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ý
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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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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Delaware
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20-5657551
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(State of Incorporation)
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(I.R.S. ID)
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COMMON STOCK, $0.01 par value per share
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NASDAQ
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Large Accelerated Filer
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¨
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Accelerated Filer
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¨
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Non-accelerated Filer
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¨
(Do not check if a smaller reporting company)
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Smaller reporting company
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ý
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Page
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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 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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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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Item 15.
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Term
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Definition
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AIG
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Ammonia Injection Grid
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ASCR™
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A trademark used to describe our Advanced Selective Catalytic Reduction process
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CAIR
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Clean Air Interstate Rule
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CAVR
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Clean Air Visibility Rule
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CSAPR
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Cross-State Air Pollution Rule
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CFD
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Computational Fluid Dynamics
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EPA
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The U.S. Environmental Protection Agency
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ESP
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Electrostatic Precipitator
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FGC
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Flue Gas Conditioning
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FUEL CHEM
®
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A trademark used to describe our fuel and flue gas treatment processes, including its TIFI
®
Targeted In-Furnace Injection™ technology to control slagging, fouling, corrosion and a variety of sulfur trioxide-related issues
|
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GSG™
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Graduated Straightening Grid
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HERT™ High Energy Reagent Technology™
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A trademark used to describe one of our SNCR processes for the reduction of NOx
|
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NO
x
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Oxides of nitrogen
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NO
x
OUT
®
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A trademark used to describe one of our SNCR processes for the reduction of NOx
|
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NO
x
OUT-SCR
®
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A trademark used to describe our direct injection of urea as a catalyst reagent
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NO
x
OUT CASCADE
®
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A trademark used to describe our process for the combination of SNCR and SCR technologies
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SCR
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Selective Catalytic Reduction
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SNCR
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Selective Non-Catalytic Reduction
|
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TIFI
®
Targeted In-Furnace Injection™
|
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A trademark used to describe our proprietary technology that enables the precise injection of a chemical reagent into a boiler or furnace as part of a FUEL CHEM program
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ULTRA™
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A trademark used to describe our process for generating ammonia for use as a Selective Catalytic Reduction reagent
|
•
|
Our APC technologies include advanced combustion modification techniques including low NO
x
burners and over fire air systems, along with post-combustion nitrogen oxide (NO
x
) control approaches, including NO
x
OUT
®
and HERT™ Selective Non-Catalytic Reduction (SNCR) and Rich Reagent Injection (RRI) systems. Our Advanced Selective Catalytic Reduction (ASCR) system utilizes the combination of combustion systems and SNCR to provide a cost effective alternative to high capital cost, standalone conventional SCR systems while providing similar NO
x
reduction levels. The ULTRA™ system generates ammonia on-site for SCR systems using safe urea reagent. Our SCR group provides process design optimization, performance testing and improvement, and catalyst selection services for SCR systems on coal-fired boilers. These technologies have established us as a leader in NO
x
reduction, with installations on over 1,000 units worldwide, where coal, fuel oil, natural gas, municipal waste, biomass, and other fuels are utilized.
|
•
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Our FUEL CHEM technologies revolve around the unique application of chemical injection programs which improve the efficiency, reliability, fuel flexibility and environmental status of combustion units by controlling slagging, fouling, corrosion, opacity and acid plume, as well as the formation of sulfur trioxide, ammonium bisulfate, particulate matter (PM
2.5
), sulfur dioxide (SO
2
), and carbon dioxide (CO
2
). We use our patented TIFI
®
Targeted In-Furnace Injection™ processes to apply specialty chemical programs to units burning a wide variety of fuels including coal, heavy oil, biomass, and municipal waste. These TIFI programs incorporate design, modeling, equipment, reagent, and service to provide complete customized on-site programs designed to improve plant operations and provide a return on investment in addition to helping meet emission regulatory requirements.
|
•
|
The Fuel Conversion business represents the continuing evolution of a new research and business development initiative we first commenced in 2014 following our acquisition of intellectual property rights and know-how related to the CARBONITE
®
fuel conversion process and technology. The goal of our Fuel Conversion technology is to convert coals of various grades into value-added engineered carbon feedstock products that are designed to be high in energy content and manufactured to contain other customizable carbon feedstock characteristics desirable in a variety of carbon feedstock use applications. Our Fuel Conversion technology has a number of potential applications including certain coal replacement, electric arc furnace reductant, ferro-alloy feedstock, and mercury reduced carbon feedstock. During 2015,
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•
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SNCR Systems: Our NO
x
OUT
®
and HERT™ SNCR processes use non-hazardous urea as the reagent rather than ammonia. Both the NO
x
OUT
®
and HERT™ processes on their own are capable of reducing NO
x
by up to 25% - 50% for utilities and by potentially significantly greater amounts for industrial units in many types of plants with capital costs ranging from $5 - $20/kW for utility boilers and with total annualized operating costs ranging from $1,000 - $2,000/ton of NO
x
removed.
|
•
|
Combined Systems: Our Advanced Selective Catalytic Reduction (ASCR™) systems include LNB, OFA, and SNCR components, along with a downsized SCR catalyst, Ammonia Injection Grid (AIG), and Graduated Straightening Grid (GSG™) system. Together, these systems provide up to 90% NO
x
reduction at significantly lower capital and operating costs than conventional SCR systems while providing greater operational flexibility to plant operators. The capital costs for ASCR systems can range from $30 - $150/kW depending on boiler size and configuration, which is significantly less than that of conventional SCRs, which can cost $300/kW or more, while operating costs are competitive with those experienced by SCR systems. The NO
x
OUT CASCADE
®
and NO
x
OUT-SCR
®
processes are basic types of ASCR systems which use just SNCR and SCR catalyst components. The NO
x
OUT CASCADE
®
systems can achieve 60% - 70% NO
x
|
•
|
ULTRA Technology: Our ULTRA™ process is designed to convert urea to ammonia safely and economically for use as a reagent in the SCR process for NO
x
reduction. Recent local objections in the ammonia permitting process have raised concerns regarding the safety of ammonia shipment and storage in quantities sufficient to supply SCR. In addition, the Department of Homeland Security has characterized anhydrous ammonia as a Toxic Inhalation Hazard commodity. Overseas, new coal-fired power plants incorporating SCR systems are expected to be constructed at a rapid rate in China, and our ULTRA™ process is believed to be a market leader for the safe conversion of urea to ammonia just prior to injection into the flue gas duct, which is particularly important near densely populated cities, major waterways, harbors or islands, or where the transport of anhydrous or aqueous ammonia is a safety concern.
|
•
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SCR Processes and Services: Our SCR group provides process design optimization, performance testing and improvement, and catalyst selection services for SCR systems on coal-fired boilers. In addition, other related services, including start-ups, maintenance support and general consulting services for SCR systems, Ammonia Injection Grid design and tuning to help optimize catalyst performance, and catalyst management services to help optimize catalyst life, are now offered to customers around the world. We also specialize in both physical experimental models, which involve construction of scale models through which fluids are tested, and computational fluid dynamics models, which simulate fluid flow by generating a virtual replication of real-world geometry and operating inputs. We design flow corrective devices, such as turning vanes, ash screens, static mixers and our patent pending Graduated Straightening Grid (GSG™). Our models help clients optimize performance in flow critical equipment, such as selective catalytic reactors in SCR systems, where the effectiveness and longevity of catalysts are of utmost concern. The Company’s modeling capabilities are also applied to other power plant systems where proper flow distribution and mixing are important for performance, such as flue gas desulphurization scrubbers, electrostatic precipitators, air heaters, exhaust stacks and carbon injection systems for mercury removal.
|
•
|
ESP Processes and Services: ESP technologies for particulate control include Electrostatic Precipitator (ESP) products and services including ESP Inspection Services, Performance Modeling, and Performance and Efficiency Upgrades, along with complete turnkey capability for ESP retrofits. Flue gas conditioning (FGC) systems include treatment using sulfur trioxide (SO
3
) and ammonia (NH
3
) based conditioning to improve the performance of ESPs by modifying the properties of the fly ash particle. Our ULTRA technology can provide the ammonia system feed requirements for FGC applications as a safe alternative to ammonia reagent based systems. FGC systems offer a lower capital cost approach to improving ash particulate capture versus the alternative of installing larger ESPs or utilizing fabric filter technology to meet targeted emissions and opacity limits. Fuel Tech’s particulate control technologies have been installed on more than 125 units worldwide.
|
•
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Burner Systems: Low NO
x
Burners and Ultra Low NO
x
Burners (LNB and ULNB) are available for coal-, oil-, and gas-fired industrial and utility units. Each system application is specifically designed to maximize NO
x
reduction. Computational fluid dynamics combustion modeling is used to validate the design prior to fabrication of equipment. NO
x
reductions can range from 40%-60% depending on the fuel type. Over-Fire Air (OFA) systems stage combustion for enhanced NO
x
reduction. Additional NO
x
reductions, beyond Low NO
x
Burners, of 35% - 50% are possible on different boiler configurations on a range of fuel types. Combined overall reductions range from 50% - 70%, with overall capital costs ranging from $10 - $20/kW and total costs ranging from $300 - $1,500/ton of NO
x
removed, depending on the scope.
|
•
|
The Air Pollution Control technology segment includes technologies to reduce NO
x
emissions in flue gas from boilers, incinerators, furnaces and other stationary combustion sources. These include Low and Ultra Low NO
x
Burners (LNB and ULNB), Over-Fire Air (OFA) systems, NO
x
OUT
®
and HERT™ Selective Non-Catalytic Reduction (SNCR) systems, and Advanced Selective Catalytic Reduction (ASCR™) systems. The ASCR system includes ULNB, OFA, and SNCR components, along with a downsized SCR catalyst, Ammonia Injection Grid (AIG), and Graduated Straightening Grid (GSG™) systems to provide high NO
x
reductions at significantly lower capital and operating costs than conventional SCR systems. The NO
x
OUT CASCADE
®
and NO
x
OUT-SCR
®
processes are basic types of ASCR systems, using just SNCR and SCR catalyst components. ULTRA™ technology creates ammonia at a plant site using safe urea for use with any SCR application. ESP technologies make use of electrostatic precipitator products and services to reduce particulate matter. Flue Gas Conditioning systems are chemical injection systems offered in markets outside the U.S. and Canada to enhance electrostatic precipitator and fabric filter performance in controlling particulate emissions.
|
•
|
The FUEL CHEM
®
technology segment which uses chemical processes in combination with advanced Computational Fluid Dynamics (CFD) and Chemical Kinetics Modeling (CKM) boiler modeling for the control of slagging, fouling, corrosion, opacity and other sulfur trioxide-related issues in furnaces and boilers through the addition of chemicals into the furnace using TIFI
®
Targeted In-Furnace Injection™ technology.
|
•
|
The Stamford, Connecticut building lease, for approximately
6,440
square feet, runs from February 1, 2010 to December 31, 2019. The facility houses certain administrative functions such as Investor Relations and certain APC sales functions.
|
•
|
The Beijing, China building lease, for approximately 8,000 square feet, runs from September 1, 2014 to August 31, 2017. This facility serves as the operating headquarters for our Beijing Fuel Tech operation.
|
•
|
The Durham, North Carolina building lease, for approximately
16,000
square feet, runs from May 1, 2014 to April 30, 2017. This facility houses engineering operations. The landlord has exercised an option to terminate the lease effective June 30, 2016.
|
•
|
The Gallarate, Italy building lease, for approximately
1,300
square feet, runs from May 1, 2013 to April 30, 2019. This facility serves as the operating headquarters for our European operations.
|
•
|
The Westlake, Ohio building lease, for approximately 5,000 square feet, runs from May 1, 2014 to April 30, 2017. This facility houses engineering operations.
|
•
|
The Aurora, IL warehouse lease, for approximately 11,000 square feet, runs from September 1, 2013 to December 31, 2020. This facility serves as an outside warehouse facility.
|
•
|
The Overland Park, KS lease, for approximately 600 square feet, runs from October 16, 2015 to October 15, 2018. This facility serves primarily as a sales office.
|
•
|
The Aberdeen Corners, GA lease, for an office suite, runs from June 1, 2015 to May 31, 2017. This facility primarily serves as a sales office.
|
2015
|
|
High
|
|
Low
|
||||
Fourth Quarter
|
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$
|
2.54
|
|
|
$
|
1.77
|
|
Third Quarter
|
|
2.42
|
|
|
1.76
|
|
||
Second Quarter
|
|
3.16
|
|
|
2.18
|
|
||
First Quarter
|
|
3.86
|
|
|
3.00
|
|
2014
|
|
High
|
|
Low
|
||||
Fourth Quarter
|
|
$
|
4.45
|
|
|
$
|
3.61
|
|
Third Quarter
|
|
5.68
|
|
|
4.10
|
|
||
Second Quarter
|
|
6.77
|
|
|
4.96
|
|
||
First Quarter
|
|
8.50
|
|
|
4.90
|
|
|
|
For the years ended December 31
|
||||||||||||||||||
CONSOLIDATED STATEMENT OF OPERATIONS DATA
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
|
2011
|
||||||||||
(in thousands of dollars, except for share and per-share data)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenues
|
|
$
|
73,664
|
|
|
$
|
79,017
|
|
|
$
|
109,338
|
|
|
$
|
97,644
|
|
|
$
|
93,668
|
|
Cost of sales
|
|
45,107
|
|
|
43,889
|
|
|
62,521
|
|
|
56,899
|
|
|
49,857
|
|
|||||
Selling, general and administrative and other costs and expenses
|
|
35,389
|
|
|
36,891
|
|
|
36,375
|
|
|
35,545
|
|
|
34,162
|
|
|||||
Goodwill and intangible assets impairment
|
|
1,425
|
|
|
23,400
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Operating (loss) income
|
|
(8,257
|
)
|
|
(25,163
|
)
|
|
8,000
|
|
|
5,200
|
|
|
9,649
|
|
|||||
Net (loss) income
|
|
(12,380
|
)
|
|
(17,725
|
)
|
|
5,101
|
|
|
2,776
|
|
|
6,148
|
|
|||||
Basic (loss) income per common share
|
|
$
|
(0.54
|
)
|
|
$
|
(0.78
|
)
|
|
$
|
0.23
|
|
|
$
|
0.12
|
|
|
$
|
0.26
|
|
Diluted (loss) income per common share
|
|
$
|
(0.54
|
)
|
|
$
|
(0.78
|
)
|
|
$
|
0.23
|
|
|
$
|
0.12
|
|
|
$
|
0.25
|
|
Weighted-average basic shares outstanding
|
|
23,101,000
|
|
|
22,782,000
|
|
|
22,286,000
|
|
|
22,709,000
|
|
|
24,095,000
|
|
|||||
Weighted-average diluted shares outstanding
|
|
23,101,000
|
|
|
22,782,000
|
|
|
22,579,000
|
|
|
23,535,000
|
|
|
24,633,000
|
|
|
|
December 31
|
||||||||||||||||||
CONSOLIDATED BALANCE SHEET DATA
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
|
2011
|
||||||||||
(in thousands of dollars)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Working capital
|
|
$
|
35,865
|
|
|
$
|
39,688
|
|
|
$
|
48,619
|
|
|
$
|
38,918
|
|
|
$
|
43,626
|
|
Total assets
|
|
76,011
|
|
|
91,471
|
|
|
110,058
|
|
|
105,897
|
|
|
112,990
|
|
|||||
Long-term obligations
|
|
501
|
|
|
520
|
|
|
789
|
|
|
715
|
|
|
1,347
|
|
|||||
Total liabilities
|
|
17,037
|
|
|
19,170
|
|
|
21,435
|
|
|
21,661
|
|
|
23,977
|
|
|||||
Stockholders’ equity (1)
|
|
58,974
|
|
|
72,301
|
|
|
88,623
|
|
|
84,236
|
|
|
89,013
|
|
(1)
|
Stockholders’ equity includes the principal amount of nil coupon non-redeemable perpetual loan notes. See Note 7 to the consolidated financial statements.
|
•
|
An decrease in employee costs, primarily commissions and bonuses, totaling $1,029
|
•
|
An decrease in non-employee commissions of $215
|
•
|
An decrease in stock compensation expense of $539
|
•
|
An increase in depreciation and amortization of $140
|
•
|
An decrease in professional fees and consulting services of $455
|
•
|
An decrease related to cleanup fees for a legacy facility of $325
|
•
|
An decrease in bad debt expense of $127
|
•
|
An decrease in office and administrative costs relating to our foreign subsidiaries of $1,211
|
•
|
An decrease in employee costs, primarily commissions and bonuses, totaling $2,698
|
•
|
An decrease in non-employee commissions of $629
|
•
|
An increase in stock compensation expense of $524
|
•
|
An increase in depreciation and amortization of $396
|
•
|
An increase in professional fees and consulting services of $759
|
•
|
An increase related to cleanup fees for a legacy facility of $325
|
•
|
An increase in bad debt expense of $191
|
•
|
An increase in office and administrative costs relating to our foreign subsidiaries of $147
|
Contractual Cash Obligations
|
|
Total
|
|
2016
|
|
2017-2018
|
|
2019-2020
|
|
Thereafter
|
||||||||||
Operating lease obligations
|
|
$
|
2,493
|
|
|
$
|
972
|
|
|
$
|
1,082
|
|
|
$
|
439
|
|
|
$
|
—
|
|
Total
|
|
$
|
2,493
|
|
|
$
|
972
|
|
|
$
|
1,082
|
|
|
$
|
439
|
|
|
$
|
—
|
|
•
|
in support of the warranty period defined in the contract; or
|
•
|
in support of the system performance criteria that are defined in the contract.
|
Commercial Commitments
|
|
Total
|
|
2016
|
|
2017
|
|
2018
|
|
Thereafter
|
||||||||||
Standby letters of credit and bank guarantees
|
|
$
|
7,860
|
|
|
$
|
6,048
|
|
|
$
|
976
|
|
|
$
|
836
|
|
|
$
|
—
|
|
Performance Surety Bonds
|
|
$
|
12,389
|
|
|
$
|
7,791
|
|
|
$
|
3,364
|
|
|
$
|
1,234
|
|
|
$
|
—
|
|
Total
|
|
$
|
20,249
|
|
|
$
|
13,839
|
|
|
$
|
4,340
|
|
|
$
|
2,070
|
|
|
$
|
—
|
|
/s/ RSM US LLP
|
|
Chicago, Illinois
|
March 23, 2016
|
|
|
December 31,
|
||||||
|
|
2015
|
|
2014
|
||||
ASSETS
|
|
|
|
|
||||
Current assets:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
21,684
|
|
|
$
|
18,637
|
|
Marketable securities
|
|
19
|
|
|
36
|
|
||
Accounts receivable, net
|
|
23,060
|
|
|
31,910
|
|
||
Inventories
|
|
1,653
|
|
|
1,111
|
|
||
Prepaid expenses and other current assets
|
|
3,889
|
|
|
4,094
|
|
||
Income taxes receivable
|
|
1,857
|
|
|
597
|
|
||
Deferred income taxes
|
|
239
|
|
|
1,953
|
|
||
Total current assets
|
|
52,401
|
|
|
58,338
|
|
||
Property and equipment, net
|
|
12,001
|
|
|
13,527
|
|
||
Goodwill
|
|
2,116
|
|
|
2,116
|
|
||
Other intangible assets, net
|
|
7,144
|
|
|
10,464
|
|
||
Deferred income taxes
|
|
992
|
|
|
5,649
|
|
||
Other assets
|
|
1,357
|
|
|
1,377
|
|
||
Total assets
|
|
$
|
76,011
|
|
|
$
|
91,471
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
||||
Current liabilities:
|
|
|
|
|
||||
Short-term debt
|
|
$
|
—
|
|
|
$
|
1,625
|
|
Accounts payable
|
|
8,942
|
|
|
7,310
|
|
||
Accrued liabilities:
|
|
|
|
|
||||
Employee compensation
|
|
1,645
|
|
|
2,007
|
|
||
Other accrued liabilities
|
|
5,949
|
|
|
7,708
|
|
||
Total current liabilities
|
|
16,536
|
|
|
18,650
|
|
||
Other liabilities
|
|
501
|
|
|
520
|
|
||
Total liabilities
|
|
17,037
|
|
|
19,170
|
|
||
COMMITMENTS AND CONTINGENCIES (Note 9)
|
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
|
||||
Common stock, $.01 par value, 40,000,000 shares authorized, 23,419,008 and 23,027,704 shares issued, and 23,167,216 and 22,860,398 outstanding in 2015 and 2014, respectively
|
|
234
|
|
|
230
|
|
||
Additional paid-in capital
|
|
135,394
|
|
|
134,985
|
|
||
Accumulated deficit
|
|
(74,132
|
)
|
|
(61,752
|
)
|
||
Accumulated other comprehensive loss
|
|
(1,556
|
)
|
|
(448
|
)
|
||
Nil coupon perpetual loan notes
|
|
76
|
|
|
76
|
|
||
Treasury stock, 251,792 and 167,306 shares in 2015 and 2014, respectively, at cost
|
|
(1,042
|
)
|
|
(790
|
)
|
||
Total stockholders’ equity
|
|
58,974
|
|
|
72,301
|
|
||
Total liabilities and stockholders’ equity
|
|
$
|
76,011
|
|
|
$
|
91,471
|
|
|
|
For the years ended December 31,
|
||||||||||
|
|
2015
|
|
2014
|
|
2013
|
||||||
Revenues
|
|
$
|
73,664
|
|
|
$
|
79,017
|
|
|
$
|
109,338
|
|
Costs and expenses:
|
|
|
|
|
|
|
||||||
Cost of sales
|
|
45,107
|
|
|
43,889
|
|
|
62,521
|
|
|||
Selling, general and administrative
|
|
31,116
|
|
|
35,432
|
|
|
36,375
|
|
|||
Research and development
|
|
4,273
|
|
|
1,459
|
|
|
2,442
|
|
|||
Goodwill and intangible assets impairment
|
|
1,425
|
|
|
23,400
|
|
|
—
|
|
|||
Total Costs and Expenses
|
|
81,921
|
|
|
104,180
|
|
|
101,338
|
|
|||
Operating (loss) income
|
|
(8,257
|
)
|
|
(25,163
|
)
|
|
8,000
|
|
|||
Interest expense
|
|
(27
|
)
|
|
(125
|
)
|
|
(56
|
)
|
|||
Interest income
|
|
21
|
|
|
29
|
|
|
58
|
|
|||
Other expense
|
|
(360
|
)
|
|
(544
|
)
|
|
(137
|
)
|
|||
(Loss) Income before taxes
|
|
(8,623
|
)
|
|
(25,803
|
)
|
|
7,865
|
|
|||
Income tax (expense) benefit
|
|
(3,757
|
)
|
|
8,078
|
|
|
(2,764
|
)
|
|||
Net (loss) income
|
|
$
|
(12,380
|
)
|
|
$
|
(17,725
|
)
|
|
$
|
5,101
|
|
Net (loss) income per common share:
|
|
|
|
|
|
|
||||||
Basic
|
|
$
|
(0.54
|
)
|
|
$
|
(0.78
|
)
|
|
$
|
0.23
|
|
Diluted
|
|
$
|
(0.54
|
)
|
|
$
|
(0.78
|
)
|
|
$
|
0.23
|
|
Weighted-average number of common shares outstanding:
|
|
|
|
|
|
|
||||||
Basic
|
|
23,101,000
|
|
|
22,782,000
|
|
|
22,286,000
|
|
|||
Diluted
|
|
23,101,000
|
|
|
22,782,000
|
|
|
22,579,000
|
|
|
|
For the years ended December 31,
|
||||||||||
|
|
2015
|
|
2014
|
|
2013
|
||||||
Net (loss) income
|
|
$
|
(12,380
|
)
|
|
$
|
(17,725
|
)
|
|
$
|
5,101
|
|
Other comprehensive (loss) income:
|
|
|
|
|
|
|
||||||
Foreign currency translation adjustments
|
|
(1,097
|
)
|
|
(489
|
)
|
|
438
|
|
|||
Unrealized (losses)/gains from marketable securities, net of tax
|
|
(11
|
)
|
|
4
|
|
|
(9
|
)
|
|||
Total other comprehensive (loss) income
|
|
(1,108
|
)
|
|
(485
|
)
|
|
429
|
|
|||
Comprehensive (loss) income
|
|
$
|
(13,488
|
)
|
|
$
|
(18,210
|
)
|
|
$
|
5,530
|
|
|
|
Common Stock
|
|
Additional
Paid-in Capital |
|
Accumulated Deficit
|
|
Accumulated
Other
Comprehensive
Income (Loss)
|
|
Nil
Coupon
Perpetual Loan Notes
|
|
Treasury Stock
|
|
Total
|
|||||||||||||||||
|
|
Shares
|
|
Amount
|
|
|
|
|
|
|
|||||||||||||||||||||
Balance at December 31, 2012
|
|
22,102
|
|
|
$
|
221
|
|
|
$
|
133,498
|
|
|
$
|
(49,128
|
)
|
|
$
|
(392
|
)
|
|
$
|
76
|
|
|
$
|
(39
|
)
|
|
$
|
84,236
|
|
Net income
|
|
|
|
|
|
|
|
5,101
|
|
|
|
|
|
|
|
|
5,101
|
|
|||||||||||||
Foreign currency translation adjustments
|
|
|
|
|
|
|
|
|
|
438
|
|
|
|
|
|
|
438
|
|
|||||||||||||
Unrealized loss on marketable securities, net of tax
|
|
|
|
|
|
|
|
|
|
(9
|
)
|
|
|
|
|
|
(9
|
)
|
|||||||||||||
Exercise of stock options
|
|
195
|
|
|
2
|
|
|
809
|
|
|
|
|
|
|
|
|
|
|
811
|
|
|||||||||||
Tax benefit from stock compensation expense
|
|
|
|
|
|
67
|
|
|
|
|
|
|
|
|
|
|
67
|
|
|||||||||||||
Stock compensation expense
|
|
|
|
|
|
1,798
|
|
|
|
|
|
|
|
|
|
|
1,798
|
|
|||||||||||||
Tax effect of expired vested options
|
|
|
|
|
|
(121
|
)
|
|
|
|
|
|
|
|
|
|
(121
|
)
|
|||||||||||||
Common shares issued upon vesting of restricted stock units
|
|
395
|
|
|
4
|
|
|
(3,255
|
)
|
|
|
|
|
|
|
|
|
|
|
(3,251
|
)
|
||||||||||
Treasury shares withheld
|
|
(99
|
)
|
|
|
|
|
|
|
|
|
|
|
|
$
|
(447
|
)
|
|
(447
|
)
|
|||||||||||
Balance at December 31, 2013
|
|
22,593
|
|
|
$
|
227
|
|
|
$
|
132,796
|
|
|
$
|
(44,027
|
)
|
|
$
|
37
|
|
|
$
|
76
|
|
|
$
|
(486
|
)
|
|
$
|
88,623
|
|
Net loss
|
|
|
|
|
|
|
|
(17,725
|
)
|
|
|
|
|
|
|
|
(17,725
|
)
|
|||||||||||||
Foreign currency translation adjustments
|
|
|
|
|
|
|
|
|
|
(489
|
)
|
|
|
|
|
|
(489
|
)
|
|||||||||||||
Unrealized gain on marketable securities, net of tax
|
|
|
|
|
|
|
|
|
|
4
|
|
|
|
|
|
|
4
|
|
|||||||||||||
Exercise of stock options
|
|
60
|
|
|
|
|
297
|
|
|
|
|
|
|
|
|
|
|
297
|
|
||||||||||||
Tax benefit from stock compensation expense
|
|
|
|
|
|
7
|
|
|
|
|
|
|
|
|
|
|
7
|
|
|||||||||||||
Stock compensation expense
|
|
|
|
|
|
2,322
|
|
|
|
|
|
|
|
|
|
|
2,322
|
|
|||||||||||||
Tax effect of expired vested options
|
|
|
|
|
|
(379
|
)
|
|
|
|
|
|
|
|
|
|
(379
|
)
|
|||||||||||||
Common shares issued upon vesting of restricted stock units
|
|
266
|
|
|
3
|
|
|
(58
|
)
|
|
|
|
|
|
|
|
|
|
(55
|
)
|
|||||||||||
Treasury shares withheld
|
|
(59
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(304
|
)
|
|
(304
|
)
|
||||||||||||
Balance at December 31, 2014
|
|
22,860
|
|
|
$
|
230
|
|
|
$
|
134,985
|
|
|
$
|
(61,752
|
)
|
|
$
|
(448
|
)
|
|
$
|
76
|
|
|
$
|
(790
|
)
|
|
$
|
72,301
|
|
Net loss
|
|
|
|
|
|
|
|
(12,380
|
)
|
|
|
|
|
|
|
|
(12,380
|
)
|
|||||||||||||
Foreign currency translation adjustments
|
|
|
|
|
|
|
|
|
|
(1,097
|
)
|
|
|
|
|
|
(1,097
|
)
|
|||||||||||||
Unrealized loss on marketable securities, net of tax
|
|
|
|
|
|
|
|
|
|
(11
|
)
|
|
|
|
|
|
(11
|
)
|
|||||||||||||
Stock compensation expense
|
|
|
|
|
|
1,809
|
|
|
|
|
|
|
|
|
|
|
1,809
|
|
|||||||||||||
Issuance of Deferred Director's shares
|
|
39
|
|
|
1
|
|
|
(71
|
)
|
|
|
|
|
|
|
|
|
|
(70
|
)
|
|||||||||||
Tax effect of expired vested options
|
|
|
|
|
|
(908
|
)
|
|
|
|
|
|
`
|
|
|
|
(908
|
)
|
|||||||||||||
Common shares issued upon vesting of restricted stock units
|
|
352
|
|
|
3
|
|
|
(421
|
)
|
|
|
|
|
|
|
|
|
|
(418
|
)
|
|||||||||||
Treasury shares withheld
|
|
(84
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(252
|
)
|
|
(252
|
)
|
||||||||||||
Balance at December 31, 2015
|
|
23,167
|
|
|
$
|
234
|
|
|
$
|
135,394
|
|
|
$
|
(74,132
|
)
|
|
$
|
(1,556
|
)
|
|
$
|
76
|
|
|
$
|
(1,042
|
)
|
|
$
|
58,974
|
|
|
|
For the years ended December 31,
|
||||||||||
|
|
2015
|
|
2014
|
|
2013
|
||||||
OPERATING ACTIVITIES
|
|
|
|
|
|
|
||||||
Net (loss) income
|
|
$
|
(12,380
|
)
|
|
$
|
(17,725
|
)
|
|
$
|
5,101
|
|
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
|
|
|
|
|
|
|
||||||
Depreciation
|
|
2,067
|
|
|
1,922
|
|
|
2,175
|
|
|||
Amortization
|
|
2,138
|
|
|
2,384
|
|
|
839
|
|
|||
Gain on disposal of equipment
|
|
(26
|
)
|
|
—
|
|
|
—
|
|
|||
Allowance for doubtful accounts
|
|
—
|
|
|
762
|
|
|
707
|
|
|||
Deferred income taxes
|
|
4,916
|
|
|
(9,524
|
)
|
|
1,252
|
|
|||
Stock compensation expense
|
|
1,809
|
|
|
2,322
|
|
|
1,798
|
|
|||
Goodwill and intangible assets impairment
|
|
1,425
|
|
|
23,400
|
|
|
—
|
|
|||
Changes in operating assets and liabilities, net of acquisitions:
|
|
|
|
|
|
|
||||||
Accounts receivable
|
|
7,880
|
|
|
6,117
|
|
|
(6,970
|
)
|
|||
Inventories
|
|
(560
|
)
|
|
(616
|
)
|
|
77
|
|
|||
Prepaid expenses, other current assets and other noncurrent assets
|
|
(1,245
|
)
|
|
(913
|
)
|
|
2,118
|
|
|||
Accounts payable
|
|
1,817
|
|
|
(3,600
|
)
|
|
(2,968
|
)
|
|||
Accrued liabilities and other noncurrent liabilities
|
|
(913
|
)
|
|
906
|
|
|
(1,287
|
)
|
|||
Net cash provided by operating activities
|
|
6,928
|
|
|
5,435
|
|
|
2,842
|
|
|||
|
|
|
|
|
|
|
||||||
INVESTING ACTIVITIES
|
|
|
|
|
|
|
||||||
Purchases of property, equipment and patents
|
|
(802
|
)
|
|
(2,808
|
)
|
|
(1,754
|
)
|
|||
Proceeds from the sale of equipment
|
|
26
|
|
|
—
|
|
|
—
|
|
|||
Purchases of other intangible assets
|
|
—
|
|
|
(3,010
|
)
|
|
—
|
|
|||
Payment for acquisitions, net of cash acquired
|
|
—
|
|
|
(8,079
|
)
|
|
—
|
|
|||
Net cash used in investing activities
|
|
(776
|
)
|
|
(13,897
|
)
|
|
(1,754
|
)
|
|||
|
|
|
|
|
|
|
||||||
FINANCING ACTIVITIES
|
|
|
|
|
|
|
||||||
Net proceeds (payments) of short-term debt
|
|
(1,623
|
)
|
|
—
|
|
|
1,614
|
|
|||
Proceeds from exercises of stock options
|
|
—
|
|
|
297
|
|
|
811
|
|
|||
Excess tax benefit from exercises of stock options
|
|
—
|
|
|
7
|
|
|
67
|
|
|||
Treasury shares withheld
|
|
(252
|
)
|
|
(304
|
)
|
|
(447
|
)
|
|||
Net cash provided by (used in) financing activities
|
|
(1,875
|
)
|
|
—
|
|
|
2,045
|
|
|||
Effect of exchange rate fluctuations on cash
|
|
(1,230
|
)
|
|
(639
|
)
|
|
152
|
|
|||
Net (decrease) increase in cash and cash equivalents
|
|
3,047
|
|
|
(9,101
|
)
|
|
3,285
|
|
|||
Cash and cash equivalents at beginning of year
|
|
18,637
|
|
|
27,738
|
|
|
24,453
|
|
|||
Cash and cash equivalents at end of year
|
|
$
|
21,684
|
|
|
$
|
18,637
|
|
|
$
|
27,738
|
|
|
|
|
|
|
|
|
||||||
Supplemental Cash Flow Information:
|
|
|
|
|
|
|
||||||
Cash paid for:
|
|
|
|
|
|
|
||||||
Interest
|
|
$
|
27
|
|
|
$
|
125
|
|
|
$
|
56
|
|
Income taxes paid
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,901
|
|
Year
|
|
Balance at
January 1
|
|
Provision charged
to expense
|
|
Write-offs /
Recoveries
|
|
Balance at
December 31
|
||||||||
2013
|
|
$
|
460
|
|
|
$
|
1,175
|
|
|
$
|
(446
|
)
|
|
$
|
1,189
|
|
2014
|
|
$
|
1,189
|
|
|
$
|
1,099
|
|
|
$
|
(366
|
)
|
|
$
|
1,922
|
|
2015
|
|
$
|
1,922
|
|
|
$
|
—
|
|
|
$
|
(150
|
)
|
|
$
|
1,772
|
|
|
|
December 31,
|
||||||
|
|
2015
|
|
2014
|
||||
Foreign currency translation
|
|
|
|
|
||||
Balance at beginning of period
|
|
$
|
(471
|
)
|
|
$
|
18
|
|
Other comprehensive (loss) income:
|
|
|
|
|
||||
Foreign currency translation adjustments (1)
|
|
(1,097
|
)
|
|
(489
|
)
|
||
Balance at end of period
|
|
$
|
(1,568
|
)
|
|
$
|
(471
|
)
|
Available-for-sale marketable securities
|
|
|
|
|
||||
Balance at beginning of period
|
|
$
|
23
|
|
|
$
|
19
|
|
Other comprehensive income (loss):
|
|
|
|
|
||||
Net unrealized holding gain (loss) (2)
|
|
(11
|
)
|
|
4
|
|
||
Deferred income taxes (2)
|
|
—
|
|
|
—
|
|
||
Total other comprehensive income (loss)
|
|
(11
|
)
|
|
4
|
|
||
Balance at end of period
|
|
$
|
12
|
|
|
$
|
23
|
|
Total accumulated other comprehensive (loss) income
|
|
$
|
(1,556
|
)
|
|
$
|
(448
|
)
|
(1)
|
In all periods presented, there were no tax impacts related to rate changes and no amounts were reclassified to earnings.
|
(2)
|
In all periods presented, there were no realized holding gains or losses and therefore no amounts were reclassified to earnings.
|
|
|
2015
|
||||||||||||||
Reporting Unit
|
|
Beginning Carrying Amount
|
|
Acquired Goodwill
|
|
Impairment Charge
|
|
Ending Carrying Amount
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||
FUEL CHEM Technology Segment
|
|
$
|
2,116
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,116
|
|
APC Technology Segment
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
|
|
$
|
2,116
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,116
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
2014
|
||||||||||||||
Reporting Unit
|
|
Beginning Carrying Amount
|
|
Acquired Goodwill
|
|
Impairment Charge
|
|
Ending Carrying Amount
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||
FUEL CHEM Technology Segment
|
|
$
|
2,116
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,116
|
|
APC Technology Segment
|
|
18,935
|
|
|
4,465
|
|
|
(23,400
|
)
|
|
—
|
|
||||
|
|
$
|
21,051
|
|
|
$
|
4,465
|
|
|
$
|
(23,400
|
)
|
|
$
|
2,116
|
|
|
|
|
|
2015
|
|
2014
|
||||||||||||||||||||
Description of Other Intangibles
|
|
Amortization
Period
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
Carrying
Amount
|
||||||||||||
Customer relationships
|
|
4-15 years
|
|
$
|
3,633
|
|
|
$
|
(3,114
|
)
|
|
$
|
519
|
|
|
$
|
5,087
|
|
|
$
|
(2,690
|
)
|
|
$
|
2,397
|
|
Trademarks and trade names
|
|
4-8 years
|
|
441
|
|
|
(382
|
)
|
|
59
|
|
|
441
|
|
|
(293
|
)
|
|
148
|
|
||||||
Patent assets
|
|
1-15 years
|
|
3,007
|
|
|
(1,210
|
)
|
|
1,797
|
|
|
2,764
|
|
|
(987
|
)
|
|
1,777
|
|
||||||
Acquired technologies
|
|
5-8 years
|
|
7,515
|
|
|
(2,746
|
)
|
|
4,769
|
|
|
7,974
|
|
|
(1,832
|
)
|
|
6,142
|
|
||||||
Total
|
|
|
|
$
|
14,596
|
|
|
$
|
(7,452
|
)
|
|
$
|
7,144
|
|
|
$
|
16,266
|
|
|
$
|
(5,802
|
)
|
|
$
|
10,464
|
|
Year
|
Estimated
Amortization
Expense
|
||
2016
|
$
|
1,700
|
|
2017
|
1,374
|
|
|
2018
|
1,269
|
|
|
2019
|
1,016
|
|
|
2020
|
564
|
|
|
Thereafter
|
1,221
|
|
|
Total
|
$
|
7,144
|
|
Description of Property and Equipment
|
|
Depreciable
Life
|
|
2015
|
|
2014
|
||||
Land
|
|
|
|
$
|
1,440
|
|
|
$
|
1,440
|
|
Building
|
|
39 years
|
|
4,535
|
|
|
4,535
|
|
||
Building and leasehold improvements
|
|
3-39 years
|
|
5,102
|
|
|
5,115
|
|
||
Field equipment
|
|
3-4 years
|
|
19,797
|
|
|
19,796
|
|
||
Computer equipment and software
|
|
2-3 years
|
|
2,978
|
|
|
3,005
|
|
||
Furniture and fixtures
|
|
3-10 years
|
|
1,527
|
|
|
1,525
|
|
||
Vehicles
|
|
5 years
|
|
36
|
|
|
36
|
|
||
Total cost
|
|
|
|
35,415
|
|
|
35,452
|
|
||
Less accumulated depreciation
|
|
|
|
(23,414
|
)
|
|
(21,925
|
)
|
||
Total net book value
|
|
|
|
$
|
12,001
|
|
|
$
|
13,527
|
|
|
|
2015
|
|
2014
|
|
2013
|
|||
Basic weighted-average shares
|
|
23,101,000
|
|
|
22,782,000
|
|
|
22,286,000
|
|
Conversion of unsecured loan notes
|
|
—
|
|
|
—
|
|
|
7,000
|
|
Unexercised options and unvested restricted stock units
|
|
—
|
|
|
—
|
|
|
286,000
|
|
Diluted weighted-average shares
|
|
23,101,000
|
|
|
22,782,000
|
|
|
22,579,000
|
|
|
|
As Reported on June 30, 2014
|
Measurement Adjustments
|
Final Purchase Price Allocation
|
||||||
Current assets
|
|
$
|
2,365
|
|
$
|
26
|
|
$
|
2,391
|
|
Property, plant and equipment
|
|
281
|
|
(281
|
)
|
—
|
|
|||
Identifiable intangible assets
|
|
—
|
|
5,158
|
|
5,158
|
|
|||
Current and long-term liabilities assumed
|
|
(2,035
|
)
|
(1,900
|
)
|
(3,935
|
)
|
|||
Total identifiable net assets acquired
|
|
611
|
|
3,003
|
|
3,614
|
|
|||
Goodwill
|
|
7,468
|
|
(3,003
|
)
|
4,465
|
|
|||
Total assets acquired
|
|
$
|
8,079
|
|
$
|
—
|
|
$
|
8,079
|
|
Description
|
|
Amount
|
Useful Life (Years)
|
||
Order backlog
|
|
$
|
1,172
|
|
1.0
|
Trademarks
|
|
90
|
|
2.0
|
|
Customer relationships
|
|
870
|
|
4.0
|
|
Developed technology
|
|
3,230
|
|
7.0
|
|
Net assumed contractual obligations
|
|
(204
|
)
|
1.0
|
|
Total identifiable assets acquired
|
|
$
|
5,158
|
|
5.3
|
|
Year Ended December 31, 2014
|
||
Revenue
|
$
|
4,193
|
|
Net income (loss)
|
(120
|
)
|
|
|
|
||
Net loss per Common Share
|
|
||
Basic
|
$
|
—
|
|
Diluted
|
$
|
—
|
|
|
|
Year Ended December 31,
|
||||||
|
|
2014
|
|
2013
|
||||
Revenue
|
|
$
|
84,713
|
|
|
$
|
122,723
|
|
Net income / (loss)
|
|
(15,596
|
)
|
|
6,508
|
|
||
|
|
|
|
|
||||
Net income / (loss) per Common Share
|
|
|
|
|
||||
Basic
|
|
$
|
(0.68
|
)
|
|
$
|
0.29
|
|
Diluted
|
|
$
|
(0.68
|
)
|
|
$
|
0.29
|
|
|
|
2015
|
|
2014
|
||||
Costs incurred on uncompleted contracts
|
|
$
|
94,686
|
|
|
$
|
92,190
|
|
Estimated earnings
|
|
52,246
|
|
|
47,510
|
|
||
Earned revenue
|
|
146,932
|
|
|
139,700
|
|
||
Less billings to date
|
|
(141,478
|
)
|
|
(132,790
|
)
|
||
Total
|
|
$
|
5,454
|
|
|
$
|
6,910
|
|
Classified as follows:
|
|
|
|
|
||||
Costs and estimated earnings in excess of billings on uncompleted contracts
|
|
$
|
7,312
|
|
|
$
|
9,904
|
|
Billings in excess of costs and estimated earnings on uncompleted contracts
|
|
(1,858
|
)
|
|
(2,994
|
)
|
||
Total
|
|
$
|
5,454
|
|
|
$
|
6,910
|
|
Origin of income before taxes
|
|
2015
|
|
2014
|
|
2013
|
||||||
United States
|
|
$
|
(9,763
|
)
|
|
$
|
(25,142
|
)
|
|
$
|
6,025
|
|
Foreign
|
|
1,140
|
|
|
(661
|
)
|
|
1,840
|
|
|||
(Loss) income before taxes
|
|
$
|
(8,623
|
)
|
|
$
|
(25,803
|
)
|
|
$
|
7,865
|
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
Current:
|
|
|
|
|
|
|
||||||
Federal
|
|
$
|
(1,155
|
)
|
|
$
|
158
|
|
|
$
|
1,114
|
|
State
|
|
14
|
|
|
(34
|
)
|
|
334
|
|
|||
Foreign
|
|
120
|
|
|
1,108
|
|
|
836
|
|
|||
Total current
|
|
(1,021
|
)
|
|
1,232
|
|
|
2,284
|
|
|||
Deferred:
|
|
|
|
|
|
|
||||||
Federal
|
|
4,143
|
|
|
(7,260
|
)
|
|
642
|
|
|||
State
|
|
548
|
|
|
(959
|
)
|
|
(78
|
)
|
|||
Foreign
|
|
87
|
|
|
(1,091
|
)
|
|
(84
|
)
|
|||
Total deferred
|
|
4,778
|
|
|
(9,310
|
)
|
|
480
|
|
|||
Income tax (benefit) expense
|
|
$
|
3,757
|
|
|
$
|
(8,078
|
)
|
|
$
|
2,764
|
|
|
|
2015
|
|
2014
|
|
2013
|
|||
Provision at the U.S. federal statutory rate
|
|
(34.0
|
)%
|
|
(34.0
|
)%
|
|
34.0
|
%
|
State taxes, net of federal benefit
|
|
(5.2
|
)%
|
|
(3.6
|
)%
|
|
1.9
|
%
|
Foreign tax rate differential
|
|
(0.6
|
)%
|
|
0.1
|
%
|
|
(2.5
|
)%
|
Valuation allowance
|
|
72.3
|
%
|
|
1.2
|
%
|
|
2.9
|
%
|
Other true up
|
|
7.8
|
%
|
|
(0.4
|
)%
|
|
(4.2
|
)%
|
Stock-based compensation
|
|
—
|
%
|
|
—
|
%
|
|
(0.4
|
)%
|
Intangible assets impairment and other non-deductibles
|
|
2.2
|
%
|
|
5.9
|
%
|
|
—
|
%
|
Other
|
|
1.1
|
%
|
|
(0.5
|
)%
|
|
3.4
|
%
|
Income tax expense (benefit) effective rate
|
|
43.6
|
%
|
|
(31.3
|
)%
|
|
35.1
|
%
|
|
|
2015
|
|
2014
|
||||
Deferred tax assets:
|
|
|
|
|
||||
Stock compensation expense
|
|
$
|
3,394
|
|
|
$
|
4,631
|
|
Goodwill
|
|
2,673
|
|
|
3,110
|
|
||
Royalty accruals - BJFT
|
|
992
|
|
|
—
|
|
||
Bad debt allowance - BJFT
|
|
333
|
|
|
—
|
|
||
Inter-company interest expense accrual - US tax
|
|
476
|
|
|
—
|
|
||
Net operating loss carryforwards
|
|
1,576
|
|
|
2,006
|
|
||
Credit carry-forwards
|
|
359
|
|
|
—
|
|
||
Other
|
|
637
|
|
|
2,419
|
|
||
Total deferred tax assets
|
|
10,440
|
|
|
12,166
|
|
||
Deferred tax liabilities:
|
|
|
|
|
||||
Depreciation
|
|
(777
|
)
|
|
(1,096
|
)
|
||
Intangible assets
|
|
(294
|
)
|
|
(1,156
|
)
|
||
Other
|
|
(306
|
)
|
|
(306
|
)
|
||
Total deferred tax liabilities
|
|
(1,377
|
)
|
|
(2,558
|
)
|
||
Net deferred tax asset before valuation allowance
|
|
9,063
|
|
|
9,608
|
|
||
Valuation allowances for deferred tax assets
|
|
(7,832
|
)
|
|
(2,006
|
)
|
||
Net deferred tax asset
|
|
$
|
1,231
|
|
|
$
|
7,602
|
|
Current assets
|
|
$
|
239
|
|
|
$
|
1,953
|
|
Long-term assets (liabilities)
|
|
992
|
|
|
5,649
|
|
||
Net deferred tax asset
|
|
$
|
1,231
|
|
|
$
|
7,602
|
|
Year
|
|
Balance at
January 1
|
|
Charged to costs
and expenses
|
|
(Deductions)/Other
|
|
Balance at
December 31
|
||||||
2013
|
|
$
|
1,868
|
|
|
—
|
|
|
(35
|
)
|
|
$
|
1,833
|
|
2014
|
|
$
|
1,833
|
|
|
—
|
|
|
173
|
|
|
$
|
2,006
|
|
2015
|
|
$
|
2,006
|
|
|
6,625
|
|
|
(799
|
)
|
|
$
|
7,832
|
|
Description
|
|
2015
|
|
2014
|
|
2013
|
||||||
Balance at beginning of period
|
|
$
|
117
|
|
|
$
|
65
|
|
|
$
|
39
|
|
Increases in positions taken in a current period
|
|
38
|
|
|
52
|
|
|
65
|
|
|||
Decreases due to settlements
|
|
(15
|
)
|
|
—
|
|
|
(39
|
)
|
|||
Decreases due to lapse of statute of limitations
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Balance at end of period
|
|
$
|
140
|
|
|
$
|
117
|
|
|
$
|
65
|
|
|
|
For the Year Ended December 31,
|
||||||||||
|
|
2015
|
|
2014
|
|
2013
|
||||||
Stock options
|
|
$
|
194
|
|
|
$
|
236
|
|
|
$
|
(245
|
)
|
Restricted stock units
|
|
1,615
|
|
|
2,086
|
|
|
2,043
|
|
|||
Deferred directors fees
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total stock-based compensation expense
|
|
1,809
|
|
|
2,322
|
|
|
1,798
|
|
|||
Tax benefit of stock-based compensation expense
|
|
(696
|
)
|
|
(892
|
)
|
|
(671
|
)
|
|||
After-tax effect of stock based compensation
|
|
$
|
1,113
|
|
|
$
|
1,430
|
|
|
$
|
1,127
|
|
|
|
2015
|
|
2014
|
|
2013
|
|||
Expected dividend yield
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
Risk-free interest rate
|
|
2.21
|
%
|
|
1.55
|
%
|
|
1.01
|
%
|
Expected volatility
|
|
51.6
|
%
|
|
47.4
|
%
|
|
55.2
|
%
|
Expected life of option
|
|
8.8 years
|
|
|
4.9 years
|
|
|
4.7 years
|
|
|
|
2015
|
|
2014
|
|
2013
|
|||||||||||||||
|
|
Number
of
Options
|
|
Weighted-
Average
Exercise Price
|
|
Number
of
Options
|
|
Weighted-
Average
Exercise Price
|
|
Number
of
Options
|
|
Weighted-
Average
Exercise Price
|
|||||||||
Outstanding at beginning of year
|
|
1,546,500
|
|
|
$
|
11.62
|
|
|
1,688,500
|
|
|
$
|
11.88
|
|
|
1,914,000
|
|
|
$
|
11.38
|
|
Granted
|
|
126,000
|
|
|
2.44
|
|
|
94,500
|
|
|
5.22
|
|
|
80,000
|
|
|
3.85
|
|
|||
Exercised
|
|
—
|
|
|
—
|
|
|
(60,000
|
)
|
|
4.96
|
|
|
(195,000
|
)
|
|
4.16
|
|
|||
Expired or forfeited
|
|
(481,375
|
)
|
|
12.04
|
|
|
(176,500
|
)
|
|
13.01
|
|
|
(110,500
|
)
|
|
10.93
|
|
|||
Outstanding at end of year
|
|
1,191,125
|
|
|
$
|
10.48
|
|
|
1,546,500
|
|
|
$
|
11.62
|
|
|
1,688,500
|
|
|
$
|
11.88
|
|
Exercisable at end of year
|
|
1,191,125
|
|
|
$
|
10.48
|
|
|
1,546,500
|
|
|
$
|
11.62
|
|
|
1,678,500
|
|
|
$
|
11.92
|
|
Weighted-average fair value of options granted during the year
|
|
|
|
$
|
1.54
|
|
|
|
|
$
|
2.20
|
|
|
|
|
$
|
1.79
|
|
|
|
Number
of
Options
|
|
Weighted-
Average
Exercise Price
|
|
Weighted-
Average
Remaining
Contractual
Life
|
|
Aggregate
Intrinsic Value
|
|||||
Outstanding on January 1, 2015
|
|
1,546,500
|
|
|
$
|
11.62
|
|
|
|
|
|
||
Granted
|
|
126,000
|
|
|
2.44
|
|
|
|
|
|
|||
Exercised
|
|
—
|
|
|
—
|
|
|
|
|
|
|||
Expired or forfeited
|
|
(481,375
|
)
|
|
12.04
|
|
|
|
|
|
|||
Outstanding on December 31, 2015
|
|
1,191,125
|
|
|
$
|
10.48
|
|
|
4.3 years
|
|
$
|
—
|
|
Exercisable on December 31, 2015
|
|
1,191,125
|
|
|
$
|
10.48
|
|
|
4.3 years
|
|
$
|
—
|
|
Options Outstanding
|
|
Options Exercisable
|
||||||||||||||
Range of
Exercise Prices
|
|
Number of
Options
|
|
Weighted-
Average
Remaining
Contractual Life
|
|
Weighted-
Average
Exercise Price
|
|
Number of
Options
|
|
Weighted-
Average
Exercise Price
|
||||||
$ 2.44 - $ 2.75
|
|
126,000
|
|
|
9.4 years
|
|
$
|
2.44
|
|
|
126,000
|
|
|
$
|
2.44
|
|
$ 2.76 - $ 5.50
|
|
294,500
|
|
|
6.7 years
|
|
4.56
|
|
|
294,500
|
|
|
4.56
|
|
||
$ 5.51 - $ 8.26
|
|
100,000
|
|
|
4.8 years
|
|
7.33
|
|
|
100,000
|
|
|
7.33
|
|
||
$ 8.27 - $11.02
|
|
368,750
|
|
|
3.0 years
|
|
10.04
|
|
|
368,750
|
|
|
10.04
|
|
||
$11.03 - $13.77
|
|
10,000
|
|
|
0.2 years
|
|
11.40
|
|
|
10,000
|
|
|
11.40
|
|
||
$13.78 - $16.53
|
|
71,000
|
|
|
1.1 years
|
|
15.79
|
|
|
71,000
|
|
|
15.79
|
|
||
$16.54 - $19.29
|
|
41,250
|
|
|
1.1 years
|
|
17.82
|
|
|
41,250
|
|
|
17.82
|
|
||
$19.30 - $22.05
|
|
—
|
|
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
||
$22.06 - $24.80
|
|
76,625
|
|
|
1.7 years
|
|
22.89
|
|
|
76,625
|
|
|
22.89
|
|
||
$24.81 - $27.57
|
|
103,000
|
|
|
1.1 years
|
|
25.88
|
|
|
103,000
|
|
|
25.88
|
|
||
$ 2.44 - $27.57
|
|
1,191,125
|
|
|
4.3 years
|
|
$
|
10.48
|
|
|
1,191,125
|
|
|
$
|
10.48
|
|
|
|
Non-Vested Stock
Options
Outstanding
|
|
Weighted-Average
Grant Date
Fair Value
|
|||
Outstanding on January 1, 2015
|
|
—
|
|
|
$
|
—
|
|
Granted
|
|
126,000
|
|
|
1.54
|
|
|
Vested
|
|
(126,000
|
)
|
|
1.54
|
|
|
Forfeited
|
|
—
|
|
|
—
|
|
|
Outstanding on December 31, 2015
|
|
—
|
|
|
—
|
|
•
|
The first type of award is based on individual performance during the respective calendar year as determined by the Committee based on performance criteria specified in the Agreement. These awards will vest over a
three
-year period beginning on the Determination Date. We estimated the fair value of these performance-based RSU awards on the date of the Agreement using the trading price of the Company’s stock and our estimate of the probability that the specified
|
•
|
The second type of RSU award contains a targeted number of RSUs to be granted based on our revenue growth relative to a specified peer group during a period of
two
calendar years. These awards vest
67%
on the second anniversary of the Agreement date and
33%
on the third anniversary of the Agreement date. We estimated the fair value of these performance-based RSU awards on the Agreement date using the trading price of the Company’s stock and our estimate of the probability that the specified performance criteria will be met. For these revenue growth performance-based awards, we amortize compensation costs over the requisite service period, adjusted for estimated forfeitures, for each separately vesting tranche of the award.
|
•
|
The third type of RSU award contains a targeted number of RSUs to be granted based on the total shareholder return (TSR) of our Common Shares relative to a specified peer group during a period of
two
calendar years. These awards vest
67%
on the second anniversary of the Agreement date and
33%
on the third anniversary of the Agreement date. We estimated the fair value of these market-based RSU awards on the Agreement date using a Monte Carlo valuation methodology and amortize the fair value over the requisite service period for each separately vesting tranche of the award. The principal variable assumptions utilized in valuing these RSUs under this valuation methodology include the risk-free interest rate, stock volatility and correlations between our stock price and the stock prices of the peer group of companies.
|
|
|
Shares
|
|
Weighted Average
Grant Date
Fair Value
|
||
Unvested restricted units at January 1, 2013
|
|
752,024
|
|
|
6.21
|
|
Granted
|
|
485,000
|
|
|
4.62
|
|
Forfeited
|
|
(70,070
|
)
|
|
5.58
|
|
Vested
|
|
(394,938
|
)
|
|
2.94
|
|
Unvested restricted stock units at December 31, 2013
|
|
772,016
|
|
|
5.35
|
|
Granted
|
|
484,450
|
|
|
5.63
|
|
Forfeited
|
|
(13,306
|
)
|
|
5.27
|
|
Vested
|
|
(266,091
|
)
|
|
5.84
|
|
Unvested restricted stock units at December 31, 2014
|
|
977,069
|
|
|
5.36
|
|
Granted
|
|
789,500
|
|
|
3.33
|
|
Forfeited
|
|
(209,748
|
)
|
|
4.62
|
|
Vested
|
|
(351,938
|
)
|
|
5.17
|
|
Unvested restricted stock units at December 31, 2015
|
|
1,204,883
|
|
|
4.21
|
|
Year of Payment
|
Amount
|
||
2016
|
$
|
972
|
|
2017
|
700
|
|
|
2018
|
382
|
|
|
2019
|
366
|
|
|
2020
|
73
|
|
|
Total
|
$
|
2,493
|
|
•
|
The Stamford, Connecticut building lease, for approximately
6,440
square feet, runs from February 1, 2010 to December 31, 2019. The facility houses certain administrative functions such as Investor Relations and certain APC sales functions.
|
•
|
The Beijing, China building lease, for approximately
8,000
square feet, runs from September 1, 2014 to August 31, 2017. This facility serves as the operating headquarters for our Beijing Fuel Tech operation.
|
•
|
The Durham, North Carolina building lease, for approximately
16,000
square feet, runs from May 1, 2014 to April 30, 2017. This facility houses engineering operations. The landlord has exercised an option to terminate the lease effective June 30, 2016.
|
•
|
The Gallarate, Italy building lease, for approximately
1,300
square feet, runs from May 1, 2013 to April 30, 2019. This facility serves as the operating headquarters for our European operations.
|
•
|
The Westlake, Ohio building lease, for approximately
5,000
square feet, runs from May 1, 2014 to April 30, 2017. This facility houses engineering operations.
|
•
|
The Aurora, IL warehouse lease, for approximately
11,000
square feet, runs from September 1, 2013 to December 31, 2020. This facility serves as an outside warehouse facility.
|
•
|
The Overland Park, KS lease, for approximately
600
square feet, runs from October 16, 2015 to October 15, 2018. This facility serves primarily as a sales office.
|
•
|
The Aberdeen Corners, GA lease, for an office suite, runs from June 1, 2015 to May 31, 2017. This facility primarily serves as a sales office.
|
•
|
in support of the warranty period defined in the contract; or
|
•
|
in support of the system performance criteria that are defined in the contract.
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
Aggregate product warranty liability at beginning of year
|
|
$
|
268
|
|
|
$
|
596
|
|
|
$
|
776
|
|
Net aggregate expense (income) related to product warranties
|
|
8
|
|
|
(311
|
)
|
|
(68
|
)
|
|||
Aggregate reductions for payments
|
|
(8
|
)
|
|
(17
|
)
|
|
(112
|
)
|
|||
Aggregate product warranty liability at end of year
|
|
$
|
268
|
|
|
$
|
268
|
|
|
$
|
596
|
|
•
|
The Air Pollution Control technology segment includes technologies to reduce NO
x
emissions in flue gas from boilers, incinerators, furnaces and other stationary combustion sources. These include Low and Ultra Low NO
x
Burners (LNB and ULNB), Over-Fire Air (OFA) systems, NO
x
OUT
®
and HERT™ Selective Non-Catalytic Reduction (SNCR) systems, and Advanced Selective Catalytic Reduction (ASCR
™
) systems. Our ASCR systems include ULNB, OFA, and SNCR components, along with a downsized SCR catalyst, Ammonia Injection Grid (AIG), and Graduated Straightening Grid GSG™ systems to provide high NO
x
reductions at significantly lower capital and operating costs than conventional SCR systems. The NO
x
OUT CASCADE
®
and NO
x
OUT-SCR
®
processes are more basic, using just SNCR and SCR catalyst components. ULTRA™ technology creates ammonia at a plant site using safe urea for use with any SCR application. Flue Gas Conditioning systems are chemical injection systems offered in markets outside the U.S. and Canada to enhance electrostatic precipitator and fabric filter performance in controlling particulate emissions.
|
•
|
The FUEL CHEM
®
technology segment, which uses chemical processes in combination with advanced CFD and CKM boiler modeling, for the control of slagging, fouling, corrosion, opacity and other sulfur trioxide-related issues in furnaces and boilers through the addition of chemicals into the furnace using TIFI
®
Targeted In-Furnace Injection™ technology.
|
•
|
The Fuel Conversion segment represents a new business initiative we commenced in 2014. As described in Note 1, we acquired intellectual property rights and know-how related to the CARBONITE® fuel conversion process and technology. This process can convert coals of various grades into value-added products that are high in energy content, carbon-rich and less pollutive. This technology has a number of potential applications including certain coal replacement, electric arc furnace (EAF) reductant, ferro-alloy feedstock, absorbent and Hg reduced carbon stock. During 2015, we have been testing and developing the engineered carbon products for specific markets. We are in the process of evaluating the commercialization of these product offerings with prospective customers and
|
For the year ended December 31, 2015
|
|
Air Pollution
Control Segment
|
|
FUEL CHEM
Segment
|
|
Fuel Conversion Segment
|
|
Other
|
|
Total
|
||||||||||
Revenues from external customers
|
|
$
|
43,485
|
|
|
$
|
30,179
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
73,664
|
|
Cost of sales
|
|
(30,612
|
)
|
|
(14,495
|
)
|
|
—
|
|
|
—
|
|
|
(45,107
|
)
|
|||||
Gross margin
|
|
12,873
|
|
|
15,684
|
|
|
—
|
|
|
—
|
|
|
28,557
|
|
|||||
Selling, general and administrative
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(31,116
|
)
|
|
(31,116
|
)
|
|||||
Research and development
|
|
—
|
|
|
—
|
|
|
(2,826
|
)
|
|
(1,447
|
)
|
|
(4,273
|
)
|
|||||
Intangible assets impairment
|
|
(1,425
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,425
|
)
|
|||||
Operating (loss) income
|
|
$
|
11,448
|
|
|
$
|
15,684
|
|
|
$
|
(2,826
|
)
|
|
$
|
(32,563
|
)
|
|
$
|
(8,257
|
)
|
For the year ended December 31, 2014
|
|
Air Pollution
Control Segment
|
|
FUEL CHEM
Segment
|
|
Fuel Conversion Segment
|
|
Other
|
|
Total
|
||||||||||
Revenues from external customers
|
|
$
|
42,031
|
|
|
$
|
36,986
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
79,017
|
|
Cost of sales
|
|
(26,586
|
)
|
|
(17,303
|
)
|
|
—
|
|
|
—
|
|
|
(43,889
|
)
|
|||||
Gross margin
|
|
15,445
|
|
|
19,683
|
|
|
—
|
|
|
—
|
|
|
35,128
|
|
|||||
Selling, general and administrative
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(35,432
|
)
|
|
(35,432
|
)
|
|||||
Research and development
|
|
—
|
|
|
—
|
|
|
(277
|
)
|
|
(1,182
|
)
|
|
(1,459
|
)
|
|||||
Goodwill impairment
|
|
(23,400
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(23,400
|
)
|
|||||
Operating (loss) income
|
|
$
|
(7,955
|
)
|
|
$
|
19,683
|
|
|
$
|
(277
|
)
|
|
$
|
(36,614
|
)
|
|
$
|
(25,163
|
)
|
For the year ended December 31, 2013
|
|
Air Pollution
Control Segment
|
|
FUEL CHEM
Segment
|
|
Other
|
|
Total
|
||||||||
Revenues from external customers
|
|
$
|
72,552
|
|
|
$
|
36,786
|
|
|
$
|
—
|
|
|
$
|
109,338
|
|
Cost of sales
|
|
(45,138
|
)
|
|
(17,383
|
)
|
|
—
|
|
|
(62,521
|
)
|
||||
Gross margin
|
|
27,414
|
|
|
19,403
|
|
|
—
|
|
|
46,817
|
|
||||
Selling, general and administrative
|
|
—
|
|
|
—
|
|
|
(36,375
|
)
|
|
(36,375
|
)
|
||||
Research and development
|
|
—
|
|
|
—
|
|
|
(2,442
|
)
|
|
(2,442
|
)
|
||||
Operating income
|
|
$
|
27,414
|
|
|
$
|
19,403
|
|
|
$
|
(38,817
|
)
|
|
$
|
8,000
|
|
For the years ended December 31,
|
|
2015
|
|
2014
|
|
2013
|
||||||
Revenues:
|
|
|
|
|
|
|
||||||
United States
|
|
$
|
51,485
|
|
|
$
|
50,901
|
|
|
$
|
63,275
|
|
Foreign
|
|
22,179
|
|
|
28,116
|
|
|
46,063
|
|
|||
|
|
$
|
73,664
|
|
|
$
|
79,017
|
|
|
$
|
109,338
|
|
As of December 31,
|
|
2015
|
|
2014
|
||||
Assets:
|
|
|
|
|
||||
United States
|
|
$
|
47,437
|
|
|
$
|
64,324
|
|
Foreign
|
|
28,574
|
|
|
27,147
|
|
||
|
|
$
|
76,011
|
|
|
$
|
91,471
|
|
For the quarters ended
|
|
March 31
|
|
June 30
|
|
September 30
|
|
December 31
|
||||||||
2015
|
|
|
|
|
|
|
|
|
||||||||
Revenues
|
|
$
|
15,103
|
|
|
$
|
18,683
|
|
|
$
|
21,677
|
|
|
$
|
18,201
|
|
Cost of sales
|
|
8,437
|
|
|
11,547
|
|
|
13,829
|
|
|
11,294
|
|
||||
Net (loss) income
|
|
(1,654
|
)
|
|
(1,371
|
)
|
|
(289
|
)
|
|
(9,066
|
)
|
||||
Net (loss) income per common share:
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
$
|
(0.07
|
)
|
|
$
|
(0.06
|
)
|
|
$
|
(0.01
|
)
|
|
$
|
(0.39
|
)
|
Diluted
|
|
$
|
(0.07
|
)
|
|
$
|
(0.06
|
)
|
|
$
|
(0.01
|
)
|
|
$
|
(0.39
|
)
|
2014
|
|
|
|
|
|
|
|
|
||||||||
Revenues
|
|
$
|
18,661
|
|
|
$
|
20,190
|
|
|
$
|
21,482
|
|
|
$
|
18,684
|
|
Cost of sales
|
|
10,810
|
|
|
11,677
|
|
|
11,582
|
|
|
9,820
|
|
||||
Net (loss) income
|
|
(1,086
|
)
|
|
(720
|
)
|
|
1,192
|
|
|
(17,111
|
)
|
||||
Net (loss) income per common share:
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
$
|
(0.05
|
)
|
|
$
|
(0.03
|
)
|
|
$
|
0.05
|
|
|
$
|
(0.75
|
)
|
Diluted
|
|
$
|
(0.05
|
)
|
|
$
|
(0.03
|
)
|
|
$
|
0.05
|
|
|
$
|
(0.75
|
)
|
•
|
Level 1 – Observable inputs to the valuation methodology such as quoted prices in active markets for identical assets or liabilities
|
•
|
Level 2 – Inputs to the valuation methodology including quoted prices for similar assets or liabilities in active markets, quoted prices for identical assets or liabilities in inactive markets, inputs other than quoted prices that are observable for the asset or liability, and inputs that are derived principally from or corroborated by observable market data by correlation or other means
|
•
|
Level 3 – Significant unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own estimates and assumptions or those expected to be used by market participants. Generally, these fair value measures are model-based valuation techniques such as discounted cash flows, option pricing models, and other commonly used valuation techniques
|
|
Level 1
|
Level 2
|
Level 3
|
Impairment Losses
|
Fair Value at December 31, 2015
|
||||||||||
Other intangible assets, net
|
$
|
—
|
|
$
|
—
|
|
$
|
8,569
|
|
$
|
(1,425
|
)
|
$
|
7,144
|
|
|
$
|
—
|
|
$
|
—
|
|
$
|
8,569
|
|
$
|
(1,425
|
)
|
$
|
7,144
|
|
|
Level 1
|
Level 2
|
Level 3
|
Impairment Losses
|
Fair Value at December 31, 2014
|
||||||||||
Goodwill
|
$
|
—
|
|
$
|
—
|
|
$
|
23,400
|
|
$
|
(23,400
|
)
|
$
|
—
|
|
|
$
|
—
|
|
$
|
—
|
|
$
|
23,400
|
|
$
|
(23,400
|
)
|
$
|
—
|
|
Plan Category
|
|
Number of Securities to be issued upon exercise of outstanding options and vesting of restricted stock units
|
|
Weighted-average
exercise price of
outstanding options
|
|
Number of securities remaining available for future issuance under equity compensation plan excluding securities listed in column (a)
|
||||
|
|
(a)
|
|
(b)
|
|
(c)
|
||||
Equity compensation plans approved by security holders (1)
|
|
2,396,008
|
|
|
$
|
10.48
|
|
|
1,190,426
|
|
(1)
|
Includes Common Shares of Fuel Tech, Inc. authorized for awards under Fuel Tech’s 2014 Long-Term Incentive Plan adopted in May of 2014.
|
(a)
|
(1) Financial Statements
|
|
|
|
|
|
|
Incorporated by Reference
|
|||||||
Exhibit
|
|
Description
|
|
Filed
Herewith
|
|
Form
|
|
Period
ending
|
|
Exhibit
|
|
Filing date
|
|
3.1
|
|
Certificate of Incorporation of Fuel Tech, Inc.
|
|
|
|
8-K
|
|
|
|
3.2
|
|
|
10/5/2006
|
3.2
|
|
Certificate of Conversion of Fuel Tech, Inc.
|
|
|
|
8-K
|
|
|
|
3.1
|
|
|
10/5/2006
|
3.3
|
|
Amended and Restated By-Laws of Fuel Tech, Inc. dated as of May 28, 2015
|
|
|
|
8-K
|
|
|
|
3.1
|
|
|
6/1/2015
|
4.1
|
|
Instrument Constituting US $19,200,000 Nil Coupon Non-Redeemable Convertible Unsecured Loan Notes of Fuel-Tech N.V., dated December 21, 1989
|
|
|
|
10-Q
|
|
9/30/2009
|
|
4.1
|
|
|
11/4/2009
|
4.2
|
|
First Supplemental Instrument Constituting US $3,000 Nil Coupon Non-Redeemable Convertible Unsecured Loan Notes of Fuel-Tech N.V., dated July 10, 1990
|
|
|
|
10-Q
|
|
9/30/2009
|
|
4.2
|
|
|
11/4/2009
|
4.3
|
|
Instrument Constituting US $6,000 Nil Coupon Non-Redeemable Convertible Unsecured Loan Notes of Fuel-Tech N.V., dated March 12, 1993
|
|
|
|
10-Q
|
|
9/30/2009
|
|
4.3
|
|
|
11/4/2009
|
4.4*
|
|
Fuel Tech, Inc. Incentive Plan as amended through June 3, 2004
|
|
|
|
S-8
|
|
|
|
4.1
|
|
|
10/2/2006
|
4.5*
|
|
Fuel Tech, Inc. 2014 Long-Term Incentive Plan
|
|
|
|
S-8
|
|
|
|
4.1
|
|
|
3/31/2014
|
4.6*
|
|
Fuel Tech, Inc. Form of Non-Executive Director Stock Option Agreement
|
|
|
|
10-K
|
|
12/31/2006
|
|
4.6
|
|
|
3/6/2007
|
4.7
|
|
Fuel Tech, Inc. Form of 2014 Long-Term Incentive Plan Non-Employee Director's Stock Option Agreement
|
|
|
|
10-Q
|
|
6/30/2014
|
|
4.2
|
|
|
8/11/2014
|
4.8*
|
|
Fuel Tech, Inc. Form of Non-Qualified Stock Option Agreement
|
|
|
|
10-K
|
|
12/31/2006
|
|
4.7
|
|
|
3/6/2007
|
4.9*
|
|
Fuel Tech, Inc. Form of Incentive Stock Option Agreement
|
|
|
|
10-K
|
|
12/31/2006
|
|
4.8
|
|
|
3/6/2007
|
4.10*
|
|
Fuel Tech, Inc. Form of Revised Restricted Stock Unit Agreement
|
|
|
|
10-K
|
|
12/31/2011
|
|
4.9
|
|
|
3/5/2012
|
4.11*
|
|
Fuel Tech, Inc. Form of Restricted Stock Unit Agreement (2014 Long-Term Incentive Plan)
|
|
|
|
10-Q
|
|
6/30/2014
|
|
4.1
|
|
|
8/11/2014
|
4.12*
|
|
Fuel Tech, Inc. Form of 2011 Executive Performance RSU Award Agreement
|
|
|
|
8-K
|
|
|
|
10.1
|
|
|
3/28/2011
|
4.13*
|
|
Fuel Tech, Inc. Form of 2012 Executive Performance RSU Award Agreement
|
|
|
|
8-K
|
|
|
|
4.2
|
|
|
5/7/2013
|
4.14*
|
|
Fuel Tech, Inc. Form of 2013 Executive Performance RSU Award Agreement
|
|
|
|
8-K
|
|
|
|
4.3
|
|
|
5/7/2013
|
4.15*
|
|
Fuel Tech, Inc. Form of 2015 Executive Performance RSU Award Agreement
|
|
|
|
10-Q
|
|
3/31/2015
|
|
10.3
|
|
|
5/11/2015
|
4.16*
|
|
Fuel Tech, Inc. Form of 2014 Long-Term Incentive Plan Stock Option Agreement
|
|
|
|
10-Q
|
|
3/31/2015
|
|
10.2
|
|
|
5/11/2015
|
4.17*
|
|
Fuel Tech, Inc. Form of 2016 Executive Performance RSU Award Agreement
|
|
X
|
|
|
|
|
|
|
|
|
10.1**
|
|
License Agreement dated November 18, 1998 between The Gas Technology Institute and Fuel Tech, Inc. relating to the FLGR Process.
|
|
|
|
10-K
|
|
12/31/1999
|
|
3.3
|
|
|
3/30/2000
|
10.2**
|
|
Amendment No. 1, dated February 28, 2000, to License Agreement dated November 18, 1998 between The Gas Technology Institute and Fuel Tech, Inc. relating to the FLGR Process.
|
|
|
|
10-K
|
|
12/31/1999
|
|
3.3
|
|
|
3/30/2000
|
10.3
|
|
Form of Indemnity Agreement between Fuel Tech, Inc. and its Directors and Officers.
|
|
|
|
8-K
|
|
|
|
99.1
|
|
|
2/7/2007
|
10.4**
|
|
Restated Supply Agreement, dated March 4, 2009, between Fuel Tech, Inc. and Martin Marietta Magnesia Specialties, LLC.
|
|
|
|
10-K
|
|
12/31/2008
|
|
10.7
|
|
|
3/5/2009
|
10.5
|
|
Amendment No. 1 to Restated Supply Agreement, dated October 31, 2013, between Fuel Tech, Inc. and Martin Marietta Magnesia Specialties, Inc.
|
|
|
|
10-Q
|
|
9/30/2013
|
|
10.1
|
|
|
11/7/2013
|
10.6
|
|
Stock Purchase Agreement, dated April 28, 2014, between Lawrence Ekey and Fuel Tech, Inc.
|
|
|
|
10-Q
|
|
3/31/2014
|
|
10.1
|
|
|
5/12/2014
|
10.7
|
|
Credit Agreement, dated as of June 30, 2009, between JPMorgan Chase Bank, N.A. and Fuel Tech, Inc.
|
|
|
|
10-Q
|
|
9/30/2009
|
|
10.5
|
|
|
11/4/2009
|
10.8
|
|
First Amendment to Credit Agreement, dated as of October 5, 2009, between JPMorgan Chase Bank, N.A. and Fuel Tech, Inc.
|
|
|
|
10-Q
|
|
9/30/2009
|
|
10.6
|
|
|
11/4/2009
|
10.9
|
|
Second Amendment to Credit Agreement, dated as of November 4, 2009, between JPMorgan Chase Bank, N.A. and Fuel Tech, Inc.
|
|
|
|
10-Q
|
|
9/30/2009
|
|
10.7
|
|
|
11/4/2009
|
10.10
|
|
Third Amendment to Credit Agreement, dated as of June 30, 2011, between JPMorgan Chase Bank, N.A. and Fuel Tech, Inc.
|
|
|
|
10-Q
|
|
6/30/2011
|
|
4.1
|
|
|
8/8/2011
|
10.11
|
|
Fourth Amendment to Credit Agreement, dated as of June 30, 2013, between JPMorgan Chase Bank, N.A. and Fuel Tech, Inc.
|
|
|
|
10-Q
|
|
6/30/2013
|
|
4.1
|
|
|
8/7/2013
|
10.12
|
|
Fifth Amendment to Credit Agreement, dated as of June 16th, 2015, between Fuel Tech, Inc. and JP Morgan Chase Bank, N.A.
|
|
X
|
|
|
|
|
|
|
|
|
|
10.13
|
|
Sixth Amendment to Credit Agreement, dated as of June 30, 2015, between Fuel Tech, Inc. and JP Morgan Chase Bank, N.A.
|
|
|
|
10-Q
|
|
6/30/2015
|
|
10.2
|
|
|
8/10/2015
|
10.14
|
|
Seventh Amendment to Credit Agreement, dated as of December 31, 2015, between Fuel Tech, Inc. and JP Morgan Chase Bank, N.A.
|
|
X
|
|
|
|
|
|
|
|
|
|
10.15
|
|
Sublease Agreement, dated December 9, 2009, between Fuel Tech, Inc. and American Bailey Corporation
|
|
|
|
10-K
|
|
12/31/2009
|
|
10.14
|
|
|
3/4/2010
|
10.16*
|
|
2014 Executive Officer Incentive Plan of Fuel Tech, Inc.
|
|
|
|
10-K
|
|
12/31/2013
|
|
10.16
|
|
|
3/10/2014
|
10.17*
|
|
2015 Executive Officer Incentive Plan of Fuel Tech, Inc.
|
|
|
|
10-Q
|
|
3/31/2015
|
|
10.1
|
|
|
5/11/2015
|
10.18*
|
|
2016 Executive Officer Plan of Fuel Tech, Inc.
|
|
X
|
|
|
|
|
|
|
|
|
|
10.19*
|
|
2016 Corporate Incentive Plan of Fuel Tech, Inc.
|
|
X
|
|
|
|
|
|
|
|
|
|
10.20*
|
|
Employment Agreement, dated August 2, 2010, between David S. Collins and Fuel Tech, Inc.
|
|
|
|
10-Q
|
|
6/30/2010
|
|
10.1
|
|
|
8/9/2010
|
10.21*
|
|
Employment Agreement, dated April 1, 2010, between Douglas G. Bailey and Fuel Tech, Inc.
|
|
|
|
10-K
|
|
12/31/2010
|
|
10.19
|
|
|
3/9/2011
|
10.22*
|
|
Employment Agreement, dated August 31, 2009, between Robert E. Puissant and Fuel Tech, Inc.
|
|
|
|
10-K
|
|
12/31/2010
|
|
10.20
|
|
|
3/9/2011
|
10.23*
|
|
Employment Agreement, dated September 20, 2010 between Vincent J. Arnone and Fuel Tech, Inc.
|
|
|
|
10-K
|
|
12/31/2011
|
|
10.21
|
|
|
3/5/2012
|
10.24*
|
|
Employment Agreement, dated July 13, 2003, between Albert G. Grigonis and Fuel Tech, Inc.
|
|
|
|
10-K
|
|
12/31/2013
|
|
10.21
|
|
|
3/10/2014
|
23.1
|
|
Consent of Independent Registered Public Accounting Firm.
|
|
X
|
|
|
|
|
|
|
|
|
31.1
|
|
Certifications of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
X
|
|
|
|
|
|
|
|
|
31.2
|
|
Certifications of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
X
|
|
|
|
|
|
|
|
|
32
|
|
Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
X
|
|
|
|
|
|
|
|
|
101.1 INS
|
|
XBRL Instance Document.
|
|
|
|
101.2 SCH
|
|
XBRL Taxonomy Extension Schema Document.
|
|
|
|
101.3 CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
|
|
|
101.4 DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
|
|
|
101.5 LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document.
|
|
|
|
101.6 PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
**
|
Portions of this document have been omitted pursuant to a request for confidential treatment and the omitted information has been filed separately with the Securities and Exchange Commission.
|
|
FUEL TECH, INC.
|
|
|
|
|
Date: March 23, 2016
|
By:
|
/s/ Vincent J. Arnone
|
|
|
Vincent J. Arnone
|
|
|
President and Chief Executive Officer
|
|
|
(Principal Executive Officer)
|
|
|
|
Date: March 23, 2016
|
By:
|
/s/ David S. Collins
|
|
|
David S. Collins
|
|
|
Senior Vice President and Chief Financial Officer
|
|
|
(Principal Financial Officer)
|
Signature
|
|
Title
|
|
|
|
/s/ Vincent J. Arnone
|
|
President and Chief Executive Officer
(Principal Executive Officer)
|
Vincent J. Arnone
|
|
|
|
|
|
/s/ Douglas G. Bailey
|
|
Executive Chairman
|
Douglas G. Bailey
|
|
|
|
|
|
/s/ Miguel Espinosa
|
|
Director
|
Miguel Espinosa
|
|
|
|
|
|
/s/ W. Grant Gregory
|
|
Director
|
W. Grant Gregory
|
|
|
|
|
|
/s/ Thomas S. Shaw, Jr.
|
|
Director
|
Thomas S. Shaw, Jr.
|
|
|
|
|
|
/s/ Delbert L. Williamson
|
|
Director
|
Delbert L. Williamson
|
|
|
|
|
|
/s/ Dennis L. Zeitler
|
|
Director
|
Dennis L. Zeitler
|
|
|
|
|
|
/s/ David S. Collins
|
|
Sr. Vice President, Chief Financial Officer and Treasurer
(Principal Financial Officer) |
David S. Collins
|
|
(a)
|
Lender, Borrower and Loan Parties shall have executed this Amendment;
|
(b)
|
Borrower shall be in good standing in the States of Illinois and Delaware; and
|
(c)
|
Borrower shall pay all costs and fees incurred by Lender in connection with the preparation and performance of this Amendment.
|
(a)
|
Lender, Borrower and Loan Parties shall have executed this Amendment;
|
(b)
|
Borrower shall be in good standing in the States of Illinois and Delaware; and
|
(c)
|
Borrower shall pay all costs and fees incurred by Lender in connection with the preparation and performance of this Amendment.
|
3.
|
EOIP Payouts
|
Executive Officer Incentive Plan Mechanics
|
||||||||||
|
Minimums
|
|
Funding
Percentage
|
|
Incremental
Value
|
Incremental
Percentage
|
|
Percentage Cap
|
|
|
Adjusted EBITDA, as defined
|
|
$2,500
|
|
2.00
|
%
|
500
|
0.200
|
%
|
4.00
|
%
|
Revenue
|
|
$75,000
|
|
0.50
|
%
|
1,500
|
0.100
|
%
|
1.50
|
%
|
APC Bookings
|
|
$37,500
|
|
0.50
|
%
|
1,500
|
0.100
|
%
|
1.50
|
%
|
|
|
3.00
|
%
|
|
|
7.00
|
%
|
|||
|
|
|
|
|
|
|||||
|
|
|
|
|
|
4.
|
DEFINITIONS
|
5.
|
OTHER CONDITIONS
|
|
Fuel Tech, Inc.
|
_______________________________
PARTICIPANT
|
By:
____________________________________
Its:
____________________________________
|
•
|
historical equity awards, by employee, by year;
|
•
|
intrinsic values for each equity award, or, when applicable, the fair value of each equity award using the Black-Scholes option pricing model;
|
•
|
the number of equity award units available for issuance under the Plan;
|
•
|
supervisor recommendations for employee equity awards; the estimate of expected intrinsic value (
e.g.
, equity award compensation expense) of the aggregate equity award;
|
•
|
net income (before or after taxes);
|
•
|
basic or diluted earnings per share (before or after taxes);
|
•
|
gross revenue, net revenue, gross revenue growth or net revenue growth;
|
•
|
sales of particular products or services;
|
•
|
gross profit, gross profit growth, net profit or net operating profit (before or after taxes);
|
•
|
earnings before or after deduction for all or any portion of interest, taxes, depreciation, amortization, incentive pay, contributions to 401(k) or other employee benefit plans, or items of income or expense not occurring in the normal course of business, whether or not on continuing operations or on an aggregate or per share basis (basic or fully diluted);
|
•
|
return on assets, capital, invested capital, equity, or sales (discounted or otherwise);
|
•
|
cash flow (including, but not limited to, operating cash flow, free cash flow, and cash flow return on capital);
|
•
|
one or more operating ratios such as earnings before or after interest, taxes and/or depreciation and/or amortization;
|
•
|
gross or operating margins;
|
•
|
improvements in capital structure;
|
•
|
budget and expense management or cost targets;
|
•
|
productivity ratios;
|
•
|
economic value added or other value added measurements;
|
•
|
share price (including, but not limited to, growth measures and total stockholder return);
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•
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book value;
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•
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financing and other capital raising transactions (including sales of our equity or debt securities;
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•
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operating efficiency;
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•
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working capital targets;
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•
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enterprise value;
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•
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completion of acquisitions, business expansion, reorganizations or divestitures (in whole or in part);
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•
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borrowing levels, leverage ratios or credit rating;
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•
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regulatory achievements (including submitting or filing applications or other documents with regulatory authorities or receiving approval of any such applications or other documents and passing pre-approval inspections (whether of us or a third-party manufacturer) and validation of manufacturing processes (whether ours or a third-party manufacturer’s);
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•
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strategic partnerships or transactions (including in-licensing and out-licensing of intellectual property);
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•
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establishing relationships with commercial entities with respect to the marketing, distribution and sale of our products (including with group purchasing organizations, distributors and other vendors);
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•
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supply chain achievements (including establishing relationships with manufacturers or suppliers of component materials and manufacturers of our products);
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•
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co-development, co-marketing, profit sharing, joint venture or other similar arrangements;
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•
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economic value-added models or equivalent metrics;
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•
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implementation, completion or attainment of measurable objectives with respect to research, development, manufacturing, commercialization, products or projects, production volume levels, succession and hiring projects, or expansions of specific business operations;
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timely completion of new product roll-outs;
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timely launch of new facilities;
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sales or licenses of our assets, including its intellectual property, whether in a particular jurisdiction or territory or globally, or through partnering transactions);
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•
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royalty income;
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•
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exceptional and innovative individual performance;
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individual contribution to a strategic goal;
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•
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teamwork;
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•
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leadership accomplishments; and
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•
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employee job level
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□
|
No deferral. I wish to receive Shares upon vesting of each installment of RSUs.
|
□
|
I wish to defer receipt of
all
Shares underlying any Look-Back RSUs until ____ years (minimum of 5) after the Determination Date.
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□
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I wish to defer receipt of
all
Shares underlying any Revenue Growth RSUs until ____ years (minimum of 5) after the Determination Date.
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□
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I wish to defer receipt of
all
Shares underlying any TSR Performance RSUs until ____ years (minimum of 5) after the Determination Date.
|
______________________________
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Date: _____________________, 20___
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Date: March 23, 2016
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By:
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/s/ Vincent J. Arnone
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Vincent J. Arnone
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Chief Executive Officer
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Date: March 23, 2016
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By:
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/s/ David S. Collins
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David S. Collins
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|
Chief Financial Officer
|
|
Date: March 23, 2016
|
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|
|
|
By:
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/s/ Vincent J. Arnone
|
|
|
Vincent J. Arnone
|
|
|
Chief Executive Officer
|
|
|
|
|
Date: March 23, 2016
|
|
|
|
|
|
By:
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/s/ David S. Collins
|
|
|
David S. Collins
|
|
|
Chief Financial Officer
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|