15. Subsequent Events

The Company has evaluated all subsequent events through the filing date of this Form 10-K with the SEC, to ensure that this filing includes appropriate disclosure of events both recognized in the financial statements as of March 31, 2018, and events which occurred subsequently but were not recognized in the financial statements. Except as described below and in Note 11—Revolving Credit Facility, there were no other subsequent events which required recognition, adjustment to or disclosure in the financial statements.

On April 13, 2018, a warrant holder exercised its rights to the warrant agreement to exercise on a cashless basis 5,760,000 Series A warrants at an exercise price of $0.60 per share under the warrant agreement. In accordance with terms of the warrant agreement, after taking into account the shares withheld to satisfy the cashless exercise option, the Company issued 3,806,243 shares of common stock.

On October 13, 2017, we granted Turbine International, LLC (“TI”) and its affiliate, MTE Service, the sole distribution rights for our products and services in the Russian oil and gas sector in exchange for payments of approximately $6.3 million. In connection with the appointment, we entered into an Accounts Receivable Assignment Agreement (the “Assignment Agreement”) and Promissory Note (the “Note”) with TI.

Pursuant to the terms of the Assignment Agreement, we agreed to assign to TI the right, title and interest to receivables owed to us from BPC upon TI’s payment to us of $2.5 million in three payments by February 1, 2018. We received payments from TI of approximately $0.3 million and $1.0 million under the Assignment Agreement during the three and twelve months ended March 31, 2018, respectively. The receivables owed to us from BPC had a balance of $5.3 million as of March 31, 2018, and this balance was fully reserved. As of March 31, 2018, the right, title and interest to the accounts receivables owed to us from BPC had not been assigned to TI, as TI had not yet made all payments as required under the Assignment Agreement by February 1, 2018.

Under the terms of the Note, TI agreed to pay us $3.8 million over a three-year period in 35 equal monthly installments starting in August 2018. On October 13, 2017, we and Hispania Petroleum, S.A. (the “Guarantor”), entered into a Guaranty Agreement (the “Guaranty Agreement”) whereby the Guarantor guarantees TI’s obligations under the Agreement and Note. MTE Service is a wholly owned subsidiary of Hispania Petroleum S.A. 

On June 5, 2018, we entered into an amendment to the Assignment Agreement (the “Amended Assignment Agreement”) and the Note (the “Amended Note”) with TI. Pursuant to the terms of the Amended Assignment Agreement, the right, title and interest to receivables owed to us from BPC will be contingent upon TI’s payment to us of the remaining approximately $1.5 million in five payments by September 20, 2019. Under the terms of the Amended Note, TI has now agreed to pay us $3.8 million over a three-year period in 13 equal quarterly installments starting in December 20, 2019.