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Note 1 - Organization
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12 Months Ended |
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Aug. 31, 2012
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| Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block] |
NOTE
1: ORGANIZATION
Pure
Cycle Corporation (the “Company”) was
incorporated in Delaware in 1976 and reincorporated in
Colorado in 2008. The Company owns water assets in the
Denver, Colorado metropolitan area, in the Arkansas River
Valley in southern Colorado, and on the western slope of
Colorado. The Company is currently using its water assets
located in the Denver metropolitan area to provide wholesale
water and wastewater services to customers located in the
Denver metropolitan area.
The
Company provides a full line of water and wastewater services
which includes designing and constructing water and
wastewater systems as well as operating and maintaining such
systems. The Company’s business focus is to provide
wholesale water and wastewater services, predominately to
local governmental entities, which provide services to their
end-use customers throughout the Denver metropolitan area as
well as along the Colorado Front Range.
The
Company believes it has sufficient working capital and
financing sources to fund its operations for at least the
next fiscal year, because at August 31, 2012, the Company had
$2.7 million of cash, cash equivalents and marketable
securities, and $1.4 million of working
capital. Subsequent to fiscal year end 2012, the
Company sold the 1.5 million shares of Pure Cycle common
stock issued to High Plains A&M, LLC (“HP
A&M”), which were pledged as security for certain
debt obligations, in a foreclosure sale for $3.5 million or
$2.35 per share.
The
Company’s ability to generate working capital from its
water and wastewater projects is dependent on its ability to
successfully market its water, or in the event it is
unsuccessful, to sell the underlying water assets. In the
event increased sales are not achieved or the Company is
unable to sell its water assets at a sufficient level, the
Company may have to issue additional short or long-term debt
or seek to sell additional shares of the Company’s
common or preferred stock to generate sufficient working
capital. There can be no assurance that the
Company will be successful in marketing its water on terms
that are acceptable to the Company.
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