Filed Pursuant to Rule 424(b)(3)
Registration No. 333-197446

Prospectus

BioFuel Energy Corp.

Subscription Rights and Common Stock

We are distributing, at no charge, to the holders of our common stock as of 5:00 p.m., New York City time, on September 15, 2014, which we refer to as the record date, transferable subscription rights to purchase up to an aggregate of 12,247,393 shares of our common stock, par value $0.01 per share, 6,701,335 of which are available in this public rights offering and the remainder of which will be available pursuant to the private rights offering described below. Each holder of our common stock as of the record date will receive one subscription right for each share of common stock owned as of the record date. As of the close of business on September 15, 2014, there were 5,456,625 shares of our common stock issued and outstanding, net of 40,481 shares held in treasury.

Each subscription right will permit the holder of such right to acquire, at a rights price equal to $5.00 per share of common stock, 2.2445 shares of common stock (subject to rounding as described in this prospectus), which we refer to as the basic subscription privilege. The rights price represents an approximately 53.9% discount to the closing price of our common stock on September 15, 2014. Each holder of a subscription right that fully exercises its basic subscription privilege may also subscribe for additional shares, which we refer to as the over-subscription privilege, for pro rata allocation in the event that not all available shares are purchased pursuant to the stockholders’ basic subscription privilege (subject to the limitations described herein). The over-subscription privilege, however, will only be offered for an aggregate number of shares that, when combined with the number of shares purchased pursuant to the stockholders’ basic subscription privilege, does not exceed 12,247,393 shares.

The subscription rights will expire and have no value if they are not exercised by 5:00 p.m., New York City time, on October 17, 2014, which we refer to as the expiration date. All exercises of subscription rights are irrevocable. As described below, a portion of the rights offering to certain of our existing stockholders is being conducted on a private, non-registered basis, which we refer to as the private rights offering. We refer to the private rights offering and this public rights offering, collectively, as the rights offering.

Subject to certain conditions and possible reductions as described in more detail herein, the total proceeds expected to be raised in the rights offering and the related Backstop Commitments (as defined below) is approximately $61.2 million. The rights offering is intended to provide a portion of the funds we will need to acquire the equity interests of JBGL Builder Finance LLC and certain subsidiaries of JBGL Capital, LP (collectively, “JBGL”), as further described herein (the “Acquisition”). We expect the remainder of the funds necessary to pay for the Acquisition to come from the incurrence of indebtedness, the issuance of shares of our common stock to the sellers of the equity interests of JBGL and the Additional Equity Investment (as defined below). The completion of the rights offering will occur substantially simultaneously with, and is contingent upon, the completion of the Acquisition and the related transactions described herein.

Certain affiliates of Greenlight Capital, Inc, (together with its affiliates, “Greenlight”) that are existing stockholders have agreed, subject to certain conditions, to purchase shares of our common stock in an amount equal to their full basic subscription privilege. Certain affiliates of Third Point LLC (together with its affiliates, “Third Point”) have agreed, subject to certain conditions, to purchase shares of our common stock in an amount equal to their basic subscription privilege and to fully exercise their over-subscription privileges, up to a number of shares as described herein. We refer to these transactions as the private rights offering. In addition, certain entities have severally agreed, subject to certain conditions, to purchase substantially simultaneously with the completion of this public rights offering, in the aggregate, 100% of the available shares not otherwise sold in the rights offering (the “Backstop Commitments”). Moreover, in connection with the Acquisition, certain affiliates of Greenlight Capital, Inc. that hold membership units in one of our subsidiaries, BioFuel Energy, LLC, have, subject to certain conditions, agreed to purchase from us, substantially simultaneously with the consummation of the Acquisition, the number of shares of common stock they would have purchased pursuant to the rights offering had they exchanged all of such membership units (together with an equal number of shares of our class B common stock) for common stock on or prior to the record date and exercised all of the resulting basic subscription rights pursuant to the rights offering (the “Additional Equity Investment”). Any shares of common stock purchased in connection with the transactions described in this paragraph will be purchased directly from us on a private basis and are not being registered pursuant to the registration statement of which this prospectus is a part. We expect the aggregate gross proceeds from this public rights offering, the private rights offering, the Backstop Commitments and the Additional Equity Investment to be approximately $70 million.

Shares of our common stock are traded on The Nasdaq Capital Market under the symbol “BIOF.” If we do not consummate the Acquisition on or prior to November 4, 2014, our common stock could be delisted from The Nasdaq Capital Market. The closing price of shares of our common stock on September 15, 2014 was $10.84 per share. On March 27, 2014, the last trading day before we announced our receipt of the Proposal (as defined herein), the closing price of shares of our common stock was $2.96 per share. On June 10, 2014, the last trading day before we announced our entry into the Transaction Agreement (as defined herein), the closing price of shares of our common stock was $5.78 per share. The subscription rights are transferable and we intend to list them for trading on The Nasdaq Capital Market under the symbol “BIOFR” during the course of the rights offering.

Investing in the securities offered by this prospectus involves a high degree of risk. You should carefully consider the risks described under the “Risk Factors” section of this prospectus beginning on page 15 before buying any of the securities offered hereby.

 

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

The date of this prospectus is September 19, 2014

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Table of Contents

Prospectus Summary			1
Summary of the Rights Offering			5
Risk Factors			15
Forward-Looking Statements			33
Use of Proceeds			35
Market Price and Dividends on Common Stock			36
Capitalization			37
Dilution			38
Selected Combined and Consolidated Historical Financial Information of JBGL			39
Unaudited Pro Forma Combined Financial Information			40
BioFuel Management’s Discussion and Analysis of Financial Condition and Results of Operations			47
JBGL Management’s Discussion and Analysis of Financial Condition and Results of Operations			53
Business of JBGL			76
Management			88
Executive Compensation			94
The Transactions			110
The Rights Offering			117
Description of Capital Stock			131
Description of Indebtedness			138
Shares Eligible for Future Sale			141
Security Ownership of Certain Beneficial Owners and Management			142
Certain Relationships and Related Party Transactions			144
Material U.S. Federal Income Tax Consequences			146
Plan of Distribution			151
Legal Matters			151
Experts			151
Where You Can Find More Information			151
Index to Consolidated Financial Statements			F-1

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About This Prospectus

We are responsible only for the information contained in this prospectus or to which we have referred you, including any free writing prospectus that we file with the Securities and Exchange Commission relating to this prospectus. We have not authorized anyone to provide you with any other information, and we take no responsibility for any other information that others may provide you. We are not making an offer of securities in any state or other jurisdiction where the offer is not permitted. To the extent that any facts or events arising after the date of this prospectus, individually or in the aggregate, represent a fundamental change in the information presented in this prospectus, this prospectus will be updated to the extent required by law to contain all material information. We encourage you to consult your own counsel, accountant and other advisors for legal, tax, business, financial and related advice regarding an investment in our securities.

 

As used in this prospectus, unless the context requires otherwise, “BioFuel,” “we,” “our,” “us” and the “Company” refer to BioFuel Energy Corp. and its subsidiaries and “JBGL” refers, collectively, to JBGL Builder Finance LLC, JBGL Exchange, LLC, JBGL Willow Crest, LLC, JBGL Hawthorne, LLC, JBGL Inwood, LLC, JBGL Chateau, LLC, JBGL Castle Pines, LP, JBGL Castle Pines Management, LLC, JBGL Lakeside, LLC, JBGL Mustang, LLC, and JBGL Kittyhawk, LLC, in each case prior to the consummation of the Acquisition.

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Risk Factors

An investment in our common stock involves a high degree of risk. You should carefully consider the risks described below, together with the other information included in this prospectus, before making an investment decision in the rights offering.

Risks Related to the Rights Offering

Your equity interest in us may be diluted as a result of the rights offering, the consummation of the Acquisition and the related transactions described herein.

We expect that the rights offering will result in our issuance of approximately 12,247,393 shares of common stock. The subscription price per share, which is $5.00, represents a significant discount to the market price of our common stock at the time of determination and as of a recent date prior to the date of this prospectus. The rights price represented an approximately 53.9% discount to the closing price of our common stock on September 15, 2014. In addition, Greenlight and Third Point have entered into the Greenlight Commitment Agreement and the Third Point Commitment Agreement with us, respectively, which requires them, subject to certain conditions, to fully exercise their basic subscription privileges (and, in the case of Third Point, to fully exercise its over-subscription privilege up to the Third Point Ownership Threshold). Further, Third Point and the Backstop Parties have severally agreed, subject to certain conditions, to purchase substantially simultaneously with the completion of this public rights offering, in the aggregate, all of the available shares not otherwise sold in the rights offering following the exercise of all other holders’ basic subscription privileges and over-subscription privileges. See “The Rights Offering.”

As a result, holders who do not fully exercise their subscription privileges should expect that they will, at the completion of the rights offering, own a smaller proportional equity interest in us than would be the case had they fully exercised their subscription rights. Additionally, we will issue shares of our common stock to the Sellers in connection with the completion of the Acquisition, which will reduce your ownership interest in us even if you fully exercise your subscription rights. See “Dilution.”

The rights price determined for the rights offering is not necessarily an indication of the fair value of the shares of our common stock.

The rights price will represent a significant discount to the market price of our common stock at the time of determination, but is not necessarily related to our book value, net worth or any other established criteria of value either before or after the Acquisition. You should not consider the rights price to be an indication of the fair value of the shares offered in the rights offering. We cannot assure you that you will be able to sell the common stock purchased pursuant to the rights offering at a price that is equal to or greater than $5.00. Further, if a substantial number of subscription rights are exercised and the holders of the shares received upon exercise of those rights choose to sell some or all of those shares, the resulting sales could depress the market price of our common stock after the completion of the rights offering.

You may not revoke your subscription exercise and could be committed to buying shares of common stock.

Once you exercise your subscription rights, you are not allowed to revoke or change the exercise or request a refund of monies paid. All exercises of subscription rights are irrevocable, even if you subsequently learn information about us, the rights offering or the Acquisition that you consider to be unfavorable. If you exercise your subscription rights and, afterwards, the market price of our common stock decreases below the rights price, you will have committed to purchase shares of common stock at a price above the prevailing market price of our common stock. Our common stock is traded on The Nasdaq Capital Market under the symbol “BIOF,” and the closing sales price of our common stock on The Nasdaq Capital Market on September 15, 2014 was $10.84 per share. The rights price is $5.00 per share. The rights price, together with the number of shares of common stock we propose to issue and ultimately will issue if the rights offering is completed, may result in a decrease in the market price of our common stock.

No prior market exists for the subscription rights and a liquid and reliable market for the subscription rights may not develop.

Although the subscription rights issued in the rights offering are transferable and we intend to list them for trading on The Nasdaq Capital Market during the course of the rights offering, we cannot give any

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assurance that the subscription rights will trade on The Nasdaq Capital Market, that an active market for the subscription rights will develop or be maintained during the course of the rights offering or, if a market does develop, the prices at which the subscription rights will trade. You may have difficulty selling your subscription rights should you decide to do so. Any market price of our subscription rights may not necessarily bear any relationship to our book value, assets, past results of operations, financial condition or any other established criteria of value, and may not be indicative of the market price for shares of our common stock in the future.

We will terminate the rights offering if the Transaction Agreement is terminated prior to the consummation of the Acquisition. If we terminate the rights offering, the only obligation to you that we or the subscription agent will have will be to return your subscription payments.

We will terminate the rights offering if the Transaction Agreement is terminated prior to the consummation of the Acquisition. The Transaction Agreement may be terminated by the Sellers following the occurrence of certain events including, without limitation, the failure of our stockholders to approve the Acquisition or the delisting of our common stock from The Nasdaq Capital Market. See “The Transactions —  The Transaction Agreement.” If we terminate the rights offering, all subscription rights will expire without value and the only obligation that we or the subscription agent will have with respect to subscription rights that have been exercised will be to return any subscription payments the subscription agent has received, without interest, as soon as practicable. See “The Rights Offering — Termination.”

If you acquire subscription rights, you may suffer a complete loss of your investment.

We will terminate the rights offering if the Transaction Agreement is terminated prior to the consummation of the Acquisition. The Transaction Agreement may be terminated by the Sellers following the occurrence of certain events including, without limitation, the failure of our stockholders to approve the Acquisition or the delisting of our common stock from The Nasdaq Capital Market. See “The Transactions —  The Transaction Agreement.”

We intend to list the subscription rights for trading on The Nasdaq Capital Market during the course of the rights offering. If you acquire subscription rights in the open market or otherwise and the rights offering is not consummated, the purchase price you paid for any subscription rights you have purchased will not be refunded to you. Accordingly, you may suffer a complete loss of your investment if you acquire subscription rights.

If you do not act promptly and properly exercise your rights prior to the expiration of the rights offering, your exercise of subscription rights will be rejected.

Holders that desire to purchase shares of common stock in the rights offering must act promptly to ensure that all required forms and payments are actually received by the subscription agent prior to the expiration of the rights offering at 5:00 p.m., New York City time, on October 17, 2014. If you are a beneficial holder, you must act promptly to ensure that your broker, dealer, custodian bank or other nominee acts for you and that all required forms and payments are actually received by the subscription agent prior to the expiration of the rights offering. We are not responsible if your broker, dealer, custodian bank or other nominee fails to ensure that all required forms and payments are actually received by the subscription agent prior to the expiration of the rights offering. If you fail to complete and sign the required subscription forms, send an incorrect payment amount or otherwise fail to follow the subscription procedures that apply to your exercise of rights prior to the expiration of the rights offering, the subscription agent will reject your subscription or may accept it only to the extent of the payment received. Neither we nor the subscription agent undertake to contact you concerning an incomplete or incorrect subscription form or payment, nor are we under any obligation to correct such forms or payment. We have the sole discretion to determine whether a subscription exercise properly complies with the subscription procedures.

If you exercise your over-subscription rights, we cannot guarantee that you will receive any or all of the amounts of common stock for which you over-subscribe and, in certain circumstances, your ability to over-subscribe could be reduced.

Holders who fully exercise their basic subscription privilege will be entitled to subscribe for an additional amount of common stock equal to up to 100% of the shares of common stock for which such holder was

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otherwise entitled to subscribe. We can provide no assurance that you will actually be entitled to purchase the number of shares of common stock you subscribe to purchase pursuant to your over-subscription privilege. There may not be shares available for you to purchase pursuant to your over-subscription privilege, either because all holders exercised their basic subscription rights or because other holders (including Third Point, which has an over-subscription priority up to the Third Point Ownership Threshold) have also exercised their over-subscription privileges such that there are more over-subscription requests than there are shares available following the basic subscriptions. If insufficient shares of common stock are available to fully satisfy the over-subscription privilege requests of all holders, after satisfaction of Third Point’s over-subscription priority up to the Third Point Ownership Threshold, the available unsubscribed shares of common stock will be distributed proportionately among those holders who exercised their over-subscription privileges based on the number of shares of common stock each holder subscribed to purchase pursuant to his or her over-subscription privilege.

You may be unable to resell any shares of our common stock that you purchase pursuant to the exercise of subscription rights immediately upon expiration of the rights offering period, or you may be unable to sell such shares at a price equal to or greater than the subscription price.

If you exercise subscription rights, you may not be able to resell the shares of our common stock purchased by exercising your subscription rights until you, or your broker, dealer, custodian bank or other nominee, if applicable, have received those shares. Moreover, you will have no rights as a stockholder of the shares you purchased in the rights offering until we issue the shares to you. Although we will endeavor to issue a direct registration account statement representing those shares as soon as practicable after completion of the rights offering, there may be a delay of up to five business days between the expiration date of the rights offering and the time that the rights offering is completed, the Acquisition is consummated and the shares are issued pursuant to the rights offering. In addition, we cannot assure you that, following the exercise of your subscription rights, you will be able to sell the shares of our common stock you purchased in the rights offering at a price equal to or greater than the subscription price.

Risks Related to Ownership of Our Common Stock

The price of our common stock may continue to be volatile.

The trading price of our common stock is highly volatile and could be subject to future fluctuations in response to a number of factors beyond our control. In recent years the stock market has experienced significant price and volume fluctuations. These fluctuations may be unrelated to the operating performance of particular companies. These broad market fluctuations may cause declines in the market price of our common stock. The price of our common stock could fluctuate based upon factors that have little or nothing to do with our company or its performance, and those fluctuations could materially reduce our common stock price.

The subscription price per share, which is $5.00, represents a significant discount to the market price of our common stock at the time of determination. The rights price represented an approximately 53.9% discount to the closing price of our common stock on September 15, 2014. The rights offering and its terms, including the subscription price per share, together with the number of shares of common stock we could issue if the rights offering is completed, may result in an immediate decrease in the market price of our common stock. This decrease may continue after the completion of the rights offering. If that occurs, your purchase of shares of our common stock in the rights offering may be at a price greater than the prevailing market price. Further, if a substantial number of holders of shares of our common stock received upon exercise of subscription rights choose to sell some of all of such shares, the resulting sales could depress the market price of our common stock.

Certain large stockholders own a significant percentage of our shares and exert significant influence over us. Their interests may not coincide with yours and they may make decisions with which you may disagree.

Following the consummation of the Acquisition, we expect Greenlight, Third Point and the Brickman Parties to control approximately 49.9%, 16.7% and 8.4%, respectively, of the voting power of the Company assuming that Third Point acquires the maximum number of shares under the Third Point Commitment Letter. These large stockholders, acting together, could determine substantially all matters requiring stockholder

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approval, including the election of directors and approval of significant corporate transactions, such as a sale or other change of control transaction involving the Company. In addition, this concentration of ownership may delay or prevent a change in control of our company and make some transactions more difficult or impossible without the support of these stockholders. The interests of these stockholders may not always coincide with our interests as a company or the interests of other stockholders. Accordingly, these stockholders could cause us to enter into transactions or agreements that you would not approve or make decisions with which you may disagree.

Greenlight, our largest stockholder, will also be our largest creditor. Greenlight will exert a significant influence over us and its interest as a creditor may not coincide with our interest as a company or your interest as a stockholder.

Following the consummation of the Acquisition, we expect Greenlight to control approximately 49.9% of the voting power of the Company. In connection with the Acquisition, we expect to incur up to $150 million of indebtedness from Greenlight. As our largest creditor, Greenlight may have interests that may not always coincide with our interests as a company or the interests of our stockholders generally. As our largest stockholder, Greenlight will exert a significant influence over us, which may cause us to enter into transactions or agreements, or to otherwise take actions, that you would not approve or make decisions with which you may disagree.

We do not intend to pay dividends on our common stock.

We have not paid any dividends since our inception and do not anticipate paying any cash dividends on our common stock in the foreseeable future. Any payment of future dividends will be at the discretion of our board of directors and will depend upon, among other things, our earnings, financial condition, capital requirements, level of indebtedness, statutory and contractual restrictions applying to the payment of dividends and other considerations that the board of directors deems relevant. Investors must rely on sales of their common stock after price appreciation, which may never occur, as the only way to realize a return on their investment. Investors seeking cash dividends should not purchase our common stock.

Our common stock could be delisted from The Nasdaq Capital Market, which could negatively impact the price of our common stock and our ability to access the capital markets.

Our common stock is currently listed on The Nasdaq Capital Market under the symbol “BIOF.” On May 8, 2014, we received a letter from the Listing Qualifications Staff (the “Staff”) of The Nasdaq Stock Market LLC (“Nasdaq”) indicating that the Staff believes the Company is a “public shell” and the continued listing of its securities is no longer warranted. Therefore, in accordance with Nasdaq Listing Rule 5101, the Staff determined to apply more stringent criteria for the continued listing of the Company’s securities and to suspend trading of our common stock and remove our securities from listing and registration on Nasdaq.

The Company timely appealed the Staff’s determination to a Nasdaq Hearings Panel (the “Panel”), which, on July 1, 2014, granted the Company an exception to the continued listing standards until November 4, 2014, which is 180 days from the date we received the delisting letter from the Staff. If we do not consummate the Acquisition on or prior to November 4, 2014, our common stock could be delisted from The Nasdaq Capital Market, which could negatively impact the price of our common stock and our ability to access the capital markets. Although the delisting of our common stock from The Nasdaq Capital Market would allow the Sellers to terminate the Transaction Agreement, we cannot assure you that they would do so. Further, although the Transaction Agreement gives us and the Sellers the right to terminate the Transaction Agreement if the Acquisition is not consummated on or before November 4, 2014, we and the Sellers could nevertheless agree to consummate the Acquisition and the related transactions, including the rights offering, after such date. If the Transaction Agreement is not terminated and the Acquisition is consummated, the rights offering will not be canceled, regardless of whether our common stock is delisted from The Nasdaq Capital Market.

Certain large stockholders’ shares may be sold into the market in the future, which could cause the market price of our common stock to decrease significantly.

Following the consummation of the rights offering, the Acquisition and the related transactions described herein, we expect that all or a significant portion of our common stock held by Greenlight, Third Point and

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the Brickman Parties will be “restricted securities” within the meaning of the federal securities laws because they were acquired from us on a private, non-registered basis. In addition, any shares purchased by the Backstop Parties pursuant to the Backstop Commitments will be restricted securities because they will have been acquired from us on a private, non-registered basis. We have entered into registration rights agreements with each of these parties, however, that give these parties the right to require us to register the resale of their shares. If these holders sell substantial amounts of these shares, the price of our common stock could decline. In addition, the sale of these shares could impair our ability to raise capital through the sale of additional equity securities.

Risk Related to Our Tax Asset, Indebtedness and Organizational Structure

Our ability to use net operating loss carryforwards to offset future taxable income for U.S. federal income tax purposes may be limited as a result of the rights offering, the Acquisition and the related transactions described herein, or of prior or future acquisitions of our common stock.

As of June 30, 2014, we reported federal net operating loss carryforwards of approximately $181.3 million, which will begin to expire if not used by December 31, 2029.

For accounting purposes, a valuation allowance is required to reduce our potential deferred tax assets if it is determined that it is more likely than not that all or some portion of such assets will not be realized due to the lack of sufficient taxable income. Our financial statements currently provide a full valuation allowance against all of our NOL carryforwards.

Our ability to utilize our tax attributes, such as NOL carryforwards and tax credits (“Tax Attributes”), will be subject to significant limitation for federal income tax purposes if we undergo an “ownership change” as defined in Section 382 of the Internal Revenue Code of 1986, as amended (the “Code”). For this purpose, an ownership change generally occurs, as of any “testing date” (as defined under Section 382 of the Code), if our “5-percent shareholders” have collectively increased their ownership in BioFuel Energy Corp. stock by more than 50 percentage points over their lowest percentage ownership at any time during the relevant testing period, which generally begins the later of either January 1, 2008 or three years preceding the relevant testing date. In general, our 5-percent shareholders would include any (i) individual who owns 5% or more (directly, indirectly or constructively) of BioFuel Energy Corp. stock and (ii) “public groups” who own BioFuel Energy Corp. stock (even in certain cases if they own less than 5% of BioFuel Energy Corp. stock) or stock in higher tier entities who own 5% or more (directly, indirectly or constructively) of BioFuel Energy Corp. stock. A “public group” generally consists of a group of persons each of whom owns (directly, indirectly or constructively) less than 5% of BioFuel Energy Corp. stock. An ownership change may therefore occur following substantial changes in the direct or indirect ownership of our outstanding stock by one or more 5-percent shareholders over this period.

If we were to experience an ownership change, Section 382 of the Code imposes an annual limitation on the amount of our post-change taxable income that may be offset by our pre-change Tax Attributes. The limitation imposed by Section 382 of the Code for any post-change year is generally determined by multiplying the value of BioFuel Energy Corp. stock immediately before the ownership change by the applicable long-term tax-exempt rate. Any unused annual limitation may, subject to certain limits, be carried over to later years.

It is unclear whether all or a portion of our Tax Attributes are or will be subject to a limitation under Section 382 of the Code following the rights offering, either as a result of an ownership change experienced by us in the past or an ownership change to be experienced by us on account of the rights offering, the Acquisition and the related transactions. The determination of whether the rights offering would result in an ownership change under Section 382 of the Code depends, in part, on the number of shares of common stock actually purchased in the rights offering and pursuant to the Additional Equity Investment and the Backstop Commitments, prior ownership shifts involving 5-percent shareholders and the effect of the Acquisition and the related transactions in conjunction with the rights offering.

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Certain limitations are being imposed on the exercise of subscription rights (including the over-subscription privilege) and in the Third Point Commitment Agreement, the Backstop Commitment and the structure of the Acquisition in order to minimize the impact of these transactions on our ownership change calculation.

Even if the rights offering, the Acquisition and the related transactions do not result in an ownership change under Section 382 of the Code, it is possible that future changes in the ownership of BioFuel Energy Corp. stock by 5-percent shareholders, including certain changes in the ownership of any entity that owns 5% or more of BioFuel Energy Corp. stock, will result in an ownership change under Section 382 of the Code.

To reduce the likelihood of an ownership change, our board of directors has implemented the Section 382 rights agreement described herein and, in connection with the consummation of the Acquisition, we intend to amend our Charter to add customary transfer and ownership limitations regarding preservation of the Company’s NOLs. See “Description of Capital Stock — Series B Junior Participating Preferred Stock” and “The Transactions — The Charter Amendment.”

Our ability to use our Tax Attributes will also depend on the amount of taxable income we generate in future periods. Our Tax Attributes may expire before we can generate sufficient taxable income to utilize them in full.

Our substantial debt could adversely affect our business, financial condition or results of operations and prevent us from fulfilling our debt-related obligations.

Following the consummation of the Acquisition and the related transactions described herein, we will have a substantial amount of debt. The total principal amount of our debt following the Acquisition could be as high as $150 million (not including debt at the JBGL entity level relating to property acquisitions and development). Our substantial debt could have important consequences for the holders of our common stock, including:

We cannot assure you that our business will generate sufficient cash flow from operations or that future borrowings will be available to us through capital markets financings or otherwise in an amount sufficient to enable us to pay our indebtedness, or to fund our other liquidity needs. We may need to refinance all or a portion of our indebtedness on or before its maturity. We cannot assure you that we will be able to refinance any of our indebtedness on commercially reasonable terms or at all. In addition, we may incur additional indebtedness in order to finance our operations or to repay existing indebtedness. If we cannot service our indebtedness, we may have to take actions such as selling assets, seeking additional debt or equity or reducing or delaying capital expenditures, property acquisitions or developments, strategic acquisitions, investments and alliances. We cannot assure you that any such actions, if necessary, could be effected on commercially reasonable terms or at all, or on terms that would be advantageous to our stockholders or on terms that would not require us to breach the terms and conditions of our existing or future debt agreements. Pursuant to the Commitment Letter, if an event of default occurs under the documentation governing the new term loan facility we intend to enter upon the consummation of the Acquisition, the lenders may accelerate our repayment obligations and/or exercise other remedies under the facility.

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Provisions in our charter documents may delay or prevent our acquisition by a third party or may reduce the value of your investment.

Some provisions in our Charter and bylaws may be deemed to have an anti-takeover effect and may delay, defer or prevent a tender offer or takeover attempt that a stockholder may deem to be in his or her best interest. For example, our board of directors may determine the rights, preferences, privileges and restrictions of unissued series of preferred stock without any vote or action by our stockholders. In addition, stockholders must provide advance notice to nominate directors or to propose business to be considered at a meeting of stockholders and may not take action by written consent. Additionally, our board of directors adopted the 382 Rights Agreement described herein under “Description of Capital Stock — Series B Junior Participating Preferred Stock” and, following the consummation of the Acquisition and the Charter Amendment, we expect that our Charter will contain transfer restrictions intended to prevent future acquisitions of our common stock that would limit our ability to use the NOLs. The existence of these provisions could also limit the price that investors may be willing to pay in the future for shares of our common stock.

Risks Related to JBGL’s Business and Industry

The homebuilding industry is cyclical. A severe downturn in the industry, such as the one experienced in 2006 through 2011, could adversely affect JBGL’s business, results of operations and stockholder’s equity.

The residential homebuilding industry is cyclical and is highly sensitive to changes in general economic conditions such as levels of employment, consumer confidence and income, availability of financing for acquisitions, construction and permanent mortgages, interest rate levels, inflation and demand for housing. Since early 2006, the U.S. housing market has been negatively impacted by declining consumer confidence, restrictive mortgage standards and large supplies of foreclosures, resales and new homes, among other factors. When combined with a prolonged economic downturn, high unemployment levels, increases in the rate of inflation and uncertainty in the U.S. economy, these conditions have contributed to decreased demand for housing, declining sales prices and increasing pricing pressure. While national data indicate that the overall demand for new homes improved during 2012 and 2013, in the event that the current recovery stalls or reverses and these economic and business trends continue or decline further, JBGL could experience declines in the market value of its inventory and demand for its lots, homes and construction loans, which could have a material adverse effect on its business, prospects, liquidity, financial condition and results of operations.

JBGL’s operating performance is subject to risks associated with the real estate industry.

Real estate investments are subject to various risks and fluctuations and cycles in value and demand, many of which are beyond JBGL’s control. Certain events may decrease cash available for operations, as well as the value of JBGL’s real estate assets. These events include, but are not limited to:

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In addition, periods of economic slowdown or recession, rising interest rates or declining demand for real estate, or the public perception that any of these events may occur, could result in a general decline in the purchase of homes or an increased incidence of home order cancellations. If JBGL cannot successfully implement its business strategy, its business, prospects, liquidity, financial condition and results of operations will be adversely affected.

Further, acts of war, any outbreak or escalation of hostilities between the United States and any foreign power or acts of terrorism may cause disruption to the U.S. economy, or the local economies of the markets in which JBGL operates, cause shortages of building materials, increase costs associated with obtaining building materials, result in building code changes that could increase costs of construction, affect job growth and consumer confidence or cause economic changes that JBGL cannot anticipate, all of which could reduce demand for JBGL’s lots, homes and construction loans and adversely impact its business, prospects, liquidity, financial condition and results of operations.

JBGL’s business and financial results could be adversely affected by significant inflation or deflation.

Inflation can adversely affect JBGL’s homebuilding operations by increasing costs of land, financing, materials, labor and construction. While JBGL attempts to pass on cost increases to customers through increased prices, in a weak housing market, JBGL may not be able to offset cost increases with higher selling prices. In addition, significant inflation is often accompanied by higher interest rates, which have a negative impact on housing demand. In a highly inflationary environment, depending on industry and other economic conditions, JBGL may be precluded from raising home prices enough to keep up with the rate of inflation, which could reduce its profit margins. Moreover, with inflation, the costs of capital increase and the purchasing power of JBGL’s cash resources could decline. Current or future efforts by the government to stimulate the economy may increase the risk of significant inflation and its adverse impact on JBGL’s business or financial results.

Alternatively, a significant period of deflation could cause a decrease in overall spending and borrowing levels. This could lead to a further deterioration in economic conditions, including an increase in the rate of unemployment. Deflation could also cause the value of JBGL’s inventories to decline or reduce the value of existing homes below the related mortgage loan balance, which could potentially increase the supply of existing homes and have a negative impact on JBGL’s results of operations.

JBGL is dependent on the continued availability and satisfactory performance of subcontractors, which, if unavailable, could have a material adverse effect on its business.

JBGL and its homebuilding subsidiaries conduct their land development and construction operations only as a general contractor. Virtually all land development and construction work is performed by unaffiliated third-party subcontractors. As a consequence, the timing and quality of the development of JBGL’s land and the construction of its homes depends on the availability and skill of its subcontractors. There may not be sufficient availability of and satisfactory performance by these unaffiliated third-party subcontractors in the markets in which JBGL operates. In addition, inadequate subcontractor resources could have a material adverse effect on JBGL’s business.

JBGL has recently experienced labor shortages and increased labor costs in both the DFW and Atlanta markets. These labor shortages have resulted in higher wages for subcontractors, construction workers frequently moving between jobs for higher pay, increased prices and delays in projects.

Labor and raw material shortages and price fluctuations could delay or increase the cost of land development and home construction, which could materially and adversely affect JBGL.

The residential construction industry experiences labor and raw material shortages from time to time, including shortages in qualified tradespeople and supplies of insulation, drywall, cement, steel and lumber. These labor and raw material shortages can be more severe during periods of strong demand for housing or if either of the regions in which JBGL operates experiences a natural disaster that has a significant impact on existing residential and commercial structures. The cost of labor and raw materials may also be adversely affected during periods of shortage or high inflation. During the recent economic downturn, a large number of qualified tradespeople went out of business or otherwise exited the market in the DFW and Atlanta regions.

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This reduction in available tradespeople exacerbated labor shortages as demand for new housing increased in these markets. Shortages and price increases could cause delays in, and increase JBGL’s costs of, land development and home construction, which in turn could have a material adverse effect on its business, prospects, liquidity, financial condition and results of operations.

Failure to recruit, retain and develop highly skilled, competent employees may have a material adverse effect on JBGL’s business and results of operations.

Key employees, including management team members at both the corporate and homebuilder subsidiary levels, are fundamental to JBGL’s ability to obtain, generate and manage opportunities. If any of the management team members were to cease employment with JBGL, its results of operations could suffer. JBGL’s ability to retain its management team or to attract suitable replacements should any members of its management team leave is dependent on the competitive nature of the employment market. The loss of services from key management team members or a limitation in their availability could materially and adversely impact JBGL’s business, prospects, liquidity, financial condition and results of operations. Further, such a loss could be negatively perceived in the capital markets. In addition, JBGL does not maintain key person insurance in respect of any member of its senior management team.

In addition, key employees working in the land development, homebuilding and construction industries are highly sought after. Experienced employees in the homebuilding, land acquisition and construction industries are fundamental to JBGL’s ability to generate, obtain and manage opportunities. In particular, local knowledge and relationships are critical to JBGL’s ability to source attractive land acquisition opportunities. Failure to attract and retain such personnel or to ensure that their experience and knowledge is not lost when they leave the business through retirement, redundancy or otherwise may adversely affect the standards of JBGL’s service and may have an adverse impact on its business, financial conditions and results of operations.

JBGL’s long-term success depends on its ability to acquire undeveloped land, partially-finished developed lots and finished lots suitable for residential homebuilding at reasonable prices, in accordance with its land investment criteria.

The homebuilding industry is highly competitive for suitable land and the risk inherent in purchasing and developing land increases as consumer demand for housing increases. The availability of finished and partially-finished developed lots and undeveloped land for purchase that meet JBGL’s investment criteria depends on a number of factors outside its control, including land availability in general, competition with other homebuilders and land buyers, inflation in land prices, zoning, allowable housing density, the ability to obtain building permits and other regulatory requirements. Should suitable land or lots become more difficult to locate or obtain, the number of lots JBGL may be able to develop and sell could decrease, the number of homes JBGL may be able to build and sell could be reduced and the cost of land could increase, perhaps substantially, which could adversely impact JBGL’s results of operations.

As competition for suitable land increases, the cost of acquiring both finished and undeveloped lots and the cost of developing owned land could rise and the availability of suitable land at acceptable prices may decline, which could adversely impact JBGL’s financial results. The availability of suitable land assets could also affect the success of JBGL’s land acquisition strategy, which may impact its ability to increase the number of actively selling communities, to grow its revenues and margins and to achieve or maintain profitability.

If JBGL is unable to develop communities successfully or within expected timeframes, JBGL’s results of operations could be adversely affected.

Before a community generates any revenue, time and material expenditures are required to acquire and prepare land, finish and entitle lots, obtain development approvals, pay taxes and construct significant portions of project infrastructure, amenities, model homes and sales facilities. It can take several years from the time that JBGL acquires control of a property to the time that JBGL makes its first home sale on the site. Delays in the development of communities expose JBGL to the risk of changes in market conditions for homes. A decline in JBGL’s ability to develop and market its communities successfully and to generate positive cash flow from these operations in a timely manner could have a material adverse effect on JBGL’s business and results of operations and on JBGL’s ability to service its debt and to meet its working capital requirements.

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Because real estate investments are relatively illiquid, JBGL’s ability to promptly sell one or more properties for reasonable prices in response to changing economic, financial and investment conditions may be limited and it may be forced to hold non-income producing properties for extended periods of time.

Real estate investments are relatively difficult to sell quickly. As a result, JBGL’s ability to promptly sell one or more properties in response to changing economic, financial and investment conditions is limited and it may be forced to hold non-income producing assets for an extended period of time. JBGL cannot predict whether it will be able to sell any property for the price or on the terms that it sets or whether any price or other terms offered by a prospective purchaser would be acceptable to it. JBGL also cannot predict the length of time needed to find a willing purchaser and to close the sale of a property.

JBGL depends on the success of its controlled homebuilding subsidiaries.

JBGL participates in the homebuilding business through subsidiaries in which it owns a 50% controlling interest, which we refer to as its “builders.” JBGL has entered into arrangements with these builders in order to take advantage of the local knowledge and relationships of the builders, acquire attractive land positions and brand images, manage its risk profile and leverage its capital base. The viability of JBGL’s participation in the homebuilding business depends on its ability to maintain good relationships with its builders. JBGL’s builders are focused on maximizing the value of their operations and working with a partner that can help them be successful. The effectiveness of JBGL’s management, the value of its expertise and the rapport it maintains with its builders are important factors for new builders considering doing business with JBGL and may affect JBGL’s ability to attract customers, subcontractors, employees or others upon whom its business, financial condition and results of operations ultimately depend. Further, JBGL’s relationships with its builders generate additional business opportunities that support its growth. If JBGL is unable to maintain good relationships with its builders, it may be unable to fully take advantage of existing agreements or expand its relationships with these builders. Additionally, JBGL’s opportunities for developing new relationships with additional builders may be adversely impacted.

JBGL sells lots to its builders for their homebuilding operations and provides them loans to finance home construction. If JBGL’s builders fail to successfully execute their business strategies for any reason, they may be unable to purchase lots from JBGL, repay outstanding construction finance loans made by JBGL or borrow from JBGL in the future, any of which could negatively impact JBGL’s business, financial condition and results of operations.

If JBGL is required to either repurchase or sell a substantial portion of the equity interest in its controlled homebuilding subsidiaries, JBGL’s capital resources and financial condition could be adversely affected.

The operating agreements governing two of JBGL’s controlled homebuilding subsidiaries contain buy-sell provisions that may be triggered in certain circumstances. In the event that a buy-sell event occurs, JBGL’s builder will have the right to initiate a buy-sell process, which may happen at an inconvenient time for JBGL. In the event the buy-sell provisions are exercised at a time when JBGL lacks sufficient capital to purchase the remaining equity interest, JBGL may elect to sell its equity interest in the entity. If JBGL is forced to sell its equity interest, it will no longer benefit from the future operations of the applicable entity. If a buy-sell provision is exercised and JBGL elects to purchase the interest in an entity that it does not already own, JBGL may be obligated to expend significant capital in order to complete such acquisition, which may result in JBGL being unable to pursue other investments or opportunities. If either of these events occurs, JBGL’s revenue and net income could decline or JBGL may not have sufficient capital necessary to implement its growth strategy.

JBGL’s geographic concentration could materially and adversely affect it if the homebuilding industry in its current markets should decline.

JBGL’s business strategy is focused on the development of land, the issuance of construction finance loans and the design, construction and sale of single-family detached and attached homes in the DFW and Atlanta markets, as well as the eventual entry into other geographic markets. In DFW, JBGL principally operates in the counties of Dallas, Collin and Denton. In Atlanta, it principally operates in the counties of Fulton, Gwinnett, Cobb, Forsyth and Dekalb. Because JBGL’s operations are concentrated in these areas, a

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prolonged economic downturn in one or more of these areas could have a material adverse effect on its business, prospects, liquidity, financial condition and results of operations, and a disproportionately greater impact on JBGL than other homebuilders with more diversified operations. Further, slower rates of population growth or population declines in the DFW or Atlanta markets, especially as compared to the high population growth rates in prior years, could affect the demand for housing, causing home prices in these markets to fall and adversely affect JBGL’s business, financial condition and results of operations.

JBGL’s developments are subject to extensive government regulation, which could cause it to incur significant liabilities or restrict its business activities.

JBGL’s developments are subject to numerous local, state, federal and other statutes, ordinances, rules and regulations concerning zoning, development, building design, construction and similar matters that impose restrictive zoning and density requirements, the result of which is to limit the number of homes that can be built within the boundaries of a particular area. Projects that are not entitled may be subjected to periodic delays, changes in use, less intensive development or elimination of development in certain specific areas due to government regulations. JBGL may also be subject to periodic delays or may be precluded entirely from developing in certain communities due to building moratoriums or “slow-growth” or “no-growth” initiatives that could be implemented in the future. Local governments also have broad discretion regarding the imposition of development and service fees for projects in their jurisdiction. Projects for which JBGL has received land use and development entitlements or approvals may still require a variety of other governmental approvals and permits during the development process and can also be impacted adversely by unforeseen health, safety and welfare issues, which can further delay these projects or prevent their development. As a result, lot and home sales could decline and costs could increase, which could have a material adverse effect on JBGL’s business, prospects, liquidity, financial condition and results of operations.

If the market value of JBGL’s land and homes drops significantly, its profits would decrease.

The market value of land, building lots and housing inventories can fluctuate significantly as a result of changing market conditions, and the measures JBGL employs to manage inventory risk may not be adequate to insulate its operations from a severe drop in inventory values. JBGL acquires land for replacement of land inventory and expansion within its current markets, and may in the future acquire land for expansion into new markets. If housing demand decreases below what JBGL anticipated when it acquired its inventory, it may not be able to generate profits consistent with those it has generated in the past and it may not be able to recover its costs when it sells lots and homes. When market conditions are such that land values are not appreciating, option arrangements previously entered into may become less desirable, at which time JBGL may elect to forego deposits and pre-acquisition costs and terminate such arrangements. In the face of adverse market conditions, JBGL may have substantial inventory carrying costs, may have to write down its inventory to its fair value in accordance with generally accepted accounting principles and/or may have to sell land or homes at a loss. Any material write-downs of assets, or sales at a loss, could have a material adverse effect on JBGL’s business, prospects, liquidity, financial condition and results of operations.

The terms and availability of mortgage financing can affect consumer demand for homes and the ability of consumers to complete the purchase of a home. Because most of JBGL’s homebuyers, and the homebuyers of those entities to whom JBGL sells lots, finance the purchase of their homes, unfavorable terms in, or the unavailability of, mortgage financing could materially and adversely affect JBGL.

JBGL’s business depends on the ability of its homebuyers, as well as the ability of those who buy homes from the homebuilding entities to which JBGL sells lots (JBGL’s “homebuilding customers”), to obtain financing for the purchase of their homes. Many of these homebuyers must sell their existing homes in order to buy a home from JBGL or its homebuilding customers. Since 2009, the U.S. residential mortgage market as a whole has experienced significant instability due to, among other things, defaults on subprime and other loans, resulting in the declining market value of such loans. In light of these developments, lenders, investors, regulators and other third parties questioned the adequacy of lending standards and other credit requirements for several loan programs made available to borrowers in recent years. This has led to tightened credit requirements and an increase in indemnity claims for mortgages. Deterioration in credit quality among subprime and other nonconforming loans has caused most lenders to eliminate subprime mortgages and most

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other loan products that do not conform to Federal National Mortgage Association (“Fannie Mae”), Federal Home Loan Mortgage Corporation (“Freddie Mac”), Federal Housing Administration (the “FHA”) or Veterans Administration (the “VA”) standards. Fewer loan products and tighter loan qualifications, in turn, make it more difficult for a borrower to finance the purchase of a new home or the purchase of an existing home from a potential “move-up” buyer who wishes to purchase a home from JBGL or its homebuilding customers. If potential buyers of JBGL’s or its homebuilding customers’ homes, or the buyers of those potential buyers’ existing homes, cannot obtain suitable financing, JBGL’s business, prospects, liquidity, financial condition and results of operations could be materially and adversely affected.

Interest rate increases or changes in federal lending programs or other regulations could lower demand for JBGL’s lots, homes and construction finance loans, which could materially and adversely affect its business and results of operations.

Rising interest rates, decreased availability of mortgage financing or of certain mortgage programs, higher down payment requirements or increased monthly mortgage costs may lead to reduced demand for JBGL’s homes, lots and construction loans. Increased interest rates can also hinder JBGL’s ability to realize its backlog because certain of its home purchase contracts provide customers with a financing contingency. Financing contingencies allow customers to cancel their home purchase contracts in the event that they cannot arrange for adequate financing. As a result, rising interest rates can decrease JBGL’s home sales and mortgage originations. Any of these factors could have a material adverse effect on JBGL’s business, prospects, liquidity, financial condition and results of operations.

In addition, as a result of the turbulence in the credit markets and mortgage finance industry, the federal government has taken on a significant role in supporting mortgage lending through its conservatorship of Fannie Mae and Freddie Mac, both of which purchase home mortgages and mortgage-backed securities originated by mortgage lenders, and its insurance of mortgages originated by lenders through the FHA and the VA. The availability and affordability of mortgage loans, including consumer interest rates for such loans, could be adversely affected by a curtailment or cessation of the federal government’s mortgage-related programs or policies. The FHA may continue to impose stricter loan qualification standards, raise minimum down payment requirements, impose higher mortgage insurance premiums and other costs and/or limit the number of mortgages it insures. Due to growing federal budget deficits, the U.S. Treasury may not be able to continue supporting the mortgage-related activities of Fannie Mae, Freddie Mac, the FHA and the VA at present levels, or it may revise significantly the federal government’s participation in and support of the residential mortgage market. Further, in 2013 the Obama administration proposed the wind-down of Fannie Mae and Freddie Mac, a proposal recently supported by Julian Castro, the incoming Secretary of Housing and Urban Development. Because the availability of Fannie Mae, Freddie Mac, FHA- and VA-backed mortgage financing is an important factor in marketing and selling many of JBGL’s homes, any limitations, restrictions or changes in the availability of such government-backed financing could reduce JBGL’s home sales, which could have a material adverse effect on its business, prospects, liquidity, financial condition and results of operations.

Furthermore, in July 2010, the Dodd-Frank Wall Street Reform and Consumer Protection Act was signed into law. This legislation provides for a number of new requirements relating to residential mortgages and mortgage lending practices, many of which are to be developed further by implementing rules. These include, among others, minimum standards for mortgages and lender practices in making mortgages, limitations on certain fees and incentive arrangements, retention of credit risk and remedies for borrowers in foreclosure proceedings. The effect of these provisions on lending institutions will depend on the rules that are ultimately enacted. These requirements, however, as and when implemented, are expected to reduce the availability of loans to borrowers and/or increase the costs to borrowers to obtain such loans. Any such reduction could result in a decline of JBGL’s home sales, lot sales and construction finance loan portfolio which could materially and adversely affect its business and results of operations.

Any increase in unemployment or underemployment may lead to an increase in the number of loan delinquencies and property repossessions, which would have an adverse impact on JBGL.

The unemployment rate in the United States was 6.2% as of July 2014, according to the U.S. Bureau of Labor Statistics (“BLS”). In addition, the labor force participation rate reported by the BLS has been

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declining, from 66.2% in January 2008 to 62.9% in July 2014, potentially reflecting an increased number of “discouraged workers” who have left the labor force. People who are not employed, are underemployed, who have left the labor force or are concerned about the loss of their jobs are less likely to purchase new homes, may be forced to try to sell the homes they own and may face difficulties in making required mortgage payments. Therefore, any increase in unemployment or underemployment may lead to an increase in the number of loan delinquencies and property repossessions and have an adverse impact on JBGL both by reducing demand for its homes, lots and construction loans and by increasing the supply of homes for sale.

Any limitation on, or reduction or elimination of, tax benefits associated with owning a home would have an adverse effect on the demand for JBGL’s homes, lots and construction loans, which could be material to its business.

Changes in federal income tax laws may affect demand for new homes. Current tax laws generally permit significant expenses associated with owning a home, primarily mortgage interest expense and real estate taxes, to be deducted for the purpose of calculating an individual’s federal, and in many cases state, taxable income. Various proposals have been publicly discussed to limit mortgage interest deductions and to limit the exclusion of gain from the sale of a principal residence. If such proposals were enacted without offsetting provisions, the after-tax cost of owning a new home would increase for many of JBGL’s potential customers and the potential customers of JBGL’s homebuilding customers. Enactment of any such proposal may have an adverse effect on the homebuilding industry in general, as the loss or reduction of homeowner tax deductions could decrease the demand for new homes.

The occurrence of severe weather or natural disasters could increase JBGL’s operating expenses and reduce its revenues and cash flows.

The climates and geology of the states in which JBGL operates, Georgia and Texas, present increased risks of severe weather and natural disasters. The occurrence of severe weather conditions or natural disasters can delay new home deliveries and lot development, reduce the availability of materials and/or negatively impact the demand for new homes in affected areas. For example, the winter of 2013 – 2014 brought severe weather conditions in the states in which JBGL operates, including extreme rain in Atlanta and abnormally low temperatures and icy conditions in the DFW region, which hindered land development and delayed home construction.

Further, to the extent that hurricanes, severe storms, earthquakes, tornadoes, droughts, floods, wildfires or other natural disasters or similar events occur, JBGL’s homes under construction or its building lots could be damaged or destroyed, which may result in losses exceeding JBGL’s insurance coverage. Any of these events could increase JBGL’s operating expenses, impair its cash flows and reduce its revenues.

High cancellation rates may negatively impact JBGL’s business.

JBGL’s backlog reflects the number and value of homes for which it has entered into non-contingent sales contracts with customers but not yet delivered. (While JBGL may accept sales contracts on a contingent basis in limited circumstances, such contracts are not included in JBGL’s backlog until the contingency is removed.) Although these sales contracts typically require a cash deposit and do not allow for the sale to be contingent on the sale of the customer’s existing home, a customer may in certain circumstances cancel the contract and receive a complete or partial refund of the deposit as a result of local laws or contract provisions. If home prices decline, the national or local homebuilding environment or general economy weakens, JBGL’s neighboring competitors reduce their sales prices (or increase their sales incentives), interest rates increase or the availability of mortgage financing tightens, homebuyers may have an incentive to cancel their contracts with JBGL, even where they might be entitled to no refund or only a partial refund. Significant cancellations could have a material adverse effect on JBGL’s business as a result of lost sales revenue and the accumulation of unsold housing inventory.

JBGL may not be able to compete effectively against competitors in the homebuilding, land development and financial services industries.

Competition in the land development and homebuilding industries is intense, and there are relatively low barriers to entry. Land developers and homebuilders compete for, among other things, customers, desirable

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land parcels, financing, raw materials and skilled labor. Increased competition could hurt JBGL’s business, as it could prevent JBGL from acquiring attractive land parcels for development and resale or homebuilding (or make such acquisitions more expensive), hinder JBGL’s market share expansion and lead to pricing pressures that adversely impact its margins and revenues. If JBGL is unable to compete successfully, its business, prospects, liquidity, financial condition and results of operations could be materially and adversely affected. JBGL’s competitors may independently develop land and construct housing units that are superior or substantially similar to its products. Furthermore, a number of JBGL’s primary competitors are significantly larger, have a longer operating history and may have greater resources or lower cost of capital than JBGL’s. Accordingly, they may be able to compete more effectively in one or more of the markets in which JBGL operates. Many of these competitors also have longstanding relationships with subcontractors and suppliers in the markets in which JBGL operates. JBGL’s homebuilding business also competes for sales with individual resales of existing homes and with available rental housing.

JBGL’s construction financing business competes with other lenders, including national, regional and local banks and other financial institutions, some of which have greater access to capital or different lending criteria and may be able to offer more attractive financing to potential customers.

JBGL’s future growth may include additional strategic investments, joint ventures, partnerships and/or acquisitions of companies that may not be as successful as JBGL anticipates and could disrupt its ongoing businesses and adversely affect its operations.

JBGL’s investments in its homebuilding subsidiaries have contributed to its historical growth and similar investments may be a component of its growth strategy in the future. JBGL may make additional strategic investments, enter into new joint venture or partnership arrangements or acquire businesses, some of which may be significant. These endeavors may involve significant risks and uncertainties, including distraction of management from current operations, significant start-up costs, insufficient revenues to offset expenses associated with these new investments and inadequate return of capital on these investments, any of which may adversely affect JBGL’s financial condition and results of operations. JBGL’s failure to successfully identify and manage future investments, joint ventures, partnerships or acquisitions could harm its results of operations.

JBGL may be unable to obtain suitable bonding for the development of its housing projects.

JBGL is often required to provide bonds to governmental authorities and others to ensure the completion of its projects. As a result of market conditions, surety providers have been reluctant to issue new bonds and some providers are requesting credit enhancements (such as cash deposits or letters of credit) in order to maintain existing bonds or to issue new bonds. If JBGL is unable to obtain required bonds for its future projects, or if it is required to provide credit enhancements with respect to its current or future bonds, its business, prospects, liquidity, financial condition and results of operations could be materially and adversely affected.

Difficulty in obtaining sufficient capital could result in an inability to acquire land for JBGL’s developments or increased costs and delays in the completion of development projects.

The homebuilding industry is capital-intensive and requires significant up-front expenditures to acquire land parcels and begin development. If internally generated funds are not sufficient, JBGL may seek additional capital in the form of equity or debt financing from a variety of potential sources, including additional bank financings and/or securities offerings. The availability of borrowed funds, especially for land acquisition and construction financing, may be greatly reduced nationally, and the lending community may require increased amounts of equity to be invested in a project by borrowers in connection with both new loans and the extension of existing loans. The credit and capital markets have recently experienced significant volatility. If JBGL is required to seek additional financing to fund its operations, continued volatility in these markets may restrict JBGL’s flexibility to access such financing. If JBGL is not successful in obtaining sufficient capital to fund its planned capital and other expenditures, it may be unable to acquire land for its housing developments and/or to develop the housing. Any difficulty in obtaining sufficient capital for planned development expenditures could also cause project delays and any such delay could result in cost increases. Any one or more of the foregoing events could have a material adverse effect on JBGL’s business, prospects, liquidity, financial condition and results of operations.

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JBGL is subject to environmental laws and regulations, which may increase its costs, limit the areas in which it can build homes and develop land and delay completion of its projects.

JBGL is subject to a variety of local, state, federal and other statutes, ordinances, rules and regulations concerning the environment. The particular environmental laws that apply to any given homebuilding or development site vary according to multiple factors, including the site’s location, its environmental conditions and the present and former uses of the site, as well as adjoining properties. Environmental laws and conditions may result in delays, may cause JBGL to incur substantial compliance and other costs and can prohibit or severely restrict homebuilding and land development activity in environmentally sensitive regions or areas. In addition, in those cases where an endangered or threatened species is involved, environmental rules and regulations can result in the restriction or elimination of development in identified environmentally sensitive areas. From time to time, the United States Environmental Protection Agency and similar federal or state agencies review homebuilders’ compliance with environmental laws and may levy fines and penalties for failure to comply strictly with applicable environmental laws or impose additional requirements for future compliance as a result of past failures. Any such actions taken with respect to JBGL may increase its costs. Further, JBGL expects that increasingly stringent requirements will be imposed on homebuilders and land developers in the future. Environmental regulations can also have an adverse impact on the availability and price of certain raw materials such as lumber.

Under various environmental laws, current or former owners of real estate, as well as certain other categories of parties, may be required to investigate and clean up hazardous or toxic substances or petroleum product releases, and may be held liable to a governmental entity or to third parties for related damages, including for bodily injury, and for investigation and clean-up costs incurred by such parties in connection with the contamination.

A major health and safety incident relating to JBGL’s business could be costly in terms of potential liabilities and reputational damage.

Building sites are inherently dangerous, and operating in the homebuilding and land development industries poses certain inherent health and safety risks. Due to health and safety regulatory requirements and the number of projects JBGL works on, health and safety performance is critical to the success of all areas of its business. Any failure in health and safety performance may result in penalties for non-compliance with relevant regulatory requirements, and a failure that results in a major or significant health and safety incident is likely to be costly in terms of potential liabilities incurred as a result. Such a failure could generate significant negative publicity and have a corresponding impact on JBGL’s reputation, its relationships with relevant regulatory agencies or governmental authorities and its ability to attract employees, subcontractors and customers, which in turn could have a material adverse effect on its business, financial condition and results of operations.

Poor relations with the residents of its communities, or with local real estate agents, could negatively impact JBGL’s home sales, which could cause its revenues or results of operations to decline.

Residents of communities JBGL develops rely on it to resolve issues or disputes that may arise in connection with the operation or development of their communities. Efforts made by JBGL to resolve these issues or disputes could be deemed unsatisfactory by the affected residents and subsequent actions by these residents could adversely affect sales or JBGL’s reputation. In addition, JBGL could be required to make material expenditures related to the settlement of such issues or disputes or to modify its community development plans, which could adversely affect its results of operations.

Most of JBGL’s homebuying customers engage local real estate agents that are unaffiliated with JBGL in connection with their search for a new home. If JBGL does not maintain good relations with, and a good reputation among, these real estate agents, the agents may not encourage consumers to consider, or may actively discourage consumers from considering, JBGL’s communities, which could adversely affect its results of operations.

Information technology failures and data security breaches could harm JBGL’s business.

JBGL uses information technology and other computer resources to carry out important operational and marketing activities, as well as to maintain its business records, including information provided by its

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customers. Many of these resources are provided to JBGL and/or maintained on its behalf by third-party service providers pursuant to agreements that specify certain security and service level standards. JBGL’s ability to conduct its business may be impaired if these resources are compromised, degraded, damaged or fail, whether due to a virus or other harmful circumstance, intentional penetration or disruption of JBGL’s information technology resources by a third party, natural disaster, hardware or software corruption or failure or error (including a failure of security controls incorporated into or applied to such hardware or software), telecommunications system failure, service provider error or failure, intentional or unintentional personnel actions (including the failure to follow JBGL’s security protocols) or lost connectivity to networked resources. A significant and extended disruption in the functioning of these resources could damage JBGL’s reputation and cause it to lose customers, sales and revenue.

Product liability claims and litigation and warranty claims that arise in the ordinary course of business may be costly, which could adversely affect JBGL’s business.

As a homebuilder, JBGL is subject to construction defect and home warranty claims arising in the ordinary course of business. These claims are common in the homebuilding industry and can be costly. In addition, the costs of insuring against construction defect and product liability claims are high, and the amount of coverage offered by insurance companies is currently limited. This coverage may be further restricted and become more costly. If the limits or coverages of JBGL’s current and former insurance programs prove inadequate, or it is not able to obtain adequate, or reasonably priced, insurance against these types of claims in the future, or the amounts currently provided for future warranty or insurance claims are inadequate, JBGL may experience losses that could negatively impact its financial results.

JBGL’s business is seasonal in nature, so its quarterly results of operations may fluctuate.

Historically, the homebuilding industry experiences seasonal fluctuations in quarterly results of operations and capital requirements. JBGL typically experiences the highest new home order activity in spring and summer, although this activity is also highly dependent on the number of active selling communities, timing of new community openings and other market factors. Since it typically takes four to six months to construct a new home, JBGL delivers more homes in the second half of the year as spring and summer home orders convert to home deliveries. Because of this seasonality, homes starts, construction costs and related cash outflows have historically been highest in the second and third quarters, and the majority of cash receipts from home deliveries occurs during the second half of the year. JBGL expects this seasonal pattern to continue over the long-term, although it may also be affected by volatility in the homebuilding industry.

Additionally, weather-related problems may occur in the late winter and early spring, delaying starts or closings or increasing costs and reducing profitability. In addition, delays in opening new communities or new sections of existing communities could have an adverse impact on home sales and revenues. Expenses are not incurred and recognized evenly throughout the year. Because of these factors, JBGL’s quarterly results of operations may be uneven and may be marked by lower revenues and earnings in some quarters than in others.

Utility and resource shortages or rate fluctuations could have an adverse effect on JBGL’s operations.

The markets in which JBGL operates may in the future be subject to utility and resource shortages, including significant changes to the availability of electricity and water. Shortages of natural resources in JBGL’s markets, particularly of water, may make it more difficult for JBGL to obtain regulatory approval of new developments. JBGL has also experienced material fluctuations in utility and resource costs across its markets, and it may incur additional costs and may not be able to complete construction on a timely basis if such fluctuations arise. JBGL’s lumber inventory is particularly sensitive to these shortages. Furthermore, these shortages and rate fluctuations may adversely affect the regional economies in which JBGL operates, which may reduce demand for its homes, lots and construction loans and negatively affect its business and results of operations.

JBGL’s business and financial results could be adversely affected by the failure of persons who act on its behalf to comply with applicable regulations and guidelines.

Although JBGL expects all of its employees, officers and directors to comply at all times with all applicable laws, rules and regulations, there may be instances in which subcontractors or others through whom

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it does business engage in practices that do not comply with applicable regulations or guidelines. Should JBGL learn of practices relating to homes it builds, lots it develops or financing it provides that do not comply with applicable regulations or guidelines, it would move actively to stop the non-complying practices as soon as possible and would take disciplinary action with regard to employees who were aware of the practices and did not take steps to address them, including in some instances terminating their employment. However, regardless of the steps JBGL takes after it learns of practices that do not comply with applicable regulations or guidelines, JBGL can in some instances be subject to fines or other governmental penalties, and its reputation can be injured, due to the practices’ having taken place.

JBGL may become subject to litigation, which could materially and adversely affect JBGL.

In the future, JBGL may become subject to litigation, including claims relating to JBGL’s operations and otherwise in the ordinary course of business. Some of these claims may result in significant defense costs and potentially significant judgments against JBGL, some of which are not, or cannot be, insured against. JBGL generally intends to vigorously defend itself. However, JBGL cannot be certain of the ultimate outcomes of any claims that may arise in the future. Resolution of these types of matters may result in JBGL having to pay significant fines, judgments, or settlements, which, if uninsured, or if the fines, judgments and settlements exceed insured levels, could adversely impact JBGL’s earnings and cash flows, thereby materially and adversely affecting JBGL. Certain litigation or the resolution of certain litigation may affect the availability or cost of some of JBGL’s insurance coverage, which could materially and adversely impact JBGL, expose JBGL to increased risks that would be uninsured, and materially and adversely impact JBGL’s ability to attract directors and officers.

JBGL may suffer uninsured losses or suffer material losses in excess of insurance limits.

JBGL could suffer physical damage to property and liabilities resulting in losses that may not be fully recoverable by insurance. In addition, certain types of risks, such as personal injury claims, may be, or may become in the future, either uninsurable or not economically insurable, or may not be currently or in the future covered by JBGL’s insurance policies or otherwise be subject to significant deductibles or limits. Should an uninsured loss or a loss in excess of insured limits occur or be subject to deductibles, JBGL could sustain financial loss or lose capital invested in the affected property as well as anticipated future income from that property. In addition, JBGL could be liable to repair damage or meet liabilities caused by risks that are uninsured or subject to deductibles. JBGL may be liable for any debt or other financial obligations related to affected property. Material losses or liabilities in excess of insurance proceeds may occur in the future.

The requirements of being a public company may strain JBGL’s resources and distract its management, which could make it difficult to manage its business.

JBGL has been a privately-held company since it began operations in 2008. Following the consummation of the Acquisition and the related transactions described herein, JBGL will be required to comply with various regulatory and reporting requirements, including those required by the Securities and Exchange Commission (the “SEC”). Complying with these reporting and other regulatory requirements will be time-consuming and will result in increased costs to JBGL and could have a negative effect on its business, financial condition and results of operations.

As a public company, JBGL will be subject to the reporting requirements of the Exchange Act and the requirements of the Sarbanes-Oxley Act of 2002 (as amended, the “Sarbanes-Oxley Act”). These requirements may place a strain on JBGL’s system and resources. The Exchange Act requires that JBGL file annual, quarterly and current reports with respect to its business and financial condition. The Sarbanes-Oxley Act requires that JBGL maintain effective disclosure controls and procedures and internal controls over financial reporting. To maintain and improve the effectiveness of its disclosure controls and procedures, JBGL may need to commit significant resources, hire additional staff and provide additional management oversight. JBGL will be implementing additional procedures and processes for the purpose of addressing the standards and requirements applicable to public companies. Sustaining its growth also may require JBGL to commit additional management, operational and financial resources to identify new professionals to join JBGL and to maintain appropriate operation and financial systems to adequately support expansion. These activities may divert management’s attention from other business concerns, which could have a material adverse effect on JBGL’s business, financial condition and results of operations.

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JBGL has identified material weaknesses in its internal control over financial reporting. Failure to establish and maintain effective internal control over financial reporting could have an adverse effect on JBGL’s business and results of operations.

Maintaining effective internal control over financial reporting is necessary for JBGL to produce reliable financial reports and is important in helping to prevent financial fraud. During the financial statement audit procedures conducted in connection with the preparation of JBGL’s combined and consolidated financial statements included in this prospectus, JBGL management and Grant Thornton, LLP, JBGL’s independent registered public accounting firm, identified material weaknesses in JBGL’s internal control over financial reporting. A material weakness is defined as a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of JBGL’s annual or interim financial statements will not be prevented or detected on a timely basis.

There can be no assurance that JBGL will be able to remediate these material weaknesses or that additional material weaknesses or significant deficiencies in JBGL’s internal control over financial reporting will not be identified in the future. Any failure to remediate material weaknesses or significant deficiencies noted by JBGL or its independent registered public accounting firm or to implement required new or improved controls or difficulties encountered in their implementation could cause JBGL to fail to meet its reporting obligations, result in material misstatements in its financial statements, result in harm to JBGL’s business and could cause investors to lose confidence in its reported financial information. The foregoing may result in a material adverse effect on JBGL’s business, prospects, liquidity, financial condition and results of operations and a decline in the trading price of the common stock. Failure to comply with Section 404 of the Sarbanes-Oxley Act and the related rules of the SEC could potentially subject JBGL to sanctions or investigations by the SEC, the Financial Industry Regulatory Authority or other regulatory authorities.

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Forward-Looking Statements

This prospectus includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, which we refer to as the “Securities Act,” and Section 21E of the Securities Exchange Act of 1934, as amended, which we refer to as the “Exchange Act.” All statements other than statements of historical fact are “forward-looking statements,” including any projections of earnings, revenue or other financial items, any statements of the plans, strategies or objectives of management for future operations, any statements concerning proposed new projects or other developments, any statements regarding future economic conditions or performance, any statements of management’s beliefs, goals, strategies, intentions and objectives, any statements concerning the industry in which the Company now operates, or will in the future operate, or potential acquisitions (including the Acquisition), and any statements of assumptions underlying any of the foregoing. Words such as “may,” “will,” “should,” “could,” “would,” “predicts,” “potential,” “continue,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “projects,” “estimates” and similar expressions, as well as statements in the future tense, identify forward-looking statements.

These statements are necessarily subjective and involve known and unknown risks, uncertainties and other important factors that could cause our actual results, performance or achievements, or industry results, to differ materially from any future results, performance or achievements described in or implied by such statements. Actual results may differ materially from expected results described in our forward-looking statements, including with respect to correct measurement and identification of factors affecting our business or the extent of their likely impact, the accuracy and completeness of the publicly available information with respect to the factors upon which our business strategy is based or the success of our business. In addition, even if results are consistent with the forward-looking statements contained in this prospectus, those results may not be indicative of results or developments in subsequent periods. Furthermore, industry forecasts are likely to be inaccurate, especially over long periods of time and in industries particularly sensitive to market conditions such as homebuilding and builder finance.

Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of whether, or the times by which, our performance or results may be achieved. Forward-looking statements are based on information available at the time those statements are made and management’s belief as of that time with respect to future events, and are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in or suggested by the forward-looking statements. Following the consummation of the Acquisition, important factors that could cause such differences include, but are not limited to:

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Should one or more of the risks or uncertainties described above or elsewhere in this prospectus occur, or should underlying assumptions prove incorrect, our actual results and plans could differ materially from those expressed in any forward-looking statements. Except as required by law, we disclaim all responsibility to publicly update any information contained in a forward-looking statement or any forward-looking statement and therefore disclaim any resulting liability for potentially related damages. To the extent that any facts or events arising after the date of this prospectus, individually or in the aggregate, represent a fundamental change in the information presented in this prospectus, this prospectus will be updated to the extent required by law to contain all material information.

All forward-looking statements attributable to us or to persons acting on our behalf, including any such forward-looking statements made subsequent to the publication of this prospectus, are expressly qualified in their entirety by this cautionary statement.

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Use of Proceeds

The gross proceeds to us from the rights offering will depend on the number of subscription rights that are exercised by the holders of such rights in the public rights offering. Because we expect all of the shares available in the public rights offering not otherwise sold to be sold pursuant to the Backstop Commitments, we expect that the aggregate gross proceeds raised in the rights offering and the Backstop Commitments will be approximately $61.2 million. We estimate that aggregate net proceeds from the rights offering and the Backstop Commitments will be approximately $60.5 million, after deducting our estimated offering expenses. We intend to use the proceeds of the rights offering and the Backstop Commitments to fund, in part, the Acquisition, and to pay related fees and expenses. We intend to fund the remainder of the cash portion of the $275 million Acquisition purchase price with proceeds from the Additional Equity Investment, indebtedness we intend to incur on the terms set forth in the Commitment Letter and cash on hand. We intend to use any remaining proceeds from the rights offering for general corporate purposes.

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Market Price and Dividends on Common Stock

Market Information

We completed an initial public offering of shares of our common stock in June 2007. Our common stock trades on The Nasdaq Capital Market under the symbol “BIOF.” The following table sets forth the high and low closing prices for the common stock as reported on The Nasdaq Capital Market for the quarterly periods indicated. These prices do not include retail markups, markdowns or commissions.

Year ended, December 31, 2012		High				Low
First Quarter		$	17.00			$	12.00
Second Quarter		$	12.60			$	3.56
Third Quarter		$	10.21			$	2.24
Fourth Quarter		$	7.31			$	3.68

Year ended December 31, 2013		High				Low
First Quarter		$	6.73			$	4.15
Second Quarter		$	5.15			$	3.08
Third Quarter		$	4.23			$	3.35
Fourth Quarter		$	3.65			$	1.45

Year ending December 31, 2014		High				Low
First Quarter		$	7.30			$	1.75
Second Quarter		$	8.79			$	5.17
Third Quarter (through September 15, 2014)		$	12.61			$	6.08

On March 27, 2014, which was the last trading day before we announced our receipt of the Proposal, the closing price of our common stock was $2.96. On June 10, 2014, which was the last trading day before we announced our entry into the Transaction Agreement, the closing price of our common stock was $5.78. On September 15, 2014, the closing price of our common stock was $10.84.

On September 15, 2014, there were approximately 16 stockholders of record of our common stock and three stockholders of record of our class B common stock. We believe the number of beneficial owners of our common stock is substantially greater than the number of record holders because a large portion of our outstanding common stock is held of record in broker “street names” for the benefit of individual investors. As of September 15, 2014, there were 5,456,625 common shares outstanding, net of 40,481 shares held in treasury, and 780,958 class B common shares outstanding.

Dividend Policy

We have not paid any dividends since our inception and do not anticipate declaring or paying any cash dividends on our common stock in the foreseeable future. We currently anticipate that we will retain all of our available cash for general corporate purposes. Payment of future dividends, if any, will be at the discretion of our board of directors and will depend on many factors, including general economic and business conditions, our strategic plans, our financial results and condition, legal requirements and other factors as our board of directors deems relevant.

Equity Compensation Plans

Information concerning our equity compensation plans is set out under the heading “Executive Compensation” below.

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Capitalization

The following table sets forth our cash and cash equivalents and our capitalization as of June 30, 2014 (1) on an actual basis and (2) on an as adjusted basis to give effect to the rights offering, the Acquisition and the related transactions (assuming that the per share value of the common stock issued to the Sellers as the equity portion of the Acquisition consideration is equal to $10.84, which was the closing sales price of our common stock on The Nasdaq Capital Market on September 15, 2014)), as if they had each occurred on June 30, 2014, after deducting the estimated fees and expenses of the rights offering, the Acquisition and the related transactions.

You should read this table together with the information under the heading “BioFuel Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the consolidated financial statements and related notes and other financial information included in this prospectus.

		As of June 30, 2014
		Actual				As adjusted to give effect to the rights offering, the Acquisition and the related transactions(1)
		(unaudited) (dollars in thousands)
Cash and equivalents		$	8,054			$	86,902
Total debt			—				186,130
Stockholders’ equity:
Preferred stock ((i) 5,000,000 shares authorized and no shares issued and outstanding, actual; and (ii) 5,000,000 shares authorized and no shares issued and outstanding, as adjusted)			—				—
Common stock, $0.01 par value per share, ((i) 10,000,000 shares authorized and 5,497,106 shares issued and outstanding, actual; and (ii) 100,000,000 shares authorized and 31,346,083 shares issued and outstanding, as adjusted)			54				313
Class B common stock, $0.01 par value per share ((i) 3,750,000 shares authorized and 780,958 shares issued and outstanding, actual; and (ii) no shares authorized and no shares issued and outstanding, as adjusted)(2)			8				—
Less common stock held in treasury, at cost, ((i) 40,481 shares, actual; and (ii) no shares, as adjusted)(3)			(4,316	)			—
Additional paid-in capital			191,056				118,215
Accumulated deficit			(171,789	)			—
Total BioFuel Energy Corp. stockholders’ equity			15,013				118,528
Noncontrolling interest			(7,578	)			10,785
Total equity			7,435				129,313
Total capitalization		$	15,489			$	402,345

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Dilution

As of June 30, 2014, our net tangible book value was $7,435,000, or $1.19 per share of our common stock and class B common stock (net of 40,481 shares held in treasury). Net tangible book value per share represents the amount of our total tangible assets, less the amount of our tangible liabilities, divided by the aggregate number of shares of common stock and class B common stock outstanding (net of shares held in treasury). After giving pro forma effect to (1) the issuance of common stock pursuant to the LLC Unit Exchange, (2) the issuance and sale of common stock pursuant to the rights offering (including any shares of common stock sold pursuant to the Backstop Agreements), (3) the issuance and sale of common stock pursuant to the Additional Equity Investment, (4) the issuance of common stock pursuant to the Equity Issuance, (5) the incurrence of indebtedness pursuant to the Commitment Letter, (6) the use of the net proceeds from the rights offering (including any shares sold pursuant to the Backstop Agreements) and the Additional Equity Investment, together with borrowings pursuant to the Commitment Letter and cash on hand, to finance the cash portion of the Purchase Price and pay transaction costs and (7) the consummation of the Acquisition, our pro forma net tangible book value as of June 30, 2014, would have been $129,313,000, or $4.13 per share, assuming a rights price equal to $5.00 and a per share value of the common stock to be issued to the Sellers as the equity portion of the Purchase Price equal to $10.84, which was the closing sales price of our common stock on The Nasdaq Capital Market on September 15, 2014. This represents an immediate increase in pro forma net tangible book value to existing stockholders of $2.93 per share and an immediate dilution to stockholders that purchase shares of common stock pursuant to the rights offering of $0.87 per share. Dilution represents the difference between the rights price and the pro forma net tangible book value per share immediately after the completion of the rights offering and the consummation of the Acquisition and the related transactions described herein.

The following table sets forth the accretion calculations:

		As of June 30, 2014
		Biofuel Energy Corp. Actual				Pro Forma Combined(1)
		(in thousands, except per share amounts)
Tangible assets		$	8,841			$	345,867
Tangible liabilities			(1,406	)			(216,554	)
Net tangible assets		$	7,435			$	129,313
Divided by shares outstanding			6,238				31,346
Net tangible book value per share		$	1.19  (a)			$	4.13	(b)
Increase in pro forma net tangible book value per share to existing stockholders						$	2.93  (b)-(a)-
Immediate dilution to stockholders that purchase shares in the rights offering:
Pro forma combined net tangible book value per share						$	4.13
Rights offering price per share							(5.00	)
Immediate dilution per share to stockholders that purchase shares in the rights offering						$	(0.87	)

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Selected Combined and Consolidated Historical Financial Information of JBGL

The selected combined and consolidated historical financial information of JBGL as of and for the years ended December 31, 2013, 2012 and 2011 was derived from the combined and consolidated financial statements of JBGL audited by Grant Thornton LLP, an independent registered public accounting firm, included elsewhere in this prospectus. The selected condensed combined historical financial information of JBGL as of and for the three months and six months ended June 30, 2014, and for the three months and six months ended June 30, 2013, was derived from the unaudited condensed combined financial statements of JBGL included elsewhere in this prospectus. The selected combined and consolidated historical financial information of JBGL as of and for the years ended December 31, 2010, and 2009 was derived from the unaudited combined and consolidated financial statements of JBGL not included in this prospectus. The results for the three months and six months ended June 30, 2014, are not necessarily indicative of the results to be expected for the entire year ended December 31, 2014. This selected financial information should be read in conjunction with “JBGL Management’s Discussion and Analysis of Financial Condition and Results of Operations” and JBGL’s financial statements and the notes thereto included elsewhere in this prospectus.

		ASSETS
		As of June 30,								As of December 31,
		2014				2013				2013				2012				2011				2010				2009
Cash and cash equivalents		$	19,122,380			$	14,119,114			$	18,066,679			$	7,484,492			$	8,127,135			$	7,102,255			$	1,441,851
Inventory			243,443,374				174,532,672				237,126,258				144,088,120				34,416,485				11,720,533				10,189,723
Notes receivable, net			3,800,000				7,511,309				7,556,070				15,272,170				29,801,457				12,628,515				—
Other			8,624,930				8,679,662				5,658,691				1,965,836				973,854				122,485				—
Total assets		$	274,990,684			$	204,842,757			$	268,407,698			$	168,810,618			$	73,318,931			$	31,573,788			$	11,631,574
			LIABILITIES AND MEMBERS’ EQUITY
Borrowings on lines of credit		$	20,102,594			$	8,917,762			$	17,208,035			$	6,544,264			$	2,950,000			$	—			$	—
Notes payable			16,027,648				23,927,044				26,595,229				21,441,775				3,717,632				793,626				—
Other			29,017,552				27,135,166				25,785,540				19,136,699				4,571,973				3,004,239				108,038
Total liabilities			65,147,794				59,979,972				69,588,804				47,122,738				11,239,605				3,797,865				108,038
Total members’ equity			209,842,890				144,862,785				198,818,894				121,687,880				62,079,326				27,775,923				11,523,536
Total liabilities and members’ equity		$	274,990,684			$	204,842,757			$	268,407,698			$	168,810,618			$	73,318,931			$	31,573,788			$	11,631,574

		Three Months Ended June 30,								For the Six Months Ended June 30,								For the Year Ended December 31,
		2014				2013				2014				2013				2013				2012				2011				2010				2009
REVENUES:
Sale of residential units		$	55,048,744			$	37,829,298			$	104,685,088			$	64,958,699			$	168,591,201			$	50,105,030			$	9,085,785			$	864,822			$	—
Cost of residential units			(41,219,387	)			(28,358,191	)			(78,611,754	)			(49,401,195	)			(122,616,113	)			(39,642,357	)			(7,921,806	)			(491,628	)			—
Gross profit on sale of residential units			13,829,357				9,471,107				26,073,334				15,557,504				45,975,088				10,462,673				1,163,979				373,194				—
Sale of land and lots			10,794,690				8,881,770				24,167,258				14,512,393				33,734,513				22,927,080				6,184,206				8,905,967				2,508,650
Cost of land and lots			(8,141,006	)			(5,984,826	)			(17,909,072	)			(8,580,118	)			(21,512,814	)			(15,256,065	)			(3,982,602	)			(5,540,845	)			(1,724,781	)
Gross profit on sale of land and lots			2,653,684				2,896,944				6,258,186				5,932,275				12,221,699				7,671,015				2,201,604				3,365,122				783,869
Interest and fees			305,660				783,757				680,120				1,678,610				3,542,174				7,124,339				2,558,159				137,698				—
Other income			427,732				1,417,600				480,154				1,849,694				1,400,418				3,771,839				1,636,099				225,524				553
			17,216,433				14,569,408				33,491,794				25,018,083				63,139,379				29,029,866				7,559,841				4,101,538				784,422
EXPENSES:
Salaries and management fees – related party			3,213,424				2,079,708				6,747,392				4,227,840				11,266,351				4,370,845				1,886,509				927,736				—
Selling, general and administrative			2,491,408				890,383				4,772,977				2,178,237				6,623,437				3,311,734				1,183,762				1,147,042				566,312
Other expenses			647,077				153,471				953,976				284,576				606,210				404,673				35,737				3,332				—
			6,351,909				3,123,562				12,474,345				6,690,653				18,495,998				8,087,252				3,106,008				2,078,110				566,312
Net income before taxes			10,864,524				11,445,846				21,017,449				18,327,430				44,643,381				20,942,614				4,453,833				2,023,428				218,110
State tax expense			—				59,000				337,790				209,500				327,481				230,411				34,089				41,888				—
Net income			10,864,524				11,386,846				20,679,659				18,177,930				44,315,900				20,712,203				4,419,744				1,981,540				218,110
Less: net income attributable to non-controlling interest			3,454,819				3,772,067				5,921,453				4,471,692				12,308,734				3,517,911				56,382				—				—
Net income attributable to controlling interest		$	7,409,705			$	7,614,799			$	14,758,206			$	13,646,238			$	32,007,166			$	17,194,292			$	4,363,362			$	1,981,540			$	218,110

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Unaudited Pro Forma Combined Financial Information

The following unaudited pro forma combined financial information is based upon the historical consolidated financial information of the Company and the historical combined and consolidated financial information of JBGL included elsewhere in this prospectus and presents the combination of the historical financial statements of the Company and JBGL adjusted to give effect to (1) the issuance of common stock pursuant to the LLC Unit Exchange and the elimination of amounts related to the Company’s noncontrolling interest in the LLC, (2) the issuance and sale of common stock pursuant to the rights offering (including any shares of common stock sold pursuant to the Backstop Agreements), (3) the issuance and sale of common stock pursuant to the Additional Equity Investment, (4) the issuance of common stock pursuant to the Equity Issuance, (5) the incurrence of indebtedness pursuant to the Commitment Letter, (6) the use of the net proceeds from the rights offering (including any shares sold pursuant to the Backstop Agreements) and the Additional Equity Investment, together with borrowings pursuant to the Commitment Letter and cash on hand, to finance the cash portion of the Purchase Price and to pay transaction costs and (7) the consummation of the Acquisition, in each case based on the assumptions and adjustments described in the notes accompanying the unaudited pro forma combined financial information. The historical financial information has been adjusted to give effect to events that are directly attributable to (1) the Company’s disposition of its ethanol plants or (2) the Acquisition and the related transactions described herein, factually supportable and, in the case of the statement of income data, expected to have a continuing impact.

The unaudited pro forma combined balance sheet information has been prepared as of June 30, 2014, and gives effect to the consummation of the Acquisition and the related transactions described herein as if they had occurred on that date. The unaudited pro forma combined income statement information, which has been prepared for the year ended December 31, 2013, and the six months ended June 30, 2014, gives effect to the disposition of the Company’s ethanol plants and the consummation of the Acquisition and the related transactions described herein as if they had occurred on January 1, 2013.

The unaudited pro forma combined financial information is presented for informational purposes only and is not necessarily indicative of the financial position or results of operations that would have been achieved had the disposition of the Company’s ethanol plants and the Acquisition and the related transactions described herein been completed at the dates indicated. In addition, the unaudited pro forma combined financial information does not purport to project the future financial position or results of operations of the combined company after completion of the Acquisition.

You should read this data in conjunction with (1) the historical consolidated financial statements of the Company and the related notes thereto, (2) “BioFuel Management’s Discussion and Analysis of Financial Condition and Results of Operations,” (3) the historical combined and consolidated financial statements of JBGL and the related notes thereto and (4) “JBGL Management’s Discussion and Analysis of Financial Condition and Results of Operations,” each of which is included elsewhere in this prospectus.

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BIOFUEL ENERGY CORP.
 
Pro Forma Combined Balance Sheet
As of June 30, 2014

		BioFuel Energy Corp. Actual				JBGL Actual				Pro Forma Adjustments				Pro Forma Combined
		(in thousands)
Assets
Cash and cash equivalents		$	8,054			$	17,113			$	61,735	(a)		$	86,902
Restricted cash							2,009								2,009
Accounts receivable							366								366
Inventory:
Completed home inventory and residential lots held for sale							42,776								42,776
Work in process							133,175								133,175
Undeveloped land							61,103								61,103
Investment in direct financing lease							6,389								6,389
Property and equipment, net			57				1,494								1,551
Notes receivable, net							3,800								3,800
Earnest money deposits							5,600								5,600
Other assets			730				1,166				300	(b)			2,196
Total assets		$	8,841			$	274,991			$	62,035			$	345,867
Liabilities and equity
Accounts payable		$	47			$	9,628			$				$	9,675
Accrued expenses			1,359				8,141								9,500
Customer and builder deposits							11,249								11,249
Borrowings on lines of credit							20,102								20,102
Notes payable							16,028				150,000	(c)			166,028
Total liabilities			1,406				65,148				150,000				216,554
Commitments and contingencies
Equity
BioFuel Energy Corp. stockholders’ equity:
Preferred stock
Common stock			54								259	(d)			313
Class B common stock			8								(8	)(e)
Less common stock held in treasury			(4,316	)							4,316	(f)
Additional paid-in capital			191,056				199,058				(271,899	)(g)			118,215
Accumulated deficit			(171,789	)							171,789	(g)
Total BioFuel Energy Corp. stockholders’ equity			15,013				199,058				(95,543	)			118,528
Noncontrolling interest			(7,578	)			10,785				7,578	(h)			10,785
Total equity			7,435				209,843				(87,965	)			129,313
Total liabilities and equity		$	8,841			$	274,991			$	62,035			$	345,867

 
 
See accompanying notes to the unaudited pro forma combined financial information.

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BIOFUEL ENERGY CORP.
 
Pro Forma Combined Income Statement
For the Year Ended December 31, 2013

		BioFuel Energy Corp. Actual				JBGL Actual				Pro Forma Adjustments				Pro Forma Combined
		(in thousands, except per share amounts)
Sale of residential units, net		$				$	168,591			$				$	168,591
Cost of residential units							122,616								122,616
Gross profit on sale of residential lots							45,975								45,975
Sale of land and lots							33,735								33,735
Cost of land and lots							21,513								21,513
Gross profit on sale of land and lots							12,222								12,222
Interest and fees income							2,503								2,503
Interest income on direct financing lease							1,039								1,039
Profit participation income on real estate projects							597								597
Other income							803								803
							63,139								63,139
General and administrative expenses:
Salaries and benefits			8,107				10,251								18,358
Management fees							1,016								1,016
Selling, general and administrative			1,636				6,915								8,551
Interest expense							314				14,700	(i)			15,014
Other expense			3												3
Net income (loss) from continuing operations before income taxes			(9,746	)			44,643				(14,700	)			20,197
Income tax (provision) benefit							(327	)			(2,828	)(j)			(3,155	)
Net income(loss) from continuing operations			(9,746	)			44,316				(17,528	)			17,042
Less: Net (income) loss from continuing operations attributable to the noncontrolling interest			1,375				(12,309	)			(1,375	)(h)			(12,309	)
Net income (loss) from continuing operations attributable to BioFuel Energy Corp. common stockholders		$	(8,371	)		$	32,007			$	(18,903	)		$	4,733
Basic and fully diluted income (loss) per share attributable to BioFuel Energy Corp.		$	(1.57	)										$	0.15
Weighted average shares outstanding – basic and fully diluted			5,345												31,346	(k)

 
 
See accompanying notes to the unaudited pro forma combined financial information.

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BIOFUEL ENERGY CORP.
 
Pro Forma Combined Income Statement
For the Six Months Ended June 30, 2014

		BioFuel Energy Corp. Actual				JBGL Actual				Pro Forma Adjustments				Pro Forma Combined
		(in thousands, except per share amounts)
Sale of residential units, net		$				$	104,685			$				$	104,685
Cost of residential units							78,612								78,612
Gross profit on sale of residential lots							26,073								26,073
Sale of land and lots							24,167								24,167
Cost of land and lots							17,909								17,909
Gross profit on sale of land and lots							6,258								6,258
Interest and fees income							252								252
Interest income on direct financing lease							429								429
Other income			156				480								636
			156				33,492								33,648
General and administrative expenses:
Salaries and benefits			825				5,978								6,803
Management fees							770								770
Selling, general and administrative			2,949				5,019								7,968
Interest expense							708				7,350	(i)			8,058
Income (loss) from operations before income taxes			(3,618	)			21,017				(7,350	)			10,049
Income tax (provision) benefit							(338	)			(1,313	)(j)			(1,651	)
Net Income (loss)			(3,618	)			20,679				(8,663	)			8,398
Less: Net (income) loss attributable to the noncontrolling interest			157				(5,921	)			(157	)(h)			(5,921	)
Net income (loss) attributable to BioFuel Energy Corp. common stockholders		$	(3,461	)		$	14,758			$	(8,820	)		$	2,477
Basic and fully diluted income (loss) per share attributable to BioFuel Energy Corp.		$	(0.64	)										$	0.08
Weighted average shares outstanding – basic and fully diluted			5,443												31,346	(k)

 
 
See accompanying notes to the unaudited pro forma combined financial information.

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Notes

1. Basis of Presentation

On November 22, 2013, the Company transferred its ethanol plants and all related assets to certain designees of the lenders under the Senior Debt Facility. On June 10, 2014, the Company entered into the Transaction Agreement with Greenlight and the Brickman Parties pursuant to which the Company will acquire JBGL for cash and stock consideration of $275 million.

The unaudited pro forma combined financial information is presented after giving effect to (1) the issuance of common stock pursuant to the LLC Unit Exchange and the elimination of amounts related to the Company’s noncontrolling interest in the LLC, (2) the issuance and sale of common stock pursuant to the rights offering (including any shares of common stock sold pursuant to the Backstop Agreements), (3) the issuance and sale of common stock pursuant to the Additional Equity Investment, (4) the issuance of common stock pursuant to the Equity Issuance, (5) the incurrence of indebtedness pursuant to the Commitment Letter, (6) the use of the net proceeds from the rights offering (including any shares sold pursuant to the Backstop Agreements) and the Additional Equity Investment, together with borrowings pursuant to the Commitment Letter and cash on hand, to finance the cash portion of the Purchase Price and to pay transaction costs and (7) the consummation of the Acquisition. The Company intends to account for the Acquisition as a recapitalization of JBGL. Upon analyzing the applicable accounting literature and considering post-transaction factors such as ownership and voting interest percentages, composition of the governing body and composition of management, the Company has determined that JBGL will be the accounting acquirer in the Acquisition. Accordingly, JBGL’s assets and liabilities will be recorded at their historical cost basis and the Company will not record any step-up in basis or any intangible assets or goodwill as a result of the Acquisition. The unaudited pro forma combined financial information assumes that the disposition of the Company’s ethanol plants and the consummation of the Acquisition and the related transactions described herein occurred on January 1, 2013, for purposes of the unaudited pro forma combined income statements, and on June 30, 2014, for purposes of the unaudited pro forma combined balance sheet, and gives effect to such transactions, for purposes of the unaudited pro forma combined income statements, as if they had been effective during the entire period presented.

The unaudited pro forma combined financial information represents management’s estimates based on available information. The pro forma adjustments included herein may be revised as additional information becomes available and as additional analysis is performed.

2. Pro Forma Adjustments

The following pro forma adjustments have been reflected in the unaudited pro forma combined financial information. All adjustments assume a per share value of the common stock to be issued in the Equity Issuance equal to $10.84, which was the closing sales price of our common stock on The Nasdaq Capital Market on September 15, 2014. The actual per share value of the common stock issued to the Sellers in the Equity Issuance will be equal to the weighted average price per share of our common stock as quoted on The Nasdaq Capital Market for the five trading days immediately prior to Closing. All adjustments are based on current valuations, estimates and assumptions.

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3. Deferred Tax Asset

As of June 30, 2014, the Company had a $63.4 million deferred tax asset related to its net operating loss carryforwards. For accounting purposes, a valuation allowance is required to reduce a deferred tax asset if it is determined that it is more likely than not that all or some portion of the deferred tax asset will not be realized due to the lack of sufficient taxable income. The Company’s financial statements currently provide a full valuation allowance against our deferred tax asset due to the Company’s historical operating losses and, in accordance with applicable guidance in connection with the preparation of the pro forma financial statements, we have not adjusted this valuation allowance. As a result, the deferred tax asset is not set forth on our historical or pro forma balance sheet.

The net operating loss carryforwards do not begin to expire until 2029. Our ability to utilize our net operating loss carryforwards will depend on the amount of taxable income we generate in future periods. Based on JBGL’s 2013 and year-to-date 2014 taxable income results, management expects that JBGL should generate sufficient taxable income to utilize substantially all of the net operating loss carryforwards before they expire. The Company will evaluate the appropriateness of a valuation allowance in future periods based on the consideration of all available evidence, including the generation of taxable income, using the more likely than not standard.

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BioFuel Management’s Discussion and Analysis of Financial Condition and Results of Operations

You should read the following discussion in conjunction with our financial statements and the accompanying notes included in this prospectus. This discussion contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from the results discussed in or implied by any of the forward-looking statements as a result of various factors, including those listed elsewhere in this prospectus. See “Risk Factors” and “Forward-Looking Statements” above.

Overview

BioFuel Energy Corp. was incorporated as a Delaware corporation on April 11, 2006, to invest solely in BioFuel Energy, LLC, a limited liability company organized on January 25, 2006, to build and operate ethanol production facilities in the midwestern United States. From June 2008 through November 22, 2013, the Company operated two ethanol production facilities located in Wood River, Nebraska, and Fairmont, Minnesota, that produced and sold ethanol and its related co-products. The Company’s ethanol plants were owned and operated by the operating subsidiaries of the LLC, which were party to a Credit Agreement with a group of lenders. Substantially all of the assets of the operating subsidiaries were pledged as collateral under the Senior Debt Facility. On November 22, 2013, the Company’s ethanol plants and all related assets were transferred to certain designees of the lenders in full satisfaction of all outstanding obligations under the Senior Debt Facility. Following the disposition of the ethanol production facilities, we are a holding company with no substantial operations of our own. Our headquarters are located in Denver, Colorado.

On March 28, 2014, the Company received a preliminary non-binding proposal from the Brickman Parties and Greenlight, one of our principal stockholders and an investment management company co-founded by David Einhorn, one of our directors, who serves as Greenlight’s President. The Brickman Parties and Greenlight proposed a transaction pursuant to which the Company would acquire all of the equity interests of JBGL for $275 million, payable in cash and shares of our common stock. As further described in this prospectus, JBGL is a series of real estate entities involved in the purchase and development of land for residential purposes, construction lending and home building operations. JBGL is currently owned and controlled by Greenlight and the Brickman Parties.

In response to the Proposal, our board of directors established a special committee consisting of independent directors to evaluate the Proposal and alternatives for the Company. The special committee retained independent financial and legal advisors to assist in its evaluation of the Proposal.

On June 10, 2014, the Company entered into the Transaction Agreement with Greenlight and the Brickman Parties pursuant to which the Company will acquire JBGL for $275 million. The Transaction Agreement was unanimously approved by the Special Committee. The Transaction Agreement was also unanimously approved by the board of directors of the Company other than Mr. Einhorn, who recused himself from the board’s deliberations and approval.

At June 30, 2014, the Company retained approximately $8.1 million in cash and cash equivalents on its consolidated balance sheet. As of June 30, 2014, the Company also retained federal net operating loss carryforwards in the amount of $181.3 million, which have been fully reserved against.

Basis for Consolidation

At June 30, 2014, the Company owned 87.6% of the LLC membership units with the remaining 12.4% owned by certain investment funds affiliated with Greenlight. As a result, the Company consolidates the results of the LLC. The amount of income or loss allocable to the 12.4% holders is reported as noncontrolling interest in our consolidated statements of operations. As of June 30, 2014, the Class B common shares of the Company were held by the same investment funds who held 780,958 membership units in the LLC that, together with the corresponding Class B shares, can be exchanged for newly issued shares of common stock of the Company on a one-for-one basis. The proportionate value of the LLC membership units held by the individual or investment funds other than the Company are recorded as noncontrolling interest on the consolidated balance sheets.

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Revenues

Our primary source of revenue is engineering and/or business consulting services that the Company is providing to certain next generation biofuel and bio-chemical companies. During the time that the Company owned and operated its ethanol facilities, which was through November 22, 2013, our primary source of revenue was the sale of ethanol.

General and Administrative Expenses

General and administrative expenses consist of salaries and benefits paid to our management and administrative employees, expenses relating to third party services, travel, office rent, marketing and other expenses, including expenses associated with being a public company, such as fees paid to our independent auditors associated with our annual audit and quarterly reviews, directors’ fees, and listing and transfer agent fees.

Results of Operations

The following discussion summarizes the significant factors affecting the consolidated operating results of the Company for the three and six months ended June 30, 2014 and 2013, and the years ended December 31, 2013 and 2012. This discussion should be read in conjunction with the financial statements and accompanying notes contained in this prospectus.

The following table sets forth general and administrative expenses, loss from continuing operations, and loss from discontinued operations (in thousands) for the three and six months ended June 30, 2014 and 2013, and for the years ended December 31, 2013 and 2012:

		Three Months Ended June 30,								Six Months Ended June 30,								Year Ended December 31,
		2014				2013				2014				2013				2013				2012
Revenues		$	56			$	—			$	156			$	—			$	—			$	—
General and administrative expenses:
Compensation expense			(384	)			(786	)			(825	)			(1,764	)			(8,107	)			(4,283	)
Other			(2,486	)			(625	)			(2,949	)			(967	)			(1,636	)			(1,807	)
Operating loss			(2,814	)			(1,411	)			(3,618	)			(2,731	)			(9,743	)			(6,090	)
Other income (expense)			—				—				—				1				(3	)			—
Loss from continuing operations			(2,814	)			(1,411	)			(3,618	)			(2,730	)			(9,746	)			(6,090	)
Discontinued operations:
Loss from discontinued operations			—				(3,326	)			—				(7,335	)			(11,885	)			(40,232	)
Loss on disposal of plants			—				—				—				—				(24,019	)			—
Loss from discontinued operations			—				—				—				(7,335	)			(35,904	)			(40,232	)
Net loss			(2,814	)			(4,737	)			(3,618	)			(10,065	)			(45,650	)			(46,322	)
Less: Net loss from continuing operations attributable to noncontrolling interest			64				183				157				355				1,375				852
Less: Net loss from discontinued operations attributable to the noncontrolling interest			—				430				—				951				5,067				5,627
Net loss attributable to BioFuel Energy Corp. common stockholders		$	(2,750	)		$	(4,124	)		$	(3,461	)		$	(8,759	)		$	(39,208	)		$	(39,843	)

Three Months Ended June 30, 2014 Compared to the Three Months Ended June 30, 2013

Revenues:  Revenues were $0.1 million for the three months ended June 30, 2014 and related to engineering and/or business consulting services that the Company is providing to certain next generation biofuel and bio-chemical companies. There was no such revenue for the three months ended June 30, 2013.

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General and administrative expenses:  General and administrative expenses increased $1.5 million or 103.4%, to $2.9 million for the three months ended June 30, 2014, as compared to $1.4 million for the three months ended June 30, 2013. The increase was primarily attributable to $2.2 million in legal and financial advisor costs related to the Acquisition that were incurred during the three months ended June 30, 2014, which were offset by a decrease in stock compensation expense and salary expense, as the Company had fewer employees during the three months ended June 30, 2014 as compared to the three months ended June 30, 2013.

Loss from discontinued operations:  Loss from discontinued operations was $3.3 million for the three months ended June 30, 2013 and related to the loss incurred from the operation of the Company’s ethanol plants. There was no such loss for the three months ended June 30, 2014 as the ethanol plants were disposed of in November 2013.

Six Months Ended June 30, 2014 Compared to the Six Months Ended June 30, 2013

Revenues:  Revenues were $0.2 million for the six months ended June 30, 2014 and related to engineering and/or business consulting services that the Company is providing to certain next generation biofuel and bio-chemical companies. There was no such revenue for the six months ended June 30, 2013.

General and administrative expenses:  General and administrative expenses increased $1.1 million or 38.2%, to $3.8 million for the six months ended June 30, 2014, as compared to $2.7 million for the six months ended June 30, 2013. The increase was primarily attributable to $2.2 million in legal and financial advisor costs related to the Acquisition that were incurred during the six months ended June 30, 2014, which were offset by a decrease in stock compensation expense and salary expense, as the Company had fewer employees during the six months ended June 30, 2014 as compared to the six months ended June 30, 2013.

Loss from discontinued operations:  Loss from discontinued operations was $7.3 million for the six months ended June 30, 2013 and related to the loss incurred from the operation of the Company’s ethanol plants. There was no such loss for the six months ended June 30, 2014 as the ethanol plants were disposed of in November 2013.

Year Ended December 31, 2013 Compared to the Year Ended December 31, 2012

General and administrative expenses:  General and administrative expenses increased $3.6 million or 59.0%, to $9.7 million for the year ended December 31, 2013, as compared to $6.1 million for the year ended December 31, 2012. The increase was primarily attributable to an increase in compensation expense resulting from the accrual of severance payments totaling $4.2 million at the end of 2013, due to the disposition of the Company’s ethanol plants.

Loss from discontinued operations:  Loss from discontinued operations was $11.9 million for the year ended December 31, 2013 compared to $40.2 million for the year ended December 31, 2012, a decrease of $28.3 million or 70.4%. The decrease from 2012 to 2013 was primarily attributable to a decrease in the gross loss of $24.0 million, resulting from an improved “crush spread”, which is the difference between the price received for ethanol versus the price paid for corn. From 2012 to 2013 revenues decreased $164.9 million while cost of goods sold decreased $188.9 million, thereby resulting in a $24.0 million decrease in the gross loss. Revenues decreased primarily due to lower sales volumes, as the Fairmont plant was idle for all of 2013, which were partially offset by an increase in per unit prices received for both our ethanol and co-products. Cost of goods sold decreased primarily due to a decrease in the price paid for corn, which was the primary cost input.

Loss on disposal of plants:  Loss on disposal of plants for the year ended December 31, 2013 of $24.0 million related to the write-off of the Operating Subsidiaries’ assets and liabilities resulting from the disposition of the ethanol plants in November 2013.

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Liquidity and Capital Resources

Six Months Ended June 30, 2014 Compared to the Six Months Ended June 30, 2013

Our cash flows from operating, investing and financing activities during the six months ended June 30, 2014 and 2013 are summarized below (in thousands):

		Six Months Ended June 30,
		2014				2013
Cash provided by (used in):
Operating activities		$	(4,818	)		$	3,040
Investing activities			—				(1,074	)
Financing activities			—				(57	)
Net increase (decrease) in cash and cash equivalents		$	(4,818	)		$	1,909

Cash provided by (used in) operating activities.  Net cash used in operating activities was $4.8 million for the six months ended June 30, 2014, compared to net cash provided by operating activities of $3.0 million for the six months ended June 30, 2013. For the six months ended June 30, 2014, the amount was primarily comprised of a net loss of $3.6 million and working capital uses of $1.2 million. Working capital uses were primarily comprised of $2.2 million of working capital sources related to the collection of deposits, which were offset by working capital uses of $4.2 million related to the payment of severance under the Company’s COC Plan. For the six months ended June 30, 2013, the amount was primarily comprised of a net loss of $10.1 million that was offset by non-cash charges of $14.6 million, which was primarily depreciation and amortization.

Cash used in investing activities.  Net cash used in investing activities was $1.1 million for the six months ended June 30, 2013 and related to capital expenditures for various plant improvement projects. There were no such expenditures for the six months ended June 30, 2014.

Cash used in financing activities.  Net cash used in financing activities was nominal for the six months ended June 30, 2013 and related to payments on certain capital leases and notes payable. There were no such payments for the six months ended June 30, 2014.

The LLC’s principal source of liquidity at June 30, 2014, was its cash and cash equivalents of $8.1 million. Our principal liquidity needs are expected to be funding general corporate expenses and expenses related to the Acquisition and the related transactions described herein.

Year Ended December 31, 2013 Compared to the Year Ended December 31, 2012

Our cash flows from operating, investing and financing activities during the years ended December 31, 2013 and 2012 are summarized below (in thousands):

		Years Ended December 31,
		2013				2012
Cash provided by (used in):
Operating activities		$	13,220			$	1,453
Investing activities			(9,512	)			(843	)
Financing activities			(159	)			(6,426	)
Net increase (decrease) in cash and cash equivalents		$	3,549			$	(5,816	)

Cash provided by operating activities.  Net cash provided by operating activities was $13.2 million for the year ended December 31, 2013, compared to $1.5 million for the year ended December 31, 2012. For the year ended December 31, 2013, the amount was primarily comprised of a net loss of $45.7 million that was offset by working capital sources of $7.9 million and non-cash charges of $51.0 million, which was primarily depreciation and amortization of $25.3 million and loss on disposal of plants of $24.0 million. Working capital sources primarily related to an increase in other current liabilities of $10.2 million. For the year ended

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December 31, 2012, the amount was primarily comprised of a net loss of $46.3 million that was offset by working capital sources of $18.0 million and non-cash charges of $29.8 million, which was primarily depreciation and amortization.

Cash used in investing activities.  Net cash used in investing activities was $9.5 million for the year ended December 31, 2013, compared to $0.8 million for the year ended December 31, 2012. For the year ended December 31, 2013, the amount was comprised of $2.4 million for capital expenditures for various plant improvement projects and $8.8 million given to the lenders related to the disposition of the plants, which was offset by $1.7 million of proceeds related to the payment made by the lenders to the Company under the terms of a Release Agreement. For the year ended December 31, 2012, the amount for capital expenditures related to various plant improvement projects.

Cash used in financing activities.  Net cash used in financing activities was $0.2 million for the year ended December 31, 2013, compared to $6.4 million for the year ended December 31, 2012. For the year ended December 31, 2013, the amount was comprised of $0.2 million in principal payments of notes payable and capital leases. For the year ended December 31, 2012, the amount was comprised of $6.3 million in principal payments under our Senior Debt Facility and $0.1 million in payments of notes payable and capital leases.

The LLC’s principal source of liquidity at December 31, 2013, was its cash and cash equivalents of $12.9 million.

Summary of Critical Accounting Policies and Significant Estimates

The consolidated financial statements of BioFuel Energy Corp. included in this prospectus have been prepared in conformity with accounting principles generally accepted in the United States. Note 3 to the consolidated financial statements contains a summary of our significant accounting policies, certain of which require the use of estimates and assumptions. Accounting estimates are an integral part of the preparation of financial statements and are based on judgments by management using its knowledge and experience about the past and current events and assumptions regarding future events, all of which we consider to be reasonable. These judgments and estimates reflect the effects of matters that are inherently uncertain and that affect the carrying value of our assets and liabilities, the disclosure of contingent liabilities and reported amounts of expenses during the reporting period.

The accounting estimates and assumptions discussed in this section are those that we believe involve significant judgments and the most uncertainty. Changes in these estimates or assumptions could materially affect our financial position and results of operations and are therefore important to an understanding of our consolidated financial statements.

Income Taxes

The Company accounts for income taxes using the asset and liability method, under which deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Company regularly reviews historical and anticipated future pre-tax results of operations to determine whether the Company will be able to realize the benefit of its deferred tax assets. A valuation allowance is required to reduce the potential deferred tax asset when it is more likely than not that all or some portion of the potential deferred tax asset will not be realized due to the lack of sufficient taxable income. The Company establishes reserves for uncertain tax positions that reflect its best estimate of deductions and credits that may not be sustained on a more likely than not basis. As the Company has incurred tax losses since its inception and expects to continue to incur tax losses for the foreseeable future, we will continue to provide a valuation allowance against deferred tax assets until the Company believes that such assets will be realized.

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Recent Accounting Pronouncements

From time to time, new accounting pronouncements are issued by standards setting bodies that are adopted by us as of the specified effective date. Unless otherwise discussed, our management believes that the impact of recently issued standards that are not yet effective will not have a material impact on our consolidated financial statements upon adoption.

In May 2014, the FASB issued guidance on revenue from contracts with customers, which implements a five step process of how an entity should recognize revenue in order 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. This guidance will be effective at the beginning of fiscal year 2017, and early application is not permitted. The standard permits the use of either the retrospective or cumulative effect transition method. We are currently evaluating the impact that the adoption will have on our consolidated financial statements and related disclosures. We have not yet selected a transition method nor have we determined the effect of the standard on our ongoing financial reporting.

Quantitative and Qualitative Disclosures about Market Risk

At June 30, 2014, we had $8.1 million of cash and cash equivalents invested in standard cash accounts held at one financial institution, which is in excess of FDIC insurance limits.

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JBGL Management’s Discussion and Analysis of Financial Condition and Results of Operations

Introduction

You should read the following in conjunction with the sections of this prospectus entitled “Risk Factors,” “Forward-Looking Statements,” “Selected Financial Information of JBGL” and “Business of JBGL” and JBGL’s historical combined and consolidated financial statements and related notes thereto included elsewhere in this prospectus. This discussion contains forward-looking statements reflecting current expectations that involve risks and uncertainties. Actual results and the timing of events may differ materially from those contained in these forward-looking statements due to a number of factors, including those discussed in the section entitled “Risk Factors” and elsewhere in this prospectus.

JBGL is a real estate operator involved in the purchase and development of land for residential use, construction lending and home building operations. JBGL Capital (its land development business) and JBGL Builder Finance (its builder operations business) and their affiliates are engaged in all aspects of the homebuilding process, including land acquisition and development, entitlements, design, construction, marketing and sales of various residential projects in master planned communities primarily in the high growth metropolitan areas of DFW and Atlanta.

JBGL currently owns or controls approximately 4,300 home sites in prime locations in the DFW and Atlanta markets. JBGL considers prime locations to be supply constrained lots with high housing demand and where much of the surrounding property has already been developed. JBGL management believes that it is a leading land developer in its markets. JBGL develops lots for both public builders and large private builders. JBGL also owns 50% controlling interests in several builders and provides construction financing for approximately 900 homes annually. JBGL Capital, LP, was formed in 2008 and JBGL Builder Finance LLC was formed in 2010.

JBGL is an active, value-added real estate investor and developer. JBGL formed and purchased 50% of The Providence Group of Georgia, LLC (“The Providence Group”) in 2011 and formed and purchased 50% of CB JENI Homes of DFW LLC (“CB JENI”) in 2012. In 2013, JBGL formed Southgate Homes, DFW LLC (“Southgate”). JBGL has voting control over these builders. The Providence Group focuses on the construction and sale of single family homes and townhomes in the Atlanta market and CB JENI does the same in the DFW market. Southgate is focused on the development of semi-custom homes and build-on-your-own lot custom homes in the DFW market.

Definitions

In the following discussion, “backlog” refers to homes under sales contracts that have not yet closed at the end of the relevant period, “cancellation rate” refers to sales contracts canceled divided by sales contracts executed during the relevant period, “net new home orders” refers to new home sales contracts reduced by the number of sales contracts canceled during the relevant period, and “overall absorption rate” refers to the rate at which net new home orders are contracted per selling community during the relevant period. Sales contracts relating to homes in backlog may be canceled by the prospective purchaser for a number of reasons, such as the prospective purchaser’s inability to obtain suitable mortgage financing. Upon a cancellation, the escrow deposit may be returned to the prospective purchaser (other than with respect to certain design-related deposits, which JBGL retains). Accordingly, backlog may not be indicative of JBGL’s future revenue.

Overview and Outlook

The following are key operating metrics for JBGL for the three months ended June 30, 2014 as compared to the same period in 2013: home deliveries increased by 15.8%, home sales revenue increased by 45.5%, average selling prices increased by 25.7%, backlog units decreased by 4.8%, backlog units value increased by 3.5%, while net new home orders decreased by 35.6% from 233 homes ordered in the three months ended June 30, 2013 to 150 homes ordered in the three months ended June 30, 2014. The increase in average sales price of homes during the comparable periods presented, including the increase in the average sales price of homes in backlog, is the result of local market appreciation of homes of approximately 9.9%. The average sales price of homes may increase or decrease depending on the mix of typical homes JBGL delivers and sells during any period and local market conditions. These changes in the average sales price of homes are part of JBGL’s natural business cycle.

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The following are key operating metrics for JBGL for the six months ended June 30, 2014 as compared to the same period in 2013: home deliveries increased by 23.2%, home sales revenue increased by 61.2%, average selling prices increased by 30.8%, net new home orders decreased by 24.2% from 429 homes ordered in the six months ended June 30, 2013 to 325 homes ordered in the six months ended June 30, 2014. The increase in average sales price of homes during the comparable periods presented, including the increase in the average sales price of homes in backlog, is the result of local market appreciation of homes of approximately 9.4% The average sales price of homes may increase or decrease depending on the mix of typical homes JBGL delivers and sells during any period and local market conditions. These changes in the average sales price of homes are part of JBGL’s natural business cycle.

Key operating metrics improved for JBGL during the year ended December 31, 2013 as compared to the same period in 2012 due to the acquisition of CB JENI in April 2012: net new home orders increased by 80.4%, home deliveries increased by 205.5%, home sales revenue increased by 236.5%, average selling prices increased by 10.1%, backlog units increased by 100.0%, and backlog units value increased by 129.9%.

During the year ended December 31, 2013 and the first half of 2014, the housing market continued to show signs of improvement driven by rising consumer confidence, high affordability metrics, and a reduction in home inventory levels.

JBGL’s two primary markets, DFW and Atlanta, have shown significant housing market recovery. JBGL believes the housing market recovery is sustainable, and that it operates in two of the most desirable housing markets in the nation. Among the 12 largest metropolitan areas in the country, the DFW metropolitan area ranked first in the rate of job growth and second in the number of jobs added from April 2013 to April 2014 (Source: US Bureau of Labor Statistics, April 2014). The Atlanta metropolitan area has recorded year over year employment gains each month for nearly four years (Source: US Bureau of Labor Statistics, May 2014). JBGL believes that increasing demand and supply constraints in its target markets create favorable conditions for its future growth.

Basis of Presentation

JBGL’s combined and consolidated financial statements include its accounts and the accounts of its subsidiaries and have been prepared in accordance with GAAP as contained within the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”). JBGL’s condensed, combined and consolidated financial statements and notes thereto for interim periods presented are unaudited.

These interim financial statements contain all adjustments (consisting of normal recurring adjustments) that are necessary for a fair statement of JBGL’s operating results, financial position and cash flows. Operating results for the interim periods presented are not necessarily indicative of the results for any subsequent interim period or for the full fiscal year ending December 31, 2014.

Results of Operations

Land Development

During the three months ended June 30, 2014, JBGL’s land development segment revenue increased $1.9 million, or 21.3%, to $10.8 million from $8.9 million in revenue for the three months ended June 30, 2013. The increase was comprised of (a) $1.1 million due to an increase of 12.6% in finished inventory lots delivered to 107, for the three months ended June 30, 2014, from 95 for the three months ended June 30, 2013, and (b) $0.8 million related to an increase in the average sales price per lot of $100,885 per lot for the three months ended June 30, 2014, from $93,492 per lot for the three months ended June 30, 2013.

During the six months ended June 30, 2014, JBGL’s land development segment revenue increased $9.7 million, or 66.9%, to $24.2 million from $14.5 million in revenue for the six months ended June 30, 2013. The increase was comprised of (a) $8.9 million due to an increase of 61.3% in finished inventory lots delivered, to 242 for the six months ended June 30, 2014, from 150 for the six months ended June 30, 2013, and (b) $0.8 million related to an increase in the average sales price per lot of $99,865 per lot for the six months ended June 30, 2014 from $96,749 per lot for the six months ended June 30, 2013.

During the year ended December 31, 2013, JBGL’s land development segment revenue increased $10.8 million, or 47.2%, to $33.7 million from $22.9 million in revenue for the year ended December 31,

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2012. The increase was comprised of $19.7 million due to an increase of 86% in finished inventory lots delivered, to 372 for the year ended December 31, 2013, from 200 for the year ended December 31, 2012, offset by a decrease of $8.9 million related to a decrease in the average sales price per lot of $90,591 per lot for the year ended December 31, 2013 from $114,635 per lot for the year ended December 31, 2012.

Builder Operations

During the three months ended June 30, 2014, JBGL’s builder operations segment delivered 154 homes, with an average sales price of $357,459. During the same period, JBGL’s builder operations segment generated approximately $55.0 million in revenue. For the three months ended June 30, 2014, JBGL’s builder operations segment’s net new home orders were 150, a 35.6% decrease from the same period in 2013 due to a greater amount of lower priced finished inventory in the three months ended June 30, 2013. At June 30, 2014, JBGL’s builder operations segment had a backlog of 240 sold but unclosed homes, a 4.8% decrease from the same period in 2013, with a total value of approximately $78.9 million, an increase of $2.6 million, or 3.5%, over the same period in 2013, which was primarily attributable to an decrease in the number of homes in backlog due to lower sales, and an increase in the average sales price of homes in backlog is the result of local market appreciation of approximately 8.6%.

During the six months ended June 30, 2014, JBGL’s builder operations segment delivered 292 homes, with an average sales price of $358,511. During the same period, JBGL’s builder operations segment generated approximately $104.7 million in revenue. For the six months ended June 30, 2014, JBGL’s builder operations segment’s net new home orders were 325, a 24.2% decrease over the same period in 2013 due to a greater amount of lower priced finished inventory in the six months ended June 30, 2013.

During the year ended December 31, 2013, JBGL’s builder operations segment delivered 556 homes, with an average sales price of $303,222. During the same period, JBGL’s builder operations segment generated approximately $168.6 million in revenue. For the year ended December 31, 2013, net new home orders totaled 644, an 80.4% increase from the same period in 2012. At December 31, 2013, JBGL’s builder operations segment had a backlog of 182 sold but unclosed homes, a 100.0% increase from the same period in 2012, with a total value of approximately $58.6 million, an increase of $33.1 million, or 129.9%, from the same period in 2012, which was primarily attributable to an increase in the number of homes in backlog, an increase in the average sales price of homes in backlog due to changes to the mix of homes between single family and townhomes contracted for sale during the period, and local market appreciation of approximately 10%.

Key operating metrics improved for JBGL during the year ended December 31, 2012 as compared to 2011 due to the acquisition of two builders (CB JENI in April 2012 and The Providence Group in July 2011). During the year ended December 31, 2012, JBGL’s builder operations segment delivered 182 homes, with an average sales price of $275,302. During the same period, JBGL’s builder operations segment generated approximately $50.1 million in revenue. For the year ended December 31, 2012, net new home orders totaled 357, a 1685.0% increase from the same period in 2011. At December 31, 2012, JBGL’s builder operations segment had a backlog of 91 sold but unclosed homes, a 4,450.0% increase from the same period in 2011, with a total value of approximately $25.5 million, an increase of $24.9 million, or 4,079.0%, from the same period in 2011.

The increase in average sales price of homes during the comparable periods presented, including the increase in the average sales price of homes in backlog, was attributable to changes in product mix due to an increase of higher priced single family homes over lower priced townhomes, increases in the number of homes delivered at higher price points, and local market appreciation of approximately 10%.

The average sales price of homes may increase or decrease depending on the mix of typical homes delivered and sold during such period and local market conditions. These changes in the average sales price of homes are part of JBGL’s natural business cycle.

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Revenues

JBGL primarily generates revenue through (a) the sale of lots from its land development segment to public builders, large private builders and its builders, (b) making first lien construction loans to its builders, and (c) the closing and delivery of homes through its builder operations segment. JBGL recognizes revenue on homes and lots when completed and title to and possession of the property have been transferred to the purchaser.

All customer deposits are treated as liabilities. JBGL also serves as the general contractor for certain custom homes where the customers, and not JBGL, own the underlying land and improvements. JBGL recognizes revenue for these contracts either on a percentage of completion method or cost plus method.

Selling, General and Administrative Expenses

Selling, general and administrative expenses represent salaries, benefits and management fees, property taxes, advertising and marketing, rent and lease expenses, and other administrative items, and are recorded in the period incurred.

Expenses

Lot acquisition, materials, other direct costs, interest and other indirect costs related to the acquisition, development, and construction of lots and homes are capitalized until the homes are complete, after which they are expensed. Direct and indirect costs of developing residential lots are allocated based on the relative sales price of the lots. Capitalized costs of residential lots are charged to earnings when the related revenue is recognized. Costs incurred in connection with developed lots such as permits and construction, and completed homes such as raw materials and labor, are charged to earnings when incurred.

Other Income (Expense), Net

Other income (expense) consists of interest income, interest expense, costs incurred for business acquisitions, depreciation, income from rental property and forfeited deposits.

Consolidated Financial Data

The consolidated historical financial data presented below reflect both JBGL’s land development and builder operations segments, and are not necessarily indicative of the results to be expected for any future period.

		June 30, 2014				June 30, 2013				December 31, 2013				December 31, 2012				December 31, 2011
ASSETS
Cash and cash equivalents		$	19,122,380			$	14,119,114			$	18,066,679			$	7,484,492			$	8,127,135
Inventory			243,443,374				174,532,672				237,126,258				144,088,120				34,416,485
Notes receivable, net			3,800,000				7,511,309				7,556,070				15,272,170				29,801,457
Other			8,624,930				8,679,662				5,658,691				1,965,836				973,854
Total assets		$	274,990,684			$	204,842,757			$	268,407,698			$	168,810,618			$	73,318,931
LIABILITIES AND MEMBERS’ EQUITY
Borrowings on lines of credit		$	20,102,594			$	8,917,762			$	17,208,035			$	6,544,264			$	2,950,000
Notes payable			16,027,648				23,927,044				26,595,229				21,441,775				3,717,632
Other			29,017,552				27,135,166				25,785,540				19,136,699				4,571,973
Total liabilities			65,147,794				59,979,972				69,588,804				47,122,738				11,239,605
Total members’ equity			209,842,890				144,862,785				198,818,894				121,687,880				62,079,326
Total liabilities and members’ equity		$	274,990,684			$	204,842,757			$	268,407,698			$	168,810,618			$	73,318,931

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		Three Months Ended June 30,								Six Months Ended June 30,								Year Ended December 31,
		2014				2013				2014				2013				2013				2012				2011
REVENUES:
Sale of residential units		$	55,048,744			$	37,829,298			$	104,685,088			$	64,958,699			$	168,591,201			$	50,105,030			$	9,085,785
Cost of residential units			(41,219,387	)			(28,358,191	)			(78,611,754	)			(49,401,195	)			(122,616,113	)			(39,642,357	)			(7,921,806	)
Gross profit on sale of residential units			13,829,357				9,471,107				26,073,334				15,557,504				45,975,088				10,462,673				1,163,979
Sale of land and lots			10,794,690				8,881,770				24,167,258				14,512,393				33,734,513				22,927,080				6,184,206
Cost of land and lots			(8,141,006	)			(5,984,826	)			(17,909,072	)			(8,580,118	)			(21,512,814	)			(15,256,065	)			(3,982,602	)
Gross profit on sale of land and lots			2,653,684				2,896,944				6,258,186				5,932,275				12,221,699				7,671,015				2,201,604
Interest and fees			305,660				783,757				680,120				1,678,610				3,542,174				7,124,339				2,558,159
Other income			427,732				1,417,600				480,154				1,849,694				1,400,418				3,771,839				1,636,099
			17,216,433				14,569,408				33,491,794				25,018,083				63,139,379				29,029,866				7,559,840
EXPENSES:
Salaries and management fees – related party			3,213,424				2,079,708				6,747,392				4,227,840				11,266,351				4,370,845				1,886,509
Selling, general and administrative			2,491,408				890,383				4,772,977				2,178,237				6,623,437				3,311,734				1,183,762
Other expenses			647,077				153,471				953,976				284,576				606,210				404,673				35,737
			6,351,909				3,123,562				12,474,345				6,690,653				18,495,998				8,087,252				3,106,008
Net income before taxes			10,864,524				11,445,846				21,017,449				18,327,430				44,643,381				20,942,614				4,453,833
State tax expense			—				59,000				337,790				209,500				327,481				230,411				34,089
Net income			10,864,524				11,386,846				20,679,659				18,177,930				44,315,900				20,712,203				4,419,744
Less: net income attributable to non-controlling interest			3,454,819				3,772,067				5,921,453				4,471,692				12,308,734				3,517,911				56,382
Net income attributable to controlling interest		$	7,409,705			$	7,614,779			$	14,758,206			$	13,646,238			$	32,007,166			$	17,194,292			$	4,363,362