1,100,000 for the nine months ended February 28(29), 2017 and 2016, respectively.

Effective February 21, 2017, Greystone purchased certain production equipment from Yorktown for $1,500,340 which included a cash payment of $30,627 and the assumption of a note payable with First Bank in the amount of $1,469,713 with an interest rate of 1.45% above the prime rate of interest (5.2% at February 28, 2017), and a maturity of August 21, 2021. The note with First Bank is secured by the equipment. During the period from September 2016 through January 2016, Greystone rented this equipment from Yorktown for a total of $163,204.

In addition, Yorktown provides office space for Greystone in Tulsa, Oklahoma at a monthly rental of $2,200.

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 F. 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. Greystone charges a tolling fee for blending and pelletizing plastic resin using TriEnda’s equipment and raw materials. Revenue from TriEnda totaled $519,814 and $253,466 for the nine months ended February 28(29), 2017 and 2016, respectively. The account receivable from TriEnda at February 28, 2017 was $65,168.

The tolling service provided by Greystone generates a certain amount of scrap material which is purchased by Greystone. Purchases for the nine months ended February 28(29), 2017 and 2016 totaled $24,265 and $71,000, respectively. Greystone had accounts payable to TriEnda of $17,031 at February 28, 2017.

6

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 $220,325 and $203,562 for the nine months ended February 28(29), 2017 and 2016, respectively. The account receivable due from Green at February 28, 2017 was $73,440.

Note 5. Debt

Debt as of February 28, 2017 and May 31, 2016 is as follows:

	February 28, 2017			May 31, 2016
Term note A payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 4.0%, maturing January 7, 2019	$	4,797,299		$	5,310,179
Term note B payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 4.0%, maturing January 7, 2019		1,962,157			2,688,659
Revolving note payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 4.0%, due January 31, 2019		1,900,000			1,675,000
Term note payable by GRE to International Bank of Commerce, interest rate of 4.5%, monthly principal and interest payments of $26,215, due January 31, 2019		2,886,906			3,021,734
Note payable to First Bank, prime rate of interest plus 1.45% but not less than 4.95%, monthly principal and interest payments of $30,628, due August 21, 2021, secured by equipment		1,469,713			-
Capital lease with a private pallet leasing company, interest rate of 5%, maturity of August 7, 2019		4,380,410			-
Note payable to Robert Rosene, 7.5% interest, due January 15, 2019		4,498,383			2,066,000
Note payable to Yorktown Management & Financial Services, LLC, 5% interest, due February 28, 2019, monthly principal and interest payments of $20,629		470,212			634,616
Other		316,970			50,560
Face value of long-term debt		22,682,050			15,446,748
Debt issue costs, net of amortization		(269,727	)		(69,185	)
		22,412,323			15,377,563
Less: Current portion		(4,629,186	)		(2,088,327	)
Long-term debt	$	17,783,137		$	13,289,236

The prime rate of interest as of February 28, 2017 was 3.75%. The prime rate of interest changed to 4% effective March 16, 2017.

7

Loan Agreement between Greystone and IBC

On January 31, 2014, Greystone and GSM (the “Borrowers”) and International Bank of Commerce (“IBC”) entered into a Loan Agreement (the “IBC Loan Agreement”). The IBC Loan Agreement provides for a revolving loan in an aggregate principal amount of up to $2,500,000 (the “Revolving Loan”) and a term loan in the aggregate principal amount of $9,200,000 (the “Term Loan”). The exact amount which can be borrowed under the Revolving Loan from time to time is dependent upon the amount of the borrowing base, but can in no event exceed $2,500,000.

On January 7, 2016, the Borrowers and IBC entered into the First Amendment to the IBC Loan Agreement (the “First Amendment”) whereby IBC made an additional term loan to Borrowers in the original principal amount of $2,530,072 (the “New Equipment Loan”). The New Equipment Loan and $2,917,422 of the principal amount outstanding on the Term Loan were consolidated into a new loan in the combined principal amount of $5,447,504 (the “Term Loan A”). The Term Loan’s remaining principal balance of $3,000,000 was deemed to be a separate term loan (the “Term Loan B”). Greystone’s board of directors approved compensation to Warren F. Kruger, President and CEO, and Robert B. Rosene, Jr., a member of Greystone’s board of directors, as the individual guarantors pursuant to the IBC Agreement, as amended. Messrs. Kruger and Rosene each recieved a cash payment of $65,000 and a warrant to purchase 250,000 shares of Greystone common stock for $0.01 per share as discussed further in Note 6. The cost of the compensation is accounted for as debt issue costs to be amortized over the remaining primary terms of the IBC notes.

The Term Loans A and B bear interest at the New York Prime Rate plus 0.5% but not less than 4.0% and mature January 7, 2019. The Borrowers are required to make equal monthly payments of principal and interest in such amounts sufficient to amortize the principal balance of (i) the Note A Term Loan over a seven year period beginning January 31, 2016 (currently $74,455 per month) and (ii) the Note B Term Loan over the three-year life of the loan (currently $88,790 per month).

The Revolving Loan bears interest at the New York Prime Rate plus 0.5% but not less than 4.0%. Effective December 12, 2016, the Revolving Loan was amended and restated to extend the maturity of the note to January 31, 2019. 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.

8

The IBC Loan Agreement includes customary representations and warranties and affirmative and negative covenants which include (i) requiring the Borrowers to maintain a debt service coverage ratio of 1:25 to 1:00 and a funded debt to EBIDA ratio not exceeding 3:00 to 1:00 measured quarterly, (ii) subject to certain exceptions, limiting the Borrowers’ combined capital expenditures on fixed assets to $1,000,000 per year, (iii) prohibiting Greystone, without IBC’s prior written consent, from declaring or paying any dividends, redemptions of stock or membership interests, distributions and withdrawals (as applicable) in respect of its capital stock or any other equity interest, other than additional payments to holders of its preferred stock in an amount not to exceed $500,000 in any fiscal year, (iv) subject to certain exceptions, prohibiting the incurrence of additional indebtedness by the Borrowers, and (v) requiring the Borrowers to prevent (A) any change in capital ownership such that there is a material change in the direct or indirect ownership of (1) Greystone’s outstanding preferred stock, and (2) any equity interest in GSM, or (B) Warren Kruger from ceasing to be actively involved in the management of Greystone as President and/or Chief Executive Officer. The foregoing list of covenants is not exhaustive and there are several other covenants contained in the IBC Loan Agreement.

Greystone’s debt service coverage ratio as of February 28, 2017 was 0.95 to 1:00 which was less than the required minimum as discussed above. Effective December 12, 2016, the Borrowers and IBC entered into the Third Amendment to the IBC Loan Agreement (the “Third Amendment”) waiving this instance of noncompliance, and further removing the requirement to maintain the minimum debt service coverage ratio until the rolling test period ending February 28, 2018.

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 loans 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 F. 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.

9

Loan Agreement between GRE and IBC

On January 31, 2014, GRE and IBC entered into a Loan Agreement which provided for a mortgage loan to GRE of $3,412,500. The loan provides for a 4.5% interest rate and a maturity of January 31, 2019 and is secured by a mortgage on the two buildings in Bettendorf, Iowa which are leased to Greystone.

Capital Lease with Private Pallet Leasing Company

In August, 2016, Greystone entered into a three-year lease agreement with a private pallet leasing company to provide for certain production equipment with a total cost of approximately $5.4 million. The lease agreement includes a bargain purchase option to acquire the production equipment at the end of the lease term. The lease is for two Milacron injection molding machines and two pallet molds designed and dedicated to production of 48X40 pallets (the “Pallets”) for the pallet leasing company. Monthly lease payments, estimated at approximately $100,000 per machine, are payable on a per invoice basis at the rate of $6.25 for each pallet produced by the leased production equipment and shipped to the leasing company. The lease bears an interest rate of 5%, has a three-year maturity and provides for minimum monthly lease rental payment based upon the total Pallets sold in excess of a specified amount not to exceed the monthly productive capacity of the leased machines.

The first of the Milacron machines was placed into service in August, 2016. The second machine was placed into service in September, 2016 under the same terms and conditions as the first machine. Maturities for the two years subsequent to February 28, 2017 for the capital lease are estimated to be $2,148,796 and $2,231,614.

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 a 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 a note payable of $4,541,690. Effective April 10, 2017, Mr. Rosene agreed to an extended maturity date of January 15, 2019. 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.

Note Payable between Greystone and Yorktown Management Financial Services, LLC (“Yorktown”)

On February 29, 2016, Greystone entered into an unsecured note payable to Yorktown in the amount of $688,296 in connection with the acquisition of equipment from Yorktown. The note payable bears interest at the rate of 5% and is payable over three years with monthly principal and interest payments of $20,629.

Maturities

Maturities of Greystone’s long-term debt and capital leases for the five years subsequent to February 28, 2017 are $4,629,186, $16,962,065, $373,064, $379,791 and $337,944.

Note 6. Warrants to Purchase Common Stock

Effective September 1, 2016, Greystone’s board of directors authorized the issuance of warrants to purchase 250,000 shares of Greystone’s common stock for $0.01 per share to each of Warren F. Kruger, President and CEO, and Robert B. Rosene, Jr., a member of Greystone’s board, as compensation for providing guarantees on Greystone’s debt with International Bank of Commerce. The warrants have a vesting period of two years and expire August 31, 2026. The issuance will be capitalized as debt issue cost as of the measurement date for approximately $120,000 and amortized over the remaining guaranty term.

10

The value of Greystone’s common stock on September 1, 2016 was $0.24 per share. The estimated fair value at the date of the grant for the warrants utilizing the Black-Scholes option valuation model and the assumptions that were used in the Black-Scholes option model for fiscal year 2017 are as follows:

Estimated fair value of warrants at date of grant	$	120,000
Black-Scholes model assumptions
Average expected life (years)		6
Average expected volatility factor		145.77	%
Average risk-free interest rate		4.0	%
Average expected dividend yields	$	-0-

Note 7. 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 loans with floating rates of interest approximate fair value. Fixed rate loans are valued based on cash flows using estimated rates of comparable loans. The carrying amounts reported in the balance sheet approximate fair value.

Note 8. Concentrations, Risks and Uncertainties

Greystone derived approximately 67% of its total sales from two customers (21% and 46% respectively) in fiscal year 2017 and approximately 41% (31% and 10%, respectively) in fiscal year 2016. The loss of a material amount of business from 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 $1,202,381 and $1,216,492 in fiscal years 2017 and 2016, 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 February 28, 2017, Greystone is indebted to Mr. Rosene in the amount of $4,498,383 for a note payable due January 15, 2019. There is no assurance that Mr. Rosene will renew the note as of the maturity date.

Note 9. Commitment

As of February 28, 2017, Greystone had an outstanding commitment in the amount of $1.9 million toward the purchase of certain production equipment.

11

Note 10. Recent Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, “Revenue from Contracts with Customers” (“ASU 14-09”) which creates a comprehensive set of guidelines for the recognition of revenue under the principle: “Recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.” The requirements of ASU 14-09 are effective for fiscal years, and interim periods within those years, beginning after December 15, 2017 and will require either retrospective application to each prior period presented or retrospective application with the cumulative effect of initially applying the standard recognized at the date of adoption. Greystone is currently evaluating the impact this ASU will have on our financial position and results of operations.

In February 2016, the FASB issued Accounting Standards 2016-02, Leases (Topic 842), which is intended to improve financial reporting about leasing transactions. The ASU will require organizations (“lessees”) that lease assets with lease terms of more than twelve months to recognize on the balance sheet the assets and liabilities for the rights and obligations created by those leases. Organizations that own the assets leased by lessees (“lessors”) will remain largely unchanged from current GAAP. In addition, the ASU will require disclosures to help investors and other financial statement users better understand the amount, timing and uncertainty of cash flows arising from leases. The effective date of this ASU is for fiscal years beginning after December 31, 2018 and interim periods within that year. Greystone is currently reviewing the ASU to assess the potential impact on the consolidated financial statements.

In March 2016, FASB issued Accounting Standards 2016-09, Improvements to Employee Share-Based Payment Accounting, which amends ASC Topic 718, Compensation – Stock Compensation. The objective of this amendment is part of the FASB’s Simplification Initiative as it applies to several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The effective date of the amendment is for fiscal years beginning after December 31, 2016 and interim periods within that reporting period. Greystone is currently reviewing the ASU to assess the potential impact on the consolidated financial statements.

12

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Results of Operations

General to All Periods

The unaudited consolidated financial statements include Greystone Logistics, Inc., its two wholly-owned subsidiaries, Greystone Manufacturing, L.L.C. (“GSM”) and Plastic Pallet Production, Inc. (“PPP”). Greystone also consolidates its variable interest entity, Greystone Real Estate, L.L.C. (“GRE”). All material intercompany accounts and transactions have been eliminated.

References to fiscal year 2017 refer to the nine-month and three-month periods ended February 28, 2017. References to fiscal year 2016 refer to the nine-month and three-month periods ended February 29, 2016.

Sales

Greystone’s primary focus is to provide quality plastic pallets to its existing customers while continuing its marketing efforts to broaden its customer base. Greystone’s existing customers are primarily located in the United States and engaged in the beverage, pharmaceutical and other industries. Greystone has generated and plans to continue to generate interest in its pallets by attending trade shows sponsored by industry segments that would benefit from Greystone’s products. Greystone hopes to gain wider product acceptance by marketing the concept that the widespread use of plastic pallets could greatly reduce the destruction of trees on a worldwide basis. Greystone’s marketing is conducted through contract distributors, its President and other employees.

13

Greystone derives a substantial portion of its revenue from two customers. One customer accounted for approximately 21% and 31% of Greystone’s total sales in fiscal year 2017 and 2016, respectively. The second customer accounted for 46% and 10% of Greystone’s total sales in fiscal years 2017 and 2016, respectively.

Personnel

Greystone had approximately 158 and 150 full-time employees as of February 28(29), 2017 and 2016, respectively.

Nine-Month Period Ended February 28, 2017 Compared to Nine-Month Period Ended February 29, 2016

Sales

Sales for fiscal year 2017 were $25,759,823 compared to $15,270,671 in fiscal year 2016 for an increase of $10,489,152. Pallet sales were $25,240,009 in fiscal year 2016 compared to $14,999,740 in fiscal year 2016 for an increase of $10,240,269. Other sales included tolling services of $519,814 in fiscal year 2017 and $270,931 in fiscal 2016.

Greystone has two major customers – a national brewer and a pallet leasing company. Sales to these major customers in fiscal year 2017 were 67% of total sales compared to 41% in fiscal year 2016. Sales to the national brewer were 21% and 31% in fiscal years 2017 and 2016, respectively. Sales to the pallet leasing company were 46% and 10% in fiscal years 2017 and 2016, respectively. The increase in pallet sales from fiscal year 2016 to 2017 was primarily due to increased sales to the pallet leasing company. Pallet sales to Greystone’s major customers are generally based on their need and may vary by period. Greystone cannot predict the future needs for these major customers and continues its marketing efforts toward new customers to broaden and diversify the customer base.

Due to Greystone’s increased demand for refined, recycled plastic resin in the manufacturing process for pallets, Greystone estimates that tolling services and sales of pelletized resin will be minimal, if any, in future periods.

Cost of Sales

Cost of sales in fiscal year 2017 was $21,103,691, or 82% of sales, compared to $12,743,989, or 83% of sales, in fiscal year 2016. Greystone showed an improved ratio of cost of sales to sales (the “cost of sales ratio”) in fiscal year 2017 over fiscal year 2016 as well as the previously reported cost of sales ratio of 87% for the six-month period ended November 30, 2016.

As discussed herein in the comparison of the three-month period ended February 28, 2017 to the prior period, Greystone achieved a cost of sales ratio of 72% in fiscal year 2017 resulting principally by emerging from the production start-up phase for the pallet designed for the pallet leasing customer.

14

General, Selling and Administrative Expenses

General, selling and administrative expenses were $2,133,228 in fiscal year 2017 compared to $1,840,574 in fiscal year 2016 for an increase of $292,654, or approximately 16%. The increase is primarily due to increased activity from the substantial increase in sales and related operations in fiscal year 2017 compared to fiscal year 2016.

Interest Expense

Interest expense was $832,887 in fiscal year 2017 compared to $619,481 in fiscal year 2016 for an increase of $213,406. This increase in interest expense in fiscal year 2017 over fiscal year 2016 is principally attributable to the increase in debt related to the acquisition of equipment to necessary to meet current demand for plastic pallets.

Provision for Income Taxes

The provision for (benefit from) income taxes was $556,700 and $(39,100) in fiscal years 2017 and 2016, respectively. The provision for income taxes does not include the income from the variable interest entity as the entity is not included in the income tax returns of Greystone and the taxable income of the entity is passed-through to the respective owners.

Based upon a review of its income tax filing positions, Greystone believes that its positions would be sustained upon an audit by the Internal Revenue Service and does not anticipate any adjustments that would result in a material change to its financial position. Therefore, no reserves for uncertain income tax positions have been recorded.

Net Income

Greystone recorded net income of $1,133,317 in fiscal year 2017 compared to $105,727 in fiscal year 2016 primarily for the reasons discussed above.

Net Income (Loss) Attributable to Common Stockholders

Net income available to common stockholders for fiscal year 2017 was $697,337, or $0.02 per share, compared to a net loss available to common stockholders of $(314,263), or $(0.01) per share, in fiscal year 2016 primarily for the reasons discussed above.

Three-Month Period Ended February 28, 2017 Compared to Three-Month Period Ended February 29, 2016

Sales

Sales for fiscal year 2017 were $8,693,851 compared to $5,280,480 in fiscal year 2016 for an increase of $3,413,371. Pallet sales were $8,542,727 in fiscal year 2017 compared to $5,122,785 in fiscal year 2016 for an increase of $3,419,942. Other sales included tolling services of $151,124 in fiscal year 2017 and compared to $157,695 in fiscal year 2016.

15

Greystone has two major customers – a national brewer and a pallet leasing company. Sales to these major customers in fiscal year 2017 were 67% of total sales compared to 54% in fiscal year 2016. Sales to the national brewer were 14% and 32% in fiscal years 2017 and 2016, respectively. Sales to the pallet leasing company were 53% and 22% in fiscal years 2017 and 2016, respectively. The increase in pallet sales from fiscal year 2016 to 2017 was primarily due to increased sales to the pallet leasing company. Pallet sales to Greystone’s major customers are generally based on their need and may vary by period. Greystone cannot predict the future needs for these major customers and continues its marketing efforts toward new customers to broaden and diversify the customer base.

Due to the Greystone’s increased demand for refined, recycled plastic resin in the manufacturing process for pallets, Greystone estimates that tolling services and sales of pelletized resin will be minimal, if any, in future periods.

Cost of Sales

Cost of sales in fiscal year 2017 was $6,234,807, or 72% of sales, compared to $4,574,839, or 87% of sales, in fiscal year 2016. The improved ratio of cost of sales to sales in fiscal year 2017 resulted principally by Greystone ability to emerge from the production start-up phase for the pallet designed for the pallet leasing customer.

General, Selling and Administrative Expenses

General, selling and administrative expenses were $745,924 in fiscal year 2017 compared to $601,106 in fiscal year 2016 for an increase of $144,818 or 24%. The increase is primarily due to increased activity from the substantial increase in sales and related operations in fiscal year 2017 compared to fiscal year 2016.

Interest Expense

Interest expense was $290,087 in fiscal year 2017 compared to $232,105 in fiscal year 2016 for an increase of $57,982. This increase in interest expense in fiscal year 2017 over fiscal year 2016 is principally attributable to the increase in debt related to the acquisition of equipment to necessary to meet current demand for plastic pallets.

Provision for Income Taxes

The provision for (benefit from) income taxes was $502,150 and $(67,750) in fiscal years 2017 and 2016, respectively. The provision for income taxes does not include the income from the variable interest entity as the entity is not included in the income tax returns of Greystone and the taxable income from this entity is passed-through to the respective owners.

Based upon a review of its income tax filing positions, Greystone believes that its positions would be sustained upon an audit by the Internal Revenue Service and does not anticipate any adjustments that would result in a material change to its financial position. Therefore, no reserves for uncertain income tax positions have been recorded.

16

Net Income

Greystone recorded a net income of $920,883 in fiscal year 2017 compared to a net loss of $(59,820) in fiscal year 2016 primarily for the reasons discussed above.

Net Income (Loss) Attributable to Common Stockholders

The net income available to common stockholders for fiscal year 2017 was $773,667, or $0.03 per share, compared to a net loss of $(200,528), or $(0.01) per share, in fiscal year 2016 primarily for the reasons discussed above.

Liquidity and Capital Resources

A summary of cash flows for the nine-month period ended February 28, 2017 is as follows:

Cash provided by operating activities	$	4,831,619
Cash used in investing activities		(2,242,366	)
Cash used in financing activities		(3,003,603	)

The contractual obligations of Greystone are as follows:

	Total		Less than 1 year		1-3 years		4-5 years		More than 5 years
Long-term debt	$	22,682,050	$	4,629,186	$	17,335,129	$	717,735	$	-0-

Greystone had a working capital deficit of $(2,897,949) at February 28, 2017. To provide for the funding to meet Greystone’s operating activities and contractual obligations as of February 28, 2017, Greystone will have to continue to produce positive operating results or explore various options including additional long-term debt and equity financing. However, there is no guarantee that Greystone will continue to create positive operating results or be able to raise sufficient capital to meet these obligations.

As discussed in Note 5 to the consolidated financial statements, Greystone has loans with IBC which include a term loan with a maturity of January 7, 2019 and a revolving loan which expires January 31, 2019. The exact amount which can be borrowed under the revolving loan from time to time is dependent upon the amount of the borrowing base, but can in no event exceed $2,500,000.

Substantially all of the financing that Greystone has received through the last few fiscal years resulted from loans provided by certain officers and directors of Greystone and bank loans which are guaranteed by certain officers and directors of Greystone. Greystone continues to be dependent upon its officers and directors to provide and/or secure additional financing and there is no assurance that its officers and directors will continue to do so. As such, there is no assurance that funding will be available for Greystone to continue operations.

17

Greystone has 50,000 outstanding shares of cumulative 2003 Preferred Stock with a liquidation preference of $5,000,000 and a preferred dividend rate of the prime rate of interest plus 3.25%. Greystone does not anticipate that it will make cash dividend payments to any holders of its common stock unless and until the financial position of Greystone improves through increased revenues, another financing transaction or otherwise. Pursuant to the IBC Loan Agreement, as discussed in Note 5 to the consolidated financial statements, Greystone may pay dividends on its preferred stock in an amount not to exceed $500,000 per year.

Forward Looking Statements and Material Risks

This Quarterly Report on Form 10-Q includes certain statements that may be deemed “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are made in reliance on the safe harbor protections provided under the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical fact, that address activities, events or developments that Greystone expects, believes or anticipates will or may occur in the future, including decreased costs, securing financing, the profitability of Greystone, potential sales of pallets or other possible business developments, are forward-looking statements. Such statements are subject to a number of assumptions, risks and uncertainties. The forward-looking statements contained in this Quarterly Report on Form 10-Q could be affected by any of the following factors: Greystone’s prospects could be affected by changes in availability of raw materials, competition, rapid technological change and new legislation regarding environmental matters; Greystone may not be able to secure additional financing necessary to sustain and grow its operations; and a material portion of Greystone’s business is and will be dependent upon a few large customers and there is no assurance that Greystone will be able to retain such customers. These risks and other risks that could affect Greystone’s business are more fully described in Greystone’s Form 10-K for the fiscal year ended May 31, 2016, which was filed on August 29, 2016. Actual results may vary materially from the forward-looking statements. Greystone undertakes no duty to update any of the forward-looking statements contained in this Quarterly Report on Form 10-Q.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Not applicable.

Item 4. Controls and Procedures.

As of the end of the period covered by this Quarterly Report on Form 10-Q, Greystone carried out an evaluation under the supervision of Greystone’s Chief Executive Officer and Chief Financial Officer of the effectiveness of the design and operation of Greystone’s disclosure controls and procedures pursuant to the Securities Exchange Act Rules 13a-15(e) and 15d-15(e). Based on an evaluation as of May 31, 2016, Warren F. Kruger, Greystone’s Chief Executive Officer, and William W. Rahhal, Greystone’s Chief Financial Officer, identified two material weaknesses in Greystone’s internal control over financial reporting. As of the end of the period covered by this Quarterly Report on Form 10-Q, such material weaknesses had not been rectified. As a result of the continuation of these two material weaknesses, Greystone’s CEO and Chief Financial Officer concluded that Greystone’s disclosure controls and procedures were not effective at February 28, 2017.

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During the nine-month period ended February 28, 2017, there were no changes in Greystone’s internal controls over financial reporting that have materially affected, or that are reasonably likely to materially affect, Greystone’s internal control over financial reporting.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings.

None.

Item 1A. Risk Factors.

Not applicable.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

None.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

None.

Item 6. Exhibits.

The following exhibits are filed or furnished as part of this Quarterly Report on Form 10-Q.

31.1	Certification of Chief Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a) promulgated under the Securities Exchange Act of 1934, as amended, and Item 601(b)(31) of Regulation S-K, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (submitted herewith).
31.2	Certification of Chief Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a) promulgated under the Securities Exchange Act of 1934, as amended, and Item 601(b)(31) of Regulation S-K, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (submitted herewith).
32.1	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (submitted herewith).
32.2	Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (submitted herewith).
101	Interactive data files pursuant to Rule 405 of Regulation S-T: (i) the Consolidated Balance Sheets at February 28, 2017 and May 31, 2016, (ii) the Consolidated Statements of Operations for the nine-month and three-month periods ended February 28(29), 2017 and 2016, (iii) the Consolidated Statements of Cash Flows for the nine-month periods ended February 28(29), 2017 and 2016, and (iv) the Notes to the Consolidated Financial Statements (submitted herewith).

19

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	GREYSTONE LOGISTICS, INC.
	(Registrant)
Date: April 14, 2017	/s/ Warren F. Kruger
	Warren F. Kruger, President and Chief
	Executive Officer (Principal Executive Officer)
Date: April 14, 2017	/s/ William W. Rahhal
	William W. Rahhal, Chief Financial Officer
	(Principal Financial Officer and Principal Accounting Officer)

20

Index to Exhibits

The following exhibits are filed or furnished as part of this Quarterly Report on Form 10-Q.

31.1	Certification of Chief Executive Officer pursuant to Rules 13a-14(a) and 15d-14(a) promulgated under the Securities Exchange Act of 1934, as amended, and Item 601(b)(31) of Regulation S-K, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (submitted herewith).
31.2	Certification of Chief Financial Officer pursuant to Rules 13a-14(a) and 15d-14(a) promulgated under the Securities Exchange Act of 1934, as amended, and Item 601(b)(31) of Regulation S-K, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (submitted herewith).
32.1	Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (submitted herewith).
32.2	Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (submitted herewith).
101	Interactive data files pursuant to Rule 405 of Regulation S-T: (i) the Consolidated Balance Sheets at February 28, 2017 and May 31, 2016, (ii) the Consolidated Statements of Operations for the nine-month and three-month periods ended February 28(29), 2017 and 2016, (iii) the Consolidated Statements of Cash Flows for the nine month periods ended February 28(29), 2017 and 2016, and (iv) the Notes to the Consolidated Financial Statements (submitted herewith).

21

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Warren F. Kruger, certify that:

1.	I have reviewed this quarterly report on Form 10-Q of Greystone Logistics, Inc.;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

April 14, 2017	/s/ Warren F. Kruger
	Warren F. Kruger
	President and Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION

I, William W. Rahhal, certify that:

1.	I have reviewed this quarterly report on Form 10-Q of Greystone Logistics, Inc.;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

April 14, 2017	/s/ William W. Rahhal
	William W. Rahhal
	Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report of Greystone Logistics, Inc. (the “Company”) on Form 10-Q for the period ending February 28, 2017, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Warren F. Kruger, President and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

April 14, 2017	/s/ Warren F. Kruger
	Warren F. Kruger
	President and Chief Executive Officer

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

The foregoing certification is being furnished to the Securities and Exchange Commission as an exhibit to the Report and shall not be considered filed as part of the Report.

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report of Greystone Logistics, Inc. (the “Company”) on Form 10-Q for the period ending February 28, 2017, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, William W. Rahhal, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

April 14, 2017	/s/ William W. Rahhal
	William W. Rahhal
	Chief Financial Officer

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

The foregoing certification is being furnished to the Securities and Exchange Commission as an exhibit to the Report and shall not be considered filed as part of the Report.

XML

Document and Entity Information - shares	9 Months Ended
	Feb. 28, 2017	Apr. 10, 2017
Document And Entity Information
Entity Registrant Name	GREYSTONE LOGISTICS, INC.
Entity Central Index Key	0001088413
Document Type	10-Q
Document Period End Date	Feb. 28, 2017
Amendment Flag	false
Current Fiscal Year End Date	--05-31
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		28,361,201
Trading Symbol	GLGI
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2017

XML

Consolidated Balance Sheets (Unaudited) - USD ($)	Feb. 28, 2017	May 31, 2016
Current Assets:
Cash	$ 483,027	$ 897,377
Accounts receivable - Trade, net of allowance for doubtful accounts of $31,660 and $13,260, respectively	393,657	3,536,574
Accounts receivable - Related party receivable	121,577	150,113
Inventory	3,551,442	1,304,495
Prepaid expenses	157,501	70,058
Total Current Assets	4,707,204	5,958,617
Property and Equipment, net of accumulated depreciation	20,110,110	12,565,319
Deferred Tax Asset	726,982	1,283,682
Other Assets	11,841	23,405
Total Assets	25,556,137	19,831,023
Current Liabilities:
Current portion of long-term debt	4,629,186	2,088,327
Accounts payable and accrued expenses	2,949,117	2,642,112
Accrued interest payable - related party		2,475,690
Preferred dividends payable	26,850	60,005
Total Current Liabilities	7,605,153	7,266,134
Long-Term Debt, net of current portion	17,783,137	13,289,236
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 and 27,886,201 shares issued and outstanding	2,836	2,789
Additional paid-in capital	53,790,764	53,613,811
Accumulated deficit	(54,688,575)	(55,385,912)
Total Greystone Stockholders' Deficit	(894,970)	(1,769,307)
Non-controlling interest	1,062,817	1,044,960
Total Equity (Deficit)	167,847	(724,347)
Total Liabilities and Equity (Deficit)	$ 25,556,137	$ 19,831,023

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Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($)	Feb. 28, 2017	May 31, 2016
Statement of Financial Position [Abstract]
Allowance for doubtful on accounts receivable	$ 31,660	$ 13,260
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	27,886,201
Common stock, shares outstanding	28,361,201	27,886,201

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Consolidated Statements of Operations (Unaudited) - USD ($)	3 Months Ended		9 Months Ended
	Feb. 28, 2017	Feb. 29, 2016	Feb. 28, 2017	Feb. 29, 2016
Income Statement [Abstract]
Sales	$ 8,693,851	$ 5,280,480	$ 25,759,823	$ 15,270,671
Cost of Sales	6,234,807	4,574,839	21,103,691	12,743,989
Gross Profit	2,459,044	705,641	4,656,132	2,526,682
General, Selling and Administrative Expenses	745,924	601,106	2,133,228	1,840,574
Operating Income	1,713,120	104,535	2,522,904	686,108
Other Expense:
Interest expense	(290,087)	(232,105)	(832,887)	(619,481)
Income before Income Taxes	1,423,033	(127,570)	1,690,017	66,627
Provision for (Benefit from) Income Taxes	502,150	(67,750)	556,700	(39,100)
Net Income	920,883	(59,820)	1,133,317	105,727
Income Attributable to Variable Interest Entities	(60,914)	(58,912)	(180,466)	(175,249)
Preferred Dividends	(86,302)	(81,796)	(255,514)	(244,741)
Net Income (Loss) Attributable to Common Stockholders	$ 773,667	$ (200,528)	$ 697,337	$ (314,263)
Income (Loss) Per Share of Common Stock - Basic and Diluted	$ 0.03	$ (0.01)	$ 0.02	$ (0.01)
Weighted Average Shares of Common Stock Outstanding - Basic	28,361,201	27,886,201	28,309,003	27,640,033
Weighted Average Shares of Common Stock Outstanding - Diluted	28,935,114	27,886,201	28,888,170	27,640,033

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Consolidated Statements of Cash Flows (Unaudited) - USD ($)	9 Months Ended
	Feb. 28, 2017	Feb. 29, 2016
Cash Flows from Operating Activities:
Net income	$ 1,133,317	$ 105,727
Adjustments to reconcile net income to net cash provided  by operating activities:
Depreciation and amortization	1,997,334	1,043,365
Decrease (Increase) in deferred tax asset	556,700	(39,100)
Stock based compensation		40,068
Changes in trade accounts receivable	3,142,917	(82,097)
Changes in related party receivable	28,536	(23,492)
Changes in inventory	(2,246,947)	(2,362,667)
Changes in prepaid expenses	(87,243)	(82,762)
Changes in accounts payable and accrued expenses	307,005	2,865,698
Net cash provided by operating activities	4,831,619	1,464,740
Cash Flows from Investing Activities:
Purchase of property and equipment	(2,242,366)	(3,394,268)
Cash Flows from Financing Activities:
Proceeds from long-term debt		2,530,072
Proceeds from revolving loan	500,000	1,200,000
Payments on long-term debt and capitalized lease	(2,704,325)	(1,249,557)
Payments on revolving loan	(275,000)	(300,000)
Debt issue costs	(130,000)
Proceeds from exercised stock options	57,000	57,000
Dividends paid on preferred stock	(288,669)	(245,631)
Dividends paid by variable interest entity	(162,609)	(153,000)
Net cash provided by (used in) financing activities	(3,003,603)	1,838,884
Net Decrease in Cash	(414,350)	(90,644)
Cash, beginning of period	897,377	598,887
Cash, end of period	483,027	508,243
Non-Cash Activities:
Acquisition of equipment pursuant to capital lease	5,450,474
Acquisition of equipment from related party - Through issuance of note payable	1,469,713	688,296
Acquisition of equipment from related party - Through decrease in related party receivable		449,569
Acquisition of building with long-term debt	318,750
Conversion of accrued interest to long-term debt	2,475,690
Warrants issued	120,000
Preferred dividend accrual	26,850	890
Supplemental Information:
Interest paid	$ 832,887	$ 351,988

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Basis of Financial Statements

9 Months Ended

Feb. 28, 2017

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 February 28, 2017, the results of its operations for the nine-month and three-month periods ended February 28(29), 2017 and 2016, and its cash flows for the nine-month periods ended February 28(29), 2017 and 2016. 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, 2016 and the notes thereto included in Greystone’s Form 10-K for such period. The results of operations for the nine-months and three-month periods ended February 28(29), 2017 and 2016 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.

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Earnings Per Share

9 Months Ended

Feb. 28, 2017

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 (loss) available to common stockholders by the weighted-average shares outstanding during the period. Diluted earnings per share is calculated by dividing net income (loss) available 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, as follows:

	2017		2016
Nine-month periods ended February 28(29):
Options to purchase common stock		-		675,000
Preferred stock convertible into common stock		3,333,333		3,333,333
Total		3,333,333		4,008,333
Three-month periods ended February 28(29):
Options to purchase common stock		-		675,000
Preferred stock convertible into common stock		3,333,333		3,333,333
Total		3,333,333		4,008,333

The following tables set forth the computation of basic and diluted earnings per share for the following periods:

	2017		2016
Nine-month periods ended February 28(29):
Numerator -
Net income (loss) available to common stockholders	$	697,337	$	(314,263	)
Denominator -
Weighted-average shares outstanding - basic		28,309,003		27,640,033
Incremental shares from assumed conversion of options and warrants		579,167		-
Diluted shares		28,888,170		27,640,033
Loss per share -
Basic and Diluted	$	0.02	$	(0.01	)
Three-month periods ended February 28(29):
Numerator -
Net income (loss) available to common   stockholders	$	773,667	$	(200,528	)
Denominator -
Weighted-average shares outstanding - basic		28,361,201		27,886,201
Incremental shares from assumed   conversion of options and warrants		573,913		-
Diluted shares		28,935,114		27,886,201
Loss per share -
Basic and Diluted	$	0.03	$	(0.01	)

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Inventory

9 Months Ended

Feb. 28, 2017

Inventory Disclosure [Abstract]

Inventory

Note 3. Inventory

Inventory consists of the following:

	February 28, 2017		May 31, 2016
Raw materials	$	1,162,324	$	536,350
Finished goods		2,389,118		768,145
Total inventory	$	3,551,442	$	1,304,495

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Related Party Transactions

9 Months Ended

Feb. 28, 2017

Related Party Transactions [Abstract]

Related Party Transactions

Note 4. Related Party Transactions

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 $22,500 for use of Yorktown’s grinding equipment and $5,000 for the use of Yorktown’s pelletizing equipment for which GSM paid Yorktown rental fees of $1,100,000 for the nine months ended February 28(29), 2017 and 2016, respectively.

Effective February 21, 2017, Greystone purchased certain production equipment from Yorktown for $1,500,340 which included a cash payment of $30,627 and the assumption of a note payable with First Bank in the amount of $1,469,713 with an interest rate of 1.45% above the prime rate of interest (5.2% at February 28, 2017), and a maturity of August 21, 2021. The note with First Bank is secured by the equipment. During the period from September 2016 through January 2016, Greystone rented this equipment from Yorktown for a total of $163,204.

In addition, Yorktown provides office space for Greystone in Tulsa, Oklahoma at a monthly rental of $2,200.

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 F. 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. Greystone charges a tolling fee for blending and pelletizing plastic resin using TriEnda’s equipment and raw materials. Revenue from TriEnda totaled $519,814 and $253,466 for the nine months ended February 28(29), 2017 and 2016, respectively. The account receivable from TriEnda at February 28, 2017 was $65,168.

The tolling service provided by Greystone generates a certain amount of scrap material which is purchased by Greystone. Purchases for the nine months ended February 28(29), 2017 and 2016 totaled $24,265 and $71,000, respectively. Greystone had accounts payable to TriEnda of $17,031 at February 28, 2017.

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 $220,325 and $203,562 for the nine months ended February 28(29), 2017 and 2016, respectively. The account receivable due from Green at February 28, 2017 was $73,440.

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Debt

9 Months Ended

Feb. 28, 2017

Debt Disclosure [Abstract]

Debt

Note 5. Debt

Debt as of February 28, 2017 and May 31, 2016 is as follows:

	February 28, 2017			May 31, 2016
Term note A payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 4.0%, maturing January 7, 2019	$	4,797,299		$	5,310,179
Term note B payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 4.0%, maturing January 7, 2019		1,962,157			2,688,659
Revolving note payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 4.0%, due January 31, 2019		1,900,000			1,675,000
Term note payable by GRE to International Bank of Commerce, interest rate of 4.5%, monthly principal and interest payments of $26,215, due January 31, 2019		2,886,906			3,021,734
Note payable to First Bank, prime rate of interest plus 1.45% but not less than 4.95%, monthly principal and interest payments of $30,628, due August 21, 2021, secured by equipment		1,469,713			-
Capital lease with a private pallet leasing company, interest rate of 5%, maturity of August 7, 2019		4,380,410			-
Note payable to Robert Rosene, 7.5% interest, due January 15, 2019		4,498,383			2,066,000
Note payable to Yorktown Management & Financial Services, LLC, 5% interest, due February 28, 2019, monthly principal and interest payments of $20,629		470,212			634,616
Other		316,970			50,560
Face value of long-term debt		22,682,050			15,446,748
Debt issue costs, net of amortization		(269,727	)		(69,185	)
		22,412,323			15,377,563
Less: Current portion		(4,629,186	)		(2,088,327	)
Long-term debt	$	17,783,137		$	13,289,236

The prime rate of interest as of February 28, 2017 was 3.75%. The prime rate of interest changed to 4% effective March 16, 2017.

Loan Agreement between Greystone and IBC

On January 31, 2014, Greystone and GSM (the “Borrowers”) and International Bank of Commerce (“IBC”) entered into a Loan Agreement (the “IBC Loan Agreement”). The IBC Loan Agreement provides for a revolving loan in an aggregate principal amount of up to $2,500,000 (the “Revolving Loan”) and a term loan in the aggregate principal amount of $9,200,000 (the “Term Loan”). The exact amount which can be borrowed under the Revolving Loan from time to time is dependent upon the amount of the borrowing base, but can in no event exceed $2,500,000.

On January 7, 2016, the Borrowers and IBC entered into the First Amendment to the IBC Loan Agreement (the “First Amendment”) whereby IBC made an additional term loan to Borrowers in the original principal amount of $2,530,072 (the “New Equipment Loan”). The New Equipment Loan and $2,917,422 of the principal amount outstanding on the Term Loan were consolidated into a new loan in the combined principal amount of $5,447,504 (the “Term Loan A”). The Term Loan’s remaining principal balance of $3,000,000 was deemed to be a separate term loan (the “Term Loan B”). Greystone’s board of directors approved compensation to Warren F. Kruger, President and CEO, and Robert B. Rosene, Jr., a member of Greystone’s board of directors, as the individual guarantors pursuant to the IBC Agreement, as amended. Messrs. Kruger and Rosene each recieved a cash payment of $65,000 and a warrant to purchase 250,000 shares of Greystone common stock for $0.01 per share as discussed further in Note 6. The cost of the compensation is accounted for as debt issue costs to be amortized over the remaining primary terms of the IBC notes.

The Term Loans A and B bear interest at the New York Prime Rate plus 0.5% but not less than 4.0% and mature January 7, 2019. The Borrowers are required to make equal monthly payments of principal and interest in such amounts sufficient to amortize the principal balance of (i) the Note A Term Loan over a seven year period beginning January 31, 2016 (currently $74,455 per month) and (ii) the Note B Term Loan over the three-year life of the loan (currently $88,790 per month).

The Revolving Loan bears interest at the New York Prime Rate plus 0.5% but not less than 4.0%. Effective December 12, 2016, the Revolving Loan was amended and restated to extend the maturity of the note to January 31, 2019. 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 includes customary representations and warranties and affirmative and negative covenants which include (i) requiring the Borrowers to maintain a debt service coverage ratio of 1:25 to 1:00 and a funded debt to EBIDA ratio not exceeding 3:00 to 1:00 measured quarterly, (ii) subject to certain exceptions, limiting the Borrowers’ combined capital expenditures on fixed assets to $1,000,000 per year, (iii) prohibiting Greystone, without IBC’s prior written consent, from declaring or paying any dividends, redemptions of stock or membership interests, distributions and withdrawals (as applicable) in respect of its capital stock or any other equity interest, other than additional payments to holders of its preferred stock in an amount not to exceed $500,000 in any fiscal year, (iv) subject to certain exceptions, prohibiting the incurrence of additional indebtedness by the Borrowers, and (v) requiring the Borrowers to prevent (A) any change in capital ownership such that there is a material change in the direct or indirect ownership of (1) Greystone’s outstanding preferred stock, and (2) any equity interest in GSM, or (B) Warren Kruger from ceasing to be actively involved in the management of Greystone as President and/or Chief Executive Officer. The foregoing list of covenants is not exhaustive and there are several other covenants contained in the IBC Loan Agreement.

Greystone’s debt service coverage ratio as of February 28, 2017 was 0.95 to 1:00 which was less than the required minimum as discussed above. Effective December 12, 2016, the Borrowers and IBC entered into the Third Amendment to the IBC Loan Agreement (the “Third Amendment”) waiving this instance of noncompliance, and further removing the requirement to maintain the minimum debt service coverage ratio until the rolling test period ending February 28, 2018.

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 loans 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 F. 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 January 31, 2014, GRE and IBC entered into a Loan Agreement which provided for a mortgage loan to GRE of $3,412,500. The loan provides for a 4.5% interest rate and a maturity of January 31, 2019 and is secured by a mortgage on the two buildings in Bettendorf, Iowa which are leased to Greystone.

Capital Lease with Private Pallet Leasing Company

In August, 2016, Greystone entered into a three-year lease agreement with a private pallet leasing company to provide for certain production equipment with a total cost of approximately $5.4 million. The lease agreement includes a bargain purchase option to acquire the production equipment at the end of the lease term. The lease is for two Milacron injection molding machines and two pallet molds designed and dedicated to production of 48X40 pallets (the “Pallets”) for the pallet leasing company. Monthly lease payments, estimated at approximately $100,000 per machine, are payable on a per invoice basis at the rate of $6.25 for each pallet produced by the leased production equipment and shipped to the leasing company. The lease bears an interest rate of 5%, has a three-year maturity and provides for minimum monthly lease rental payment based upon the total Pallets sold in excess of a specified amount not to exceed the monthly productive capacity of the leased machines.

The first of the Milacron machines was placed into service in August, 2016. The second machine was placed into service in September, 2016 under the same terms and conditions as the first machine. Maturities for the two years subsequent to February 28, 2017 for the capital lease are estimated to be $2,148,796 and $2,231,614.

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 a 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 a note payable of $4,541,690. Effective April 10, 2017, Mr. Rosene agreed to an extended maturity date of January 15, 2019. 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.

Note Payable between Greystone and Yorktown Management Financial Services, LLC (“Yorktown”)

On February 29, 2016, Greystone entered into an unsecured note payable to Yorktown in the amount of $688,296 in connection with the acquisition of equipment from Yorktown. The note payable bears interest at the rate of 5% and is payable over three years with monthly principal and interest payments of $20,629.

Maturities

Maturities of Greystone’s long-term debt and capital leases for the five years subsequent to February 28, 2017 are $4,629,186, $16,962,065, $373,064, $379,791 and $337,944.

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Warrants to Purchase Common Stock

9 Months Ended

Feb. 28, 2017

Warrants To Purchase Common Stock

Warrants to Purchase Common Stock

Note 6. Warrants to Purchase Common Stock

Effective September 1, 2016, Greystone’s board of directors authorized the issuance of warrants to purchase 250,000 shares of Greystone’s common stock for $0.01 per share to each of Warren F. Kruger, President and CEO, and Robert B. Rosene, Jr., a member of Greystone’s board, as compensation for providing guarantees on Greystone’s debt with International Bank of Commerce. The warrants have a vesting period of two years and expire August 31, 2026. The issuance will be capitalized as debt issue cost as of the measurement date for approximately $120,000 and amortized over the remaining guaranty term.

The value of Greystone’s common stock on September 1, 2016 was $0.24 per share. The estimated fair value at the date of the grant for the warrants utilizing the Black-Scholes option valuation model and the assumptions that were used in the Black-Scholes option model for fiscal year 2017 are as follows:

Estimated fair value of warrants at date of grant	$	120,000
Black-Scholes model assumptions
Average expected life (years)		6
Average expected volatility factor		145.77	%
Average risk-free interest rate		4.0	%
Average expected dividend yields	$	-0-

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Fair Value of Financial Instruments

9 Months Ended

Feb. 28, 2017

Investments, All Other Investments [Abstract]

Fair Value of Financial Instruments

Note 7. 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 loans with floating rates of interest approximate fair value. Fixed rate loans are valued based on cash flows using estimated rates of comparable loans. The carrying amounts reported in the balance sheet approximate fair value.

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Concentrations, Risks and Uncertainties

9 Months Ended

Feb. 28, 2017

Risks and Uncertainties [Abstract]

Concentrations, Risks and Uncertainties

Note 8. Concentrations, Risks and Uncertainties

Greystone derived approximately 67% of its total sales from two customers (21% and 46% respectively) in fiscal year 2017 and approximately 41% (31% and 10%, respectively) in fiscal year 2016. The loss of a material amount of business from 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 $1,202,381 and $1,216,492 in fiscal years 2017 and 2016, 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 February 28, 2017, Greystone is indebted to Mr. Rosene in the amount of $4,498,383 for a note payable due January 15, 2019. There is no assurance that Mr. Rosene will renew the note as of the maturity date.

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Commitment

9 Months Ended

Feb. 28, 2017

Commitments and Contingencies Disclosure [Abstract]

Commitment

Note 9. Commitment

As of February 28, 2017, Greystone had an outstanding commitment in the amount of $1.9 million toward the purchase of certain production equipment.

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Recent Accounting Pronouncements

9 Months Ended

Feb. 28, 2017

Accounting Changes and Error Corrections [Abstract]

Recent Accounting Pronouncements

Note 10. Recent Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, “Revenue from Contracts with Customers” (“ASU 14-09”) which creates a comprehensive set of guidelines for the recognition of revenue under the principle: “Recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.” The requirements of ASU 14-09 are effective for fiscal years, and interim periods within those years, beginning after December 15, 2017 and will require either retrospective application to each prior period presented or retrospective application with the cumulative effect of initially applying the standard recognized at the date of adoption. Greystone is currently evaluating the impact this ASU will have on our financial position and results of operations.

In February 2016, the FASB issued Accounting Standards 2016-02, Leases (Topic 842), which is intended to improve financial reporting about leasing transactions. The ASU will require organizations (“lessees”) that lease assets with lease terms of more than twelve months to recognize on the balance sheet the assets and liabilities for the rights and obligations created by those leases. Organizations that own the assets leased by lessees (“lessors”) will remain largely unchanged from current GAAP. In addition, the ASU will require disclosures to help investors and other financial statement users better understand the amount, timing and uncertainty of cash flows arising from leases. The effective date of this ASU is for fiscal years beginning after December 31, 2018 and interim periods within that year. Greystone is currently reviewing the ASU to assess the potential impact on the consolidated financial statements.

In March 2016, FASB issued Accounting Standards 2016-09, Improvements to Employee Share-Based Payment Accounting, which amends ASC Topic 718, Compensation – Stock Compensation. The objective of this amendment is part of the FASB’s Simplification Initiative as it applies to several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The effective date of the amendment is for fiscal years beginning after December 31, 2016 and interim periods within that reporting period. Greystone is currently reviewing the ASU to assess the potential impact on the consolidated financial statements.

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Earnings Per Share (Tables)

9 Months Ended

Feb. 28, 2017

Earnings Per Share [Abstract]

Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share

Greystone excludes equity instruments from the calculation of diluted earnings per share if the effect of including such instruments is anti-dilutive, as follows:

	2017		2016
Nine-month periods ended February 28(29):
Options to purchase common stock		-		675,000
Preferred stock convertible into common stock		3,333,333		3,333,333
Total		3,333,333		4,008,333
Three-month periods ended February 28(29):
Options to purchase common stock		-		675,000
Preferred stock convertible into common stock		3,333,333		3,333,333
Total		3,333,333		4,008,333

Schedule of Computation of Basic and Diluted Earnings Per Share

The following tables set forth the computation of basic and diluted earnings per share for the following periods:

	2017		2016
Nine-month periods ended February 28(29):
Numerator -
Net income (loss) available to common stockholders	$	697,337	$	(314,263	)
Denominator -
Weighted-average shares outstanding - basic		28,309,003		27,640,033
Incremental shares from assumed conversion of options and warrants		579,167		-
Diluted shares		28,888,170		27,640,033
Loss per share -
Basic and Diluted	$	0.02	$	(0.01	)
Three-month periods ended February 28(29):
Numerator -
Net income (loss) available to common   stockholders	$	773,667	$	(200,528	)
Denominator -
Weighted-average shares outstanding - basic		28,361,201		27,886,201
Incremental shares from assumed   conversion of options and warrants		573,913		-
Diluted shares		28,935,114		27,886,201
Loss per share -
Basic and Diluted	$	0.03	$	(0.01	)

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Inventory (Tables)

9 Months Ended

Feb. 28, 2017

Inventory Disclosure [Abstract]

Schedule of Inventory

Inventory consists of the following:

	February 28, 2017		May 31, 2016
Raw materials	$	1,162,324	$	536,350
Finished goods		2,389,118		768,145
Total inventory	$	3,551,442	$	1,304,495

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Debt (Tables)

9 Months Ended

Feb. 28, 2017

Debt Disclosure [Abstract]

Schedule of Debt

Debt as of February 28, 2017 and May 31, 2016 is as follows:

	February 28, 2017			May 31, 2016
Term note A payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 4.0%, maturing January 7, 2019	$	4,797,299		$	5,310,179
Term note B payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 4.0%, maturing January 7, 2019		1,962,157			2,688,659
Revolving note payable to International Bank of Commerce, prime rate of interest plus 0.5% but not less than 4.0%, due January 31, 2019		1,900,000			1,675,000
Term note payable by GRE to International Bank of Commerce, interest rate of 4.5%, monthly principal and interest payments of $26,215, due January 31, 2019		2,886,906			3,021,734
Note payable to First Bank, prime rate of interest plus 1.45% but not less than 4.95%, monthly principal and interest payments of $30,628, due August 21, 2021, secured by equipment		1,469,713			-
Capital lease with a private pallet leasing company, interest rate of 5%, maturity of August 7, 2019		4,380,410			-
Note payable to Robert Rosene, 7.5% interest, due January 15, 2019		4,498,383			2,066,000
Note payable to Yorktown Management & Financial Services, LLC, 5% interest, due February 28, 2019, monthly principal and interest payments of $20,629		470,212			634,616
Other		316,970			50,560
Face value of long-term debt		22,682,050			15,446,748
Debt issue costs, net of amortization		(269,727	)		(69,185	)
		22,412,323			15,377,563
Less: Current portion		(4,629,186	)		(2,088,327	)
Long-term debt	$	17,783,137		$	13,289,236

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Warrants to Purchase Common Stock (Tables)

9 Months Ended

Feb. 28, 2017

Warrants To Purchase Common Stock

Schedule of Fair Value for the Warrants and Stock Options, Valuation Assumptions

The estimated fair value at the date of the grant for the warrants utilizing the Black-Scholes option valuation model and the assumptions that were used in the Black-Scholes option model for fiscal year 2017 are as follows:

Estimated fair value of warrants at date of grant	$	120,000
Black-Scholes model assumptions
Average expected life (years)		6
Average expected volatility factor		145.77	%
Average risk-free interest rate		4.0	%
Average expected dividend yields	$	-0-

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Earnings Per Share - Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share (Details) - shares	3 Months Ended		9 Months Ended
	Feb. 28, 2017	Feb. 29, 2016	Feb. 28, 2017	Feb. 29, 2016
Antidilutive Securities Excluded from Computation of Earnings Per Share	3,333,333	4,008,333	3,333,333	4,008,333
Options To Purchase Common Stock [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share		675,000		675,000
Preferred Stock Convertible Into Common Stock [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share	3,333,333	3,333,333	3,333,333	3,333,333

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Earnings Per Share - Schedule of Computation of Basic and Diluted Earnings Per Share (Details) - USD ($)	3 Months Ended		9 Months Ended
	Feb. 28, 2017	Feb. 29, 2016	Feb. 28, 2017	Feb. 29, 2016
Earnings Per Share [Abstract]
Numerator - Net income (loss) available to common shareholders	$ 773,667	$ (200,528)	$ 697,337	$ (314,263)
Denominator - Weighted-average shares outstanding - Basic	28,361,201	27,886,201	28,309,003	27,640,033
Denominator - Incremental shares from assumed conversion of options and warrants	573,913		579,167
Denominator - Diluted shares	28,935,114	27,886,201	28,888,170	27,640,033
Loss per share - Basic and Diluted	$ 0.03	$ (0.01)	$ 0.02	$ (0.01)

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Inventory - Schedule of Inventory (Details) - USD ($)	Feb. 28, 2017	May 31, 2016
Inventory Disclosure [Abstract]
Raw materials	$ 1,162,324	$ 536,350
Finished goods	2,389,118	768,145
Total inventory	$ 3,551,442	$ 1,304,495

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Related Party Transactions (Details Narrative) - USD ($)			9 Months Ended
	Feb. 21, 2017	Sep. 30, 2016	Feb. 28, 2017	Feb. 29, 2016
Yorktown [Member]
Payments of rental fees		$ 163,204
Production equipment purchased	$ 1,500,340
Cash payment	$ 30,627
Debt maturity date	Aug. 21, 2021
Yorktown [Member] | First Bank [Member]
Notes payable	$ 1,469,713
Debt instrument interest rate	1.45%		5.20%
Yorktown's Pelletizing Equipment [Member]
Payments of rental fees			$ 5,000
Yorktown's Grinding Equipment [Member]
Payments of rental fees			22,500
Yorktown [Member]
Payments of rental fees			1,100,000	$ 1,100,000
Operating lease rental fees			2,200
Trienda Holdings, LLC [Member]
Pallet sales			519,814	253,466
Account receivable			65,168
Scrap material purchase amount			24,265	71,000
Accounts payable			17,031
Green Plastic Pallets [Member]
Pallet sales			220,325	$ 203,562
Account receivable			$ 73,440

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Debt (Details Narrative) - USD ($)					1 Months Ended	9 Months Ended
	Jun. 02, 2016	Feb. 29, 2016	Jan. 07, 2016	Jan. 31, 2014	Aug. 31, 2016	Feb. 28, 2017	Feb. 29, 2016	Sep. 02, 2016	May 31, 2016	Dec. 15, 2005
Debt instrument principal amount						$ 22,682,050			$ 15,446,748
Remaining principal balance						22,412,323			$ 15,377,563
Capital expenditure on fixed assets						5,450,474
Maturities long term debt current						4,629,186
Maturities long term debt year two						16,962,065
Maturities long term debt year three						373,064
Maturities long term debt year four						379,791
Maturities long term debt year five						$ 337,944
Private Pallet Leasing Company [Member]
Debt instrument interest rate					5.00%
Production equipment cost					$ 5,400,000
Capital lease payable invoice basis rate					$ 6.25
Capital Lease amount					$ 100,000
Maturities long term debt current					2,148,796
Maturities long term debt year two					$ 2,231,614
Warren F. Kruger, President and CEO, and Robert B. Rosene, Jr., Member of Greystone's Board [Member]
Compensation			$ 65,000
Warrant to purchase of shares			250,000					250,000
Warrant exercise price			$ 0.01					$ 0.01
International Bank of Commerce [Member]
Debt instrument maturity date			Jan. 07, 2019
Robert B. Rosene, Jr. [Member]
Debt instrument interest rate										7.50%
Debt instrument principal amount										$ 2,066,000
Yorktown Management Financial Services, LLC [Member]
Debt instrument interest rate		5.00%					5.00%
Loan term		3 years
Debt monthly payment		$ 20,629
Notes payable		$ 688,296					$ 688,296
Restated Note [Member] | Mr. Rosene [Member]
Remaining principal balance	$ 4,541,690
Debt instrument maturity date	Jan. 15, 2019
Notes payable	$ 2,066,000
Debt accrued interest	$ 2,475,690
Greystone and GSM [Member]
Line of credit maximum borrowing capacity				$ 2,500,000
Greystone and GSM [Member] | Revolving Loan [Member]
Debt instrument principal amount				2,500,000
Greystone and GSM [Member] | Term Loan [Member]
Debt instrument principal amount				$ 9,200,000
New Equipment Loan [Member] | International Bank of Commerce [Member]
Debt instrument principal amount			$ 2,530,072
Term Loan [Member] | International Bank of Commerce [Member]
Debt instrument principal amount			$ 2,917,422
Term Loan A [Member]
Loan term			7 years
Debt monthly payment			$ 74,455
Term Loan A [Member] | International Bank of Commerce [Member]
Debt instrument principal amount			$ 5,447,504
Term Loan B [Member]
Loan term			3 years
Debt monthly payment			$ 88,790
Term Loan B [Member] | International Bank of Commerce [Member]
Remaining principal balance			$ 3,000,000
International Bank of Commerce [Member] | Minimum [Member]
Debt instrument interest rate			0.50%
International Bank of Commerce [Member] | Maximum [Member]
Debt instrument interest rate			4.00%
Revolving Loan [Member]
Debt instrument maturity date			Jan. 31, 2019
Revolving Loan [Member] | Minimum [Member]
Debt instrument interest rate			0.50%
Revolving Loan [Member] | Maximum [Member]
Debt instrument interest rate			4.00%
IBC Loan Agreement [Member]
Borrowers maintain coverage ratio description			Borrowers to maintain a debt service coverage ratio of 1:25 to 1:00 and a funded debt to EBIDA ratio not exceeding 3:00 to 1:00 measured quarterly			Greystone debt service coverage ratio as of February 28, 2017 was 0.95 to 1:00 which was less than the required minimum as discussed above. Effective December 12, 2016, the Borrowers and IBC entered into the Third Amendment to the IBC Loan Agreement Third Amendment waiving this instance of noncompliance, and further removing the requirement to maintain the minimum debt service coverage ratio until the rolling test period ending February 28, 2018.
Capital expenditure on fixed assets			$ 1,000,000
Preferred stock amount			500,000
Guaranty amount			$ 6,500,000
GRE And IBC [Member] | Mortgage Loan [Member]
Debt instrument interest rate				4.50%
Debt instrument principal amount				$ 3,412,500
Debt instrument maturity date				Jan. 31, 2019
Prime Rate [Member]
Debt instrument interest rate						3.75%
Prime Rate [Member] | March 16, 2017 [Member]
Debt instrument interest rate						4.00%

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Debt - Schedule of Debt (Details) - USD ($)	Feb. 28, 2017	May 31, 2016
Face value of long-term debt	$ 22,682,050	$ 15,446,748
Debt issue costs, net of amortization	(269,727)	(69,185)
Debt	22,412,323	15,377,563
Less: Current portion	(4,629,186)	(2,088,327)
Long-term Debt	17,783,137	13,289,236
Term Note A Payable To International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4%, Maturing January 7, 2019 [Member]
Long-term debt gross	4,797,299	5,310,179
Term Note B Payable To International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4%, Maturing January 7, 2019 [Member]
Long-term debt gross	1,962,157	2,688,659
Revolving Note Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.0%, Due January 31, 2019 [Member]
Long-term debt gross	1,900,000	1,675,000
Term Note Payable by GRE to International Bank of Commerce, Interest Rate of 4.5%, Monthly Principal and Interest Payments of $26,215, Due January 31, 2019 [Member]
Long-term debt gross	2,886,906	3,021,734
Note payable to First Bank, Prime Rate of Interest Plus 1.45% but not Less Than 4.95%, Monthly Principal and Interest Payments of $30,628, Due August 21, 2021, Secured by Equipment [Member]
Long-term debt gross	1,469,713
Capital Lease with a Private Pallet Leasing Company, Interest Rate of 5%, Maturity of August 7, 2019 [Member]
Long-term debt gross	4,380,410
Note Payable to Robert Rosene, 7.5% Interest, Due January 15, 2019 [Member]
Long-term debt gross	4,498,383	2,066,000
Note Payable to Yorktown Management & Financial Services, LLC, 5% Interest, Due February 28, 2019, Monthly Principal and Interest Payments of $20,629 [Member]
Long-term debt gross	470,212	634,616
Other Note Payable [Member]
Long-term debt gross	$ 316,970	$ 50,560

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Debt - Schedule of Debt (Details) (Parenthetical) - USD ($)	9 Months Ended	12 Months Ended
	Feb. 28, 2017	May 31, 2016
Term Note A Payable To International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4%, Maturing January 7, 2019 [Member]
Debt instrument interest rate	0.50%	0.50%
Debt instrument maturity date	Jan. 07, 2019	Jan. 07, 2019
Term Note A Payable To International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4%, Maturing January 7, 2019 [Member] | Maximum [Member]
Debt instrument interest rate	4.00%	4.00%
Term Note B Payable To International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4%, Maturing January 7, 2019 [Member]
Debt instrument interest rate	0.50%	0.50%
Debt instrument maturity date	Jan. 07, 2019	Jan. 07, 2019
Term Note B Payable To International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4%, Maturing January 7, 2019 [Member] | Maximum [Member]
Debt instrument interest rate	4.00%	4.00%
Revolving Note Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.0%, Due January 31, 2019 [Member]
Debt instrument interest rate	0.50%	0.50%
Debt instrument maturity date	Jan. 31, 2019	Jan. 31, 2019
Revolving Note Payable to International Bank of Commerce, Prime Rate of Interest Plus 0.5% But Not Less Than 4.0%, Due January 31, 2019 [Member] | Maximum [Member]
Debt instrument interest rate	4.00%	4.00%
Term Note Payable by GRE to International Bank of Commerce, Interest Rate of 4.5%, Monthly Principal and Interest Payments of $26,215, Due January 31, 2019 [Member]
Debt instrument interest rate	4.50%	4.50%
Debt instrument maturity date	Jan. 31, 2019	Jan. 31, 2019
Debt instrument principal and interest amount	$ 26,215	$ 26,215
Note payable to First Bank, Prime Rate of Interest Plus 1.45% but not Less Than 4.95%, Monthly Principal and Interest Payments of $30,628, Due August 21, 2021, Secured by Equipment [Member]
Debt instrument interest rate	1.45%
Debt instrument maturity date	Aug. 21, 2021
Debt instrument principal and interest amount	$ 30,628
Note payable to First Bank, Prime Rate of Interest Plus 1.45% but not Less Than 4.95%, Monthly Principal and Interest Payments of $30,628, Due August 21, 2021, Secured by Equipment [Member] | Maximum [Member]
Debt instrument interest rate	4.95%
Capital Lease with a Private Pallet Leasing Company, Interest Rate of 5%, Maturity of August 7, 2019 [Member]
Debt instrument interest rate	5.00%	5.00%
Debt instrument maturity date	Aug. 07, 2019	Aug. 07, 2019
Note Payable to Robert Rosene, 7.5% Interest, Due January 15, 2019 [Member]
Debt instrument interest rate	7.50%	7.50%
Debt instrument maturity date	Jan. 15, 2019	Jan. 15, 2019
Note Payable to Yorktown Management & Financial Services, LLC, 5% Interest, Due February 28, 2019, Monthly Principal and Interest Payments of $20,629 [Member]
Debt instrument interest rate	5.00%
Debt instrument maturity date	Feb. 28, 2019
Debt instrument principal and interest amount	$ 20,629
Note payable to First Bank, prime rate of interest plus 1.45% but not less than 4.95%, monthly principal and interest payments of $30,628, due August 21, 2021, secured by equipment [Member]
Debt instrument interest rate		5.00%
Debt instrument maturity date		Aug. 21, 2021
Debt instrument principal and interest amount		$ 30,628
Capital Lease with a Private Pallet Leasing Company, Interest Rate of 5%, Maturity of August 7, 2019 [Member]
Debt instrument interest rate		5.00%
Debt instrument maturity date		Aug. 07, 2019
Note Payable to Yorktown Management & Financial Services, LLC, 5.0% Interest, Due February 28, 2019, Monthly Principal and Interest Payments of $20,629 [Member]
Debt instrument interest rate		5.00%
Debt instrument maturity date		Feb. 28, 2019
Debt instrument principal and interest amount		$ 20,629

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Warrants to Purchase Common Stock (Details Narrative) - USD ($)	Sep. 02, 2016	Jan. 07, 2016
Common stock price per share	$ 0.24
Warren F. Kruger, President and CEO, and Robert B. Rosene, Jr., Member of Greystone's Board [Member]
Issuance of warrants to purchase shares of common stock	250,000	250,000
Warrants exercise price per share	$ 0.01	$ 0.01
Warrants vesting period	2 years
Warrants expiration date	Aug. 31, 2026
Capitalized debt issue cost	$ 120,000

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Warrants to Purchase Common Stock - Schedule of Fair Value for the Warrants and Stock Options, Valuation Assumptions (Details)	9 Months Ended
	Feb. 28, 2017 USD ($)
Warrants To Purchase Common Stock
Estimated fair value of warrants at date of grant	$ 120,000
Average expected life (years)	6 years
Average expected volatility factor	145.77%
Average risk-free interest rate	4.00%
Average expected dividend yields	0.00%

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Concentrations, Risks and Uncertainties (Details Narrative) - USD ($)	9 Months Ended	12 Months Ended
	Feb. 28, 2017	May 31, 2016
Purchases from customers		$ 1,216,492
Robert B Rosene [Member]
Notes payable	$ 4,498,383
Debt instrument maturity date	Jan. 15, 2019
Fiscal Years 2017 [Member]
Purchases from customers	$ 1,202,381
Sales Revenue, Net [Member] | Two Customers [Member]
Concentration risk percentage		41.00%
Sales Revenue, Net [Member] | Two Customers [Member] | Fiscal Years 2017 [Member]
Concentration risk percentage	67.00%
Sales Revenue, Net [Member] | Customer One [Member]
Concentration risk percentage		31.00%
Sales Revenue, Net [Member] | Customer One [Member] | Fiscal Years 2017 [Member]
Concentration risk percentage	21.00%
Sales Revenue, Net [Member] | Customer Two [Member]
Concentration risk percentage		10.00%
Sales Revenue, Net [Member] | Customer Two [Member] | Fiscal Years 2017 [Member]
Concentration risk percentage	46.00%

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Commitment (Details Narrative)	9 Months Ended
	Feb. 28, 2017 USD ($)
Commitments and Contingencies Disclosure [Abstract]
Purchase commitment amount	$ 1,900,000