Note 1 - General

3 Months Ended

Dec. 31, 2013

Disclosure Text Block [Abstract]

Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]

1. GENERAL

MERGER AGREEMENT WITH TORAY INDUSTRIES, INC.

Merger Agreement and Plan

On September 27, 2013, Zoltek entered into an Agreement and Plan of Merger (the “merger agreement”), by and among Zoltek, Toray Industries, Inc. (“Toray”) and TZ Acquisition Corp. (“Merger Sub”). Under the terms and subject to the conditions in the merger agreement, Merger Sub, a wholly-owned subsidiary of Toray, will merge with and into Zoltek (the “merger”), with Zoltek continuing as the surviving corporation in the merger as a wholly-owned subsidiary of Toray. Following completion of the merger, Zoltek will be delisted from The Nasdaq Stock Global Select Market (with there no longer being a public market for Zoltek’s common stock), and Zoltek’s common stock will be deregistered under the Securities Exchange Act of 1934, as amended. 

At the effective time of the merger (the “effective time”), pursuant to the merger agreement, each issued and outstanding share of Zoltek’s common stock (other than any shares (1) owned by Toray, Merger Sub, Zoltek or any of their subsidiaries, and (2) owned by shareholders who are entitled to, and who have properly exercised, appraisal rights in accordance with applicable Missouri law) will be converted automatically into the right to receive $16.75 per share in cash, without interest (the “merger consideration”). At the effective time, each stock option outstanding under the Company’s equity plans, whether vested or unvested, will also be converted into the right to receive the merger consideration with respect to each share subject to the award, less the applicable exercise price per share. No shareholders have exercised appraisal rights in connection with the merger.

The merger agreement includes customary representations, warranties and covenants of the parties. Each party’s obligation to consummate the merger is subject to customary conditions, including, but not limited to: (1) approval of the merger agreement by the holders of at least two-thirds of the outstanding shares of Zoltek’s common stock entitled to vote thereon , (2) the expiration or early termination of the waiting period applicable to the Merger under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”), (3) written confirmation from the Committee on Foreign Investment in the United States (“CFIUS”) that review of the Merger under the Foreign Investment and National Security Act of 2007 has been completed and that there are no unresolved national security concerns with respect to the merger, and (4) the absence of any order enjoining or prohibiting the merger. Additionally, each party’s obligation to consummate the merger is subject to certain other conditions, including, but not limited to: (a) the accuracy of the other party’s representations and warranties contained in the merger agreement (subject to certain materiality qualifiers), and (b) the other party’s compliance with its obligations under the merger agreement in all material respects. The waiting period under the HSR Act was terminated effective November 8, 2013. As previously disclosed, Zoltek has received a notice from CFIUS that it would undertake an investigation of the Merger. CFIUS has advised the parties that its investigation is to be completed no later than March 3, 2014. Zoltek anticipates that the merger will close as soon after completion of the CFIUS review as possible. The merger agreement does not contain a financing contingency.

On January 23, 2014, at a special meeting of the shareholders of the Company, the Company’s shareholders approved the merger agreement and the transactions contemplated thereby. The Company’s shareholders also voted to approve (1) any proposal to adjourn the special meeting to a later date or dates if necessary to solicit additional proxies if there were insufficient votes to approve and adopt the merger agreement and (2) by non-binding, advisory vote, certain compensation arrangements for the Company’s named executive officers in connection with the merger. The proposals are described in detail in the Definitive Proxy Statement on Schedule 14A filed with the Securities and Exchange Commission by the Company on December 11, 2013.

ORGANIZATION AND BASIS OF PRESENTATION

Zoltek Companies, Inc. is a holding company, which operates through wholly-owned subsidiaries Zoltek Corporation, Zoltek Zrt., Zoltek de Mexico SA de CV, Zoltek de Occidente SA de CV, Engineering Technology Corporation (“Entec Composite Machines”), Zoltek Properties, Inc., and Zoltek Automotive, LLC. Zoltek Corporation develops, manufactures and markets carbon fibers and related products, including carbon fibers preimpregnated with resin known as “prepreg,” and technical fibers in the United States. Carbon fibers are a low-cost but high performance reinforcement for composites used as the primary building material in everyday commercial products. Technical fibers are an intermediate product used in heat-resistant applications such as aircraft brakes. Zoltek Zrt. is a Hungarian subsidiary that manufactures and markets carbon fibers and technical fibers and manufactures acrylic fiber precursor raw material used in production of carbon fibers and technical fibers. Zoltek de Mexico SA de CV and Zoltek de Occidente SA de CV are Mexican subsidiaries that manufacture carbon fibers and precursor raw material. Entec Composite Machines manufactures and markets filament winding and pultrusion equipment used in the production of large volume composite parts. The Company’s primary sales markets are in Europe and the United States; however, the Company has an increasing presence in Asia. Unless the context otherwise indicates, references to the “Company” or “Zoltek” are to Zoltek Companies, Inc. and its subsidiaries.

Certain amounts have been reclassified to conform to the current year or quarter presentation.

Basis of Presentation

The accompanying condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and with the instructions to Form 10-Q and the rules and regulations of the SEC. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements and should be read in conjunction with the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2013, which includes consolidated financial statements and notes thereto. In the opinion of management, all normal recurring adjustments and estimates considered necessary for a fair presentation have been included. The results of operations of any interim period are not necessarily indicative of the results that may be expected for a full fiscal year.

The unaudited interim condensed consolidated financial statements include the accounts and transactions of the Company and its wholly-owned subsidiaries. Adjustments resulting from the currency translation of financial statements of the Company’s foreign subsidiaries are reflected as “Accumulated other comprehensive loss” within shareholders’ equity. Gains and losses from foreign currency transactions are included in the condensed consolidated statements of operations as “Other income (expense).” All significant inter-company transactions and balances have been eliminated in consolidation.

Adoption of New Accounting Standards

In February 2013, the FASB issued ASU No. 2013-02, Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income. Under this standard, entities are required to disclose additional information with respect to changes in accumulated other comprehensive income (“AOCI”) balances by component and significant items reclassified out of AOCI. Expanded disclosures for presentation of changes in AOCI involve disaggregating the total change of each component of other comprehensive income (loss) as well as presenting separately for each such component the portion of change in AOCI related to (1) amounts reclassified into income and (2) current-period other comprehensive income. The ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2012 (the Company’s fiscal year ended September 30, 2013), with early adoption permitted. We did not include the required expanded disclosures for presentation of changes in AOCI as there were no material amounts classified out of other comprehensive income into income for the periods shown.

In July 2013, the FASB issued ASU No. 2013-10, Inclusion of the Fed Funds Effective Swap Rate (or Overnight Index Swap Rate) as a Benchmark Interest Rate for Hedge Accounting Purposes. The amendments in this update permit the Fed Funds Effective Swap Rate (OIS) to be used as a U.S. benchmark interest rate for hedge accounting purposes in addition to U.S. Treasury (“UST”) and London Interbank Offered Rate (“LIBOR”). The amendments also remove the restriction on using different benchmark rates for similar hedges. The amendments are effective prospectively for qualifying new or redesignated hedging relationships entered into on or after July 17, 2013. The Company has not entered into any new hedging relationships since July 17, 2013.

In July 2013, the FASB issued ASU No. 2013-11, Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists. This new standard requires the netting of unrecognized tax benefits against a deferred tax asset for a loss or other carryforward that would apply in settlement of the uncertain tax positions. Under the new standard, unrecognized tax benefits will be netted against all available same-jurisdiction loss or other tax carryforwards that would be utilized, rather than only against carryforwards that are created by the unrecognized tax benefits. The Company does not expect that the new standard will have a material impact on the Company’s consolidated financial statements.