x
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the fiscal year ended December 31, 2016
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
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For the transition period from
to
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Aegion Corporation
|
(Exact name of registrant as specified in its charter)
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Large accelerated filer
x
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Accelerated filer
¨
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Non-accelerated filer
¨
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Smaller reporting company
¨
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PART I
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Item 1.
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Item 1A.
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Item 1B.
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Item 2.
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Item 3.
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Item 4.
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Item 4A.
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PART II
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Item 5.
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Item 6.
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Item 7.
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Item 7A.
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Item 8.
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Item 9.
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Item 9A.
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Item 9B.
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PART III
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Item 10.
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Item 11.
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Item 12.
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Item 13.
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Item 14.
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PART IV
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Item 15.
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||
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i.
|
adding patented Fusible PVC
®
pipe technology to our pressure pipe rehabilitation portfolio through the acquisition of Underground Solutions;
|
ii.
|
expanding our CIPP presence in Europe by acquiring the CIPP contracting operations of Leif M. Jensen A/S (“LMJ”), a Danish company and the Insituform licensee in Denmark since 2011;
|
iii.
|
gaining the remaining worldwide rights that we did not already own to market, manufacture and install the patented Tyfo
®
Fibrwrap
®
FRP technology by acquiring the operations and territories of Fyfe Europe S.A. and related companies (“Fyfe Europe”); and
|
iv.
|
expanding our
FRP
presence in Asia Pacific through the acquisition of Concrete Solutions Limited
(“CSL”)
and Building Chemical Supplies Limited (“BCS”), two New Zealand-based companies and the
Fibrwrap
®
certified applicators in New Zealand since the late 1990’s
(collectively,
“Concrete Solutions”
).
|
i.
|
In February 2016, we sold our fifty-one percent (51%) interest in BPPC to our joint venture partner, Perma-Pipe, Inc. BPPC served as our pipe coating and insulation operation in Canada. The sale of our interest in BPPC was part of a broader effort to reduce our exposure in the North American upstream market in light of expectations for a prolonged low oil price environment.
|
ii.
|
In February 2015, we sold our wholly-owned subsidiary, Video Injection - Insituform SAS (“VII”), our French CIPP contracting operation, to certain employees of VII; and in December 2014, we sold our wholly-owned subsidiary, Ka-te Insituform AG (“Ka-te”), our Swiss CIPP contracting operation, to Marco Daetwyler Gruppe AG, a Swiss company.
|
iii.
|
In March 2014, we sold our forty-nine percent (49%) interest in Bayou Coating, L.L.C. (“Bayou Coating”) to Stupp Brothers Inc., the holder of the remaining fifty-one percent (51%) interest in Bayou Coating.
|
•
|
Diversion of management time and focus from operating our business to acquisition integration challenges.
|
•
|
Failure to successfully operate and further develop the acquired business or technology.
|
•
|
Implementation or remediation of controls, procedures and policies at the acquired company.
|
•
|
Integration of the acquired company’s accounting, human resource and other administrative systems, and coordination of product, engineering and sales and marketing functions.
|
•
|
Transition of operations, users and customers onto our existing platforms.
|
•
|
Failure to obtain required approvals on a timely basis, if at all, from governmental authorities, or conditions placed upon approval, under competition and antitrust laws which could, among other things, delay or prevent us from completing a transaction, or otherwise restrict our ability to realize the expected financial or strategic goals of an acquisition.
|
•
|
In the case of foreign acquisitions, the need to integrate operations across different cultures and languages and to address the particular economic, currency, political and regulatory risks associated with specific countries.
|
•
|
Cultural challenges associated with integrating employees from the acquired company into our organization, and retention of employees from the businesses we acquire.
|
•
|
Liability for activities of the acquired company before the acquisition, including patent and trademark infringement claims, violations of laws, commercial disputes, tax liabilities and other known and unknown liabilities.
|
•
|
Assumption of contracts with terms, including, without limitation, terms relating to liability, waiver of damages and indemnification, that are not in line with our normal contracting practices.
|
•
|
Litigation or other claims in connection with the acquired company, including claims from terminated employees, customers, former stockholders or other third parties.
|
•
|
market prices of mined minerals, oil and natural gas and expectations about future prices;
|
•
|
cost of producing mined minerals, oil and natural gas;
|
•
|
the level of mining, drilling and production activity;
|
•
|
the discovery rate of new oil and gas reserves;
|
•
|
mergers, consolidations and downsizing among our clients;
|
•
|
coordination by the Organization of Petroleum Exporting Countries (OPEC);
|
•
|
the output of certain oil-producing countries;
|
•
|
the impact of commodity prices on the expenditure levels of our clients;
|
•
|
financial condition of our client base and their ability to fund capital and maintenance expenditures;
|
•
|
adverse weather conditions;
|
•
|
political instability in oil-producing countries;
|
•
|
tax incentives, including for alternative energy sources;
|
•
|
domestic and worldwide economic conditions;
|
•
|
weather conditions that can affect mining, oil or natural gas operations over a wide area;
|
•
|
level of consumption of minerals, oil, natural gas and petrochemicals by consumers, including the effects of increased regulation, conservation measures and technological advances affecting energy consumption; and
|
•
|
availability of services and materials for our clients to grow their capital expenditures.
|
•
|
all subject workers must be paid the applicable prevailing wage rate;
|
•
|
all subject workers must be either “skilled journeymen” or “registered apprentices”; and
|
•
|
commencing January 1, 2014, at least 30% of skilled journeypersons on the project must be graduates of certified apprenticeship programs, which percentage increases to 45% on January 1, 2015 and 60% on January 1, 2016.
|
•
|
difficulties in enforcing agreements, collecting receivables, resolving disputes through some foreign legal systems;
|
•
|
foreign customers with longer payment cycles than customers in the United States;
|
•
|
difficulties in enforcing intellectual property rights or weaker intellectual property right protections in some countries;
|
•
|
tax rates in certain foreign countries that exceed those in the United States and foreign earnings subject to withholding requirements;
|
•
|
tax laws that restrict our ability to use tax credits, offset gains or repatriate funds;
|
•
|
tariffs, exchange controls or other trade restrictions including transfer pricing restrictions when products produced in one country are sold to an affiliated entity in another country;
|
•
|
abrupt changes in foreign government policies and regulations;
|
•
|
unsettled political conditions;
|
•
|
acts of terrorism or criminality;
|
•
|
kidnapping of employees;
|
•
|
nationalization or privatization of companies with which we do business;
|
•
|
forced negotiation or modification of contracts;
|
•
|
increased governmental ownership and regulation of markets in which we operate;
|
•
|
the financial instability of, and the related inability or unwillingness to timely pay for our services by, national oil companies and other foreign customers resulting from, and/or exacerbated by, the continuation of depressed oil prices;
|
•
|
hostility from local populations, particularly in the Middle East; and
|
•
|
difficulties associated with compliance with a variety of laws and regulations governing international trade, including the Foreign Corrupt Practices Act.
|
•
|
supervising the bidding process, including providing estimates of significant cost components, such as material and equipment needs, and the size, productivity and composition of the workforce;
|
•
|
negotiating contracts;
|
•
|
supervising project performance, including performance by our employees, subcontractors and other third-party suppliers and vendors;
|
•
|
estimating costs for completion of contracts that is used to estimate amounts that can be reported as revenues and earnings on the contract under the percentage-of-completion method of accounting;
|
•
|
negotiating requests for change orders and the final terms of approved change orders; and
|
•
|
determining and documenting claims by us for increased costs incurred due to the failure of customers, subcontractors and other third-party suppliers of equipment and materials to perform on a timely basis and in accordance with contract terms.
|
•
|
our estimate of the headcount requirements for various units based upon our forecast of the demand for our products and services;
|
•
|
our ability to maintain our talent base and manage attrition;
|
•
|
our ability to schedule our portfolio of projects to efficiently utilize our employees and minimize downtime between project assignments; and
|
•
|
our need to invest time and resources into functions such as training, business development, employee recruiting, and sales that are not chargeable to customer projects.
|
•
|
actual or anticipated variations in quarterly operating results;
|
•
|
changes in financial estimates by securities analysts that cover our stock or our failure to meet these estimates;
|
•
|
conditions or trends in the U.S. sewer rehabilitation market;
|
•
|
conditions or trends in mined materials, oil and natural gas markets;
|
•
|
changes in municipal and corporate spending practices;
|
•
|
a downturn of the municipal bond market or lending markets generally;
|
•
|
changes in the federal or state governments that impact regulation and spending regarding energy and infrastructure;
|
•
|
changes in market valuations of other companies operating in our industries;
|
•
|
announcements by us or our competitors of a significant acquisition or divestiture; and
|
•
|
additions or departures of key personnel.
|
Charles R. Gordon
|
|
58
|
|
President and Chief Executive Officer
|
David F. Morris
|
|
55
|
|
Executive Vice President, Chief Administrative Officer, General Counsel and Secretary
|
David A. Martin
|
|
49
|
|
Executive Vice President and Chief Financial Officer
|
John D. Huhn
|
|
48
|
|
Senior Vice President and Chief Strategy Officer
|
Michael D. White
|
|
44
|
|
Senior Vice President and Corporate Controller
|
Stephen P. Callahan
|
|
50
|
|
Senior Vice President – Human Resources
|
Period
|
|
High
|
|
Low
|
||||
2016
|
|
|
|
|
||||
First Quarter
|
|
$
|
21.50
|
|
|
$
|
16.00
|
|
Second Quarter
|
|
21.95
|
|
|
17.35
|
|
||
Third Quarter
|
|
21.00
|
|
|
17.18
|
|
||
Fourth Quarter
|
|
26.14
|
|
|
17.85
|
|
||
|
|
|
|
|
||||
2015
|
|
|
|
|
||||
First Quarter
|
|
$
|
19.47
|
|
|
$
|
15.31
|
|
Second Quarter
|
|
19.67
|
|
|
17.11
|
|
||
Third Quarter
|
|
19.92
|
|
|
15.97
|
|
||
Fourth Quarter
|
|
22.41
|
|
|
16.16
|
|
Plan Category
|
|
Number of securities to be issued upon exercise of outstanding options, warrants and rights
(a)
|
|
Weighted-average exercise price of outstanding options, warrants and rights
(b)
|
|
Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in
column (a))
(c)
|
||||
Equity compensation plans approved by security holders
(1)
|
|
1,924,719
|
|
|
$
|
19.22
|
|
|
1,312,122
|
|
Equity compensation plans not approved by security holders
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Total
|
|
1,924,719
|
|
|
$
|
19.22
|
|
|
1,312,122
|
|
(1)
|
The number of securities to be issued upon exercise of granted/awarded options, warrants and rights includes: (i)
170,253
stock options; (ii)
1,501,021
restricted stock, restricted stock units and restricted performance units; and (iii)
253,445
deferred stock units outstanding at
December 31, 2016
.
|
|
|
Total Number of Shares (or Units) Purchased
|
|
Average Price Paid per Share (or Unit)
|
|
Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs
|
|
Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs
|
||||||||
January 2016
(1) (2)
|
|
435,798
|
|
|
|
$
|
17.14
|
|
|
|
431,128
|
|
|
$
|
7,868,694
|
|
February 2016
(1) (2)
|
|
305,328
|
|
|
|
17.73
|
|
|
|
289,632
|
|
|
3,016,659
|
|
||
March 2016
(1) (2)
|
|
169,530
|
|
|
|
20.30
|
|
|
|
137,822
|
|
|
422,066
|
|
||
April 2016
(1) (2)
|
|
52,257
|
|
|
|
20.69
|
|
|
|
51,949
|
|
|
18,961,760
|
|
||
May 2016
(1) (2)
|
|
201,456
|
|
|
|
19.49
|
|
|
|
200,000
|
|
|
15,450,389
|
|
||
June 2016
(1) (2)
|
|
200,880
|
|
|
|
19.25
|
|
|
|
200,428
|
|
|
11,591,883
|
|
||
July 2016
(1) (2)
|
|
140,191
|
|
|
|
19.92
|
|
|
|
135,871
|
|
|
8,784,523
|
|
||
August 2016
(1) (2)
|
|
221,405
|
|
|
|
18.92
|
|
|
|
221,200
|
|
|
14,702,882
|
|
||
September 2016
(1) (2)
|
|
240,502
|
|
|
|
18.36
|
|
|
|
240,350
|
|
|
10,290,173
|
|
||
October 2016
(1) (2)
|
|
206,435
|
|
|
|
19.04
|
|
|
|
205,016
|
|
|
6,385,249
|
|
||
November 2016
(1) (2)
|
|
149,043
|
|
|
|
21.93
|
|
|
|
89,879
|
|
|
4,547,923
|
|
||
December 2016
(1) (2) (3)
|
|
27,069
|
|
|
|
24.25
|
|
|
|
23,600
|
|
|
—
|
|
||
Total
|
|
2,349,894
|
|
|
|
$
|
18.92
|
|
|
|
2,226,875
|
|
|
|
(1)
|
In November 2015, our board of directors authorized the open market repurchase of up to $
20.0 million
of our common stock to be made during 2015 and 2016. In March 2016, our board of directors authorized the open market repurchase of up to an additional $20.0 million of our common stock to be made during 2016 following expiration of the November 2015 program. We began repurchasing shares under the March 2016 program in April 2016 immediately following completion of the November 2015 program. In August 2016, our board of directors authorized the open market repurchase of up to an additional $10.0 million of our common stock to be made during 2016 following expiration of the March 2016 program. We began repurchasing shares under the August 2016 program in October 2016 immediately following completion of the March 2016 program. Our authorization to repurchase shares under the August 2016 program expired on December 31, 2016. Once repurchased, we promptly retire the shares.
|
(2)
|
In connection with approval of our then current Credit Facility, our board of directors approved the purchase of up to $
10.0 million
of our common stock in each calendar year in connection with our equity compensation programs for employees and directors. The number of shares purchased includes shares surrendered to us to pay the exercise price and/or to satisfy tax withholding obligations in connection with “net, net” exercises of employee stock options and/or the vesting of restricted stock or deferred stock units issued to employees and directors. During
2016
,
61,980
shares were surrendered in connection with stock swap transactions and
61,039
shares were surrendered in connection with restricted stock and deferred stock units transactions. The deemed price paid was the closing price of our common stock on the Nasdaq Global Select Market on the date that the restricted stock or deferred stock units vested or the stock option was exercised. Once a repurchase is complete, we promptly retire the shares.
|
(3)
|
In October 2016, our board of directors authorized the open market repurchase of up to $40.0 million of our common stock to be made during 2017.
|
Actuant Corporation
|
Helix Energy Solutions Group
|
Barnes Group, Inc.
|
Newpark Resources
|
Basic Energy Services, Inc.
|
Tesco Corporation
|
Valmont Industries, Inc.
|
C&J Energy Services, Inc.
|
Kennametal, Inc.
|
CIRCOR International, Inc.
|
Tetra Tech, Inc.
|
Forum Energy Technologies, Inc.
|
Matrix Service Company
|
Mas Tec, Inc.
|
Dril-Quip, Inc.
|
McDermontt International Inc.
|
Team, Inc.
|
Oil States International Inc.
|
Willbros Group, Inc.
|
|
|
|
2011
|
|
2012
|
|
2013
|
|
2014
|
|
2015
|
|
2016
|
||||||||||||
Aegion Corporation
|
|
$
|
100.00
|
|
|
$
|
144.65
|
|
|
$
|
142.70
|
|
|
$
|
121.32
|
|
|
$
|
125.88
|
|
|
$
|
154.50
|
|
S&P 500 Total Returns
|
|
100.00
|
|
|
116.00
|
|
|
153.57
|
|
|
174.60
|
|
|
177.01
|
|
|
198.18
|
|
||||||
Peer Group
|
|
100.00
|
|
|
111.51
|
|
|
143.41
|
|
|
108.77
|
|
|
76.13
|
|
|
108.35
|
|
|
|
Years Ended December 31,
|
||||||||||||||||||
|
|
2016
(1)
|
|
2015
(2)
|
|
2014
(3)
|
|
2013
(4)
|
|
2012
(5)
|
||||||||||
|
|
(In thousands, except per share amounts)
|
||||||||||||||||||
STATEMENT OF OPERATIONS DATA:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenues
|
|
$
|
1,221,920
|
|
|
$
|
1,333,570
|
|
|
$
|
1,331,421
|
|
|
$
|
1,091,420
|
|
|
$
|
1,016,831
|
|
Operating income (loss)
|
|
50,826
|
|
|
19,946
|
|
|
(19,812
|
)
|
|
66,882
|
|
|
81,803
|
|
|||||
Income (loss) from continuing operations
(6)
|
|
29,488
|
|
|
(8,067
|
)
|
|
(33,320
|
)
|
|
50,812
|
|
|
54,374
|
|
|||||
Loss from discontinued operations
|
|
—
|
|
|
—
|
|
|
(3,847
|
)
|
|
(6,461
|
)
|
|
(1,713
|
)
|
|||||
Net income (loss)
(6)
|
|
29,488
|
|
|
(8,067
|
)
|
|
(37,167
|
)
|
|
44,351
|
|
|
52,661
|
|
|||||
Basic earnings (loss) per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Income (loss) from continuing operations
(6)
|
|
0.85
|
|
|
(0.22
|
)
|
|
(0.88
|
)
|
|
1.31
|
|
|
1.38
|
|
|||||
Loss from discontinued operations
|
|
—
|
|
|
—
|
|
|
(0.10
|
)
|
|
(0.17
|
)
|
|
(0.04
|
)
|
|||||
Net income (loss)
(6)
|
|
0.85
|
|
|
(0.22
|
)
|
|
(0.98
|
)
|
|
1.14
|
|
|
1.34
|
|
|||||
Diluted earnings (loss) per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Income (loss) from continuing operations
(6)
|
|
0.84
|
|
|
(0.22
|
)
|
|
(0.88
|
)
|
|
1.30
|
|
|
1.37
|
|
|||||
Loss from discontinued operations
|
|
—
|
|
|
—
|
|
|
(0.10
|
)
|
|
(0.17
|
)
|
|
(0.04
|
)
|
|||||
Net income (loss)
(6)
|
|
0.84
|
|
|
(0.22
|
)
|
|
(0.98
|
)
|
|
1.13
|
|
|
1.33
|
|
|||||
BALANCE SHEET DATA:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Cash and cash equivalents
|
|
$
|
129,500
|
|
|
$
|
209,253
|
|
|
$
|
174,965
|
|
|
$
|
158,045
|
|
|
$
|
133,676
|
|
Working capital, net of cash
|
|
172,136
|
|
|
171,176
|
|
|
198,834
|
|
|
210,858
|
|
|
202,469
|
|
|||||
Current assets
(7)
|
|
532,237
|
|
|
678,196
|
|
|
638,122
|
|
|
603,858
|
|
|
560,661
|
|
|||||
Property, plant and equipment, net
|
|
156,747
|
|
|
144,833
|
|
|
168,213
|
|
|
182,303
|
|
|
183,163
|
|
|||||
Goodwill
|
|
298,619
|
|
|
249,120
|
|
|
293,023
|
|
|
348,680
|
|
|
272,294
|
|
|||||
Identified intangible assets, net
|
|
194,911
|
|
|
174,118
|
|
|
182,273
|
|
|
209,283
|
|
|
159,629
|
|
|||||
Total assets
(7)
|
|
1,193,582
|
|
|
1,254,013
|
|
|
1,291,133
|
|
|
1,372,332
|
|
|
1,214,882
|
|
|||||
Current maturities of long-term debt
|
|
19,835
|
|
|
17,648
|
|
|
26,399
|
|
|
22,024
|
|
|
33,775
|
|
|||||
Long-term debt, less current maturities
|
|
350,785
|
|
|
333,480
|
|
|
346,536
|
|
|
361,530
|
|
|
218,834
|
|
|||||
Total liabilities
(7)
|
|
617,399
|
|
|
659,457
|
|
|
646,048
|
|
|
645,411
|
|
|
498,761
|
|
|||||
Total stockholders’ equity
|
|
568,500
|
|
|
578,025
|
|
|
626,635
|
|
|
709,368
|
|
|
699,316
|
|
(1)
|
2016 results include charges of
$15.9 million
related to our 2016 and 2014 restructuring efforts and
$2.7 million
in acquisition expenses related to our acquisitions of Underground Solutions, Fyfe Europe, Concrete Solutions, LMJ and diligence on other targets. Results also include a gain of $6.6 million in connection with the settlement of two longstanding lawsuits.
|
(2)
|
2015 results include charges of $11.0 million related to our 2014 Restructuring, $43.5 million related to certain goodwill impairments, and $1.9 million in acquisition expenses related to our acquisitions of Schultz, Underground Solutions and diligence on other targets. Results also include $3.4 million related to expenses associated with the amended and restated $650 million senior secured credit facility and our write-off of unamortized debt issuance costs from our prior credit facility.
|
(3)
|
2014 results include charges of $49.5 million related to our 2014 Restructuring, $52.7 million related to certain goodwill and definite-lived intangible asset impairments, and $1.4 million in acquisition expenses related to our acquisition of Brinderson and diligence on other targets. Results also include $4.5 million in proceeds received in connection with the settlement of escrow claims related to the purchase of Brinderson.
|
(4)
|
2013 results include $5.8 million in acquisition expenses related to our acquisition of Brinderson and diligence on other targets.
|
(5)
|
2012 results include $3.1 million in acquisition expenses related to our acquisitions of Fyfe LA, Fyfe Asia and diligence on other targets. Additionally, 2012 statement of operations data was retrospectively adjusted for the impact of discontinued operations.
|
(6)
|
All periods presented include amounts attributable to Aegion Corporation.
|
(7)
|
Amounts also include certain components of discontinued operations.
|
i.
|
adding patented Fusible PVC
®
pipe technology to our pressure pipe rehabilitation portfolio through the acquisition of Underground Solutions;
|
ii.
|
expanding our CIPP presence in Europe by acquiring the CIPP contracting operations of LMJ, a Danish company
;
|
iii.
|
gaining worldwide rights to market, manufacture and install the patented Tyfo
®
Fibrwrap
®
FRP technology by acquiring Fyfe Europe; and
|
iv.
|
expanding our
FRP
presence in Asia through the acquisition of Concrete Solutions.
|
|
|
|
|
|
|
|
2016 vs 2015
|
|
2015 vs 2014
|
||||||||||||||||
(dollars in thousands)
|
Years Ended December 31,
|
|
Increase (Decrease)
|
|
Increase (Decrease)
|
||||||||||||||||||||
|
2016
|
|
2015
|
|
2014
|
|
$
|
|
%
|
|
$
|
|
%
|
||||||||||||
Revenues
|
$
|
1,221,920
|
|
|
$
|
1,333,570
|
|
|
$
|
1,331,421
|
|
|
$
|
(111,650
|
)
|
|
(8.4
|
)%
|
|
$
|
2,149
|
|
|
0.2
|
%
|
Gross profit
|
253,164
|
|
|
275,787
|
|
|
279,983
|
|
|
(22,623
|
)
|
|
(8.2
|
)
|
|
(4,196
|
)
|
|
(1.5
|
)
|
|||||
Gross profit margin
|
20.7
|
%
|
|
20.7
|
%
|
|
21.0
|
%
|
|
N/A
|
|
|
—
|
|
|
N/A
|
|
|
(30
|
)bp
|
|||||
Operating expenses
|
197,099
|
|
|
209,477
|
|
|
234,105
|
|
|
(12,378
|
)
|
|
(5.9
|
)
|
|
(24,628
|
)
|
|
(10.5
|
)
|
|||||
Goodwill impairment
|
—
|
|
|
43,484
|
|
|
51,512
|
|
|
(43,484
|
)
|
|
N/M
|
|
|
(8,028
|
)
|
|
(15.6
|
)
|
|||||
Definite-lived intangible asset impairment
|
—
|
|
|
—
|
|
|
12,116
|
|
|
—
|
|
|
—
|
|
|
(12,116
|
)
|
|
N/M
|
|
|||||
Gain on litigation settlement
|
(6,625
|
)
|
|
—
|
|
|
—
|
|
|
(6,625
|
)
|
|
N/M
|
|
|
—
|
|
|
—
|
|
|||||
Acquisition-related expenses
|
2,696
|
|
|
1,912
|
|
|
1,375
|
|
|
784
|
|
|
41.0
|
|
|
537
|
|
|
39.1
|
|
|||||
Restructuring charges
|
9,168
|
|
|
968
|
|
|
687
|
|
|
8,200
|
|
|
847.1
|
|
|
281
|
|
|
40.9
|
|
|||||
Operating income (loss)
|
50,826
|
|
|
19,946
|
|
|
(19,812
|
)
|
|
30,880
|
|
|
154.8
|
|
|
39,758
|
|
|
200.7
|
|
|||||
Operating margin
|
4.2
|
%
|
|
1.5
|
%
|
|
(1.5
|
)%
|
|
N/A
|
|
|
270
|
bp
|
|
N/A
|
|
|
300
|
bp
|
|||||
Income (loss) from continuing operations
|
29,160
|
|
|
(7,990
|
)
|
|
(31,565
|
)
|
|
37,150
|
|
|
465.0
|
|
|
23,575
|
|
|
(74.7
|
)
|
|
December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
Infrastructure Solutions
(1)
|
$
|
283.4
|
|
|
$
|
311.2
|
|
|
$
|
337.5
|
|
Corrosion Protection
(2)
|
213.4
|
|
|
272.5
|
|
|
176.0
|
|
|||
Energy Services
(3)
|
192.8
|
|
|
192.8
|
|
|
244.5
|
|
|||
Total backlog
|
$
|
689.6
|
|
|
$
|
776.5
|
|
|
$
|
758.0
|
|
(1)
|
December 31, 2016, 2015 and 2014 included backlog from restructured entities of zero, $0.8 million and $3.7 million, respectively.
|
(2)
|
December 31, 2016 and 2015 included backlog from our large domestic pipe coating and insulation contract of $96.8 million and $134.3 million, respectively.
|
(3)
|
December 31, 2016, 2015 and 2014 included upstream-related backlog of $29.8 million, $41.1 million and $96.5 million, respectively.
|
|
|
|
|
|
|
|
2016 vs 2015
|
|
2015 vs 2014
|
||||||||||||||||
(dollars in thousands)
|
Years Ended December 31,
|
|
Increase (Decrease)
|
|
Increase (Decrease)
|
||||||||||||||||||||
|
2016
|
|
2015
|
|
2014
|
|
$
|
|
%
|
|
$
|
|
%
|
||||||||||||
Revenues
|
$
|
571,551
|
|
|
$
|
556,234
|
|
|
$
|
567,205
|
|
|
$
|
15,317
|
|
|
2.8
|
%
|
|
$
|
(10,971
|
)
|
|
(1.9
|
)%
|
Gross profit
|
141,681
|
|
|
139,895
|
|
|
135,883
|
|
|
1,786
|
|
|
1.3
|
|
|
4,012
|
|
|
3.0
|
|
|||||
Gross profit margin
|
24.8
|
%
|
|
25.2
|
%
|
|
24.0
|
%
|
|
N/A
|
|
|
(40
|
)bp
|
|
N/A
|
|
|
120
|
bp
|
|||||
Operating expenses
|
89,477
|
|
|
90,928
|
|
|
124,101
|
|
|
(1,451
|
)
|
|
(1.6
|
)
|
|
(33,173
|
)
|
|
(26.7
|
)
|
|||||
Goodwill impairment
|
—
|
|
|
—
|
|
|
16,069
|
|
|
—
|
|
|
—
|
|
|
(16,069
|
)
|
|
N/M
|
|
|||||
Definite-lived intangible asset impairment
|
—
|
|
|
—
|
|
|
1,220
|
|
|
—
|
|
|
—
|
|
|
(1,220
|
)
|
|
N/M
|
|
|||||
Gain on litigation settlement
|
(6,625
|
)
|
|
—
|
|
|
—
|
|
|
(6,625
|
)
|
|
N/M
|
|
|
—
|
|
|
—
|
|
|||||
Acquisition-related expenses
|
2,696
|
|
|
1,132
|
|
|
—
|
|
|
1,564
|
|
|
138.2
|
|
|
1,132
|
|
|
N/M
|
|
|||||
Restructuring charges
|
2,630
|
|
|
968
|
|
|
687
|
|
|
1,662
|
|
|
171.7
|
|
|
281
|
|
|
40.9
|
|
|||||
Operating income (loss)
|
53,503
|
|
|
46,867
|
|
|
(6,194
|
)
|
|
6,636
|
|
|
14.2
|
|
|
53,061
|
|
|
(856.7
|
)
|
|||||
Operating margin
|
9.4
|
%
|
|
8.4
|
%
|
|
(1.1
|
)%
|
|
N/A
|
|
|
100
|
bp
|
|
N/A
|
|
|
950
|
bp
|
|
|
|
|
|
|
|
2016 vs 2015
|
|
2015 vs 2014
|
||||||||||||||||
(dollars in thousands)
|
Years Ended December 31,
|
|
Increase (Decrease)
|
|
Increase (Decrease)
|
||||||||||||||||||||
|
2016
|
|
2015
|
|
2014
|
|
$
|
|
%
|
|
$
|
|
%
|
||||||||||||
Revenues
|
$
|
401,469
|
|
|
$
|
437,921
|
|
|
$
|
458,409
|
|
|
$
|
(36,452
|
)
|
|
(8.3
|
)%
|
|
$
|
(20,488
|
)
|
|
(4.5
|
)%
|
Gross profit
|
83,269
|
|
|
93,220
|
|
|
99,304
|
|
|
(9,951
|
)
|
|
(10.7
|
)
|
|
(6,084
|
)
|
|
(6.1
|
)
|
|||||
Gross profit margin
|
20.7
|
%
|
|
21.3
|
%
|
|
21.7
|
%
|
|
N/A
|
|
|
(60
|
)bp
|
|
N/A
|
|
|
(40
|
)bp
|
|||||
Operating expenses
|
77,657
|
|
|
84,577
|
|
|
83,256
|
|
|
(6,920
|
)
|
|
(8.2
|
)
|
|
1,321
|
|
|
1.6
|
|
|||||
Goodwill impairment
|
—
|
|
|
9,957
|
|
|
35,443
|
|
|
(9,957
|
)
|
|
N/M
|
|
|
(25,486
|
)
|
|
(71.9
|
)
|
|||||
Definite-lived intangible asset impairment
|
—
|
|
|
—
|
|
|
10,896
|
|
|
—
|
|
|
—
|
|
|
(10,896
|
)
|
|
N/M
|
|
|||||
Acquisition-related expenses
|
—
|
|
|
457
|
|
|
719
|
|
|
(457
|
)
|
|
N/M
|
|
|
(262
|
)
|
|
(36.4
|
)
|
|||||
Restructuring charges
|
3,803
|
|
|
—
|
|
|
—
|
|
|
3,803
|
|
|
N/M
|
|
|
—
|
|
|
—
|
||||||
Operating income (loss)
|
1,809
|
|
|
(1,771
|
)
|
|
(31,010
|
)
|
|
3,580
|
|
|
202.1
|
|
|
29,239
|
|
|
(94.3
|
)
|
|||||
Operating margin
|
0.5
|
%
|
|
(0.4
|
)%
|
|
(6.8
|
)%
|
|
N/A
|
|
|
90
|
bp
|
|
N/A
|
|
|
640
|
bp
|
|
|
|
|
|
|
|
2016 vs 2015
|
|
2015 vs 2014
|
||||||||||||||||
(dollars in thousands)
|
Years Ended December 31,
|
|
Increase (Decrease)
|
|
Increase (Decrease)
|
||||||||||||||||||||
|
2016
|
|
2015
|
|
2014
|
|
$
|
|
%
|
|
$
|
|
%
|
||||||||||||
Revenues
|
$
|
248,900
|
|
|
$
|
339,415
|
|
|
$
|
305,807
|
|
|
$
|
(90,515
|
)
|
|
(26.7
|
)%
|
|
$
|
33,608
|
|
|
11.0
|
%
|
Gross profit
|
28,214
|
|
|
42,672
|
|
|
44,796
|
|
|
(14,458
|
)
|
|
(33.9
|
)
|
|
(2,124
|
)
|
|
(4.7
|
)
|
|||||
Gross profit margin
|
11.3
|
%
|
|
12.6
|
%
|
|
14.6
|
%
|
|
N/A
|
|
|
(130
|
)bp
|
|
N/A
|
|
|
(200
|
)bp
|
|||||
Operating expenses
|
29,965
|
|
|
33,972
|
|
|
26,748
|
|
|
(4,007
|
)
|
|
(11.8
|
)
|
|
7,224
|
|
|
27.0
|
|
|||||
Goodwill impairment
|
—
|
|
|
33,527
|
|
|
—
|
|
|
(33,527
|
)
|
|
N/M
|
|
|
33,527
|
|
|
N/M
|
|
|||||
Acquisition-related expenses
|
—
|
|
|
323
|
|
|
656
|
|
|
(323
|
)
|
|
N/M
|
|
|
(333
|
)
|
|
(50.8
|
)
|
|||||
Restructuring charges
|
2,735
|
|
|
—
|
|
|
—
|
|
|
2,735
|
|
|
N/M
|
|
|
—
|
|
|
—
|
|
|||||
Operating income (loss)
|
(4,486
|
)
|
|
(25,150
|
)
|
|
17,392
|
|
|
20,664
|
|
|
(82.2
|
)
|
|
(42,542
|
)
|
|
(244.6
|
)
|
|||||
Operating margin
|
(1.8
|
)%
|
|
(7.4
|
)%
|
|
5.7
|
%
|
|
N/A
|
|
|
560
|
bp
|
|
N/A
|
|
|
(1,310
|
)bp
|
|
December 31,
|
||||||
|
2016
|
|
2015
|
||||
|
(in thousands)
|
||||||
Cash and cash equivalents
|
$
|
129,500
|
|
|
$
|
209,253
|
|
Restricted cash
|
4,892
|
|
|
5,796
|
|
|
Payments Due by Period
|
||||||||||||||||||||||||||
Cash Obligations
(1) (2) (3) (4)
|
Total
|
|
2017
|
|
2018
|
|
2019
|
|
2020
|
|
2021
|
|
Thereafter
|
||||||||||||||
Long-term debt and notes payable
|
$
|
374,026
|
|
|
$
|
19,835
|
|
|
$
|
35,899
|
|
|
$
|
28,438
|
|
|
$
|
289,854
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Interest on long-term debt
|
38,321
|
|
|
11,084
|
|
|
10,420
|
|
|
9,575
|
|
|
7,242
|
|
|
—
|
|
|
—
|
|
|||||||
Operating leases
|
61,085
|
|
|
18,976
|
|
|
14,610
|
|
|
10,723
|
|
|
7,035
|
|
|
4,818
|
|
|
4,923
|
|
|||||||
Total contractual cash obligations
|
$
|
473,432
|
|
|
$
|
49,895
|
|
|
$
|
60,929
|
|
|
$
|
48,736
|
|
|
$
|
304,131
|
|
|
$
|
4,818
|
|
|
$
|
4,923
|
|
(1)
|
Cash obligations are not discounted. See Notes 7 and 11 to the consolidated financial statements contained in this Report regarding our long-term debt and credit facility and commitments and contingencies, respectively.
|
(2)
|
Interest on long-term debt was calculated using the current annualized rate on our long-term debt as discussed in Note 7 to the consolidated financial statements contained in this Report.
|
(3)
|
Liabilities related to Financial Accounting Standards Board Accounting Standards Codification 740,
Income Taxes,
have not been included in the table above because we are uncertain as to if or when such amounts may be settled. As of December 31, 2016, we had income tax receivable and income tax payable of $4.6 million and $1.9 million, respectively, recorded on our consolidated balance sheet.
|
(4)
|
There were no material purchase commitments at
December 31, 2016
.
|
|
Infrastructure
Solutions
|
|
Corrosion
Protection
|
|
Energy
Services
|
|
Total
|
||||||||
Balance, January 1, 2016
|
|
|
|
|
|
|
|
||||||||
Goodwill, gross
|
$
|
190,525
|
|
|
$
|
73,345
|
|
|
$
|
80,246
|
|
|
$
|
344,116
|
|
Accumulated impairment losses
|
(16,069
|
)
|
|
(45,400
|
)
|
|
(33,527
|
)
|
|
(94,996
|
)
|
||||
Goodwill, net
|
174,456
|
|
|
27,945
|
|
|
46,719
|
|
|
249,120
|
|
||||
Acquisitions
(1)
|
50,585
|
|
|
—
|
|
|
—
|
|
|
50,585
|
|
||||
Foreign currency translation
|
(1,616
|
)
|
|
530
|
|
|
—
|
|
|
(1,086
|
)
|
||||
Balance, December 31, 2016
|
|
|
|
|
|
|
|
||||||||
Goodwill, gross
|
239,494
|
|
|
73,875
|
|
|
80,246
|
|
|
393,615
|
|
||||
Accumulated impairment losses
|
(16,069
|
)
|
|
(45,400
|
)
|
|
(33,527
|
)
|
|
(94,996
|
)
|
||||
Goodwill, net
|
$
|
223,425
|
|
|
$
|
28,475
|
|
|
$
|
46,719
|
|
|
$
|
298,619
|
|
(1)
|
During 2016 , we recorded goodwill of
$44.0 million
,
$2.4 million
,
$0.8 million
and
$3.4 million
related to the acquisitions of Underground Solutions, Fyfe Europe, LMJ and Concrete Solutions, respectively (see Note 1 to the consolidated financial statements contained in this Report).
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
/s/ Charles R. Gordon
|
|
Charles R. Gordon
President and Chief Executive Officer
(Principal Executive Officer)
|
|
/s/ David A. Martin
|
|
David A. Martin
Executive Vice President and Chief Financial Officer
(Principal Financial Officer)
|
|
|
Years Ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
Revenues
|
$
|
1,221,920
|
|
|
$
|
1,333,570
|
|
|
$
|
1,331,421
|
|
Cost of revenues
|
968,756
|
|
|
1,057,783
|
|
|
1,051,438
|
|
|||
Gross profit
|
253,164
|
|
|
275,787
|
|
|
279,983
|
|
|||
Operating expenses
|
197,099
|
|
|
209,477
|
|
|
234,105
|
|
|||
Goodwill impairment
|
—
|
|
|
43,484
|
|
|
51,512
|
|
|||
Definite-lived intangible asset impairment
|
—
|
|
|
—
|
|
|
12,116
|
|
|||
Gain on litigation settlement
|
(6,625
|
)
|
|
—
|
|
|
—
|
|
|||
Acquisition-related expenses
|
2,696
|
|
|
1,912
|
|
|
1,375
|
|
|||
Restructuring charges
|
9,168
|
|
|
968
|
|
|
687
|
|
|||
Operating income (loss)
|
50,826
|
|
|
19,946
|
|
|
(19,812
|
)
|
|||
Other income (expense):
|
|
|
|
|
|
||||||
Interest expense
|
(15,029
|
)
|
|
(16,044
|
)
|
|
(12,943
|
)
|
|||
Interest income
|
166
|
|
|
218
|
|
|
633
|
|
|||
Other
|
(694
|
)
|
|
(2,905
|
)
|
|
(3,853
|
)
|
|||
Total other expense
|
(15,557
|
)
|
|
(18,731
|
)
|
|
(16,163
|
)
|
|||
Income (loss) before taxes on income
|
35,269
|
|
|
1,215
|
|
|
(35,975
|
)
|
|||
Taxes (benefit) on income (loss)
|
6,109
|
|
|
9,205
|
|
|
(3,840
|
)
|
|||
Income (loss) before equity in earnings of affiliated companies
|
29,160
|
|
|
(7,990
|
)
|
|
(32,135
|
)
|
|||
Equity in earnings of affiliated companies
|
—
|
|
|
—
|
|
|
570
|
|
|||
Income (loss) from continuing operations
|
29,160
|
|
|
(7,990
|
)
|
|
(31,565
|
)
|
|||
Loss from discontinued operations
|
—
|
|
|
—
|
|
|
(3,847
|
)
|
|||
Net income (loss)
|
29,160
|
|
|
(7,990
|
)
|
|
(35,412
|
)
|
|||
Non-controlling interests (income) loss
|
328
|
|
|
(77
|
)
|
|
(1,755
|
)
|
|||
Net income (loss) attributable to Aegion Corporation
|
$
|
29,488
|
|
|
$
|
(8,067
|
)
|
|
$
|
(37,167
|
)
|
|
|
|
|
|
|
||||||
Earnings per share attributable to Aegion Corporation:
|
|
|
|
|
|
||||||
Basic:
|
|
|
|
|
|
||||||
Income (loss) from continuing operations
|
$
|
0.85
|
|
|
$
|
(0.22
|
)
|
|
$
|
(0.88
|
)
|
Loss from discontinued operations
|
—
|
|
|
—
|
|
|
(0.10
|
)
|
|||
Net income (loss)
|
$
|
0.85
|
|
|
$
|
(0.22
|
)
|
|
$
|
(0.98
|
)
|
Diluted:
|
|
|
|
|
|
||||||
Income (loss) from continuing operations
|
$
|
0.84
|
|
|
$
|
(0.22
|
)
|
|
$
|
(0.88
|
)
|
Loss from discontinued operations
|
—
|
|
|
—
|
|
|
(0.10
|
)
|
|||
Net income (loss)
|
$
|
0.84
|
|
|
$
|
(0.22
|
)
|
|
$
|
(0.98
|
)
|
|
Years Ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
Net income (loss)
|
$
|
29,160
|
|
|
$
|
(7,990
|
)
|
|
$
|
(35,412
|
)
|
Other comprehensive income (loss):
|
|
|
|
|
|
||||||
Currency translation adjustments
|
(6,343
|
)
|
|
(25,379
|
)
|
|
(27,591
|
)
|
|||
Pension activity, net of tax
(1)
|
(8
|
)
|
|
145
|
|
|
(576
|
)
|
|||
Deferred gain on hedging activity, net of tax
(2)
|
746
|
|
|
279
|
|
|
296
|
|
|||
Total comprehensive income (loss)
|
23,555
|
|
|
(32,945
|
)
|
|
(63,283
|
)
|
|||
Comprehensive (income) loss attributable to non-controlling interests
|
294
|
|
|
1,686
|
|
|
(605
|
)
|
|||
Comprehensive income (loss) attributable to Aegion Corporation
|
$
|
23,849
|
|
|
$
|
(31,259
|
)
|
|
$
|
(63,888
|
)
|
(1)
|
Amounts presented net of tax of
$(2)
, $37 and $(158) for the years ended December 31, 2016, 2015, and 2014, respectively.
|
(2)
|
Amounts presented net of tax of
$496
, $187 and $196 for the years ended December 31, 2016, 2015 and 2014, respectively.
|
|
December 31,
|
||||||
|
2016
|
|
2015
|
||||
Assets
|
|
|
|
||||
Current assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
129,500
|
|
|
$
|
209,253
|
|
Restricted cash
|
4,892
|
|
|
5,796
|
|
||
Receivables, net of allowances of $6,098 and $14,524, respectively
|
186,016
|
|
|
200,883
|
|
||
Retainage
|
33,643
|
|
|
37,285
|
|
||
Costs and estimated earnings in excess of billings
|
62,401
|
|
|
89,141
|
|
||
Inventories
|
63,953
|
|
|
47,779
|
|
||
Prepaid expenses and other current assets
|
51,832
|
|
|
66,999
|
|
||
Assets held for sale
|
—
|
|
|
21,060
|
|
||
Total current assets
|
532,237
|
|
|
678,196
|
|
||
Property, plant & equipment, less accumulated depreciation
|
156,747
|
|
|
144,833
|
|
||
Other assets
|
|
|
|
||||
Goodwill
|
298,619
|
|
|
249,120
|
|
||
Identified intangible assets, less accumulated amortization
|
194,911
|
|
|
174,118
|
|
||
Deferred income tax assets
|
1,848
|
|
|
2,130
|
|
||
Other assets
|
9,220
|
|
|
5,616
|
|
||
Total other assets
|
504,598
|
|
|
430,984
|
|
||
Total Assets
|
$
|
1,193,582
|
|
|
$
|
1,254,013
|
|
|
|
|
|
||||
Liabilities and Equity
|
|
|
|
||||
Current liabilities
|
|
|
|
||||
Accounts payable
|
$
|
63,058
|
|
|
$
|
72,732
|
|
Accrued expenses
|
85,010
|
|
|
112,951
|
|
||
Billings in excess of costs and estimated earnings
|
62,698
|
|
|
87,475
|
|
||
Current maturities of long-term debt
|
19,835
|
|
|
17,648
|
|
||
Liabilities held for sale
|
—
|
|
|
6,961
|
|
||
Total current liabilities
|
230,601
|
|
|
297,767
|
|
||
Long-term debt, less current maturities
|
350,785
|
|
|
333,480
|
|
||
Deferred income tax liabilities
|
23,339
|
|
|
19,386
|
|
||
Other non-current liabilities
|
12,674
|
|
|
8,824
|
|
||
Total liabilities
|
617,399
|
|
|
659,457
|
|
||
|
|
|
|
||||
(See Commitments and Contingencies: Note 11)
|
|
|
|
|
|
||
|
|
|
|
||||
Equity
|
|
|
|
||||
Preferred stock, undesignated, $.10 par – shares authorized 2,000,000; none outstanding
|
—
|
|
|
—
|
|
||
Common stock, $.01 par – shares authorized 125,000,000; shares issued and outstanding 33,956,304 and 36,053,499, respectively
|
340
|
|
|
361
|
|
||
Additional paid-in capital
|
166,598
|
|
|
199,951
|
|
||
Retained earnings
|
455,062
|
|
|
425,574
|
|
||
Accumulated other comprehensive loss
|
(53,500
|
)
|
|
(47,861
|
)
|
||
Total stockholders’ equity
|
568,500
|
|
|
578,025
|
|
||
Non-controlling interests
|
7,683
|
|
|
16,531
|
|
||
Total equity
|
576,183
|
|
|
594,556
|
|
||
Total Liabilities and Equity
|
$
|
1,193,582
|
|
|
$
|
1,254,013
|
|
|
Common Stock
|
|
Additional
Paid-In
Capital
|
|
Retained
Earnings
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Non-
Controlling
Interests
|
|
Total
Equity
|
|||||||||||||||
|
Shares
|
|
Amount
|
|
|
|
|
|
||||||||||||||||||
BALANCE, December 31, 2013
|
37,983,114
|
|
|
$
|
380
|
|
|
$
|
236,128
|
|
|
$
|
470,808
|
|
|
$
|
2,052
|
|
|
$
|
17,553
|
|
|
$
|
726,921
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
(37,167
|
)
|
|
—
|
|
|
1,755
|
|
|
(35,412
|
)
|
||||||
Issuance of common stock upon stock option exercises, including tax benefit
|
526,359
|
|
|
5
|
|
|
8,070
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,075
|
|
||||||
Restricted shares issued
|
242,722
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
||||||
Issuance of shares pursuant to restricted stock units
|
15,277
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Issuance of shares pursuant to deferred stock unit awards
|
31,794
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Forfeitures of restricted shares
|
(104,013
|
)
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
||||||
Shares repurchased and retired
|
(1,334,738
|
)
|
|
(12
|
)
|
|
(31,073
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(31,085
|
)
|
||||||
Equity-based compensation expense
|
—
|
|
|
|
|
|
5,073
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5,073
|
|
||||||
Purchase of non-controlling interest
|
—
|
|
|
|
|
|
(909
|
)
|
|
—
|
|
|
—
|
|
|
292
|
|
|
(617
|
)
|
||||||
Currency translation adjustment and derivative transactions, net
|
—
|
|
|
|
|
|
|
|
|
—
|
|
|
(26,721
|
)
|
|
(1,150
|
)
|
|
(27,871
|
)
|
||||||
BALANCE, December 31, 2014
|
37,360,515
|
|
|
$
|
374
|
|
|
$
|
217,289
|
|
|
$
|
433,641
|
|
|
$
|
(24,669
|
)
|
|
$
|
18,450
|
|
|
$
|
645,085
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
(8,067
|
)
|
|
—
|
|
|
77
|
|
|
(7,990
|
)
|
||||||
Issuance of common stock upon stock option exercises, including tax benefit
|
209,205
|
|
|
2
|
|
|
2,464
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,466
|
|
||||||
Issuance of shares pursuant to restricted stock units
|
12,646
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Issuance of shares pursuant to deferred stock unit awards
|
27,779
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Forfeitures of restricted shares
|
(54,045
|
)
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
||||||
Shares repurchased and retired
|
(1,502,601
|
)
|
|
(14
|
)
|
|
(27,789
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(27,803
|
)
|
||||||
Equity-based compensation expense
|
—
|
|
|
—
|
|
|
7,987
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,987
|
|
||||||
Investment by non-controlling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
239
|
|
|
239
|
|
||||||
Purchase of non-controlling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(472
|
)
|
|
(472
|
)
|
||||||
Currency translation adjustment and derivative transactions, net
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(23,192
|
)
|
|
(1,763
|
)
|
|
(24,955
|
)
|
||||||
BALANCE, December 31, 2015
|
36,053,499
|
|
|
$
|
361
|
|
|
$
|
199,951
|
|
|
$
|
425,574
|
|
|
$
|
(47,861
|
)
|
|
$
|
16,531
|
|
|
$
|
594,556
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net income (loss)
|
—
|
|
|
—
|
|
|
—
|
|
|
29,488
|
|
|
—
|
|
|
(328
|
)
|
|
29,160
|
|
||||||
Issuance of common stock upon stock option exercises, including tax benefit
|
114,307
|
|
|
1
|
|
|
1,817
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,818
|
|
||||||
Issuance of shares pursuant to restricted stock units
|
141,507
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
||||||
Issuance of shares pursuant to deferred stock unit awards
|
39,660
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Forfeitures of restricted shares
|
(42,775
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Shares repurchased and retired
|
(2,349,894
|
)
|
|
(23
|
)
|
|
(44,431
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(44,454
|
)
|
||||||
Equity-based compensation expense
|
—
|
|
|
—
|
|
|
9,261
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9,261
|
|
||||||
Sale of non-controlling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(7,278
|
)
|
|
(7,278
|
)
|
||||||
Distributions to non-controlling interests
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,276
|
)
|
|
(1,276
|
)
|
||||||
Currency translation adjustment and derivative transactions, net
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5,639
|
)
|
|
34
|
|
|
(5,605
|
)
|
||||||
BALANCE, December 31, 2016
|
33,956,304
|
|
|
$
|
340
|
|
|
$
|
166,598
|
|
|
$
|
455,062
|
|
|
$
|
(53,500
|
)
|
|
$
|
7,683
|
|
|
$
|
576,183
|
|
|
Years Ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
Cash flows from operating activities:
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
29,160
|
|
|
$
|
(7,990
|
)
|
|
$
|
(35,412
|
)
|
Loss from discontinued operations
|
—
|
|
|
—
|
|
|
3,847
|
|
|||
|
29,160
|
|
|
(7,990
|
)
|
|
(31,565
|
)
|
|||
Adjustments to reconcile to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
46,719
|
|
|
43,791
|
|
|
44,312
|
|
|||
Gain on sale of fixed assets
|
(1,916
|
)
|
|
(929
|
)
|
|
(310
|
)
|
|||
Equity-based compensation expense
|
9,261
|
|
|
7,987
|
|
|
5,073
|
|
|||
Deferred income taxes
|
1,772
|
|
|
924
|
|
|
(16,816
|
)
|
|||
Equity in earnings of affiliated companies
|
—
|
|
|
—
|
|
|
(570
|
)
|
|||
Non-cash restructuring charges
|
300
|
|
|
1,816
|
|
|
20,592
|
|
|||
Non-cash portion of litigation settlement
|
(3,000
|
)
|
|
—
|
|
|
—
|
|
|||
Fixed asset impairment
|
—
|
|
|
—
|
|
|
11,870
|
|
|||
Definite-lived intangible asset impairment
|
—
|
|
|
—
|
|
|
12,116
|
|
|||
Goodwill impairment
|
—
|
|
|
43,484
|
|
|
51,512
|
|
|||
Debt issuance costs
|
—
|
|
|
3,377
|
|
|
157
|
|
|||
Loss on sale of businesses
|
—
|
|
|
3,414
|
|
|
988
|
|
|||
Loss on foreign currency transactions
|
911
|
|
|
80
|
|
|
627
|
|
|||
Other
|
(1,044
|
)
|
|
(168
|
)
|
|
1,279
|
|
|||
Changes in operating assets and liabilities (net of acquisitions):
|
|
|
|
|
|
||||||
Restricted cash related to operating activities
|
2,055
|
|
|
(382
|
)
|
|
(454
|
)
|
|||
Return on equity of affiliated companies
|
—
|
|
|
—
|
|
|
590
|
|
|||
Receivables net, retainage and costs and estimated earnings in excess of billings
|
52,774
|
|
|
12,283
|
|
|
(41,211
|
)
|
|||
Inventories
|
(2,569
|
)
|
|
6,984
|
|
|
(5,286
|
)
|
|||
Prepaid expenses and other assets
|
16,759
|
|
|
(28,895
|
)
|
|
3,465
|
|
|||
Accounts payable and accrued expenses
|
(49,259
|
)
|
|
(582
|
)
|
|
5,997
|
|
|||
Billings in excess of costs and estimated earnings
|
(27,761
|
)
|
|
45,700
|
|
|
19,100
|
|
|||
Other operating
|
(946
|
)
|
|
1,129
|
|
|
402
|
|
|||
Net cash provided by operating activities of continuing operations
|
73,216
|
|
|
132,023
|
|
|
81,868
|
|
|||
Net cash used in operating activities of discontinued operations
|
—
|
|
|
—
|
|
|
(1,045
|
)
|
|||
Net cash provided by operating activities
|
73,216
|
|
|
132,023
|
|
|
80,823
|
|
|||
|
|
|
|
|
|
||||||
Cash flows from investing activities:
|
|
|
|
|
|
||||||
Capital expenditures
|
(38,760
|
)
|
|
(29,454
|
)
|
|
(32,899
|
)
|
|||
Proceeds from sale of fixed assets
|
3,310
|
|
|
3,173
|
|
|
1,547
|
|
|||
Patent expenditures
|
(1,043
|
)
|
|
(1,503
|
)
|
|
(1,923
|
)
|
|||
Restricted cash related to investing activities
|
(1,086
|
)
|
|
(3,538
|
)
|
|
(1,153
|
)
|
|||
Purchase of Underground Solutions, Inc., net of cash acquired
|
(84,740
|
)
|
|
—
|
|
|
—
|
|
|||
Purchase of Fyfe Europe S.A. and related companies
|
(2,800
|
)
|
|
—
|
|
|
—
|
|
|||
Purchase of CIPP business of Leif M. Jensen A/S
|
(3,235
|
)
|
|
—
|
|
|
—
|
|
|||
Purchase of Concrete Solutions Limited and Building Chemical Supplies Limited
|
(5,532
|
)
|
|
—
|
|
|
—
|
|
|||
Purchase of Schultz Mechanical Contractors, Inc.
|
—
|
|
|
(6,662
|
)
|
|
—
|
|
|||
Sale of interest in Bayou Perma-Pipe Canada, Ltd., net of cash disposed
|
6,599
|
|
|
—
|
|
|
—
|
|
|||
Sale of interests in Bayou Coating, L.L.C.
|
—
|
|
|
—
|
|
|
9,065
|
|
|||
Sale of Ka-te Insituform AG
|
—
|
|
|
—
|
|
|
1,123
|
|
|||
Payment to Fyfe Asia sellers for final net working capital
|
—
|
|
|
(1,098
|
)
|
|
—
|
|
|||
Payment from Brinderson sellers for final net working capital
|
—
|
|
|
—
|
|
|
1,000
|
|
|||
Net cash used in investing activities of continuing operations
|
(127,287
|
)
|
|
(39,082
|
)
|
|
(23,240
|
)
|
|||
Net cash provided by investing activities of discontinued operations
|
—
|
|
|
—
|
|
|
1,045
|
|
|||
Net cash used in investing activities
|
(127,287
|
)
|
|
(39,082
|
)
|
|
(22,195
|
)
|
|
Year Ended
December 31, 2016
|
|
Year Ended
December 31, 2015
|
||||||||||||||||||||
|
Underground
Solutions
(1)
|
|
Fyfe
Europe |
|
LMJ
|
|
Concrete
Solutions |
|
Schultz
(2)
|
|
Schultz
(3)
|
||||||||||||
Revenues
|
$
|
29,425
|
|
|
$
|
23
|
|
|
$
|
4,865
|
|
|
$
|
2,700
|
|
|
$
|
24,702
|
|
|
$
|
13,771
|
|
Net income (loss)
|
(2,694
|
)
|
|
(764
|
)
|
|
(1,153
|
)
|
|
106
|
|
|
(1,068
|
)
|
|
(1,470
|
)
|
(1)
|
The reported net loss for Underground Solutions for 2016 includes inventory step up expense of
$3.6 million
, recognized as part of the accounting for business combinations, and an allocation of corporate expenses of
$3.2 million
.
|
(2)
|
The reported net loss for Schultz for 2016 includes charges related to the 2016 Restructuring of
$0.2 million
and an allocation of corporate expenses of
$2.9 million
.
|
(3)
|
The reported net loss for Schultz for 2015 includes a pre-tax charge for goodwill impairment of
$1.7 million
and an allocation of corporate expenses of
$1.0 million
.
|
|
Years Ended December 31,
|
||||||||||
|
2016
(1)
|
|
2015
(2)
|
|
2014
(3)
|
||||||
Revenues
|
$
|
1,231,900
|
|
|
$
|
1,387,465
|
|
|
$
|
1,339,147
|
|
Net income (loss)
(4)
|
29,743
|
|
|
(6,545
|
)
|
|
(35,304
|
)
|
|||
Diluted earnings (loss) per share
|
$
|
0.84
|
|
|
$
|
(0.18
|
)
|
|
$
|
(0.94
|
)
|
(1)
|
Includes pro-forma results related to Underground Solutions, Fyfe Europe, LMJ and Concrete Solutions.
|
(2)
|
Includes pro-forma results related to Underground Solutions, Fyfe Europe, LMJ, Concrete Solutions and Schultz.
|
(3)
|
Includes pro-forma results related to Schultz.
|
(4)
|
Includes pro-forma adjustments for purchase price depreciation and amortization as if those intangibles were recorded as of January 1 of the year preceding the respective acquisition date.
|
|
Underground
Solutions
|
|
Fyfe
Europe
|
|
LMJ
|
|
Concrete
Solutions
|
|
Schultz
|
||||||||||
Cash
|
$
|
3,630
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Receivables and cost and estimated earnings in excess of billings
|
6,339
|
|
|
—
|
|
|
—
|
|
|
1,469
|
|
|
1,086
|
|
|||||
Inventories
|
12,629
|
|
|
—
|
|
|
504
|
|
|
857
|
|
|
—
|
|
|||||
Prepaid expenses and other current assets
|
671
|
|
|
—
|
|
|
—
|
|
|
18
|
|
|
19
|
|
|||||
Property, plant and equipment
|
2,755
|
|
|
50
|
|
|
1,194
|
|
|
422
|
|
|
162
|
|
|||||
Identified intangible assets
|
33,370
|
|
|
513
|
|
|
795
|
|
|
1,722
|
|
|
3,060
|
|
|||||
Deferred income tax assets
|
12,911
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Other assets
|
90
|
|
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Accounts payable
|
(4,653
|
)
|
|
—
|
|
|
—
|
|
|
(837
|
)
|
|
(663
|
)
|
|||||
Accrued expenses
|
(5,900
|
)
|
|
—
|
|
|
—
|
|
|
(149
|
)
|
|
—
|
|
|||||
Billings in excess of cost and estimated earnings
|
(2,943
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Deferred tax liabilities
|
(14,562
|
)
|
|
—
|
|
|
—
|
|
|
(482
|
)
|
|
—
|
|
|||||
Total identifiable net assets
|
$
|
44,337
|
|
|
$
|
563
|
|
|
$
|
2,493
|
|
|
$
|
3,020
|
|
|
$
|
3,664
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total consideration recorded
|
$
|
88,370
|
|
|
$
|
3,000
|
|
|
$
|
3,235
|
|
|
$
|
6,393
|
|
|
$
|
7,662
|
|
Less: total identifiable net assets
|
44,337
|
|
|
563
|
|
|
2,493
|
|
|
3,020
|
|
|
3,664
|
|
|||||
Final purchase price goodwill
|
$
|
44,033
|
|
|
$
|
2,437
|
|
|
$
|
742
|
|
|
$
|
3,373
|
|
|
$
|
3,998
|
|
|
Years Ended December 31,
|
|||||||
|
2016
|
|
2015
|
|
2014
|
|||
Weighted average number of common shares used for basic EPS
|
34,713,937
|
|
|
36,554,437
|
|
|
37,651,492
|
|
Effect of dilutive stock options and restricted and deferred stock unit awards
|
496,493
|
|
|
—
|
|
|
—
|
|
Weighted average number of common shares and dilutive potential common stock used in dilutive EPS
|
35,210,430
|
|
|
36,554,437
|
|
|
37,651,492
|
|
•
|
significant underperformance of a segment relative to expected, historical or forecasted operating results;
|
•
|
significant negative industry or economic trends;
|
•
|
significant changes in the strategy for a segment including extended slowdowns in the segment’s market;
|
•
|
a decrease in market capitalization below the Company’s book value; and
|
•
|
a significant change in regulations.
|
Statement of operations data
|
Year Ended
December 31,
2014
(1)
|
||
Revenue
|
$
|
9,088
|
|
Gross profit
|
3,489
|
|
|
Net income
|
2,413
|
|
|
Equity in earnings of affiliated companies
|
570
|
|
•
|
determine whether the entity meets the criteria to qualify as a VIE; and
|
•
|
determine whether the Company is the primary beneficiary of the VIE.
|
•
|
the design of the entity, including the nature of its risks and the purpose for which the entity was created, to determine the variability that the entity was designed to create and distribute to its interest holders;
|
•
|
the nature of the Company’s involvement with the entity;
|
•
|
whether control of the entity may be achieved through arrangements that do not involve voting equity;
|
•
|
whether there is sufficient equity investment at risk to finance the activities of the entity; and
|
•
|
whether parties other than the equity holders have the obligation to absorb expected losses or the right to receive residual returns.
|
•
|
whether the entity has the power to direct the activities of a variable interest entity that most significantly impact the entity’s economic performance; and
|
•
|
whether the entity has the obligation to absorb losses of the entity that could potentially be significant to the variable interest entity or the right to receive benefits from the entity that could potentially be significant to the variable interest entity.
|
|
December 31,
|
||||||
Balance sheet data
|
2016
|
|
2015
(1)
|
||||
Current assets
|
$
|
51,354
|
|
|
$
|
60,730
|
|
Non-current assets
|
25,607
|
|
|
26,316
|
|
||
Current liabilities
|
29,324
|
|
|
24,784
|
|
||
Non-current liabilities
|
28,849
|
|
|
25,728
|
|
(1)
|
Amounts include
$21.1 million
of current assets and
$7.0 million
of current liabilities classified as held for sale. See Note 5.
|
|
Years Ended December 31,
|
||||||||||
Statement of operations data
|
2016
|
|
2015
|
|
2014
|
||||||
Revenue
|
$
|
61,205
|
|
|
$
|
77,361
|
|
|
$
|
84,968
|
|
Gross profit
|
5,760
|
|
|
11,325
|
|
|
14,306
|
|
|||
Net income (loss)
|
(3,075
|
)
|
|
321
|
|
|
2,413
|
|
|
Year Ended December 31, 2016
|
||||||||||||||
|
Infrastructure
Solutions
|
|
Corrosion
Protection
|
|
Energy
Services
|
|
Total
|
||||||||
Severance and benefit related costs
|
$
|
2,249
|
|
|
$
|
3,588
|
|
|
$
|
1,559
|
|
|
$
|
7,396
|
|
Lease termination costs
|
—
|
|
|
154
|
|
|
983
|
|
|
1,137
|
|
||||
Relocation and other moving costs
|
307
|
|
|
62
|
|
|
193
|
|
|
562
|
|
||||
Other restructuring costs
(1)
|
808
|
|
|
761
|
|
|
5,436
|
|
|
7,005
|
|
||||
Total pre-tax restructuring charges
(2)
|
$
|
3,364
|
|
|
$
|
4,565
|
|
|
$
|
8,171
|
|
|
$
|
16,100
|
|
(1)
|
For Energy Services, includes charges primarily related to downsizing the Company’s upstream operations in California, inclusive of wind-down costs, professional fees, fixed asset disposals and certain other restructuring charges.
|
(2)
|
Includes
$1.4 million
of corporate-related restructuring charges that have been allocated to the reportable segments.
|
|
Year Ended December 31, 2016
|
||||||||||
|
Non-Cash
Restructuring
Charges
|
|
Cash
Restructuring
Charges
(1)
|
|
Total
|
||||||
|
|||||||||||
Cost of revenues
(2)
|
$
|
—
|
|
|
$
|
278
|
|
|
$
|
278
|
|
Operating expenses
(3)
|
516
|
|
|
5,962
|
|
|
6,478
|
|
|||
Restructuring charges
(4)
|
—
|
|
|
9,095
|
|
|
9,095
|
|
|||
Other expense
(5)
|
249
|
|
|
—
|
|
|
249
|
|
|||
Total pre-tax restructuring charges
|
$
|
765
|
|
|
$
|
15,335
|
|
|
$
|
16,100
|
|
(1)
|
Cash charges consist of charges incurred during the period that will be settled in cash, either during the current period or future periods.
|
(2)
|
All charges relate to Corrosion Protection.
|
(3)
|
Operating expense charges mainly include wind-down and legal fees associated with the restructuring. Includes charges of
$0.6 million
related to Infrastructure Solutions,
$0.5 million
related to Corrosion Protection and
$5.4 million
related to Energy Services.
|
(4)
|
Restructuring costs relate to severance, other termination benefit costs and early lease termination costs. Includes charges of
$2.6 million
related to Infrastructure Solutions,
$3.8 million
related to Corrosion Protection and
$2.7 million
related to Energy Services.
|
(5)
|
All charges relate to the release of cumulative currency translation adjustments in Infrastructure Solutions.
|
|
2016
Charge to Income |
|
Utilized in 2016
|
|
Reserves at
December 31, 2016 |
||||||||||
|
|
Cash
(1)
|
|
Non-Cash
|
|
||||||||||
Severance and benefit related costs
|
$
|
7,396
|
|
|
$
|
6,751
|
|
|
$
|
—
|
|
|
$
|
645
|
|
Lease termination costs
|
1,137
|
|
|
1,012
|
|
|
—
|
|
|
125
|
|
||||
Relocation and other moving costs
|
562
|
|
|
552
|
|
|
—
|
|
|
10
|
|
||||
Other restructuring costs
|
7,005
|
|
|
6,120
|
|
|
765
|
|
|
120
|
|
||||
Total pre-tax restructuring charges
|
$
|
16,100
|
|
|
$
|
14,435
|
|
|
$
|
765
|
|
|
$
|
900
|
|
(1)
|
Refers to cash utilized to settle charges during 2016.
|
|
Years Ended December 31,
|
||||||||||||||||||
|
2016
(1)
|
|
2015
(1)
|
|
2014
|
||||||||||||||
|
Total
|
|
Total
|
|
Infrastructure
Solutions |
|
Corrosion Protection
|
|
Total
|
||||||||||
Severance and benefit related costs
|
$
|
73
|
|
|
$
|
801
|
|
|
$
|
687
|
|
|
$
|
—
|
|
|
$
|
687
|
|
Lease termination costs
|
—
|
|
|
167
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Allowances for doubtful accounts
|
(585
|
)
|
|
1,186
|
|
|
11,947
|
|
|
—
|
|
|
11,947
|
|
|||||
Inventory obsolescence
|
—
|
|
|
—
|
|
|
2,746
|
|
|
—
|
|
|
2,746
|
|
|||||
Fixed asset impairment
|
—
|
|
|
—
|
|
|
533
|
|
|
11,338
|
|
|
11,871
|
|
|||||
Other asset write-offs
|
—
|
|
|
1,880
|
|
|
5,013
|
|
|
10,896
|
|
|
15,909
|
|
|||||
Other restructuring costs
(2)
|
340
|
|
|
6,946
|
|
|
6,358
|
|
|
—
|
|
|
6,358
|
|
|||||
Total pre-tax restructuring charges
|
$
|
(172
|
)
|
|
$
|
10,980
|
|
|
$
|
27,284
|
|
|
$
|
22,234
|
|
|
$
|
49,518
|
|
(1)
|
All charges relate to Infrastructure Solutions.
|
(2)
|
Includes charges related to the losses on the sales of the CIPP contracting operations in France in February 2015 and Switzerland in December 2014, including the release of cumulative currency translation adjustments resulting from those sales. Also includes the write-off of certain other current assets and long-lived assets, professional fees and certain other restructuring charges.
|
|
Year Ended December 31, 2016
|
||||||||||
|
Other
Non-Cash
Restructuring
Charges
(1)
|
|
Cash
Restructuring
Charges
(Reversals)
(1)
|
|
Total
|
||||||
Cost of revenues
|
$
|
—
|
|
|
$
|
55
|
|
|
$
|
55
|
|
Operating expenses
|
(465
|
)
|
|
165
|
|
|
(300
|
)
|
|||
Restructuring charges
|
—
|
|
|
73
|
|
|
73
|
|
|||
Total pre-tax restructuring charges
(2)
|
$
|
(465
|
)
|
|
$
|
293
|
|
|
$
|
(172
|
)
|
(1)
|
Cash charges consist of charges incurred during the period that will be settled in cash, either during the current period or future periods.
|
(2)
|
All charges relate to Infrastructure Solutions.
|
|
Year Ended December 31, 2015
|
||||||||||
|
Other
Non-Cash Restructuring Charges |
|
Cash
Restructuring Charges (1) |
|
Total
|
||||||
Cost of revenues
|
$
|
1,620
|
|
|
$
|
1,097
|
|
|
$
|
2,717
|
|
Operating expenses
|
25
|
|
|
4,362
|
|
|
4,387
|
|
|||
Restructuring charges
|
—
|
|
|
968
|
|
|
968
|
|
|||
Other expense
(2)
|
3,035
|
|
|
(127
|
)
|
|
2,908
|
|
|||
Total pre-tax restructuring charges
(3)
|
$
|
4,680
|
|
|
$
|
6,300
|
|
|
$
|
10,980
|
|
(1)
|
Cash charges consist of charges incurred during the period that will be settled in cash, either during the current period or future periods.
|
(2)
|
Non-cash charges are comprised solely of charges related to the loss on sale of the CIPP contracting operation in France, including the release of cumulative currency translation adjustments, write-off of certain other current assets and long-lived assets as well as the reversal of a legal accrual.
|
(3)
|
All charges relate to Infrastructure Solutions.
|
|
Year Ended December 31, 2014
|
||||||||||
|
Other
Non-Cash Restructuring Charges (2) |
|
Cash
Restructuring Charges (1) |
|
Total
|
||||||
Cost of revenues
|
$
|
14,610
|
|
|
$
|
1,076
|
|
|
$
|
15,686
|
|
Operating expenses
|
17,579
|
|
|
2,976
|
|
|
20,555
|
|
|||
Definite-lived intangible asset impairment
|
10,896
|
|
|
—
|
|
|
10,896
|
|
|||
Restructuring charges
|
—
|
|
|
687
|
|
|
687
|
|
|||
Other expense
(3)
|
790
|
|
|
904
|
|
|
1,694
|
|
|||
Total pre-tax restructuring charges
|
$
|
43,875
|
|
|
$
|
5,643
|
|
|
$
|
49,518
|
|
(1)
|
Cash charges consist of charges incurred during the period that will be settled in cash, either during the current period or future periods.
|
(2)
|
Non-cash charges are comprised of Corrosion Protection charges of
$10.9 million
related to definite lived intangible asset impairment and
$11.3 million
related to fixed asset impairment; and Infrastructure Solutions charges of
$21.7 million
related to inventory obsolescence, impairment definite-lived intangible assets, allowances for accounts receivable, write-off of certain other current assets and long-lived assets, loss on the sale of the CIPP contracting operation in Switzerland, including the release of cumulative currency translation adjustments, as well as a legal accrual related to disputed work performed by our European and Asia-Pacific operations.
|
|
Reserves at
December 31, 2015 |
|
2016
Charge to Income |
|
Foreign Currency Translation
|
|
Utilized in 2016
|
|
Reserves at
December 31, 2016 |
||||||||||||||
|
|
|
|
Cash
(1)
|
|
Non-Cash
|
|
||||||||||||||||
Severance and benefit related costs
|
$
|
—
|
|
|
$
|
73
|
|
|
$
|
—
|
|
|
$
|
73
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Reserves for customer receivables
(2)
|
6,605
|
|
|
(585
|
)
|
|
(47
|
)
|
|
—
|
|
|
3,739
|
|
|
2,234
|
|
||||||
Other restructuring costs
|
968
|
|
|
340
|
|
|
(9
|
)
|
|
519
|
|
|
307
|
|
|
473
|
|
||||||
Total pre-tax restructuring charges
|
$
|
7,573
|
|
|
$
|
(172
|
)
|
|
$
|
(56
|
)
|
|
$
|
592
|
|
|
$
|
4,046
|
|
|
$
|
2,707
|
|
(1)
|
Refers to cash utilized to settle charges, either those reserved at December 31, 2015 or charged to income during 2016.
|
(2)
|
During the third quarter of 2016, the Company received payment on certain accounts receivable that were previously reserved. Additionally, the Company wrote off certain balances in costs and estimated earnings in excess of billings, along with the corresponding reserves, that were deemed fully uncollectible.
|
|
Reserves at
December 31, 2014 |
|
2015
Charge to Income |
|
Foreign Currency Translation
|
|
Utilized in 2015
|
|
Reserves at
December 31, 2015 |
||||||||||||||
|
|
|
|
Cash
(1)
|
|
Non-Cash
|
|
||||||||||||||||
Severance and benefit related costs
|
$
|
466
|
|
|
$
|
801
|
|
|
$
|
(7
|
)
|
|
$
|
1,260
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Lease termination expenses
|
—
|
|
|
167
|
|
|
(2
|
)
|
|
165
|
|
|
—
|
|
|
—
|
|
||||||
Reserves for customer receivables
|
11,464
|
|
|
1,186
|
|
|
(401
|
)
|
|
—
|
|
|
5,644
|
|
|
6,605
|
|
||||||
Other asset write-offs
|
—
|
|
|
1,880
|
|
|
—
|
|
|
—
|
|
|
1,880
|
|
|
—
|
|
||||||
Other restructuring costs
|
2,496
|
|
|
6,946
|
|
|
(87
|
)
|
|
4,828
|
|
|
3,559
|
|
|
968
|
|
||||||
Total pre-tax restructuring charges
|
$
|
14,426
|
|
|
$
|
10,980
|
|
|
$
|
(497
|
)
|
|
$
|
6,253
|
|
|
$
|
11,083
|
|
|
$
|
7,573
|
|
(1)
|
Refers to cash utilized to settle charges, either those reserved at December 31, 2014 or charged to income during 2015.
|
|
Years Ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
Balance, at beginning of year
|
$
|
14,524
|
|
|
$
|
19,307
|
|
|
$
|
3,441
|
|
Bad debt expense
(1)(2)
|
1,083
|
|
|
6,369
|
|
|
21,911
|
|
|||
Write-offs and adjustments
(1)(2)
|
(9,509
|
)
|
|
(11,152
|
)
|
|
(6,045
|
)
|
|||
Balance, at end of year
(3)
|
$
|
6,098
|
|
|
$
|
14,524
|
|
|
$
|
19,307
|
|
(1)
|
The Company recorded bad debt expense (reversals) of
$(0.6) million
,
$1.2 million
and
$11.9 million
in 2016, 2015 and 2014, respectively, as part of the 2014 Restructuring (see Note 3) and was primarily due to the exiting of certain low-return businesses mainly in foreign locations.
|
(2)
|
The Company recorded bad debt expense of
$2.9 million
in 2015 related to long-dated receivables within the Corrosion Protection segment.
|
(3)
|
December 31, 2015 and 2014 balances include
$7.5 million
related to long-dated receivables, some of which were in litigation or dispute, within the Infrastructure Solutions segment.
|
|
December 31,
|
||||||
|
2016
|
|
2015
|
||||
Costs incurred on uncompleted contracts
|
$
|
741,590
|
|
|
$
|
818,008
|
|
Estimated earnings to date
|
165,862
|
|
|
159,321
|
|
||
Subtotal
|
907,452
|
|
|
977,329
|
|
||
Less – billings to date
|
(907,749
|
)
|
|
(975,663
|
)
|
||
Total
|
$
|
(297
|
)
|
|
$
|
1,666
|
|
Included in the accompanying balance sheets:
|
|
|
|
|
|
||
Costs and estimated earnings in excess of billings
|
62,401
|
|
|
89,141
|
|
||
Billings in excess of costs and estimated earnings
|
(62,698
|
)
|
|
(87,475
|
)
|
||
Total
|
$
|
(297
|
)
|
|
$
|
1,666
|
|
|
December 31,
|
||||||
|
2016
|
|
2015
|
||||
Raw materials and supplies
|
$
|
31,399
|
|
|
$
|
23,467
|
|
Work-in-process
|
2,207
|
|
|
3,612
|
|
||
Finished products
|
14,015
|
|
|
6,789
|
|
||
Construction materials
|
16,332
|
|
|
13,911
|
|
||
Total
|
$
|
63,953
|
|
|
$
|
47,779
|
|
|
Estimated
Useful Lives (Years) |
|
December 31,
|
||||||||
|
|
2016
|
|
2015
|
|||||||
Land and land improvements
|
|
|
$
|
10,414
|
|
|
$
|
10,348
|
|
||
Buildings and improvements
|
5
|
—
|
40
|
|
65,505
|
|
|
55,981
|
|
||
Machinery and equipment
|
4
|
—
|
10
|
|
189,849
|
|
|
173,898
|
|
||
Furniture and fixtures
|
3
|
—
|
10
|
|
32,386
|
|
|
30,048
|
|
||
Autos and trucks
|
3
|
—
|
10
|
|
50,128
|
|
|
50,200
|
|
||
Construction in progress
|
|
|
|
|
9,944
|
|
|
11,661
|
|
||
Subtotal
|
|
|
|
|
358,226
|
|
|
332,136
|
|
||
Less – Accumulated depreciation
|
|
|
|
|
(201,479
|
)
|
|
(187,303
|
)
|
||
Total
|
|
|
|
|
$
|
156,747
|
|
|
$
|
144,833
|
|
|
December 31,
|
||||||
|
2016
|
|
2015
|
||||
Vendor and other accrued expenses
|
$
|
33,108
|
|
|
$
|
56,570
|
|
Estimated casualty and healthcare liabilities
|
14,610
|
|
|
15,255
|
|
||
Job costs
|
8,707
|
|
|
12,403
|
|
||
Accrued compensation
|
23,398
|
|
|
22,184
|
|
||
Income tax payable and deferred income taxes
|
5,187
|
|
|
6,539
|
|
||
Total
|
$
|
85,010
|
|
|
$
|
112,951
|
|
|
December 31,
2015
|
||
Assets held for sale:
|
|
||
Total current assets
|
$
|
8,559
|
|
Property, plant & equipment, less accumulated depreciation
|
12,501
|
|
|
Total assets held for sale
|
$
|
21,060
|
|
|
|
||
Liabilities held for sale:
|
|
||
Total current liabilities
|
$
|
944
|
|
Debt
|
1,924
|
|
|
Deferred income tax liabilities
|
1,473
|
|
|
Other liabilities
|
2,620
|
|
|
Total liabilities held for sale
|
$
|
6,961
|
|
|
|
||
Non-controlling interests
|
$
|
7,142
|
|
|
Infrastructure
Solutions
|
|
Corrosion
Protection
|
|
Energy
Services
|
|
Total
|
||||||||
Balance, January 1, 2016
|
|
|
|
|
|
|
|
||||||||
Goodwill, gross
|
$
|
190,525
|
|
|
$
|
73,345
|
|
|
$
|
80,246
|
|
|
$
|
344,116
|
|
Accumulated impairment losses
|
(16,069
|
)
|
|
(45,400
|
)
|
|
(33,527
|
)
|
|
(94,996
|
)
|
||||
Goodwill, net
|
174,456
|
|
|
27,945
|
|
|
46,719
|
|
|
249,120
|
|
||||
Acquisitions
(1)
|
50,585
|
|
|
—
|
|
|
—
|
|
|
50,585
|
|
||||
Foreign currency translation
|
(1,616
|
)
|
|
530
|
|
|
—
|
|
|
(1,086
|
)
|
||||
Balance, December 31, 2016
|
|
|
|
|
|
|
|
||||||||
Goodwill, gross
|
239,494
|
|
|
73,875
|
|
|
80,246
|
|
|
393,615
|
|
||||
Accumulated impairment losses
|
(16,069
|
)
|
|
(45,400
|
)
|
|
(33,527
|
)
|
|
(94,996
|
)
|
||||
Goodwill, net
|
$
|
223,425
|
|
|
$
|
28,475
|
|
|
$
|
46,719
|
|
|
$
|
298,619
|
|
(1)
|
During 2016 , the Company recorded goodwill of
$44.0 million
,
$2.4 million
,
$0.8 million
and
$3.4 million
related to the acquisitions of Underground Solutions, Fyfe Europe, LMJ and Concrete Solutions, respectively (see Note 1).
|
|
December 31, 2016
|
|
December 31, 2015
|
||||||||||||||||||||||
|
Weighted Average Useful Lives (Years)
|
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Carrying Amount
|
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Carrying Amount
|
||||||||||||
License agreements
(1)
|
9.2
|
|
$
|
4,418
|
|
|
$
|
(3,438
|
)
|
|
$
|
980
|
|
|
$
|
3,893
|
|
|
$
|
(3,275
|
)
|
|
$
|
618
|
|
Leases
|
10.8
|
|
2,065
|
|
|
(912
|
)
|
|
1,153
|
|
|
2,065
|
|
|
(764
|
)
|
|
1,301
|
|
||||||
Trademarks
(2)
|
13.6
|
|
24,185
|
|
|
(7,868
|
)
|
|
16,317
|
|
|
22,519
|
|
|
(6,262
|
)
|
|
16,257
|
|
||||||
Non-competes
(3)
|
1.7
|
|
1,308
|
|
|
(1,054
|
)
|
|
254
|
|
|
1,210
|
|
|
(945
|
)
|
|
265
|
|
||||||
Customer relationships
(4)
|
11.4
|
|
187,554
|
|
|
(53,830
|
)
|
|
133,724
|
|
|
164,779
|
|
|
(41,967
|
)
|
|
122,812
|
|
||||||
Patents and acquired technology
(5)
|
10.0
|
|
66,222
|
|
|
(23,739
|
)
|
|
42,483
|
|
|
55,260
|
|
|
(22,395
|
)
|
|
32,865
|
|
||||||
|
|
|
$
|
285,752
|
|
|
$
|
(90,841
|
)
|
|
$
|
194,911
|
|
|
$
|
249,726
|
|
|
$
|
(75,608
|
)
|
|
$
|
174,118
|
|
(1)
|
During 2016, the Company recorded license agreements of
$0.6 million
related to the acquisition of LMJ’s CIPP business (see Note 1).
|
(2)
|
During 2016, the Company recorded trademarks of
$1.4 million
,
$0.1 million
and
$0.1 million
related to the acquisitions of Underground Solutions, Fyfe Europe and Concrete Solutions, respectively (see Note 1).
|
(3)
|
During 2016, the Company recorded non-compete agreements of
$0.1 million
related to the acquisition of Fyfe Europe (see Note 1).
|
(4)
|
During 2016, the Company recorded customer relationships of
$20.7 million
,
$0.3 million
,
$0.2 million
and
$1.6 million
related to the acquisitions of Underground Solutions, Fyfe Europe, LMJ’s CIPP business and Concrete Solutions, respectively (see Note 1).
|
(5)
|
During 2016, the Company recorded acquired technology of
$11.3 million
related to the acquisition of Underground Solutions (see Note 1).
|
Year
|
|
Amount
|
||
2017
|
|
$
|
17,212
|
|
2018
|
|
17,040
|
|
|
2019
|
|
16,883
|
|
|
2020
|
|
16,841
|
|
|
2021
|
|
16,684
|
|
|
December 31,
|
||||||
|
2016
|
|
2015
|
||||
Term note, due October 30, 2020, annualized rates of 3.08% and 2.47%, respectively
|
$
|
328,125
|
|
|
$
|
345,625
|
|
Line of credit, 2.96%
|
36,000
|
|
|
—
|
|
||
Other notes with interest rates from 3.3% to 6.5%
|
9,901
|
|
|
9,797
|
|
||
Subtotal
|
374,026
|
|
|
355,422
|
|
||
Less – Current maturities and notes payable
|
19,835
|
|
|
17,648
|
|
||
Less – Unamortized loan costs
|
3,406
|
|
|
4,294
|
|
||
Total
|
$
|
350,785
|
|
|
$
|
333,480
|
|
Year
|
|
Amount
|
||
2017
|
|
$
|
19,835
|
|
2018
|
|
35,899
|
|
|
2019
|
|
28,438
|
|
|
2020
|
|
289,854
|
|
|
2021
|
|
—
|
|
|
Total
|
|
$
|
374,026
|
|
•
|
Consolidated financial leverage ratio compares consolidated funded indebtedness to Credit Facility defined income. The initial maximum amount was not to initially exceed
3.75
to 1.00. In connection with the acquisition of Underground Solutions, the Company executed a one-time election, in accordance with the Credit Agreement, to increase the consolidated financial leverage ratio to
4.00
to 1.00 for a period of
one year
. After which, the ratio will decrease periodically at scheduled reporting periods to not more that
3.75
to 1.00 beginning with the quarter ending March 31, 2017. At
December 31, 2016
, the Company’s consolidated financial leverage ratio was
3.51
to 1.00 and, using the Credit Facility defined income, the Company had the capacity to borrow up to
$53.5 million
of additional debt.
|
•
|
Consolidated fixed charge coverage ratio compares Credit Facility defined income to Credit Facility defined fixed charges with a minimum permitted ratio of not less than
1.25
to 1.00. At
December 31, 2016
, the Company’s fixed charge ratio was
1.51
to 1.00.
|
•
|
In November 2015, the Company’s Board of Directors authorized the open market repurchase of up to
$20.0 million
of the Company’s common stock to be made during 2015 and 2016 (the “November 2015 Program”).
|
•
|
In March 2016, the Company’s Board of Directors authorized the open market repurchase of up to an additional
$20.0 million
of the Company’s common stock during 2016 (the “March 2016 Program”) following the expiration or completion of the November 2015 Program. The Company began repurchasing shares under the March 2016 Program in April 2016 immediately following completion of the November 2015 Program.
|
•
|
In August 2016, the Company’s Board of Directors authorized the open market repurchase of up to an additional
$10.0 million
of the Company’s common stock during 2016 (the “August 2016 Program”) following the expiration or completion of the March 2016 Program. The Company began repurchasing shares under the August 2016 Program in October 2016 immediately following completion of the March 2016 Program. Our authorization to repurchase shares under the August 2016 program expired on December 31, 2016.
|
|
Years Ended December 31,
|
|||||||||||||||||||
|
2016
|
|
2015
|
|
2014
|
|||||||||||||||
|
Shares
|
|
Weighted
Average
Exercise
Price
|
|
Shares
|
|
Weighted
Average Exercise Price |
|
Shares
|
|
Weighted
Average Exercise Price |
|||||||||
Outstanding at January 1
|
288,383
|
|
|
$
|
21.73
|
|
|
503,134
|
|
|
$
|
18.18
|
|
|
1,208,824
|
|
|
$
|
18.54
|
|
Granted
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
38,820
|
|
|
24.21
|
|
|||
Exercised
|
(114,307
|
)
|
|
21.33
|
|
|
(209,205
|
)
|
|
13.13
|
|
|
(526,359
|
)
|
|
16.36
|
|
|||
Canceled/Expired
|
(3,823
|
)
|
|
22.24
|
|
|
(5,546
|
)
|
|
24.21
|
|
|
(218,151
|
)
|
|
25.61
|
|
|||
Outstanding at December 31
|
170,253
|
|
|
$
|
21.99
|
|
|
288,383
|
|
|
$
|
21.73
|
|
|
503,134
|
|
|
$
|
18.18
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Exercisable at December 31
|
170,253
|
|
|
$
|
21.99
|
|
|
284,929
|
|
|
$
|
21.78
|
|
|
452,236
|
|
|
$
|
18.12
|
|
|
Years Ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
Amount collected from stock option exercises
|
$
|
2,438
|
|
|
$
|
2,748
|
|
|
$
|
8,614
|
|
Total intrinsic value of stock option exercises
|
216
|
|
|
1,108
|
|
|
3,771
|
|
|||
Tax benefit of stock option exercises recorded in additional paid-in-capital
|
615
|
|
|
209
|
|
|
6
|
|
|||
Aggregate intrinsic value of outstanding stock options
|
517
|
|
|
173
|
|
|
1,231
|
|
|||
Aggregate intrinsic value of exercisable stock options
|
517
|
|
|
169
|
|
|
1,209
|
|
|
|
Year Ended
December 31, 2014
|
||
|
|
Range
|
|
Weighted Average
|
Grant-date fair value
|
|
$11.27
|
|
$11.27
|
Volatility
|
|
41.6%
|
|
41.6%
|
Expected term (years)
|
|
7.0
|
|
7.0
|
Dividend yield
|
|
—%
|
|
—%
|
Risk-free rate
|
|
2.3%
|
|
2.3%
|
|
|
Years Ended December 31,
|
||||||||||
|
|
2016
|
|
2015
|
|
2014
|
||||||
Current:
|
|
|
|
|
|
|
||||||
Federal
|
|
$
|
(636
|
)
|
|
$
|
2,150
|
|
|
$
|
(2,112
|
)
|
Foreign
|
|
3,585
|
|
|
5,600
|
|
|
10,586
|
|
|||
State
|
|
175
|
|
|
528
|
|
|
2,635
|
|
|||
Subtotal
|
|
3,124
|
|
|
8,278
|
|
|
11,109
|
|
|||
Deferred:
|
|
|
|
|
|
|
||||||
Federal
|
|
2,158
|
|
|
218
|
|
|
(18,629
|
)
|
|||
Foreign
|
|
475
|
|
|
1,382
|
|
|
3,034
|
|
|||
State
|
|
352
|
|
|
(673
|
)
|
|
646
|
|
|||
Subtotal
|
|
2,985
|
|
|
927
|
|
|
(14,949
|
)
|
|||
Total tax provision (benefit)
|
|
$
|
6,109
|
|
|
$
|
9,205
|
|
|
$
|
(3,840
|
)
|
|
|
Years Ended December 31,
|
||||||||||
|
|
2016
|
|
2015
|
|
2014
|
||||||
Income taxes (benefit) at U.S. federal statutory tax rate
|
|
$
|
12,344
|
|
|
$
|
425
|
|
|
$
|
(12,591
|
)
|
Increase (decrease) in taxes resulting from:
|
|
|
|
|
|
|
||||||
Change in the balance of the valuation allowance for deferred tax assets allocated to foreign income tax expense
|
|
1,364
|
|
|
(756
|
)
|
|
7,785
|
|
|||
Change in the balance of the valuation allowance for deferred tax assets allocated to domestic income tax expense
|
|
(4,202
|
)
|
|
4,834
|
|
|
5,206
|
|
|||
State income taxes, net of federal income tax benefit
|
|
342
|
|
|
(94
|
)
|
|
(3,073
|
)
|
|||
Divestitures
|
|
271
|
|
|
2,269
|
|
|
—
|
|
|||
Meals and entertainment
|
|
736
|
|
|
761
|
|
|
863
|
|
|||
Changes in taxes previously accrued
|
|
23
|
|
|
(489
|
)
|
|
(1,932
|
)
|
|||
Foreign tax rate differences
|
|
(2,559
|
)
|
|
(1,468
|
)
|
|
(9,215
|
)
|
|||
Goodwill impairment
|
|
—
|
|
|
3,485
|
|
|
9,690
|
|
|||
Recognition of uncertain tax positions
|
|
85
|
|
|
24
|
|
|
(96
|
)
|
|||
Settlement of escrow arrangement
|
|
—
|
|
|
(1,115
|
)
|
|
—
|
|
|||
Domestic Production Activities deduction
|
|
(1,017
|
)
|
|
(528
|
)
|
|
(81
|
)
|
|||
Incremental U.S. taxes on undistributed foreign earnings
|
|
—
|
|
|
2,102
|
|
|
—
|
|
|||
Other matters
|
|
(1,278
|
)
|
|
(245
|
)
|
|
(396
|
)
|
|||
Total tax provision (benefit)
|
|
$
|
6,109
|
|
|
$
|
9,205
|
|
|
$
|
(3,840
|
)
|
Effective tax rate
|
|
17.3
|
%
|
|
757.6
|
%
|
|
10.7
|
%
|
|
|
December 31,
|
||||||
|
|
2016
|
|
2015
|
||||
Deferred income tax assets:
|
|
|
|
|
||||
Foreign tax credit carryforwards
|
|
$
|
3,426
|
|
|
$
|
358
|
|
Net operating loss carryforwards
|
|
26,212
|
|
|
14,688
|
|
||
Accrued expenses
|
|
17,366
|
|
|
24,449
|
|
||
Other
|
|
8,701
|
|
|
8,285
|
|
||
Total gross deferred income tax assets
|
|
55,705
|
|
|
47,780
|
|
||
Less valuation allowance
|
|
(15,428
|
)
|
|
(18,897
|
)
|
||
Net deferred income tax assets
|
|
40,277
|
|
|
28,883
|
|
||
Deferred income tax liabilities:
|
|
|
|
|
||||
Property, plant and equipment
|
|
(12,627
|
)
|
|
(11,438
|
)
|
||
Intangible assets
|
|
(28,346
|
)
|
|
(14,525
|
)
|
||
Undistributed foreign earnings
|
|
(7,051
|
)
|
|
(9,153
|
)
|
||
Other
|
|
(9,237
|
)
|
|
(8,248
|
)
|
||
Total deferred income tax liabilities
|
|
(57,261
|
)
|
|
(43,364
|
)
|
||
Net deferred income tax liabilities
|
|
$
|
(16,984
|
)
|
|
$
|
(14,481
|
)
|
|
|
December 31,
|
||||||
|
|
2016
|
|
2015
|
||||
Current deferred income tax assets, net
|
|
$
|
7,824
|
|
|
$
|
7,804
|
|
Current deferred income tax liabilities, net
(1)
|
|
(3,317
|
)
|
|
(5,029
|
)
|
||
Noncurrent deferred income tax assets, net
|
|
1,848
|
|
|
2,130
|
|
||
Noncurrent deferred income tax liabilities, net
|
|
(23,339
|
)
|
|
(19,386
|
)
|
||
Net deferred income tax liabilities
|
|
$
|
(16,984
|
)
|
|
$
|
(14,481
|
)
|
(1)
|
The December 31, 2015 balance includes
$1.5 million
of deferred income tax liabilities related to BPPC, which are classified as held for sale. See Note 5.
|
|
|
Years Ended December 31,
|
||||||||||
|
|
2016
|
|
2015
|
|
2014
|
||||||
Balance, at beginning of year
|
|
$
|
18,897
|
|
|
$
|
19,353
|
|
|
$
|
7,797
|
|
Additions
|
|
3,095
|
|
|
7,783
|
|
|
14,442
|
|
|||
Reversals
|
|
(4,984
|
)
|
|
(5,294
|
)
|
|
(2,090
|
)
|
|||
Other adjustments
|
|
(1,580
|
)
|
|
(2,945
|
)
|
|
(796
|
)
|
|||
Balance, at end of year
|
|
$
|
15,428
|
|
|
$
|
18,897
|
|
|
$
|
19,353
|
|
Year
|
|
Minimum Lease Payments
|
||
2017
|
|
$
|
18,976
|
|
2018
|
|
14,610
|
|
|
2019
|
|
10,723
|
|
|
2020
|
|
7,035
|
|
|
2021
|
|
4,818
|
|
|
Thereafter
|
|
4,923
|
|
|
Total
|
|
$
|
61,085
|
|
|
Total Fair Value at
December 31, 2016 |
|
Quoted Prices in Active Markets for Identical Assets
(Level 1)
|
|
Significant Observable Inputs
(Level 2)
|
|
Significant Unobservable Inputs
(Level 3)
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Forward Currency Contracts
|
$
|
26
|
|
|
$
|
—
|
|
|
$
|
26
|
|
|
$
|
—
|
|
Interest Rate Swap
|
1,061
|
|
|
—
|
|
|
1,061
|
|
|
—
|
|
||||
Total
|
$
|
1,087
|
|
|
$
|
—
|
|
|
$
|
1,087
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Forward Currency Contracts
|
$
|
57
|
|
|
$
|
—
|
|
|
$
|
57
|
|
|
$
|
—
|
|
Total
|
$
|
57
|
|
|
$
|
—
|
|
|
$
|
57
|
|
|
$
|
—
|
|
|
Total Fair Value at
December 31, 2015 |
|
Quoted Prices in Active Markets for Identical Assets
(Level 1)
|
|
Significant Observable Inputs
(Level 2)
|
|
Significant Unobservable Inputs
(Level 3)
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Forward Currency Contracts
|
109
|
|
|
—
|
|
|
109
|
|
|
—
|
|
||||
Total
|
$
|
109
|
|
|
$
|
—
|
|
|
$
|
109
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Forward Currency Contracts
|
$
|
243
|
|
|
$
|
—
|
|
|
$
|
243
|
|
|
$
|
—
|
|
Interest Rate Swap
|
13
|
|
|
—
|
|
|
13
|
|
|
—
|
|
||||
Total
|
$
|
256
|
|
|
$
|
—
|
|
|
$
|
256
|
|
|
$
|
—
|
|
|
Position
|
|
Notional
Amount
|
|
Weighted
Average
Remaining
Maturity
In Years
|
|
Average
Exchange
Rate
|
||
USD/EURO
|
Sell
|
|
$
|
3,400,000
|
|
|
0.3
|
|
1.06
|
USD/British Pound
|
Sell
|
|
£
|
4,595,000
|
|
|
0.3
|
|
1.24
|
EURO/British Pound
|
Sell
|
|
£
|
5,700,000
|
|
|
0.3
|
|
0.86
|
Interest Rate Swap
|
|
|
$
|
246,094,750
|
|
|
3.8
|
|
|
|
Year Ended
December 31, 2014
|
||||
Revenues
|
|
$
|
—
|
|
|
Gross loss
|
|
(67
|
)
|
|
|
Operating expenses
|
|
(5,941
|
)
|
|
|
Operating loss
|
|
(6,008
|
)
|
|
|
Other income (expense)
|
|
(74
|
)
|
|
|
Loss before tax benefits
|
|
(6,082
|
)
|
|
|
Tax benefits
|
|
2,235
|
|
|
|
Net loss
|
|
(3,847
|
)
|
|
|
Years Ended December 31,
|
||||||||||
|
2016
(1)
|
|
2015
(2)
|
|
2014
(3)
|
||||||
Revenues:
|
|
|
|
|
|
||||||
Infrastructure Solutions
|
$
|
571,551
|
|
|
$
|
556,234
|
|
|
$
|
567,205
|
|
Corrosion Protection
|
401,469
|
|
|
437,921
|
|
|
458,409
|
|
|||
Energy Services
|
248,900
|
|
|
339,415
|
|
|
305,807
|
|
|||
Total revenues
|
$
|
1,221,920
|
|
|
$
|
1,333,570
|
|
|
$
|
1,331,421
|
|
|
|
|
|
|
|
||||||
Operating income (loss):
|
|
|
|
|
|
||||||
Infrastructure Solutions
(4)
|
$
|
53,503
|
|
|
$
|
46,867
|
|
|
$
|
(6,194
|
)
|
Corrosion Protection
(5)
|
1,809
|
|
|
(1,771
|
)
|
|
(31,010
|
)
|
|||
Energy Services
(6)
|
(4,486
|
)
|
|
(25,150
|
)
|
|
17,392
|
|
|||
Total operating income (loss)
|
$
|
50,826
|
|
|
$
|
19,946
|
|
|
$
|
(19,812
|
)
|
Other income (expense):
|
|
|
|
|
|
||||||
Interest expense
|
$
|
(15,029
|
)
|
|
$
|
(16,044
|
)
|
|
$
|
(12,943
|
)
|
Interest income
|
166
|
|
|
218
|
|
|
633
|
|
|||
Other
|
(694
|
)
|
|
(2,905
|
)
|
|
(3,853
|
)
|
|||
Total other expense
|
$
|
(15,557
|
)
|
|
$
|
(18,731
|
)
|
|
$
|
(16,163
|
)
|
Income (loss) before taxes on income
|
$
|
35,269
|
|
|
$
|
1,215
|
|
|
$
|
(35,975
|
)
|
|
|
|
|
|
|
||||||
Total assets:
|
|
|
|
|
|
||||||
Infrastructure Solutions
|
$
|
584,425
|
|
|
$
|
508,817
|
|
|
$
|
485,785
|
|
Corrosion Protection
|
424,007
|
|
|
489,519
|
|
|
506,659
|
|
|||
Energy Services
|
147,171
|
|
|
183,763
|
|
|
197,858
|
|
|||
Corporate
|
37,979
|
|
|
50,854
|
|
|
100,831
|
|
|||
Assets held for sale
|
—
|
|
|
21,060
|
|
|
—
|
|
|||
Total assets
|
$
|
1,193,582
|
|
|
$
|
1,254,013
|
|
|
$
|
1,291,133
|
|
|
|
|
|
|
|
||||||
Capital expenditures:
|
|
|
|
|
|
||||||
Infrastructure Solutions
|
$
|
19,834
|
|
|
$
|
7,657
|
|
|
$
|
13,096
|
|
Corrosion Protection
|
14,393
|
|
|
17,226
|
|
|
12,107
|
|
|||
Energy Services
|
2,514
|
|
|
2,202
|
|
|
3,720
|
|
|||
Corporate
|
2,019
|
|
|
2,369
|
|
|
3,976
|
|
|||
Total capital expenditures
|
$
|
38,760
|
|
|
$
|
29,454
|
|
|
$
|
32,899
|
|
|
|
|
|
|
|
||||||
Depreciation and amortization:
|
|
|
|
|
|
||||||
Infrastructure Solutions
|
$
|
17,547
|
|
|
$
|
14,836
|
|
|
$
|
15,726
|
|
Corrosion Protection
|
18,792
|
|
|
18,834
|
|
|
19,259
|
|
|||
Energy Services
|
7,067
|
|
|
7,641
|
|
|
7,004
|
|
|||
Corporate
|
3,313
|
|
|
2,480
|
|
|
2,323
|
|
|||
Total depreciation and amortization
|
$
|
46,719
|
|
|
$
|
43,791
|
|
|
$
|
44,312
|
|
(1)
|
Results include: (i)
$15.9 million
of restructuring charges (see Note 3); (ii)
$2.7 million
of costs incurred related to the acquisitions of Underground Solutions, Fyfe Europe, LMJ, Concrete Solutions and other acquisition targets; (iii) inventory step up expense of
$3.6 million
recognized as part of the accounting for business combinations; and (iv) a gain of
$6.6 million
in connection with the settlement of
two
longstanding lawsuits (see Note 11).
|
(2)
|
Results include: (i)
$43.5 million
of goodwill impairment charges (see Note 2); (ii)
$8.1 million
of 2014 Restructuring charges (see Note 3); and (iii)
$1.9 million
of costs incurred related to the acquisitions of Underground Solutions, Schultz and other acquisition targets.
|
(3)
|
Results include: (i)
$51.5 million
of goodwill impairment charges (see Note 2); (ii)
$12.1 million
of definite-lived intangible asset impairment charges (see Note 2); (iii)
$47.8 million
of 2014 Restructuring charges (see Note 3); and (iv)
$1.4 million
of costs incurred related to the acquisition of Brinderson and other acquisition targets.
|
(4)
|
Operating income for 2016 includes: (i)
$3.1 million
of 2016 Restructuring charges (see Note 3); (ii)
$0.2 million
of 2014 Restructuring expense reversals (see Note 3); (iii)
$2.7 million
of costs incurred related to the acquisitions of Underground Solutions, Fyfe Europe, LMJ, Concrete Solutions and other acquisition targets; (iv) inventory step up expense of
$3.6 million
recognized as part of the accounting for business combinations; and (v) a gain of
$6.6 million
in connection with the settlement of
two
longstanding lawsuits (see Note 11). Operating income for 2015 includes
$8.1 million
of 2014 Restructuring charges (see Note 3) and
$1.1 million
of costs incurred related to the acquisition of Underground Solutions and other acquisition targets. Operating income for 2014 includes: (i)
$25.6 million
of 2014 Restructuring charges (see Note 3), (ii)
$16.1 million
of goodwill impairment charges (see Note 2); and (iii)
$1.2 million
of definite-lived intangible asset impairment charges (see Note 2).
|
(5)
|
Operating income for 2016 includes
$4.6 million
of 2016 Restructuring charges (see Note 3). Operating income for 2015 includes
$10.0 million
of goodwill impairment charges (see Note 2) and
$0.5 million
of acquisition related expenses. Operating income for 2014 includes: (i)
$35.4 million
of goodwill impairment charges (see Note 2); (ii)
$10.9 million
of definite-lived intangible asset impairment charges (see Note 2); (iii)
$11.3 million
of 2014 Restructuring charges (see Note 3); and (iv)
$0.7 million
of costs incurred in conjunction with potential acquisition activity.
|
(6)
|
Operating income for 2016 includes
$8.2 million
of 2016 Restructuring charges (see Note 3). Operating income for 2015 includes
$33.5 million
of goodwill impairment charges (see Note 2) and
$0.3 million
of costs incurred related to the acquisition of Schultz. Operating income for 2014 includes (i)
$0.7 million
of costs incurred related to the acquisition of Brinderson and (ii)
$4.5 million
related to proceeds received in connection with the settlement of escrow claims related to the purchase of Brinderson..
|
|
Years Ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
Revenues:
(1)
|
|
|
|
|
|
||||||
United States
|
$
|
924,580
|
|
|
$
|
965,957
|
|
|
$
|
926,834
|
|
Canada
|
129,291
|
|
|
174,827
|
|
|
202,806
|
|
|||
Europe
|
60,238
|
|
|
56,474
|
|
|
85,614
|
|
|||
Other foreign
|
107,811
|
|
|
136,312
|
|
|
116,167
|
|
|||
Total revenues
|
$
|
1,221,920
|
|
|
$
|
1,333,570
|
|
|
$
|
1,331,421
|
|
|
|
|
|
|
|
||||||
Operating income (loss):
|
|
|
|
|
|
||||||
United States
|
$
|
28,048
|
|
|
$
|
(18,959
|
)
|
|
$
|
(45,945
|
)
|
Canada
|
16,156
|
|
|
27,126
|
|
|
36,883
|
|
|||
Europe
|
981
|
|
|
3,217
|
|
|
1,862
|
|
|||
Other foreign
|
5,641
|
|
|
8,562
|
|
|
(12,612
|
)
|
|||
Total operating income (loss)
|
$
|
50,826
|
|
|
$
|
19,946
|
|
|
$
|
(19,812
|
)
|
|
|
|
|
|
|
||||||
Long-lived assets:
(1)(2)
|
|
|
|
|
|
||||||
United States
|
$
|
140,099
|
|
|
$
|
124,120
|
|
|
$
|
135,898
|
|
Canada
|
9,464
|
|
|
9,872
|
|
|
25,610
|
|
|||
Europe
|
7,575
|
|
|
7,268
|
|
|
8,984
|
|
|||
Other foreign
|
8,829
|
|
|
9,189
|
|
|
8,429
|
|
|||
Total long-lived assets
|
$
|
165,967
|
|
|
$
|
150,449
|
|
|
$
|
178,921
|
|
(1)
|
Revenues and long-lived assets are attributed to the country of origin for the Company’s legal entities. For a significant majority of its legal entities, the country of origin relates to the country or geographic area that it services.
|
(2)
|
Long-lived assets as of
December 31, 2016
,
2015
and
2014
do not include intangible assets, goodwill or deferred tax assets.
|
|
First
Quarter (1) |
|
Second
Quarter (2) |
|
Third
Quarter (3) |
|
Fourth
Quarter (4) |
||||||||
Year ended December 31, 2016:
|
|
|
|
|
|
|
|
||||||||
Revenues
|
$
|
293,908
|
|
|
$
|
297,686
|
|
|
$
|
308,524
|
|
|
$
|
321,802
|
|
Gross profit
|
54,414
|
|
|
61,190
|
|
|
66,318
|
|
|
71,242
|
|
||||
Operating income (loss)
|
(4,139
|
)
|
|
8,145
|
|
|
20,505
|
|
|
26,315
|
|
||||
Net income (loss)
|
(3,949
|
)
|
|
3,193
|
|
|
11,787
|
|
|
18,129
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Basic earnings per share:
|
|
|
|
|
|
|
|
||||||||
Net income (loss)
|
$
|
(0.11
|
)
|
|
$
|
0.10
|
|
|
$
|
0.35
|
|
|
$
|
0.52
|
|
|
|
|
|
|
|
|
|
||||||||
Diluted earnings per share
|
|
|
|
|
|
|
|
||||||||
Net income (loss)
|
$
|
(0.11
|
)
|
|
$
|
0.10
|
|
|
$
|
0.34
|
|
|
$
|
0.52
|
|
(1)
|
Includes expenses of
$9.7 million
and
$(0.2) million
related to our 2016 Restructuring and 2014 Restructuring, respectively (see Note 3).
|
(2)
|
Includes expenses of
$3.8 million
and
$0.1 million
related to our 2016 Restructuring and 2014 Restructuring, respectively (see Note 3).
|
(3)
|
Includes expenses of
$1.3 million
and
$(0.4) million
related to our 2016 Restructuring and 2014 Restructuring, respectively (see Note 3).
|
(4)
|
Includes expenses of
$1.3 million
and
$0.3 million
related to our 2016 Restructuring and 2014 Restructuring, respectively (see Note 3), and a gain on litigation settlement of
$6.6 million
(see Note 11).
|
|
|
First
Quarter
(1)
|
|
Second
Quarter
(2)
|
|
Third
Quarter
(3)
|
|
Fourth
Quarter
(4)
|
||||||||
Year ended December 31, 2015:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Revenues
|
|
$
|
309,166
|
|
|
$
|
337,096
|
|
|
$
|
356,595
|
|
|
$
|
330,713
|
|
Gross profit
|
|
59,190
|
|
|
72,053
|
|
|
77,121
|
|
|
67,423
|
|
||||
Operating income (loss)
|
|
9,125
|
|
|
14,523
|
|
|
24,938
|
|
|
(28,640
|
)
|
||||
Net income (loss)
|
|
1,372
|
|
|
8,848
|
|
|
15,223
|
|
|
(33,433
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Basic earnings per share:
|
|
|
|
|
|
|
|
|
||||||||
Net income (loss)
|
|
$
|
0.04
|
|
|
$
|
0.24
|
|
|
$
|
0.41
|
|
|
$
|
(0.91
|
)
|
|
|
|
|
|
|
|
|
|
||||||||
Diluted earnings per share
|
|
|
|
|
|
|
|
|
||||||||
Net income (loss)
|
|
$
|
0.04
|
|
|
$
|
0.24
|
|
|
$
|
0.40
|
|
|
$
|
(0.91
|
)
|
(1)
|
Includes expenses of
$3.5 million
related to our 2014 Restructuring (see Note 3).
|
(2)
|
Includes expenses of
$5.7 million
related to our 2014 Restructuring (see Note 3).
|
(3)
|
Includes expenses of
$1.5 million
related to our 2014 Restructuring (see Note 3).
|
(4)
|
Includes expenses of
$0.3 million
related to our 2014 Restructuring and
$43.5 million
related to certain goodwill impairments (see Notes 2, 3 and 6).
|
Dated: March 1, 2017
|
AEGION CORPORATION
|
|
|
|
|
|
|
|
By:
|
/s/ Charles R. Gordon
|
|
|
|
Charles R. Gordon
|
|
|
|
President and Chief Executive Officer
|
|
Signature
|
Title
|
Date
|
|
|
|
/s/ Charles R. Gordon
|
Principal Executive Officer and
|
March 1, 2017
|
Charles R. Gordon
|
Director
|
|
|
|
|
/s/ David A. Martin
|
Principal Financial Officer and
|
March 1, 2017
|
David A. Martin
|
Principal Accounting Officer
|
|
|
|
|
/s/ Stephen P. Cortinovis
|
Director
|
March 1, 2017
|
Stephen P. Cortinovis
|
|
|
|
|
|
/s/ Stephanie A. Cuskley
|
Director
|
March 1, 2017
|
Stephanie A. Cuskley
|
|
|
|
|
|
/s/ Walter J. Galvin
|
Director
|
March 1, 2017
|
Walter J. Galvin
|
|
|
|
|
|
/s/ Rhonda Germany Ballintyn
|
Director
|
March 1, 2017
|
Rhonda Germany Ballintyn
|
|
|
|
|
|
/s/ Juanita H. Hinshaw
|
Director
|
March 1, 2017
|
Juanita H. Hinshaw
|
|
|
|
|
|
/s/ M. Richard Smith
|
Director
|
March 1, 2017
|
M. Richard Smith
|
|
|
|
|
|
/s/ Alfred L. Woods
|
Director
|
March 1, 2017
|
Alfred L. Woods
|
|
|
|
|
|
/s/ Phillip D. Wright
|
Director
|
March 1, 2017
|
Phillip D. Wright
|
|
|
3.1
|
Certificate of Incorporation of the Company (incorporated by reference to Exhibit 3.1 to the current report on Form 8-K12B filed on October 26, 2011), and Certificate of Designation, Preferences and Rights of Series A Junior Participating Preferred Stock (incorporated by reference to Exhibit 3.3 to the current report on Form 8-K12B filed October 26, 2011).
|
|
|
3.2
|
Certificate of Correction of the Certificate of Incorporation of the Company (incorporated by reference to Exhibit 3.2 to the annual report on Form 10-K for the year ended December 31, 2013).
|
|
|
3.3
|
Amended and Restated By-Laws of the Company (incorporated by reference to Exhibit 3.1 to the current report on Form 8-K filed August 4, 2015).
|
|
|
10.1
|
2009 Employee Equity Incentive Plan of the Company (incorporated by reference to Appendix A to the definitive proxy statement on Schedule 14A filed March 25, 2009, as revised on April 7, 2009, in connection with the 2009 annual meeting of stockholders).
(2)
|
|
|
10.2
|
2013 Employee Equity Incentive Plan of the Company (incorporated by reference to Appendix A to the definitive proxy statement on Schedule 14A filed April 3, 2013 in connection with the 2013 annual meeting of stockholders).
(2)
|
|
|
10.3
|
2016 Employee Equity Incentive Plan of the Company (incorporated by reference to Appendix A to the definitive proxy statement on Schedule 14A filed March 11, 2016 in connection with the 2016 annual meeting of stockholders).
(2)
|
|
|
10.4
|
Amended and Restated 2001 Non-Employee Director Equity Incentive Plan of the Company (incorporated by reference to Appendix B to the definitive proxy statement on Schedule 14A filed April 16, 2003 in connection with the 2003 annual meeting of stockholders).
(2)
|
|
|
10.5
|
2006 Non-Employee Director Equity Plan of the Company (incorporated by reference to Appendix B to the definitive proxy statement on Schedule 14A filed March 10, 2006 in connection with the 2006 annual meeting of stockholders).
(2)
|
|
|
10.6
|
2011 Non-Employee Director Equity Plan of the Company (incorporated by reference to Appendix A to the definitive proxy statement on Schedule 14A filed March 18, 2011 in connection with the 2011 annual meeting of stockholders).
(2)
|
|
|
10.7
|
2016 Non-Employee Director Equity Plan of the Company (incorporated by reference to Appendix A to the definitive proxy statement on Schedule 14A filed March 11, 2016 in connection with the 2016 annual meeting of stockholders).
(2)
|
|
|
10.8
|
Employee Stock Purchase Plan of the Company (incorporated by reference to Appendix A to the definitive proxy statement on Schedule 14A filed March 15, 2007 in connection with the 2007 annual meeting of stockholders).
(2)
|
|
|
10.9
|
Senior Management Voluntary Deferred Compensation Plan, as amended and restated effective January 1, 2014 (incorporated by reference to Exhibit 10.10 to the annual report on Form 10-K for the year ended December 31, 2013).
(2)
|
|
|
10.10
|
2016 Executive Performance Plan of the Company (incorporated by reference to Appendix B to the definitive proxy statement on Schedule 14A filed March 11, 2016 in connection with the 2016 annual meeting of stockholders).
(2)
|
10.11
|
Form of Directors’ Indemnification Agreement (incorporated by reference to Exhibit 10.13 to the annual report on Form 10-K for the year ended December 31, 2011).
|
|
|
10.12
|
Form of Executive Change in Control Severance Agreement, dated as of October 6, 2014, between Aegion Corporation and each of Charles R. Gordon, David A. Martin and David F. Morris (incorporated by reference to Exhibit 10.1 to the current report on Form 8-K filed October 10, 2014).
(2)
|
|
|
10.13
|
Form of First Amendment to Executive Change in Control Severance Agreement, dated May 2, 2016, by and between Aegion Corporation and each of Charles R. Gordon, David A. Martin and David F. Morris (incorporated by reference to Exhibit 10.2 to the quarterly report on Form 10-Q for the quarter ended March 31, 2016).
(2)
|
|
|
10.14
|
Severance Policy effective March 1, 2017, filed herewith.
(2)
|
|
|
10.15
|
Form of Change in Control Severance Agreement, dated as of March 1, 2017, between Aegion Corporation and each of John D. Huhn, Stephen P. Callahan and Michael D. White, filed herewith.
(2)
|
|
|
10.16
|
Management Annual Incentive Plan effective January 1, 2017, filed herewith.
(2)
|
|
|
10.17
|
Form of Director Deferred Stock Unit Agreement (for Non-Employee Directors) (incorporated by reference to Exhibit 10.1 to the quarterly report on Form 10-Q filed May 1, 2015).
|
|
|
10.18
|
Form of Performance Unit Agreement, dated February 22, 2017, between Aegion Corporation and certain executive officers of Aegion Corporation, filed herewith.
(2)
|
|
|
10.19
|
Form of Restricted Stock Unit Agreement, dated February 22, 2017, between Aegion Corporation and certain executive officers of Aegion Corporation, filed herewith.
(2)
|
|
|
10.20
|
Letter agreement, dated October 6, 2014, between Aegion Corporation and Charles R. Gordon (incorporated by reference to Exhibit 10.2 to the current report on Form 8-K filed October 10, 2014).
(2)
|
|
|
10.21
|
Form of Restricted Stock Agreement, dated October 8, 2014, between Aegion Corporation and Charles R. Gordon (incorporated by reference to Exhibit 10.3 to the current report on Form 8-K filed October 10, 2014).
(2)
|
|
|
10.22
|
Form of Inducement Restricted Stock Award Agreement, dated October 8, 2014, between Aegion Corporation and Charles R. Gordon (incorporated by reference to Exhibit 10.5 to the current report on Form 8-K filed October 10, 2014).
(2)
|
|
|
10.23
|
Amended and Restated Credit Agreement, dated October 30, 2015 (incorporated by reference to Exhibit 10.1 to the current report on Form 8-K filed November 2, 2015).
|
|
|
10.24
|
Agreement and Plan of Merger, dated January 4, 2016, among Aegion Corporation, PUAC, Inc., Underground Solutions, Inc., Fortis Advisors LLC and UGSI Solutions, Inc. (incorporated by reference to the current report on Form 8-K filed January 8, 2016).
|
|
|
21
|
Subsidiaries of the Company, filed herewith.
|
|
|
23
|
Consent of PricewaterhouseCoopers LLP, filed herewith.
|
|
|
24
|
Power of Attorney (set forth on signature page).
|
31.1
|
Certification of Charles R. Gordon pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith.
|
|
|
31.2
|
Certification of David A. Martin pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith.
|
|
|
32.1
|
Certification of Charles R. Gordon pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, filed herewith.
|
|
|
32.2
|
Certification of David A. Martin pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, filed herewith.
|
|
|
101.INS
|
XBRL Instance Document*
|
|
|
101.SCH
|
XBRL Taxonomy Extension Schema Document*
|
|
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase Document*
|
|
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase Document*
|
|
|
101.LAB
|
XBRL Taxonomy Extension Label Linkbase Document*
|
|
|
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase Document*
|
(1)
|
The Company’s current, quarterly and annual reports are filed with the Securities and Exchange Commission under file no. 001-35328.
|
(2)
|
Management contract or compensatory plan or arrangement.
|
(a)
|
“
Agreement
” means this Officer Change in Control Severance Agreement, as it may be amended from time to time.
|
(b)
|
“
Base Salary
” means, at any time, the then regular annual rate of pay which the Officer is receiving as annual salary, excluding amounts: (i) received under short-term or long-term incentive or other bonus plans, regardless of whether or not the amounts are deferred, or (ii) designated by the Company as payment toward reimbursement of expenses.
|
(c)
|
“
Beneficial Owner
” shall have the meaning ascribed to such term in Rule 13d-3 of the General Rules and Regulations under the Exchange Act.
|
(d)
|
“
Board
” means the Board of Directors of the Company.
|
(e)
|
“
Cause
” shall be determined solely by the Board in the exercise of good faith and reasonable judgment, and shall mean the occurrence of any one or more of the following:
|
(i)
|
breaching any employment, confidentiality, noncompete, nonsolicitation or other agreement with the Company, any written Company policy relating to compliance with laws (during employment); or
|
(ii)
|
causing, inducing, requesting or advising, or attempting to cause, induce, request or advise, any employee, representative, consultant or other similar person to terminate his/her relationship, or breach any agreement, with the Company; or
|
(iii)
|
causing, inducing, requesting or advising, or attempting to cause, induce, request or advise, any customer, supplier or other Company business contact to withdraw, curtail or cancel its business with the Company; or
|
(iv)
|
the Officer’s willful and continued failure to substantially perform the Officer’s duties with the Company (other than any such failure resulting from the Officer’s Disability), after a written demand for substantial performance is delivered to the Officer that specifically identifies the manner in which the Board believes that the Officer has not substantially performed his duties, and the Officer has failed to remedy the situation within fifteen (15) business days of such written notice from the Company; or
|
(v)
|
the Officer’s conviction of a felony; or
|
(vi)
|
the Officer’s willful engagement in conduct that is demonstrably and materially injurious to the Company, monetarily or otherwise. Under this standard, no act or failure to act on the Officer’s part shall be deemed “willful” unless done, or omitted to be done, by the Officer not in good faith and without reasonable belief that the action or omission was in the best interests of the Company.
|
(f)
|
“
Change in Control
” of the Company shall mean the occurrence of any one (1) or more of the following events:
|
(i)
|
the acquisition by one person, or more than one person acting as a group, in a transaction or series of related transactions, of ownership of stock of the Company that, together with stock held by such person or group, constitutes more than 30% of the total fair market value or total voting power of the stock of the Company; and/or
|
(ii)
|
a majority of the members of the Company’s board of directors is replaced during any twelve-month period by directors whose appointment or election is not endorsed by a majority of the members of the Company’s board of directors before the date of the appointment or election; and/or
|
(iii)
|
the consummation of a merger or consolidation of the Company other than a merger or consolidation that would result in the voting securities of the Company outstanding immediately prior to the transaction continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or any parent thereof) at least 50% of the combined voting power of the securities of the Company or such surviving entity or any parent thereof outstanding immediately after such merger or consolidation; and/or
|
(iv)
|
the stockholders of the Company approve a plan of complete liquidation or dissolution of the Company or there is a consummated sale or disposition by the Company of all or substantially all of the Company’s assets, other than a sale or disposition by the Company of all or substantially all of the Company’s assets to an entity, at least 50% of the combined voting power of the voting securities of which are owned by stockholders of the Company in substantially the same proportions as their ownership of the Company immediately prior to such sale.
|
(g)
|
“
Code
” means the Internal Revenue Code of 1986, as amended.
|
(h)
|
“
Committee
” means the Compensation Committee of the Board of Directors of the Company, or, if no Compensation Committee exists, then the full Board of Directors of the Company, or a committee of Board members, as appointed by the full Board to administer this Agreement.
|
(i)
|
“
Company
” means Aegion Corporation, a Delaware corporation (including any and all subsidiaries and affiliates), or any successor thereto as provided in Section 8.1 herein.
|
(j)
|
“
Disability
” or “
Disabled
” shall mean that the Officer is, by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, receiving income replacement benefits for a period of not less than three months under an accident and health plan covering employees of the Company.
|
(k)
|
“
Effective Date
” means the date this Agreement is approved by the Committee, or such other date as the Committee shall designate in its resolution approving this Agreement, and as specified in the opening sentence of this Agreement.
|
(l)
|
“
Effective Date of Termination
” means the date on which a Qualifying Termination occurs, as provided in Section 2.2 herein, which triggers the payment of Severance Benefits hereunder.
|
(m)
|
“
Exchange Act
” means the Securities Exchange Act of 1934, as amended.
|
(n)
|
“
Good Reason
” means, without the Officer’s express written consent, the occurrence after a Change in Control of the Company of any one (1) or more of the following:
|
(i)
|
a material reduction or alteration in the nature or status of the Officer’s authorities, duties, or responsibilities from those in effect as of 90 calendar days prior to the Change
in
Control, other than an insubstantial and inadvertent act that is remedied by the Company or the acquiring company promptly after receipt of notice thereof given by the Officer;
|
(ii)
|
the Company’s or the acquiring company’s requiring the Officer to be based at a location in excess of 50 miles from the location of the Officer’s principal job location or office in effect as of 90 calendar days prior to the Change
in
Control,
except for required travel on the Company’s business to an extent substantially consistent with the Officer’s then present business travel obligations;
|
(iii)
|
a reduction by the Company or the acquiring company of the Officer’s base salary in effect as of 90 calendar days prior to the Change in Control that is greater than the lesser of: (A) ten percent (10%) of such base salary; and (B) the average percentage reduction applicable to all other Officers of the Company;
|
(iv)
|
the failure of the Company or the acquiring company to continue in effect any of the Company’s short- and long-term incentive compensation plans, or employee benefit or retirement plans, policies, practices, or other compensation arrangements in which the Officer participates taken as a whole unless such failure to continue the plan, policy, practice, or arrangement pertains to all plan participants generally; or the failure by the Company or the acquiring company to continue the Officer’s participation therein on substantially the same basis, both in terms of the amount of benefits provided and the level of the Officer’s participation relative to other participants, as existed 90 calendar days prior to the Change
in
Control;
|
(v)
|
the failure of the Company to obtain a satisfactory agreement from any successor to the Company to assume and agree to perform the Company’s obligations under this Agreement, as contemplated in Section 8.1 herein; and
|
(vi)
|
a material breach of this Agreement by the Company which is not remedied by the Company within thirty (30) business days of receipt of written notice of such breach delivered by the Officer to the Company.
|
(o)
|
“
Notice of Termination
” shall mean a written notice which shall indicate the specific termination provision in this Agreement relied upon, and shall set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Officer’s employment under the provision so indicated.
|
(p)
|
“
Person
” shall have the meaning ascribed to such term in Section 3(a)(9) of the Exchange Act and used in Sections 13(d) and 14(d) thereof, including a “group” as defined in Section 13(d).
|
(q)
|
“
Potential Change in Control
” shall be deemed to have occurred if the event set forth in any one of the following paragraphs shall have occurred:
|
(i)
|
the Company enters into an agreement, the consummation of which would result in the occurrence of a Change in Control;
|
(ii)
|
the Company or any Person publicly announces an intention to take or to consider taking actions which, if consummated, would constitute a Change in Control;
|
(iii)
|
any Person becomes the Beneficial Owner, directly or indirectly, of securities of the Company representing 15% or more of either the then outstanding shares of common stock of the Company or the combined voting power of the Company’s then outstanding securities (not including in the securities beneficially owned by such Person any securities acquired directly from the Company); or
|
(iv)
|
the Board adopts a resolution to the effect that, for purposes of this Agreement, a Potential Change in Control has occurred.
|
(r)
|
“
Qualifying Termination
” means the Officer’s separation from service (as defined in Section 409A of the Code and the applicable regulations) with the Company due to any of the events described in Section 2.2 herein, the occurrence of which triggers the payment of Severance Benefits hereunder.
|
(s)
|
“
Severance Benefits
” means the payment of amounts and benefits upon the Officer’s separation from service (as defined in Section 409A of the Code and applicable regulations) as provided in Section 2.3 herein.
|
(a)
|
The Company’s involuntary termination of the Officer’s employment without Cause; and
|
(b)
|
The Officer’s voluntary termination of the Officer’s employment for Good Reason.
|
(a)
|
A lump-sum amount equal to the Officer’s accrued but unpaid Base Salary, accrued vacation pay, unreimbursed business expenses, and all other items earned by and owed to the Officer through and including the Effective Date of Termination.
|
(b)
|
A lump-sum amount: (i) if the Effective Date of Termination is between January 1 and June 30, equal to the Officer’s then current annual target bonus opportunity; or (ii) if the Effective Date of Termination is between July 1 and December 31, equal to the greater of (A) the Officer’s then current annual target bonus opportunity or (B) the actual annual bonus payable to the Officer based on the Company’s performance up to and including the Effective Date of Termination, as such target and actual amounts are established or computed under the annual bonus plan in which the Officer is then participating, for the bonus plan year in which the Officer’s Effective Date of Termination occurs, and multiplied by a fraction the numerator of which is the number of days in the year from January 1 through the Effective Date of Termination, and the denominator of which is three hundred sixty-five (365). This payment will be in lieu of any other payment to be made to the Officer under the annual bonus plan in which the Officer is then participating for the plan year in which the Effective Date of Termination occurs.
|
(c)
|
A lump-sum amount equal to __________ multiplied by the sum of the following: (i) the higher of: (A) the Officer’s annual rate of Base Salary in effect upon the Effective Date of Termination, or (B) the Officer’s annual rate of Base Salary in effect on the date of the Change in Control; and (ii) the higher of: (A) the Officer’s annual target bonus opportunity established under the annual bonus plan in which the Officer is then participating for the bonus plan year in which the Officer’s Effective Date of Termination occurs, or (B) the Officer’s annual target bonus opportunity established under the annual bonus plan in which the Officer is participating for the bonus plan year in which the Change in Control occurs.
|
(d)
|
Continuation for __________ (____) months of the Officer’s health, dental and vision insurance coverage. The benefit shall be provided by the Company to the Officer beginning immediately upon the Effective Date of Termination. Such benefit shall be provided to the Officer at the same coverage level as in effect immediately prior to the Change in Control and the Company (or the acquirer as the case may be) shall pay the amounts that the Company would have been required to pay for health, dental and vision benefits for Officer and Officer’s eligible family members had Officer remained an employee of the Company following the Effective Date of Termination (Officer shall be responsible for the portion of health, dental and vision premiums that would be paid by an employee of the Company receiving comparable benefits). Any COBRA health benefit continuation coverage provided to Officer shall run concurrently with the aforementioned __________ (____) month period.
|
(e)
|
The Company agrees to pay on the Officer’s behalf up to $_______ in Officer outplacement services to one or more firms chosen by Officer and acceptable to the Company, provided that such services are incurred no later the first anniversary of the Officer’s Effective Date of Termination. Such expenses shall be reimbursed by the Company as soon as practical after an expense report is completed and submitted to the Company for approval, provided such expense report must be received by the Company no later than the second anniversary of the Officer’s Effective Date of Termination.
|
(a)
|
Notwithstanding anything to the contrary set forth in this Agreement, any Severance Benefits paid (i) within 2-½ months of the end of the Company’s taxable year containing the Officer’s separation from service with the Company, or (ii) within 2-½ months of the Officer’s taxable year containing the separation from service from employment by the Company shall be exempt from the requirements of Section 409A of the Code, and shall be paid in accordance with this Article 3. Severance Benefits subject to this Section 3.2(a) shall be treated and shall be deemed to be an entitlement to a separate payment within the meaning of Section 409A of the Code and the regulations thereunder.
|
(b)
|
To the extent Severance Benefits are not exempt from Section 409A under Section 3.2(a) above, any Severance Benefits paid in the first six (6) months following the Officer’s separation from service with the Company that are equal to or less than the lesser of the amounts described in Treasury Regulation Section 1.409A-1(b)(9)(iii)(A)(1) and (2) shall be exempt from Section 409A and shall be paid in accordance with this Article 3. Severance Benefits subject to this Section 3.2(b) shall be treated and shall be deemed to be an entitlement to a separate payment within the meaning of Section 409A of the Code and the regulations thereunder.
|
(c)
|
To the extent Severance Benefits are not exempt from Section 409A under Sections 3.2(a) or (b) above, any Severance Benefits paid equal to or less than the applicable dollar amount under Section 402(g)(1)(B) of the Code for the year of separation from service with the Company shall be exempt from Section 409A in accordance with Treasury Regulation Section 1.409A-1(b)(9)(v)(D) and shall be paid in accordance with this Article 3. Severance Benefits subject to this Section 3.2(c) shall be treated and shall be deemed
|
(d)
|
To the extent Severance Benefits are not exempt from Section 409A pursuant to Sections 3.2(a), (b) or (c) above, and to the extent the Officer is a “specified employee” (as defined below), payments due to the Officer under Section 3 shall begin no sooner than six (6) months after the Officer’s separation from service with the Company (other than for death); provided, however, that any payments not made during the six (6) month period described in this Section 3.2(d) due to the six (6) month delay period required under Treasury Regulation Section 1.409A-3(i)(2) shall be made in a single lump sum as soon as administratively practicable after the expiration of such six (6) month period and the balance of all other payments required under this Agreement shall be made as otherwise scheduled in this Agreement. Notwithstanding anything herein to the contrary, and subject to Code Section 409A, to the extent the following rules should apply to the Officer in connection with a payment made hereunder, such payment shall not be made or commence as a result of the Officer’s Effective Date of Termination if the Officer is a key employee (as set forth below) before the date that is not less than six (6) months after the Officer’s Effective Date of Termination. For this purpose, a key employee includes a “specified employee” (as defined in Code Section 409A(a)(2)(B)) during the entire twelve (12) month period determined by the Company ending with the annual date upon which key employees are identified by the Company, and also includes any Officer identified by the Company in good faith with respect to any distribution as belonging to the group of identified key employees, to a maximum of 200 such key employees, regardless of whether such Officer is subsequently determined by the Company, any governmental agency, or a court not to be a key employee. The identification date for determining key employees shall be each December 31 (and the new key employee list shall be updated and effective each subsequent April 1).
|
(e)
|
For purposes of this Agreement, the term “specified employee” shall have the meaning set forth in Treasury Reg. Section 1.409A-1(i). The determination of whether the Officer is a “specified employee” shall be made by the Company in good faith applying the applicable Treasury regulations.
|
(i)
|
operating results and/or losses associated with the write-down of assets of a subsidiary, business unit or division that has been designated by the Board of Directors as a discontinued business operation or to be liquidated;
|
(ii)
|
gains or losses on the sale of any subsidiary, business unit or division, or the assets or business thereof;
|
(iii)
|
gains or losses from the disposition of material capital assets (other than in a transaction described in subsection (ii)) or the refinancing of indebtedness, including, among other things, any make-whole payments and prepayment fees;
|
(iv)
|
losses associated with the write-down of goodwill or other intangible assets of the Company due to the determination under applicable accounting standards that the assets have been impaired;
|
(v)
|
gains or losses from material property casualty occurrences or condemnation awards, taking into account the proceeds paid by insurance companies and other third parties in connection with the casualty or condemnation;
|
(vi)
|
any income statement effect resulting from a change in tax laws, accounting principles (including, without limitation, generally accepted accounting principles), regulations, or other laws regulations affecting reported results, except, in each case, to the extent the effect of such a change is already reflected in the target Net Income amount;
|
(vii)
|
reorganization or restructuring charges and acquisition- or divestiture-related transaction expenses and costs;
|
(viii)
|
any gains or losses from unusual nonrecurring or extraordinary items;
|
(ix)
|
operating results of any entity or business acquired or disposed of during the Plan Year, except, in the case of an acquisition, to the extent such entity or business was included in the Company’s operating business plan for the Plan Year or, in the case of a disposition, to the extent such entity or business was not included in the Company’s operating business plan for the Plan Year;
|
(x)
|
any gain or loss resulting from currency fluctuations or translations as set forth in the Aegion Corporation Foreign Exchange Rate Policy for Annual Incentive Plan and Long-Term Incentive Plan;
|
(xi)
|
any material income or loss item the realization of which is not directly attributable to the actions of current senior management of the Company; and
|
(xii)
|
the income taxes (benefits) of any of the above-designated gains or losses.
|
1.
|
If Actual Net Income equals the Net Income Target, the portion of the Consolidated Company Financial Performance Pool related to Net Income shall be equal to the portion Company Target Funding Amount related to Net Income, subject to the additional terms specified in Exhibit A.
|
2.
|
If Actual Net Income exceeds or falls below the Net Income Target, the portion of Consolidated Company Financial Performance Pool related to Net Income shall be determined in accordance with the chart in Exhibit A (using interpolation for Actual Net Income levels as specified therein), and subject to the additional terms specified therein.
|
3.
|
If Actual Net Income is less than the threshold percentage of the Net Income Target specified in the chart in Exhibit A, the maximum amount funded to the Consolidated Company Financial Performance Pool shall be equal to $1,000,000; provided, however, that (i) such minimum amount shall only be awarded to individual Participants for extraordinary performance, as determined by the Company’s Chief Executive Officer in his sole discretion (subject to the review and approval by the Compensation Committee of any Awards to executive officers of the Company); (ii) such minimum amount shall be reduced such that any funding under this paragraph and the similar mechanism in Section F(8) of the Management Annual Incentive Plan for Business Unit Employees shall together total $1,000,000.
|
4.
|
If Actual Bookings equals the Bookings Target, the portion of the Consolidated Company Financial Performance Pool related to Bookings shall be equal to the portion of Company Target Funding Amount related to Bookings, subject to the additional terms specified in Exhibit B.
|
5.
|
If Actual Bookings exceeds or falls below the Bookings Target, the portion of the Consolidated Company Financial Performance Pool related to Bookings shall be determined in accordance with the
|
6.
|
If Actual Bookings is less than the threshold percentage of the Bookings Target (after the threshold percentage has been determined by the Chief Executive Officer in his sole discretion, per Exhibit B),, the amount funded to the Consolidated Company Financial Performance Pool shall be equal to $0.
|
1.
|
Grant of Performance Units.
Subject to the terms and conditions contained in this Agreement, the Plan and the EPP, the Company hereby grants to you the number of Performance Units designated above. The time between the Date of Grant and the vesting of the Performance Units shall be referred to as the “Vesting Period.”
|
2.
|
Performance Goals.
The vesting of Performance Units is conditioned upon the achievement by the Company of certain cumulative/average three-year performance goals (“Performance Goals”), as established by the Compensation Committee of the Board of Directors and the vesting of such Performance Units may not occur, in whole or in part, if such Performance Goals are not achieved.
|
3.
|
Vesting of Performance Units upon Achievement of Performance Goals.
Performance Units vest only upon the achievement of the cumulative/average Performance Goal for the Performance Period as set forth in
Appendix A
.
|
(i)
|
In the event that, at any time during the Performance Period, a Custom Peer Company is no longer included in the S&P Small Cap Industrial Index, such company shall no longer be a Custom Peer Company, unless such Custom Peer Company was in the Custom Peer Group by virtue of being in Aegion’s current 18-company compensation peer group.
|
(ii)
|
In the event of a merger, acquisition or business combination transaction of a Custom Peer Company with or by another Custom Peer Company, the surviving entity shall remain a Custom Peer Company, without adjustment to its financial or market structure, provided that the surviving entity is still in the S&P Small Cap Industrial Index; provided, however, that if one or both of the Custom Peer Group companies referred to in this subsection (ii) are not in the S&P Small Cap Industrial Index, the Compensation Committee shall make a determination whether such surviving entity should appropriate remain in the Custom Peer Group.
|
(iii)
|
In the event of a merger of a Custom Peer Company with or by an entity that is not a Custom Peer Company, or the acquisition or business combination transaction by a member of the Custom Peer Group of or with an entity that is not a Custom Peer Company, in each case, where the Custom Peer Company is the surviving entity, the surviving entity shall remain a Custom Peer Company, without adjustment to its financial or market structure, provided that the surviving entity is still in the S&P Small Cap Industrial Index; provided, however, that if the Custom Peer Company involved in the merger, acquisition or business combination transaction described in this subsection (iii) above is not in the S&P Small Cap Industrial Index, the Compensation Committee shall make a determination whether such surviving entity should appropriate remain in the Custom Peer Group.
|
(iv)
|
In the event of a merger or acquisition or business combination transaction of a Custom Peer Company with or by an entity that is not a Custom Peer Company, other form of “going private” transaction relating to any Custom Peer Company or the liquidation of any Custom Peer Company, where such Custom Peer Company is not the surviving entity or is otherwise no longer publicly traded, the company shall no longer be a Custom Peer Company.
|
(v)
|
In the event of a bankruptcy of a Custom Peer Company, such company shall remain a Custom Peer Company, without adjustment to its financial or market condition.
|
4.
|
Change in Control.
|
(i)
|
breaching any employment, confidentiality, noncompete, nonsolicitation or other agreement with the Company, any written Company policy relating to compliance with laws (during employment) or any general undertaking or legal obligation to the Company;
|
(ii)
|
causing, inducing, requesting or advising, or attempting to cause, induce, request or advise, any employee, representative, consultant or other similar person to terminate his/her relationship, or breach any agreement, with the Company;
|
(iii)
|
causing, inducing, requesting or advising, or attempting to cause, induce, request or advise, any customer, supplier or other Company business contact to withdraw, curtail or cancel its business with the Company; or
|
(iv)
|
failing or refusing to perform any stated duty or assignment, misconduct, disloyalty, violating any Company policy or work rule, engaging in criminal conduct in connection with your employment, being indicted or charged with any crime constituting a felony or involving dishonesty or moral turpitude, violating any term in this Agreement, unsatisfactory job performance, or any other reason constituting cause within the meaning of Missouri common law.
|
(i)
|
the acquisition by one person, or more than one person acting as a group, in a transaction or series of related transactions, of ownership of stock of the Company that, together with stock held by such person or group, constitutes more than 30% of the total fair market value or total voting power of the stock of the Company; and/or
|
(ii)
|
a majority of the members of the Company’s board of directors is replaced during any twelve-month period by directors whose appointment or election is not endorsed by a majority of the members of the Company’s board of directors before the date of the appointment or election; and/or
|
(iii)
|
the consummation of a merger or consolidation of the Company other than a merger or consolidation that would result in the voting securities of the Company outstanding immediately prior to the transaction continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or any parent thereof) at least 50% of the combined voting power of the securities of the Company or such surviving entity or any parent thereof outstanding immediately after such merger or consolidation; and/or
|
(iv)
|
the stockholders of the Company approve a plan of complete liquidation or dissolution of the Company or there is a consummated sale or disposition by the Company of all or substantially all of the Company’s assets, other than a sale or disposition by the Company of all or substantially all of the Company’s assets to an entity, at least 50% of the combined voting power of the voting securities of which are owned by stockholders of the Company in substantially the same proportions as their ownership of the Company immediately prior to such sale.
|
(i
)
|
a material reduction or alteration in the nature or status of your authorities, duties, or responsibilities from those in effect as of 90 calendar days prior to the Change
in
Control, other than an insubstantial and inadvertent act that is remedied by the Company or the Successor promptly after receipt of notice thereof given by you;
|
(ii)
|
the Company’s or the Successor’s requiring you to be based at a location in excess of 50 miles from the location of your principal job location or office in effect as of 90 calendar days prior to the Change
in
Control
,
except for required travel on the Company’s or the Successor’s business to an extent substantially consistent with your then present business travel obligations;
|
(iii)
|
a material reduction by the Company or the Successor of your base salary in effect as of 90 calendar days prior to the Change in Control; or
|
(iv)
|
the failure of the Company or the Successor to continue in effect any of the Company’s short- and long-term incentive compensation plans, or employee benefit or retirement plans, policies, practices, or other compensation arrangements in which you participate taken as a whole unless such failure to continue the plan, policy, practice, or arrangement pertains to all plan participants generally; or the failure by the Company or the Successor to continue your participation therein on substantially the same basis, both in terms of the amount of benefits provided and the level of your participation relative to other participants, as existed 90 calendar days prior to the Change
in
Control.
|
5.
|
Forfeiture of Performance Units.
Any Performance Units that remain unvested after the calculation of the cumulative TSR Goal or the average ROIC Goal for the Performance Period or after distribution in connection with a Change in Control (as set forth in Section 4 above) will be forfeited to and cancelled by the Company. In addition, except as set forth in Section 4, all unvested Performance Units will be forfeited and cancelled upon termination of your employment with the Company and its majority-owned subsidiaries for any reason unless the Performance Period in which the Performance Units are eligible to vest has been completed and the Compensation Committee has yet to certify that the Performance Goals have been achieved.
|
6.
|
Bookkeeping Account.
The Company will record the maximum number of Performance Units granted to you under this Agreement to a bookkeeping account for you (the “Performance Unit Account”). Your Performance Unit Account will be adjusted from time to time for any stock dividends, stock splits, and other transactions in accordance with Section 9. The Performance Unit Account represents an unsecured promise of the Company to deliver shares of Common Stock as and when the Performance Units vest in accordance with this Agreement. Your rights to your Performance Unit Account will be no greater than that of other general, unsecured creditors of the Company.
|
7.
|
Distribution of Shares of Common Stock
. When the Performance Units vest either (i) upon certification by the Compensation Committee of the achievement of one or both of the Performance Goals at the end of the Performance Period or (ii) in connection with a Change in Control (as set forth in Section 4 above), the number of shares of Common Stock equal to such vested Performance Units shall be distributed as soon as practicable after the date of vesting to you (or your beneficiary(ies) or personal representative, if you are deceased). Distributions shall be made in shares of Common Stock, with fractional shares rounded up to the nearest whole share. An amount payable on a date specified above shall be paid as soon as administratively feasible after such date. The payment date may be postponed further if calculation of the amount of the payment is not administratively practicable due to events beyond
|
8.
|
Death Beneficiary Designation.
You may designate a beneficiary or beneficiaries (contingently, consecutively or successively) to receive shares of Common Stock, if you die while Performance Units are held in your Performance Unit Account, and the Company will distribute upon vesting of the Performance Units shares of Common Stock equal in number to such vested Performance Units to your beneficiary(ies).
|
9.
|
Adjustments.
Subject to Section 4 above, if there is any change in the Common Stock by reason of stock dividends, split-ups, mergers, consolidations, reorganizations, combinations or exchanges of shares or the like, the number of Performance Units then credited to your Performance Unit Account shall be adjusted appropriately so that the number of Performance Units reflected in your Performance Unit Account after such an event shall equal the number of shares of Common Stock a stockholder would own after such an event if the stockholder, at the time such an event occurred, had owned shares of Common Stock equal to the number of Performance Units reflected in your Performance Unit Account immediately before such an event. You shall not be eligible to receive such additional Performance Units until such time as the Performance Units awarded pursuant to this Agreement vest, and you shall only receive such portion of such additional Performance Units as shall be calculated based upon the portion of the Performance Units that actually vest pursuant to this Agreement.
|
10.
|
Limitation on Transfer
. Your Performance Units are not transferable by you. Except as may be required by U.S. federal income tax withholding provisions or by the tax laws of any state or country, your interests (and the interests of your beneficiaries, if any) under this Agreement are not subject to the claims of your creditors and may not be voluntarily or involuntarily sold, transferred, alienated, assigned, pledged, anticipated, or encumbered. Any attempt to sell, transfer, alienate, assign, pledge, anticipate, encumber, charge or otherwise dispose of any right to benefits payable hereunder shall be void and of no force or effect and shall result in a forfeiture of all affected Performance Units.
|
11.
|
No Shareholder Rights
. You will not have any stockholder rights, such as rights to vote or to receive dividends or other distributions, with respect to any Performance Units reflected in your Performance Unit Account until distribution of shares of Common Stock after vesting of the Performance Units. You will have only the adjustment rights provided in this Agreement.
|
12.
|
Securities Law
. Shares of Common Stock will not be distributed under this Agreement if such distribution would violate any U.S. federal or state or non-U.S. securities laws. The Company may take appropriate action to achieve compliance with those laws in connection with any distribution of Common Stock to you.
|
13.
|
Taxes.
The Compensation Committee (as defined in the Plan) may withhold delivery of shares of Common Stock upon vesting until you make satisfactory arrangements to pay any withholding, transfer or other taxes due with respect to the vesting or distribution of the Performance Units and the issuance of the underlying shares of Common Stock. You are responsible for the payment of all taxes applicable to any income realized upon the distribution of the shares of Common Stock after vesting of the Performance Units. Unless you provide written notice to the Company at least ninety (90) days prior to the vesting of the Performance Units that you will settle your tax obligation by paying cash, or unless otherwise determined by the Company in its sole discretion, the Company shall withhold and cancel a sufficient number of shares of Common Stock that would be otherwise issuable upon vesting of the Performance Units to satisfy any applicable tax withholding requirement or such other statutorily permissible amount, with the fair market value of such Common Stock for such purposes equal to the closing price per share of Common Stock as generally reported on the Nasdaq Stock Market (or such other exchange or market where the Common Stock is trading) on the date of distribution of the shares of Common Stock. If you elect to settle your tax obligation by paying cash, and do not make timely payment of your tax withholding obligation by cash or check by the date of distribution of the shares of Common Stock, the Company may, in its sole discretion, withhold and cancel a sufficient number of shares of Common Stock that would be otherwise issuable upon vesting of the Performance Units to satisfy your tax withholding obligation or other statutorily permissible amount in the manner set forth in this Section 13.
|
14.
|
No Right to Continue as an Employee; No Right to Further Grants.
This Agreement does not give you any right to continue as an employee of the Company or any of its subsidiaries for any period of time or at any rate of compensation, nor does it interfere with the Company’s or its subsidiaries’ right to determine the terms of your employment.
|
15.
|
Rules of Construction.
This Agreement shall be administered, interpreted, and construed in a manner consistent with Code section 409A to the extent necessary to avoid the imposition of additional taxes under Code section 409A(a)(1)(B). Should any provision of this Agreement be found not to comply with, or otherwise be exempt from, the provisions of Code section 409A, such provision shall be modified and given effect (retroactively if necessary), in the sole discretion of the Compensation Committee, and without your consent, in such manner as the Compensation Committee determines to be necessary or appropriate to comply with, or to effectuate an exemption from, Code section 409A. In particular, where the time of payment is predicated upon a termination of employment, termination of employment shall mean a separation from service as defined in the regulations under section 409A of the Internal Revenue Code. Such regulations are hereby incorporated by reference where applicable.
|
16.
|
Interpretations Binding.
The interpretations and determinations of the Compensation Committee are binding and conclusive. This Agreement is entered into in Missouri and its terms shall be governed by and interpreted in accordance with the laws of the State of Missouri without regard to conflict of law principles.
|
17.
|
Jurisdiction.
Any suit or other legal action to enforce the terms of this Agreement or any document or agreement referenced herein must be brought in the St. Louis County, Missouri Circuit Court or (if federal jurisdiction exists) the U.S. District Court for the Eastern District of Missouri. You agree that venue and personal jurisdiction are proper in either such court, and waive all objections to jurisdiction and venue and any defense or claim that either such forum is not the most convenient forum.
|
18.
|
Termination of Right to Receive Shares; Recoupment.
You understand and agree that your right to receive and retain the Performance Units granted herein (and the benefits thereof) is conditioned on your compliance with the terms of this Agreement and any agreement referenced herein. In the event you violate this Agreement or any other agreement referenced herein, then in addition to and not in lieu of any other rights and remedies available to the Company for such breach, all of which are expressly reserved, the Company may: (i) cancel any Performance Units that are unvested or vested but not yet issued to you; and (ii) recover from you any and all common stock issued to you under any Performance Units, or an amount equal to the value of the same, with such value being the fair market value of the common stock at the close of business on the date that the shares were issued under the Performance Units.
|
1.
|
Grant of Restricted Stock Units.
Subject to the terms and conditions contained in this Agreement, the Plan and the EPP, the Company hereby grants to you the number of Restricted Stock Units designated above.
|
2.
|
Bookkeeping Account.
The Company will record the number of Restricted Stock Units granted to you under this Agreement to a bookkeeping account for you (the “Restricted Stock Unit Account”). Your Restricted Stock Unit Account will be reduced by the number of shares of Common Stock transferred to you in accordance with Section 4. Your Restricted Stock Unit Account will be adjusted from time to time for any stock dividends, stock splits, and other transactions in accordance with Section 6. The Restricted Stock Unit Account represents an unsecured promise of the Company to deliver shares of Common Stock in the future. Your rights to your Restricted Stock Unit Account will be no greater than that of other general, unsecured creditors of the Company.
|
3.
|
Performance Restrictions.
In addition to the potential forfeiture of the Restricted Stock Units pursuant to Section 4 below, you shall forfeit all of the Restricted Stock Units awarded under this Agreement upon notice to you by the Compensation Committee that the “Performance Goal” (as defined in this Section 3) established under the EPP as a condition to the vesting of the Restricted Stock Units is not satisfied in full in accordance with the terms and
|
4.
|
Vesting Period
. If the Performance Restriction is met and so as long as there is no termination of your employment, your Restricted Stock Units (or a “Substitute Equivalent Award” (as defined in this Section 4 below) in the case of a Change in Control) shall vest upon the first to occur of any of the following events during your continuous employment with the Company or one of its subsidiaries:
|
(a)
|
the third anniversary of the Date of Award;
|
(b)
|
your death;
|
(c)
|
the termination of your employment as a result of your Disability (as defined in this Section 4 below);
|
(d)
|
the termination of your employment as a result of your retirement (retirement means your voluntary termination of your employment with the Company and its subsidiaries following (i) your attainment of the age of 55 with at least 10 years of full-time service to the Company and/or its subsidiaries, (ii) your attainment of the age of 60 with at least five years of full-time service to the Company and/or its subsidiaries, or (iii) your attainment of the age of 65 (with no minimum full time service requirements with the Company and/or its subsidiaries),
provided, however,
that the number of Restricted Stock Units that shall vest shall be determined by (a)
dividing
(i) the number of whole calendar months (e.g., July 1 through July 31) of your employment with the Company or its subsidiaries during the period beginning on the Date of Award and ending on the date of termination of your employment by (ii) 36; and (b)
multiplying
the percentage determined under subsection (a) immediately above by the number of Restricted Stock Units awarded to you pursuant to this Agreement;
|
(e)
|
upon involuntary termination of your employment without “Cause” (as defined in this Section 4 below) at least 18 months after the Date of Award but prior to a Change in Control. In such case, the number of Restricted Stock Units awarded to you pursuant to this Agreement that shall vest shall be determined by (a)
|
(f)
|
upon a termination of your employment by the Company or its subsidiaries (or the Successor (as defined in this subsection below) or its subsidiaries, as the case may be) without “Cause” (as defined in this Section 4 below) or a termination of your employment by you for “Good Reason” (as defined in this Section 4 below), each after a Change in Control in which the successor organization (the “Successor”) substituted the Restricted Stock Units awarded pursuant to this Agreement with a Substitute Equivalent Award; or
|
(g)
|
immediately prior to a Change in Control if the Restricted Stock Units awarded pursuant to this Agreement is not substituted with a Substitute Equivalent Award by the Successor.
|
(i)
|
breaching any employment, confidentiality, noncompete, nonsolicitation or other agreement with the Company, any written Company policy relating to compliance with laws (during employment) or any general undertaking or legal obligation to the Company;
|
(ii)
|
causing, inducing, requesting or advising, or attempting to cause, induce, request or advise, any employee, representative, consultant or other similar person to terminate his/her relationship, or breach any agreement, with the Company;
|
(iii)
|
causing, inducing, requesting or advising, or attempting to cause, induce, request or advise, any customer, supplier or other Company business contact to withdraw, curtail or cancel its business with the Company; or
|
(iv)
|
failing or refusing to perform any stated duty or assignment, misconduct, disloyalty, violating any Company policy or work rule, engaging in criminal conduct in connection with your employment, being indicted or charged with any crime constituting a felony or involving dishonesty or moral turpitude, violating any term in this Agreement, unsatisfactory job performance, or any other reason constituting cause within the meaning of Missouri common law.
|
(ii)
|
a majority of the members of the Company’s board of directors is replaced during any twelve-month period by directors whose appointment or election is not endorsed by a majority of the members of the Company’s board of directors before the date of the appointment or election; and/or
|
(iii)
|
the consummation of a merger or consolidation of the Company other than a merger or consolidation that would result in the voting securities of the Company outstanding immediately prior to the transaction continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or any parent thereof) at least 50% of the combined voting power of the securities of the Company or such surviving entity or any parent thereof outstanding immediately after such merger or consolidation; and/or
|
(iv)
|
the stockholders of the Company approve a plan of complete liquidation or dissolution of the Company or there is a consummated sale or disposition by the Company of all or substantially all of the Company’s assets, other than a sale or disposition by the Company of all or substantially all of the Company’s assets to an entity, at least 50% of the combined voting power of the voting securities of which are owned by stockholders of the Company in substantially the same proportions as their ownership of the Company immediately prior to such
|
(i)
|
a material reduction or alteration in the nature or status of your authorities, duties, or responsibilities from those in effect as of 90 calendar days prior to the Change in Control, other than an insubstantial and inadvertent act that is remedied by the Company or the Successor promptly after receipt of notice thereof given by you;
|
(ii)
|
the Company’s or the Successor’s requiring you to be based at a location in excess of 50 miles from the location of your principal job location or office in effect as of 90 calendar days prior to the Change in Control
,
except for required travel on the Company’s or the Successor’s business to an extent substantially consistent with your then present business travel obligations;
|
(iii)
|
a material reduction by the Company or the Successor of your base salary in effect as of 90 calendar days prior to the Change in Control; or
|
(iv)
|
the failure of the Company or the Successor to continue in effect any of the Company’s short- and long-term incentive compensation plans, or employee benefit or retirement plans, policies, practices, or other compensation arrangements in which you participate taken as a whole unless such failure to continue the plan, policy, practice, or arrangement pertains to all plan participants generally; or the failure by the Company or the Successor to continue your participation therein on substantially the same basis, both in terms of the amount of benefits provided and the level of your participation relative to other participants, as existed 90 calendar days prior to the Change in Control.
|
(i)
|
has a value at least equal to the value of the Restricted Stock Units awarded pursuant to this Agreement as determined by the Compensation Committee in its sole discretion;
|
(ii)
|
relates to a publicly-traded equity security of the Successor involved in the Change in Control or another entity that is affiliated with the Company or the Successor following the Change in Control;
|
(iii)
|
is the same type of award as the Award; and
|
(iv)
|
has other terms and conditions that are not less favorable to you than the terms and conditions of the Restricted Stock Units awarded pursuant to this Agreement, as determined by the Compensation Committee in its sole discretion.
|
5.
|
Distribution of Shares of Common Stock
. As soon as practical after Restricted Stock Units vest, shares of Common Stock, equal to the number of vested Restricted Stock Units reflected in your Restricted Stock Unit Account, shall be distributed to you (or your beneficiary(ies) or personal representative, if you are deceased). Distributions shall be made in shares of Common Stock, with fractional shares rounded up to the nearest whole share.
|
6.
|
Death Beneficiary Designation.
Subject to applicable law and the terms of this Agreement, you may designate a beneficiary or beneficiaries (contingently, consecutively or successively) to receive shares of Common Stock, if you die while Restricted Stock Units are held in your Restricted Stock Unit Account, and, upon your death, the Company will transfer shares of Common Stock equal in number to the Restricted Stock Units, if any, reflected in your Restricted Stock Unit Account to your beneficiary(ies).
|
7.
|
Adjustments.
If the Company pays a cash dividend on its Common Stock, then, as soon as practical after such cash dividend is paid, the Company shall grant you additional restricted stock units (and credit your Restricted Stock Unit Account for such additional restricted stock units) with a value equal to the amount per share of such cash dividend multiplied by the number of Restricted Stock Units credited to your Restricted Stock Unit Account as of the record date of such cash dividend (the “Dividend Amount”). The number of additional restricted stock units to be granted to you pursuant to this paragraph shall be determined by dividing the Dividend Amount by the closing stock price of the Company’s Common Stock on the dividend date. You shall not be eligible to receive such additional restricted stock units until such time as the Restricted Stock Units awarded pursuant to this Agreement vest, and you shall only receive such portion of such additional restricted stock units as shall be calculated based upon the portion of the Restricted Stock Units that actually vest pursuant to this Agreement.
|
8.
|
Limitation on Transfer
. Your Restricted Stock Units are not transferable by you. Except as may be required by U.S. federal income tax withholding provisions or by the tax laws of any state or country, your interests (and the interests of your beneficiaries, if any) under this Agreement are not subject to the claims of your creditors and may not be voluntarily or involuntarily sold, transferred, alienated, assigned, pledged, anticipated, or encumbered. Any attempt to sell, transfer, alienate, assign, pledge, anticipate, encumber, charge or otherwise dispose of any right to benefits payable hereunder shall be void and of no force or effect and shall result in a forfeiture of all affected Restricted Stock Units.
|
9.
|
No Shareholder Rights
. You will not have any stockholder rights, such as rights to vote or to receive dividends or other distributions, with respect to any Restricted Stock Units reflected in your Restricted Stock Unit Account. You will have only the adjustment rights provided in this Agreement.
|
10.
|
Securities Law
. Shares of Common Stock will not be transferred under this Agreement if such transfer would violate any U.S. federal or state or non-U.S. securities laws. The Company may take appropriate action to achieve compliance with those laws in connection with any transfer of Common Stock to you.
|
11.
|
Taxes.
The Compensation Committee (as defined in the Plan) may withhold delivery of the shares of Common Stock upon vesting until you make satisfactory arrangements to pay any withholding, transfer or other taxes due with respect to the transfer or vesting of such shares. You are responsible for the payment of all taxes applicable to any income realized upon the vesting of the Restricted Stock Units on the date of vesting. Unless you provide written notice to the Company at least ninety (90) days prior to the vesting of the Restricted Stock Units that you will pay cash to settle your tax obligation, or unless otherwise determined by the Company in its sole discretion, the Company shall withhold and cancel a sufficient number of shares of Common Stock that would be otherwise issuable upon vesting of the Restricted Stock Units to satisfy any applicable tax withholding requirement or such other statutorily permissible amount, with the fair market value of such Common Stock for such purposes equal to the closing price per share of Common Stock as generally reported on the Nasdaq Stock Market (or such other exchange or market where the Common Stock is trading) on the date of vesting of the Restricted Stock Units. If you elect to settle your tax obligation by paying cash and you do not make timely payment of your tax withholding obligation by cash or check on the date of vesting of this Restricted Stock Units, the Company may, in its sole discretion, withhold and cancel a sufficient number of shares of Common Stock that would be otherwise issuable upon vesting of the Restricted Stock Units to satisfy your tax withholding obligation or other statutorily permissible amount in the manner set forth in this Section 11.
|
12.
|
Interpretations Binding.
The interpretations and determinations of the Compensation Committee are binding and conclusive. This Agreement is entered into in Missouri and its terms shall be governed by and interpreted in accordance with the laws of the State of Missouri without regard to conflicts of law principles.
|
13.
|
No Right to Continue as an Employee; No Right to Further Grants.
This Agreement does not give you any right to continue as an employee of the Company or any of its subsidiaries for any period of time or at any rate of compensation, nor does it interfere with the Company’s or its subsidiaries right to determine the terms of your employment.
|
14.
|
Governing Law and Venue.
The Restricted Stock Unit grant and the provisions of this Agreement are governed by, and subject to, the laws of the State of Missouri, U.S.A.
|
15.
|
Forfeiture of Restricted Stock Units; Recoupment.
You understand and agree that your right to receive and retain the Restricted Stock Units granted herein (and the benefits thereof) is conditioned on your compliance with the terms of this Agreement and any agreement referenced herein. In the event you violate this Agreement or any other agreement referenced herein, then in addition to and not in lieu of any other rights and remedies available to the Company for such breach, all of which are expressly reserved, the Company may (i) declare a forfeiture of, and cancel, all Restricted Stock Units; and (ii) recover from you any and all shares of common stock distributed as a result of any of the Restricted Stock Units vesting, or an amount equal to the value of the same, with the value being the fair market value of the common stock at the close of business on the date such shares of common stock were distributed as a result of such Restricted Stock Units vesting.
|
16.
|
Further Requirements.
The Company reserves the right to impose other requirements on the Restricted Stock Units and any shares of Common Stock acquired under the Plan, to the extent the Company determines it is necessary or advisable in order to comply with local law or facilitate the administration of the Plan, and to require you to sign any additional agreements or undertakings that may be necessary to accomplish the foregoing. Your signature below constitutes your consent to the foregoing and to all other provisions hereof.
|
Company Name
|
Place of Incorporation
|
Aegion Coating Services, LLC
|
Texas
|
Aegion Corrosion Protection Holdings Limited
|
United Kingdom
|
Aegion Energy Services, Inc.
|
Delaware
|
Aegion Holding Company, LLC
|
Delaware
|
Aegion International Holdings Limited
|
United Kingdom
|
Aegion International Limited
|
United Kingdom
|
Aegion Rehabilitation Services Limited
|
United Kingdom
|
Allsafe Services, Inc.
|
Delaware
|
Bayou Wasco Insulation, LLC
1
|
Delaware
|
Brinderson, LP
|
California
|
Brinderson Constructors, Inc.
|
California
|
Brinderson Services, LLC
|
Delaware
|
Building Chemical Supplies Limited
|
New Zealand
|
Concrete Solutions Limited
|
New Zealand
|
Corrpower International Limited
2
|
Saudi Arabia
|
Corrpro Canada Holdings, Inc.
|
Delaware
|
Corrpro Canada, Inc.
|
Alberta, Canada
|
Corrpro Companies Engineering Ltd.
|
United Kingdom
|
Corrpro Companies Europe Ltd.
|
United Kingdom
|
Corrpro Companies, Inc.
|
Ohio
|
Corrpro Companies International, Inc.
|
Nevada
|
Corrpro Holdings LLC
|
Delaware
|
DEH Services, LLC
|
Louisiana
|
Fibrwrap Construction Chile S.A.
3
|
Republic of Chile
|
Fibrwrap Construction Colombia S.A.S.
|
Republic of Columbia
|
Fibrwrap Construction Latin America S.A.
|
Republic of Panama
|
Fibrwrap Construction (M) Sdn Bhd
|
Malaysia
|
Fibrwrap Construction Pte Ltd
|
Singapore
|
Fibrwrap Construction Services, Inc.
|
Delaware
|
Fibrwrap Construction Services Ltd.
|
British Columbia, Canada
|
Fibrwrap Construction Services USA, Inc.
|
Delaware
|
Fibrwrap ENC Korea, Ltd.
4
|
Korea
|
Fyfe Asia Pte. Ltd.
|
Singapore
|
Fyfe Borneo Sdn Bhd
5
|
Brunei
|
Fyfe Co. LLC
|
Delaware
|
Fyfe (Hong Kong) Limited
|
Hong Kong
|
Fyfe International Holdings B.V.
|
The Netherlands
|
Fyfe Japan Co. Ltd.
|
Japan
|
Fyfe - Latin America S.A.
|
Republic of Panama
|
Fyfe - Latin America S.A. de C.V.
|
Republic of El Salvador
|
General Energy Services
|
California
|
Hockway Middle East FZE
|
Ras Al Khaimah, UAE
|
Hockway Middle East FZE
|
Dubai, UAE
|
INA Acquisition Corp.
|
Delaware
|
Infrastructure Group Holdings, LLC
|
Delaware
|
Insitu Envirotech (S.E. Asia) Pte. Ltd.
|
Singapore
|
Insituform Asia Limited
|
Hong Kong
|
Insituform C.V.
|
The Netherlands
|
Insituform Cyprus Limited
|
Cyprus
|
Insituform Europe SAS
|
France
|
Insituform Holdings B.V.
|
The Netherlands
|
Insituform Holdings (UK) Limited
|
United Kingdom
|
Insituform Hong Kong Limited
|
Hong Kong
|
Insituform Limited Partnership
|
New Brunswick, Canada
|
Insituform Linings Asia Sdn Bhd
|
Malaysia
|
Insituform Linings Limited
|
United Kingdom
|
Insituform Netherlands Holdings, LLC
|
Delaware
|
Insituform Pacific Pty Limited
|
Australia
|
Insituform Pipeline Rehabilitation Private Limited
|
India
|
Insituform Rioolrenovatietechnieken B.V.
|
The Netherlands
|
Insituform Singapore Pte. Ltd.
|
Singapore
|
Insituform sp. z o.o.
|
Poland
|
Insituform SPML JV
6
|
India
|
Insituform Technologies C.V.
|
The Netherlands
|
Insituform Technologies Ibérica S.A.
|
Spain
|
Insituform Technologies Limited
|
Alberta, Canada
|
Insituform Technologies Limited
|
United Kingdom
|
Insituform Technologies, LLC
|
Delaware
|
Insituform Technologies Netherlands B.V.
|
The Netherlands
|
Insituform Technologies Netherlands Holdings, LLC
|
Delaware
|
Insituform Technologies USA, LLC
|
Delaware
|
ITI International Services Canada Ltd.
|
Alberta, Canada
|
ITI International Services, Inc.
|
Delaware
|
Manufactured Technologies Corporation
|
Mississippi
|
Ocean City Research Corporation
|
New Jersey
|
Pacific Coast Field Services, Inc.
|
Delaware
|
PT Fyfe Fibrwrap Indonesia
7
|
Indonesia
|
Schultz Mechanical Contractors, Inc.
|
California
|
Technologie & Art Pte. Ltd.
|
Singapore
|
The Bayou Companies, LLC
|
Delaware
|
Underground Solutions, Inc.
|
Delaware
|
Underground Solutions Technologies Group, Inc.
|
Pennsylvania
|
United Pipeline de Mexico S.A. de C.V.
8
|
Mexico
|
United Pipeline Middle East, Inc.
|
Delaware
|
United Pipeline Systems, Inc.
|
Nevada
|
United Pipeline Systems International, Inc.
|
Delaware
|
United Pipeline Systems Limited
|
Alberta, Canada
|
United Pipelines Inversiones Limitada
|
Chile
|
United Pipelines SRL
|
Argentina
|
United Sistemas de Revestimento em Tubulações Ltda.
|
Brazil
|
United Sistema de Tuberias Limitada
|
Chile
|
United Special Technical Services LLC
9
|
Oman
|
UPS-Aptec Limited
10
|
United Kingdom
|
Wilson Walton Anti Corrosivos Ltd.
|
Portugal
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
/s/ Charles R. Gordon
|
Charles R. Gordon
President and Chief Executive Officer
(Principal Executive Officer)
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
/s/ David A. Martin
|
David A. Martin
Executive Vice President and Chief Financial Officer
(Principal Financial Officer)
|
(1)
|
the Form 10-K fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
information contained in the Form 10-K fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/s/ Charles R. Gordon
|
Charles R. Gordon
President and Chief Executive Officer
(Principal Executive Officer)
|
(1)
|
the Form 10-K fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
information contained in the Form 10-K fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/s/ David A. Martin
|
David A. Martin
Executive Vice President and Chief Financial Officer
(Principal Financial Officer)
|