Delaware
(State or other jurisdiction of incorporation or organization) |
4931
(Primary Standard Industrial Classification Code Number) |
04-3512838
(I.R.S. Employer Identification No.) |
Mark G. Borden, Esq.
Patrick J. Rondeau, Esq. Wilmer Cutler Pickering Hale and Dorr LLP 60 State Street Boston, Massachusetts 02109 (617) 526-6000 |
Thomas R. Burton, III, Esq.
Sahir Surmeli, Esq. Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. One Financial Center Boston, Massachusetts 02111 (617) 542-6000 |
Large accelerated filer o | Accelerated filer o | Non-accelerated filer þ | Smaller reporting company o |
The information in
this prospectus is not complete and may be changed. We may not
sell these securities until the registration statement filed
with the Securities and Exchange Commission is effective. This
prospectus is not an offer to sell these securities and it is
not soliciting an offer to buy these securities in any state
where the offer or sale is not permitted.
|
Per Share | Total | |||||||
Public offering price
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$ | $ | ||||||
Underwriting discount
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$ | $ | ||||||
Proceeds, before expenses, to us
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$ | $ | ||||||
Proceeds, before expenses, to the selling stockholders
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$ | $ |
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Rising and Volatile Energy Prices.
Over the past
decade, energy-linked commodity prices, including oil, gas, coal
and electricity, have all increased and exhibited significant
volatility. From 1999 to 2009, average U.S. retail electricity
prices have increased by more than 50%.
Potential of Energy Efficiency Measures to Significantly
Reduce Energy Consumption
. The implementation of energy
efficiency measures can significantly reduce the rate at which
energy consumption is expected to increase. According to a July
2009 report by McKinsey & Company, economically viable
and commercially available energy efficiency measures, if fully
implemented, have the potential to save more than one
trillion kWh of electricity, or 23% of overall U.S. demand,
by 2020.
Aging and Inefficient Facility Infrastructure.
Many
organizations continue to operate with an energy infrastructure
that is significantly less efficient and cost-effective than now
available through more advanced technologies applied to
lighting, heating, cooling and other building systems. As these
organizations explore alternatives for renewing their aging
facilities, they often identify multiple areas within their
facilities that could benefit from the implementation of energy
efficiency measures, including the possible use of renewable
sources of energy.
Increased Focus on Cost Reduction.
The current
economic environment has led many organizations to search for
opportunities to reduce their operating costs. There has been a
growing awareness that reduced energy consumption presents an
opportunity for significant long-term savings in operating costs
and that the installation of energy efficiency measures can be a
cost-effective way to achieve such reductions.
Movement Toward Industry Consolidation.
As energy
efficiency solutions continue to increase in technological
complexity and customers look for service providers that can
offer broad geographic and product coverage, we believe smaller
niche energy efficiency companies will continue to look for
opportunities to combine with larger companies that can better
serve their customers needs. Increased market presence and
size of energy efficiency companies should, in turn, create
greater customer awareness of the benefits of energy efficiency
measures.
Increasing Legislative Support and Initiatives.
In
the United States and Canada, federal, state, provincial, and
local governments have enacted and are considering legislation
and regulations aimed at increasing energy efficiency, reducing
greenhouse gas emissions and encouraging the expansion of
renewable energy generation.
Increased Use of Third-Party Financing.
Many
organizations desire to use their existing sources of capital
for core investments or do not have the internal capacity to
finance improvements to their energy infrastructure. These
organizations often require innovative structures to facilitate
the financing of energy efficiency and renewable energy
projects. Customers seeking to upgrade or renew their energy
systems are increasingly seeking to enter into ESPCs or other
creative arrangements that facilitate third-party financing for
their projects.
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One-Stop, Comprehensive Service Provider.
We offer
our customers expertise in addressing almost all aspects of
purchasing and using energy within a facility. Our experienced
project development and engineering staff provide us with the
capability and flexibility to determine the combination of
energy efficiency measures that is best suited to achieve the
customers energy efficiency and environmental goals.
Independence.
We are an independent company with no
affiliation to any equipment manufacturer, utility or fuel
company. Unlike affiliated service companies, we have the
freedom and flexibility to be objective in selecting particular
products and technologies available from different manufacturers
in order to optimize our solutions for customers
particular needs.
Strong Customer Relationships.
We have served over
2,000 customers since our inception, including over 1,000
customers in 2009. Our design, engineering and support
activities, which typically span multiple years, foster a close
relationship with our customers, which positions us to identify
their future needs and provide additional services to them.
Creative Solutions.
Our engineering staff has
expertise in a broad range of technologies and energy savings
strategies encompassing different types of electrical, heating,
cooling, lighting, water, renewable energy and other facility
infrastructure systems. We apply this expertise to design and
engineer innovative solutions customized to meet the specific
needs of each customer.
Strong National and Local Presence.
We have a
nationwide presence in both the United States and Canada and
serve certain of our customers in European locations. We
maintain a centralized staff of engineering, financial and legal
personnel at our headquarters in Massachusetts, who provide
support to our seven regional offices and 46 other field offices
located throughout the United States and Canada. We believe that
our organizational structure enables us to be fast, flexible and
cost-effective in responding to our customers needs.
Experienced Management and Operations Team.
Our
executive officers have an aggregate of over 150 years of
experience in the energy efficiency field. As of March 31,
2010, we employed over 200 engineers, whose experience with
respect to fuels, rates, technologies and geography-specific
regulation and economic benefits enables us to propose and
design energy efficiency solutions that take into account the
economic, technological, environmental and regulatory
considerations that we believe underlie the cost efficiencies
and operational success of a project.
Federal and State Qualifications.
The federal
governmental program under which federal agencies and
departments can enter into ESPCs requires that energy service
providers have a track record in the industry and meet other
specified qualifications. Over 20 states require similar
qualifications. In 2008, we renewed our qualification to enter
into an indefinite delivery, indefinite quantity, or IDIQ,
contract under the U.S. Department of Energy program for
ESPCs. This IDIQ contract has an aggregate maximum potential
ordering amount of $5 billion and expires in 2019. We are
currently qualified to enter into ESPCs in most states that
require qualification. The scope of our qualifications provides
us with the opportunity to continue to grow our business with
federal, state and other governmental customers and
differentiates us from energy efficiency companies that have not
been similarly qualified.
Integration of Strategic Acquisitions.
We have a
track record of completing over ten acquisitions that have
enabled us to broaden our offerings, expand our geographical
reach and accelerate our growth. We believe that our ability to
offer a comprehensive set of energy efficiency services across
North America has been, and will continue to be, enhanced by our
expertise in identifying and completing acquisitions that expand
our service offerings, as well as by our ability to integrate
and leverage the skilled engineering, sales and operational
personnel that come to us through these acquisitions.
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Pursue Organic Growth.
We plan to open additional
local offices in the regions we currently serve, as well as hire
additional sales personnel. We also plan to expand
geographically by opening new local offices in regions we do not
currently serve in the United States and Canada, as well as in
Europe.
Continue to Maintain Customer Focus.
We will
continue to maintain an entrepreneurial approach toward our
customers and remain flexible in designing projects tailored
specifically to meet their needs.
Expand Scope of Product and Service Offerings.
We
plan to continue to expand our offerings by including new types
of energy efficiency services, products and improvements to
existing products based on technological advances in energy
savings strategies, equipment and materials.
Meet Market Demand for Cost-Effective,
Environmentally-Friendly Solutions
. Through our
energy efficiency measures and small-scale renewable energy
plants and products, we enable customers to conserve energy and
reduce emissions of carbon dioxide and other pollutants. We plan
to continue to focus on providing sustainable energy solutions
that will address the growing demand for products and services
that create environmental benefits for customers.
Increase Recurring Revenue.
For many of our energy
efficiency projects, we enter into multi-year O&M
contracts, and we plan to continue to grow both the number and
scope of such contracts. We also obtain recurring revenue from
sales of electricity, thermal energy and gas generated by the
small-scale renewable energy and central plants that we
construct and own, and we plan to continue to seek opportunities
to construct such plants.
Grow Through Select Strategic Acquisitions.
We plan
to continue to pursue complementary acquisitions that will
enable us to both expand geographically in North America and
abroad, and broaden our product and service offerings.
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36
40
61
111
112
F-32
Class A Common stock offered by:
Ameresco
Shares
Selling stockholders
Shares
Total
Common stock to be outstanding after this offering:
Class A
Shares
Class B
18,000,000
Shares
Total
Use of proceeds
We intend to use our net proceeds from this offering (i) to
repay the balance outstanding under our $50 million
revolving senior secured credit facility, under which
$24.9 million in principal was outstanding as of
March 31, 2010, (ii) to repay in full the
$3.0 million subordinated note held by our president and
chief executive officer and (iii) for working capital and
other general corporate purposes, which may include opening
additional offices in the United States and abroad, expanding
sales and marketing activities, and funding the development and
construction of our small-scale renewable energy projects and
other capital expenditures. We may also use a portion of our net
proceeds for acquisitions of complementary companies, assets or
technologies. We will not receive any proceeds from the shares
sold by the selling stockholders. See Use of
Proceeds for more information.
Risk Factors
You should read the Risk Factors section and other
information included in this prospectus for a discussion of
factors to consider carefully before deciding to invest in
shares of our Class A common stock.
Proposed symbol
AMRC
15,065,490 shares of our Class A common stock outstanding
as of May 31, 2010;
18,000,000 shares of our Class B common stock outstanding
as of May 31, 2010;
shares
of our Class A common stock to be issued upon the exercise of
vested stock options by the selling stockholders in connection
with this offering at a weighted-average exercise price of
$ ; and
shares
of our Class A common stock offered by us in this offering;
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405,286 shares of our Class A common stock issuable
upon the exercise of a warrant that was outstanding and
exercisable as of May 31, 2010 at an exercise price of
$0.005 per share, which will remain outstanding after this
offering if not exercised prior to this offering;
9,593,594 shares of our Class A common stock issuable
upon the exercise of stock options outstanding as of
May 31, 2010 at a weighted-average exercise price of $3.88
per
share; and
10,000,000 shares of our Class A common stock that
will be available for future issuance under our 2010 stock
incentive plan, or our 2010 stock plan, which will become
effective upon the closing of this offering.
gives effect to the amendment and restatement of our
certificate of incorporation and amendment and restatement of
our by-laws to be effected prior to the closing of this
offering;
gives effect to a two-for-one split of our common stock to be
effected prior to the closing of this offering;
gives effect to the reclassification of all outstanding
shares of our common stock as Class A common stock to be
effected prior to the closing of this offering;
gives effect to the conversion of each outstanding option to
purchase shares of our common stock into an option to purchase
shares of our Class A common stock;
gives effect to the conversion of an outstanding warrant to
purchase shares of our common stock into a warrant to purchase
shares of our Class A common stock;
gives effect to the conversion of all shares of our
convertible preferred stock, other than those held by George P.
Sakellaris, our founder, principal stockholder, president and
chief executive officer, into shares of our Class A common
stock prior to the closing of this offering;
gives effect to the automatic conversion of all outstanding
shares of our convertible preferred stock, which will then be
held solely by Mr. Sakellaris, into shares of our Class B
common stock upon the closing of this offering; and
assumes no exercise by the underwriters of their
over-allotment option.
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As of March 31, 2010
Pro Forma
Actual
Pro Forma
As Adjusted
(Unaudited)
(In thousands)
$
24,361
$
24,361
$
152,315
152,315
382,198
382,198
110,227
110,227
110,227
128,374
128,374
128,374
2,999
2,999
2,999
105,160
105,160
(1)
Pro forma net income per share and pro forma weighted-average
shares outstanding give effect to (i) a two-for-one split
of our common stock (ii) the reclassification of all
outstanding shares of our common stock as Class A common
stock, (iii) the conversion of all shares of our
convertible preferred stock, other than those held by
Mr. Sakellaris, into shares of our Class A common
stock and (iv) the conversion of all other outstanding
shares of our convertible preferred stock into shares of our
Class B common stock.
(2)
We define adjusted EBITDA as operating income before
depreciation and amortization expense, share-based compensation
expense and a non-recurring non-cash recovery of a contingency
in 2008. Adjusted EBITDA is a non-GAAP financial measure and
should not be considered as an alternative to operating income
or any other measure of financial performance calculated and
presented in accordance with GAAP.
adjusted EBITDA and similar non-GAAP measures are widely used by
investors to measure a companys operating performance
without regard to items that can vary substantially from company
to company depending upon financing and accounting methods, book
values of assets, capital structures and the methods by which
assets were acquired;
securities analysts often use adjusted EBITDA and similar
non-GAAP measures as supplemental measures to evaluate the
overall operating performance of companies; and
by comparing our adjusted EBITDA in different historical
periods, our investors can evaluate our operating results
without the additional variations of depreciation and
amortization expense, share-based compensation expense and the
non-recurring non-cash recovery of a contingency in 2008.
as a measure of operating performance, because it does not
include the impact of items that we do not consider indicative
of our core operating performance;
for planning purposes, including the preparation of our annual
operating budget;
to allocate resources to enhance the financial performance of
our business;
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to evaluate the effectiveness of our business
strategies; and
in communications with our board of directors and investors
concerning our financial performance.
adjusted EBITDA does not reflect our cash expenditures or future
requirements for capital expenditures or other contractual
commitments;
adjusted EBITDA does not reflect changes in, or cash
requirements for, our working capital needs;
adjusted EBITDA does not reflect stock-based compensation
expense;
adjusted EBITDA does not reflect cash requirements for income
taxes;
adjusted EBITDA does not reflect net interest income (expense);
although depreciation and amortization are non-cash charges, the
assets being depreciated or amortized will often have to be
replaced in the future, and adjusted EBITDA does not reflect any
cash requirements for these replacements; and
other companies in our industry may calculate adjusted EBITDA
differently than we do, limiting its usefulness as a comparative
measure.
Year Ended December 31,
Three Months Ended March 31,
2007
2008
2009
2009
2010
(Unaudited)
(In thousands)
$
19,397
$
24,676
$
25,294
$
667
$
2,563
5,898
7,278
6,634
1,107
2,143
2,679
2,941
3,169
617
439
(5,850
)
$
27,974
$
29,045
$
35,097
$
2,391
$
5,145
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our ability to arrange financing for projects;
changes in federal, state and local government policies and
programs related to, or a reduction in governmental support for,
energy efficiency and renewable energy;
the timing of work we do on projects where we recognize revenue
on a percentage of completion basis;
seasonality in construction and in demand for our products and
services;
a customers decision to delay our work on, or other risks
involved with, a particular project;
availability and costs of labor and equipment;
the addition of new customers or the loss of existing customers;
the size and scale of new customer projects;
the availability of bonding for our projects;
our ability to control costs, including operating expenses;
changes in the mix of our products and services;
the rates at which customers renew their O&M contracts with
us;
the length of our sales cycle;
the productivity and growth of our sales force;
the timing of opening of new offices or making other significant
investments in the growth of our business, as the revenue we
hope to generate from those expenses often lags several quarters
behind those expenses;
changes in pricing by us or our competitors, or the need to
provide discounts to win business;
costs related to the acquisition and integration of companies or
assets;
general economic trends, including changes in energy efficiency
spending or geopolitical events such as war or incidents of
terrorism; and
future accounting pronouncements and changes in accounting
policies.
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failure to receive critical components and equipment that meet
our design specifications and can be delivered on schedule;
failure to obtain all necessary rights to land access and use;
failure to receive quality and timely performance of third-party
services;
increases in the cost of labor, equipment and commodities needed
to construct or operate projects;
permitting and other regulatory issues, license revocation and
changes in legal requirements;
shortages of equipment or skilled labor;
unforeseen engineering problems;
failure of a customer to accept or pay for renewable energy that
we supply;
weather interferences, catastrophic events including fires,
explosions, earthquakes, droughts and acts of terrorism; and
accidents involving personal injury or the loss of life;
labor disputes and work stoppages;
mishandling of hazardous substances and waste; and
other events outside of our control.
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terminate existing contracts, in whole or in part, for any
reason or no reason;
reduce or modify contracts or subcontracts;
decline to award future contracts if actual or apparent
organizational conflicts of interest are discovered, or to
impose organizational conflict mitigation measures as a
condition of eligibility for an award;
suspend or debar the contractor from doing business with the
government or a specific government agency; and
pursue criminal or civil remedies under the False Claims Act,
False Statements Act and similar remedy provisions unique to
government contracting.
specialized accounting systems unique to government contracting,
which may include mandatory compliance with federal Cost
Accounting Standards;
mandatory financial audits and potential liability for
adjustments in contract prices;
public disclosure of contracts, which may include pricing
information;
mandatory socioeconomic compliance requirements, including small
business promotion, labor, environmental and
U.S. manufacturing requirements; and
requirements for maintaining current facility
and/or
personnel security clearances to access certain government
facilities or to maintain certain records, and related
industrial security compliance requirements.
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the purchase price we pay could significantly deplete our cash
reserves or result in dilution to our existing stockholders;
we may find that the acquired company or assets do not improve
our customer offerings or market position as planned;
we may have difficulty integrating the operations and personnel
of the acquired company;
key personnel and customers of the acquired company may
terminate their relationships with the acquired company as a
result of the acquisition;
we may experience additional financial and accounting challenges
and complexities in areas such as tax planning and financial
reporting;
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we may assume or be held liable for risks and liabilities
(including for environmental-related costs) as a result of our
acquisitions, some of which we may not discover during our due
diligence or adequately adjust for in our acquisition
arrangements;
our ongoing business and managements attention may be
disrupted or diverted by transition or integration issues and
the complexity of managing geographically or culturally diverse
enterprises;
we may incur one-time write-offs or restructuring charges in
connection with the acquisition;
we may acquire goodwill and other intangible assets that are
subject to amortization or impairment tests, which could result
in future charges to earnings; and
we may not be able to realize the cost savings or other
financial benefits we anticipated.
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building and managing highly experienced foreign workforces and
overseeing and ensuring the performance of foreign
subcontractors;
increased travel, infrastructure and legal and compliance costs
associated with multiple international locations;
additional withholding taxes or other taxes on our foreign
income, and tariffs or other restrictions on foreign trade or
investment;
imposition of, or unexpected adverse changes in, foreign laws or
regulatory requirements, many of which differ from those in the
United States;
increased exposure to foreign currency exchange rate risk;
longer payment cycles for sales in some foreign countries and
potential difficulties in enforcing contracts and collecting
accounts receivable;
difficulties in repatriating overseas earnings;
general economic conditions in the countries in which we
operate; and
political unrest, war, incidents of terrorism, or responses to
such events.
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incur additional debt, or debt related to federal projects in
excess of specified limits;
pay cash dividends and make distributions;
make certain investments and acquisitions;
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guarantee the indebtedness of others or our subsidiaries;
redeem or repurchase capital stock;
create liens;
enter into transactions with affiliates;
engage in new lines of business;
sell, lease or transfer certain parts of our business or
property;
enter into sale-leaseback arrangements; and
merge or consolidate.
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fluctuations in our quarterly financial results or the quarterly
financial results of companies perceived to be similar to us;
changes in estimates of our future financial results or
recommendations by securities analysts;
investors general perception of us; and
changes in general economic, industry and market conditions.
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provide for a dual class capital structure that allows our
founder, principal stockholder, president and chief executive
officer, Mr. Sakellaris, to control the outcome of the
voting on virtually all matters requiring stockholder approval,
including the election of directors and significant corporate
transactions such as an acquisition of our company;
authorize the issuance of blank check preferred
stock that could be issued by our board of directors to thwart a
takeover attempt;
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establish a classified board of directors, as a result of which
only approximately one-third of our directors are presented to a
stockholder vote for re-election at any annual meeting of
stockholders;
provide that directors may be removed from office only for cause
and only upon a supermajority stockholder vote;
provide that vacancies on our board of directors, including
newly created directorships, may be filled only by a majority
vote of directors then in office;
do not permit stockholders to call special meetings of
stockholders;
prohibit stockholder action by written consent, requiring all
actions to be taken at a meeting of the stockholders;
establish advance notice requirements for nominations for
election to our board of directors or for proposing matters that
can be acted upon by stockholders at stockholder
meetings; and
require a supermajority stockholder vote to effect certain
amendments to our restated certificate of incorporation and
by-laws.
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our expectations as to the future growth of our business;
the expected future growth of the market for energy efficiency
and renewable energy solutions;
our backlog, awarded projects and recurring revenue;
the expected energy and cost savings of our projects; and
the expected energy production capacity of our renewable energy
plants.
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to repay the outstanding balance under our $50 million
revolving senior secured credit facility ($24.9 million
outstanding as of March 31, 2010), which as of
March 31, 2010 bears interest at a weighted-average rate of
2.49% per annum and matures on June 30, 2011;
approximately $3.0 million to repay in full, the entire
principal amount of and accrued but unpaid interest on the
subordinated note held by Mr. Sakellaris, which currently
bears interest at 10.0% per annum and is payable on
demand; and
the balance for working capital and other general corporate
purposes, which may include opening additional offices in the
United States and abroad, expanding sales and marketing
activities, funding the development and construction of our
small-scale renewable energy projects and other capital
expenditures.
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on an actual basis;
on a pro forma basis to reflect (1) a two-for-one split of
our common stock, (2) the reclassification of all
outstanding shares of our common stock as Class A common
stock, (3) the conversion of all shares of our convertible
preferred stock, other than those held by Mr. Sakellaris,
into shares of our Class A common stock, (4) the
conversion of all other outstanding shares of our convertible
preferred stock into shares of our Class B common stock and
(5) the issuance
of shares
of our Class A common stock upon the exercise of vested
stock options by the selling stockholders in connection with
this offering at a weighted-average exercise price of
$ ; and
on a pro forma as adjusted basis to reflect, in addition, the
sale
of shares
of our Class A common stock offered by us at an assumed
initial public offering price of $
per share, the midpoint of the estimated price range shown on
the cover page of this prospectus and after deducting the
estimated underwriting discount and estimated offering expenses
payable by us, including the sale of shares of our Class A
common stock by the selling stockholders.
March 31, 2010
Pro Forma
Actual
Pro Forma
as Adjusted
(Unaudited)
(In thousands, except share and per share amounts)
$
24,361
$
24,361
$
140,115
140,115
140,115
2,999
2,999
2,999
0
0
2
2
0
10,905
10,905
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March 31, 2010
Pro Forma
Actual
Pro Forma
as Adjusted
(Unaudited)
(In thousands, except share and per share amounts)
99,161
99,161
99,161
3,506
3,506
3,506
(8,414
)
(8,414
)
(8,414
)
105,160
105,160
$
248,274
$
248,274
$
405,286 shares of our Class A common stock issuable
upon the exercise of a warrant outstanding and exercisable as of
March 31, 2010 at an exercise price of $0.005 per share,
which will remain outstanding after this offering if not
exercised prior to this offering;
shares
of our Class A common stock issuable upon the exercise of
stock options outstanding as of March 31, 2010 at a
weighted-average exercise price of $2.805 per share; and
10,000,000 shares of our Class A common stock that
will be available for future issuance under our 2010 stock plan,
which will become effective upon the closing of this offering.
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$
$
2.55
$
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Shares Purchased
Total Consideration
Average Price
Number
%
Amount
%
Per Share
32,542,284
%
$
2,493,918
%
$
0.08
$
100
%
$
100
%
405,286 shares of Class A common stock issuable upon
the exercise of a warrant outstanding and exercisable as of
March 31, 2010 at an exercise price of $0.005 per share,
which will remain outstanding after this offering if not
exercised prior to this offering;
shares
of Class A common stock issuable upon the exercise of stock
options outstanding as of March 31, 2010 at a
weighted-average exercise price of $2.805 per share; and
10,000,000 shares of our Class A common stock that
will be available for future issuance under our 2010 stock plan,
which will become effective upon the closing of this offering.
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Three Months Ended
Year Ended December 31,
March 31,
2005
2006
2007
2008
2009
2009
2010
(Unaudited)
(In thousands, except share and per share data)
$
248,759
$
264,477
$
345,936
$
325,032
$
340,635
$
57,228
$
74,888
10,970
13,445
32,541
70,822
87,881
16,159
30,741
259,729
277,922
378,477
395,854
428,517
73,387
105,629
202,573
215,320
285,966
259,019
282,345
46,770
62,524
9,503
9,500
26,072
59,551
66,472
12,924
24,705
212,076
224,820
312,038
318,570
348,817
59,694
87,230
47,653
53,102
66,439
77,284
79,700
13,693
18,399
32,637
37,307
47,042
52,608
54,406
13,025
15,836
15,016
15,795
19,397
24,676
25,294
667
2,563
(1,577
)
(1,842
)
(3,138
)
(5,188
)
1,563
(24
)
(856
)
13,439
13,953
16,259
19,488
26,857
643
1,707
(1,223
)
(4,337
)
(5,714
)
(1,215
)
(6,950
)
(225
)
(429
)
$
12,216
$
9,615
$
10,545
$
18,273
$
19,907
418
1,278
$
1.07
$
0.83
$
0.95
$
1.71
$
1.99
$
0.04
$
0.10
$
0.33
$
0.26
$
0.28
$
0.54
$
0.61
$
0.01
$
0.03
11,388,793
11,575,789
11,121,022
10,678,110
9,991,912
9,621,351
13,282,284
36,786,666
37,667,359
37,552,953
33,990,547
32,705,617
32,957,183
36,587,847
$
0.68
$
0.01
$
0.04
29,251,912
28,881,351
32,542,284
$
18,254
$
19,928
$
27,974
$
29,045
$
35,097
$
2,391
$
5,145
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As of December 31,
As of March 31,
2005
2006
2007
2008
2009
2010
(Unaudited)
(In thousands)
$
11,790
$
45,454
$
40,892
$
18,149
$
47,928
$
24,361
89,425
140,335
154,036
131,432
171,772
152,315
170,050
256,870
262,224
292,027
375,545
382,198
53,730
91,304
108,011
90,967
132,330
110,227
47,771
74,529
39,316
90,980
102,807
128,374
2,999
2,999
2,999
2,999
2,999
2,999
46,888
56,963
70,776
74,086
102,770
105,160
(1)
Pro forma net income per share and pro forma weighted-average
shares outstanding give effect to (i) a
two-for-one
split of our common stock, (ii) the reclassification of all
outstanding shares of our common stock as Class A common
stock, (iii) the conversion of all shares of our
convertible preferred stock, other than those held by
Mr. Sakellaris, into shares of our Class A common
stock and (iv) the conversion of all other outstanding
shares of our convertible preferred stock into shares of our
Class B common stock.
(2)
We define adjusted EBITDA as operating income before
depreciation and amortization expense, share-based compensation
expense and a non-recurring non-cash recovery of a contingency
in 2008. Adjusted EBITDA is a non-GAAP financial measure and
should not be considered as an alternative to operating income
or any other measure of financial performance calculated and
presented in accordance with GAAP.
adjusted EBITDA and similar non-GAAP measures are widely used by
investors to measure a companys operating performance
without regard to items that can vary substantially from company
to company depending upon financing and accounting methods, book
values of assets, capital structures and the methods by which
assets were acquired;
securities analysts often use adjusted EBITDA and similar
non-GAAP measures as supplemental measures to evaluate the
overall operating performance of companies; and
by comparing our adjusted EBITDA in different historical
periods, our investors can evaluate our operating results
without the additional variations of depreciation and
amortization expense, stock-based compensation expense and the
non-recurring non-cash recovery of a contingency in 2008.
as a measure of operating performance, because it does not
include the impact of items that we do not consider indicative
of our core operating performance;
for planning purposes, including the preparation of our annual
operating budget;
to allocate resources to enhance the financial performance of
our business;
to evaluate the effectiveness of our business
strategies; and
in communications with our board of directors and investors
concerning our financial performance.
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adjusted EBITDA does not reflect our cash expenditures or future
requirements for capital expenditures or other contractual
commitments;
adjusted EBITDA does not reflect changes in, or cash
requirements for, our working capital needs;
adjusted EBITDA does not reflect stock-based compensation
expense;
adjusted EBITDA does not reflect cash requirements for income
taxes;
adjusted EBITDA does not reflect net interest income (expense);
although depreciation and amortization are non-cash charges, the
assets being depreciated or amortized will often have to be
replaced in the future, and adjusted EBITDA does not reflect any
cash requirements for these replacements; and
other companies in our industry may calculate adjusted EBITDA
differently than we do, limiting its usefulness as a comparative
measure.
Year Ended December 31,
Three Months Ended March 31,
2005
2006
2007
2008
2009
2009
2010
(Unaudited)
(In thousands)
$
15,016
$
15,795
$
19,397
$
24,676
$
25,294
$
667
$
2,563
3,238
3,538
5,898
7,278
6,634
1,107
2,143
594
2,679
2,941
3,169
617
439
(5,850
)
$
18,254
$
19,927
$
27,974
$
29,045
$
35,097
$
2,391
$
5,145
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FINANCIAL CONDITION AND RESULTS OF OPERATIONS
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installation or construction of energy efficiency measures,
facility upgrades
and/or
a
renewable energy plant to be owned by the customer;
sale and delivery, under long-term agreements, of electricity,
gas, heat, chilled water or other output of a renewable energy
or central plant that we own and operate;
sale and delivery of PV equipment and other renewable energy
products for which we are a distributor; and
O&M services provided under long-term O&M agreements,
as well as consulting services.
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Year Ended December 31,
2007
2008
2009
$
$
$
4.26-4.84%
2.90-5.07%
2.00-2.94%
32-43%
48-54%
57-59%
6.5 years
6.5 years
6.5 years
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our results of operations and financial condition during the
most recently completed period;
forecasts of our financial results and market conditions
affecting our business; and
developments in our business
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Number of Shares of
Common Stock
Subject to Option
Exercise Price
Grants
per Share
500,000
$
3.41
982,000
4.22
248,000
6.055
842,000
6.055
876,000
13.045
the liquidation preferences of our preferred stock, including
any financing and repurchase activities that may have occurred
in the relevant period;
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the illiquid nature of our common stock, including the
opportunity and timing for any expected liquidity events;
our size and historical operating and financial performance,
including our recent operating and financial projections as of
each grant date;
our existing backlog;
important events in the development of our business; and
the market performance of a peer group comprised of selected
publicly-traded companies we identified as being guidelines for
us.
continued challenges during 2008 in the U.S. economy and
decreased valuations of comparable companies; and
concerns about liquidity during the upcoming fiscal quarters.
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we were notified in March 2009 that the U.S. Department of
Energy had lifted restrictions on its ability to enter into
ESPCs, which permitted us to proceed with the execution of
larger federal contracts;
in May 2009, we executed a contract for our large
U.S. Department of Energy Savannah River Site renewable
energy project; however, we had not yet secured the financing
necessary to complete this project; and
improvement in general economic and market conditions in the
first half of 2009.
our backlog under signed customer contracts increased from July
2009 to September 2009;
in August 2009, we secured the financing necessary to complete
our large U.S. Department of Energy Savannah River Site
renewable energy project, the contract for which had been
executed in May 2009 but was subject to our securing that
financing. Securing this financing represented a significant
milestone for us, particularly in light of its size and the
significant disruptions in the credit and capital markets in the
preceding several years; and
improvement in general economic and market conditions in the
third quarter of 2009.
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a 30% increase in our next 12 months projected adjusted
EBITDA between September 25, 2009 and the two relevant
dates in 2010, due to growth in our backlog and several,
previously-contracted, large efficiency and renewable energy
projects entering major construction phases;
our expectation that we would conduct an initial public offering
within the next three months; and
our preliminary estimates of our valuation for purposes of this
offering.
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2009
2010
(In thousands)
$
682
$
(134
)
(641
)
(652
)
(65
)
(70
)
$
(24
)
$
(856
)
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2007
2008
2009
(In thousands)
$
$
$
2,494
(1,366
)
(2,832
)
2,264
(1,449
)
(2,118
)
(2,993
)
(323
)
(238
)
(202
)
$
(3,138
)
$
(5,188
)
$
1,563
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Payments due by Period
Less than
One to
Three to
More than
Total
One Year
Three Years
Five Years
Five Years
(In thousands)
$
24,932
$
$
24,932
$
$
57,925
11,800
9,711
6,894
29,520
57,258
3,419
53,839
23,101
3,851
6,405
4,405
8,440
7,404
1,482
2,643
1,611
1,668
$
170,620
$
20,552
$
97,530
$
12,910
$
39,628
(1)
For our revolving senior secured credit facility, the table
above assumes that the variable interest rate in effect as of
March 31, 2010 remains constant for the term of the
facility.
(2)
Federal ESPC receivable financing arrangements relate to the
installation and construction of projects for certain customers,
typically federal governmental entities, where we assign to the
lenders our right to customer receivables. We are relieved of
the financing liability when the project is completed and
accepted by the customer.
(3)
The table does not include, for our federal ESPC receivable
financing arrangements, the difference between the aggregate
amount of the long-term customer receivables sold by us to the
lender and the amount received by us from the lender for such
sale.
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Independent Energy Services Companies
Energy
efficiency companies not associated with an equipment
manufacturer, utility or fuel company. Most of these companies
are small and focus either on a specific geography or specific
customer base.
Utility-Affiliated Energy Services Companies
Companies owned by regulated North American utilities, many of
which were traditionally focused on the service territories of
their affiliated utilities. Many of these companies have since
expanded their geographical markets. Examples include
Constellation Energy Projects and Services and ConEdison
Solutions.
Equipment Manufacturers
Companies owned by
building equipment or controls manufacturers. Many of these
companies have a national presence through an extensive network
of branch offices. Examples include Honeywell, Johnson Controls
and Siemens.
Rising and Volatile Energy Prices.
Over the past
decade, energy-linked commodity prices, including oil, gas, coal
and electricity, have all increased and exhibited significant
volatility. From 1999 to 2009, average U.S. retail electricity
prices have increased by more than 50%. Over an
18-month
period from January 2007 to July 2008, oil prices increased by
almost 200%. According to the U.S. Energy Information
Administration, or EIA, oil prices are expected to increase by
approximately 115% from 2009 to 2035 and electricity prices are
expected to
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increase by approximately six percent annually over the same
time period. We believe that rising energy prices combined with
significant volatility have resulted in growing demand for
energy efficiency measures that reduce energy usage and for
sources of renewable energy that can stabilize energy costs.
Potential of Energy Efficiency Measures to Significantly
Reduce Energy Consumption
. According to the EIA,
U.S. energy demand is expected to increase nearly twofold
from 2010 to 2035 in the absence of any improvements in energy
efficiency, but the implementation of energy efficiency measures
can significantly reduce energy consumption, as shown below:
Aging and Inefficient Facility Infrastructure.
Many
organizations continue to operate with an energy infrastructure
that is significantly less efficient and cost-effective than
that now available through more advanced technologies applied to
lighting, heating, cooling and other building systems. As these
organizations explore alternatives for renewing their aging
facilities, they often identify multiple areas within their
facilities that could benefit from the implementation of energy
efficiency measures, including the possible use of renewable
sources of energy. According to a July 2009 report by
McKinsey & Company, increased energy efficiency
through facility renewal of government buildings, community
infrastructure and existing homes in the United States
represents a $76 billion market opportunity through 2020,
and could result in energy savings of $174 billion over the
same period.
Increased Focus on Cost Reduction.
The current
economic environment has led many organizations to search for
opportunities to reduce their operating costs. There has been a
growing awareness that reduced energy consumption presents an
opportunity for significant long-term savings in operating costs
and that the installation of energy efficiency measures can be a
cost-effective way to achieve such reductions.
Movement Toward Industry Consolidation.
As energy
efficiency solutions continue to increase in technological
complexity and customers look for service providers that can
offer broad geographic and product coverage, we believe smaller
niche energy efficiency companies will continue to look for
opportunities to combine with larger companies that can better
serve their customers needs. In addition, we believe
utilities will continue to consider divesting their energy
management services divisions, in part because of the potential
conflicts between the
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interests of an energy provider and the interests of a provider
of energy efficiency services. Increased market presence and
size of energy efficiency companies should, in turn, create
greater customer awareness of the benefits of energy efficiency
measures.
Increased Use of Third-Party Financing.
Many
organizations desire to use their existing sources of capital
for core investments or do not have the internal capacity to
finance improvements to their energy infrastructure. These
organizations often require innovative structures to facilitate
the financing of energy efficiency and renewable energy
projects. Customers seeking to upgrade or renew their energy
systems are increasingly seeking to enter into ESPCs or other
creative arrangements that facilitate third-party financing for
their projects.
Increasing Legislative Support and Initiatives.
In
the United States and Canada, federal, state, provincial and
local governments have enacted and are considering legislation
and regulations aimed at increasing energy efficiency, reducing
greenhouse gas emissions and encouraging the expansion of
renewable energy generation. Examples of such legislation and
regulation are:
Federal.
In 2007, the United States enacted the
Energy Independence and Security Act which mandates that federal
buildings reduce energy consumption by 30% by 2015 compared to
their 2003 baseline and contains multiple provisions promoting
long-term ESPCs. The U.S. Department of Energy also has a
number of research, development, grant and financing
programs most notably the DOE Loan Guarantee
Program to encourage energy efficiency and renewable
energy. Additionally, the United States has adopted federal
incentives for renewable energy, including the production tax
credit, investment tax credit and accelerated depreciation.
States.
At the U.S. state level, significant
measures to support energy efficiency and renewable energy have
been implemented, including as of December 31, 2009, the
following:
20 states have adopted energy efficiency resource
standards, or EERS, and long-term energy savings targets for
utilities.
29 U.S. states and the District of Columbia have renewable
portfolio standards, or RPS, in place, and six states have
renewable portfolio goals.
14 states have passed legislation enabling a new financing
mechanism known as Property Assessed Clean Energy (PACE) Bonds.
The bonds provide funds that can be used by commercial and
residential property owners to finance efficiency measures and
small-scale renewable energy systems.
The U.S. Senate and House of Representatives have passed
various forms of EERS and RPS legislation and, if enacted, all
50 states would have additional incentives to support
energy efficiency and renewable energy.
Canada.
The federal, provincial and local
governments have also provided incentives for the development of
energy efficiency and renewable energy projects, and facility
renewal. In 2010, the federal government announced its 2020
greenhouse gas emissions reduction target
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under the Copenhagen Accord, a 17% reduction from 2005 levels,
subject to adjustment to remain consistent with the
U.S. target. In 2009, Ontario and Quebec both passed
enabling legislation to establish
cap-and-trade
programs, which aim at reducing emissions by 15% below 1990
levels by 2020 and 20% by 2020, respectively. Ontario also
passed the Green Energy and Green Economy Act in May 2009 to
expand renewable energy production, encourage energy
conservation and create green jobs. The act established a
feed-in tariff program with pricing incentives to encourage the
development of renewable energy. Similarly, British Columbia has
also passed enabling legislation to establish a
cap-and-trade
program and a greenhouse gas reduction target of at least 33%
below 2007 levels by 2020. Under the federal Economic Action
Plan, the federal government has committed to multi-year
expenditures of $4 billion for new infrastructure funding,
and has established program funds of $1 billion for
sustainable energy and other green projects and $2 billion
to repair, retrofit and expand facilities at post-secondary
institutions.
Economic Stimuli.
Governments worldwide have
allocated significant portions of economic stimuli to clean
energy. The American Recovery and Reinvestment Act of 2009
allocated $67 billion to promote clean energy, energy
efficiency and advanced vehicles. Additionally, the Emergency
Economic Stabilization Act instituted a grant program that
provides cash in lieu of the investment tax credit for eligible
renewable energy generation sources which commence construction
in 2010.
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One-Stop, Comprehensive Service Provider.
We offer
our customers expertise in addressing almost all aspects of
purchasing and using energy within a facility. Our experienced
project development and engineering staff provide us with the
capability and flexibility to determine the combination of
energy efficiency measures that is best suited to achieve the
customers energy efficiency and environmental goals. Our
solutions range from smaller projects, such as a lighting system
retrofit, to larger and more complex projects comprising new
heating, cooling and electrical infrastructure, solar panels and
a small-scale renewable energy plant serving multiple buildings.
Independence.
We are an independent company with no
affiliation to any equipment manufacturer, utility or fuel
company. Unlike affiliated service companies, we have the
freedom and flexibility to be objective in selecting particular
products and technologies available from different
manufacturers. By bundling components from multiple sources, we
can optimize our solution for customers particular needs.
In addition, we can leverage the high volume of equipment
purchases that originate across our North American operations to
obtain attractive pricing terms that enable us to provide
cost-effective solutions to our customers.
Strong Customer Relationships.
We have served over
2,000 customers since our inception, including over 1,000
customers in 2009. The sales, design and construction process
for energy efficiency and renewable energy projects typically
takes from 12 to 36 months, during which time our engineers
work closely with the customer to ensure a successful
installation. For certain projects, we enter into a multi-year
O&M contract under which we have personnel
on-site
monitoring and controlling the customers energy systems.
Our services include helping customers procure energy and
managing their utility bill payment processes. All of these
design, engineering and support activities foster a close
relationship with our customers, which positions us to identify
their future needs and provide additional services to them. For
example, for a single federal facility, we have completed three
separate projects over the period from 2005 to 2009.
Creative Solutions.
We seek to provide innovative
solutions to meet our customers energy efficiency,
facility renewal and environmental goals. Our engineering staff
has expertise in a broad range of technologies and energy
savings strategies encompassing different types of electrical,
heating, cooling, lighting, water, renewable energy, and other
facility infrastructure systems. We are constantly seeking to
identify new services, products and technologies that can be
incorporated into our energy efficiency and renewable energy
solutions to enhance their performance. We apply this expertise
to design and engineer innovative solutions customized to meet
the specific needs of each client. We also have an internal
structured finance team that is skilled and experienced in
arranging third-party financing for our customers projects.
Strong National and Local Presence.
We have a
nationwide presence in both the United States and Canada and
serve certain of our customers in European locations. We
maintain a centralized staff of engineering, financial and legal
personnel at our headquarters in Massachusetts, who provide
support to our seven regional offices and 46 other field offices
located throughout the United States and Canada. We leverage our
centralized resources and local offices by sharing experiences
and best practices across the offices. We are able to
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maintain an entrepreneurial approach toward our customers by
delegating significant responsibility to our regional offices
and making them accountable for their own operational and
financial performance. We believe that our organizational
structure enables us to be fast, flexible and cost-effective in
responding to our customers needs.
Experienced Management and Operations Team.
Our
executive officers have an aggregate of over 150 years of
experience in the energy efficiency field. Some have worked
together for over 15 years and most have worked together at
Ameresco for over five years. In addition, we have accumulated
significant in-house expertise in our sales, engineering,
financing, legal, construction and operations functions. As of
March 31, 2010, we employed over 200 engineers, whose
experience with respect to fuels, rates, technologies and
geography-specific regulation and economic benefits enables us
to propose and design energy efficiency solutions that take into
account the economic, technological, environmental and
regulatory considerations that we believe underlie the cost
efficiencies and operational success of a project. Many of our
employees were previously employed by utilities, construction
companies, financial institutions, engineering firms,
consultancies and government agencies, which provides them with
specialized experience in solving problems and creating value
for our customers.
Federal and State Qualifications.
The federal
governmental program under which federal agencies and
departments can enter into ESPCs requires that energy service
providers have a track record in the industry and meet other
specified qualifications. Over 20 states require similar
qualifications to do business with state agencies and, in
certain cases, with other governmental agencies in the state. In
2008, we renewed our IDIQ qualification under the
U.S. Department of Energy program for ESPCs, and we are
currently qualified to enter into ESPCs in most states that
require qualification. Our projects accounted for almost half of
the total dollar amount of published task orders issued under
the Department of Energys IDIQ program for ESPCs in fiscal
2009. The scope of our qualifications provides us with the
opportunity to continue to grow our business with federal, state
and other governmental customers and differentiates us from
energy efficiency companies that have not been similarly
qualified.
Integration of Strategic Acquisitions.
We have a
track record of completing over ten acquisitions that have
enabled us to broaden our offerings, expand our geographical
reach and accelerate our growth. We follow a disciplined
approach in evaluating and valuing potential acquisition
candidates and frequently improve their operating performance
significantly following our acquisition. Our acquisition of the
energy services business of Duke Energy in 2002 expanded our
geographical reach into Canada and the southeastern United
States, and enabled us to penetrate the federal government
market for energy efficiency projects. Our acquisition of the
energy services business of Northeast Utilities in 2006 further
grew our capability to provide services for the federal market
and in Europe. Our acquisition of Southwestern Photovoltaics in
2007 significantly expanded our offering of solar energy
products and services. We believe that our ability to offer a
comprehensive set of energy efficiency services across North
America has been, and will continue to be, enhanced by our
expertise in identifying and completing acquisitions that expand
our service offerings, as well as by our ability to integrate
and leverage the skilled engineering, sales and operational
personnel that come to us through these acquisitions.
Pursue Organic Growth.
We plan to grow primarily by
leveraging our core expertise in designing, engineering and
installing energy efficiency solutions to reach additional
customers
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in our target markets. To achieve this goal, we plan to open
additional local offices in the regions we currently serve, as
well as hire additional sales personnel. We also plan to expand
geographically by opening new offices in regions we do not
currently serve in the United States and Canada, as well as in
Europe.
Continue to Maintain Customer Focus.
Our success
will continue to depend in large part on our ability to
understand and meet our customers energy infrastructure
requirements. We will maintain an entrepreneurial approach
toward our customers and remain flexible in designing projects
tailored specifically to meet their needs. We will also continue
to monitor and explore alternative services, products and
technologies that might offer improved system performance and
will seek to design and engineer innovative solutions for our
customers.
Expand Scope of Product and Service Offerings.
We
believe the breadth of our services differentiates us from our
competitors. We plan to continue to expand our offerings by
including new types of energy efficiency services, products and
improvements to existing products based on technological
advances in energy savings strategies, equipment and materials.
Examples of services that we have added to complement our energy
efficiency services include asset planning, new construction,
waste reduction, water conservation, demand response, management
of utility and non-utility invoices and web-based software for
tracking of a customers carbon footprint, electrical
distribution upgrades, meters with communication capabilities,
transformer replacements and power factor correction. Through
our acquisition of Southwestern Photovoltaics in 2007, we
significantly expanded our offering of solar energy products,
which enabled us both to integrate solar solutions into broad
energy efficiency projects and to target projects based
specifically on solar energy. We plan to seek similar
opportunities to broaden our offerings of complementary products
and services.
Meet Market Demand for Cost-Effective,
Environmentally-Friendly Solutions.
We believe that
addressing climate change will remain a global theme for
governmental, institutional and commercial organizations.
Through our energy efficiency measures and small-scale renewable
energy plants and products, we enable customers to conserve
energy and reduce emissions of carbon dioxide and other
pollutants. We plan to continue to focus on providing
sustainable energy solutions that will address the growing
demand for products and services that create environmental
benefits for customers.
Increase Recurring Revenue.
We intend to continue to
seek opportunities to increase our sources of recurring revenue.
For many of our energy efficiency projects, we enter into
multi-year O&M contracts, and we plan to continue to grow
both the number and scope of such contracts. We also obtain
recurring revenue from sales of electricity, thermal energy and
gas generated by the small-scale renewable energy and central
plants that we construct and own, and we plan to continue to
seek opportunities to construct such plants based on LFG,
biomass, biogas, solar, wind, geothermal and other sources of
energy.
Grow through Select Strategic Acquisitions.
We have
been able to accelerate the expansion of our service offerings,
customer base and geographic reach through targeted
acquisitions. We will continue to follow a disciplined approach
in evaluating and valuing potential acquisition candidates. We
plan to pursue complementary acquisitions that will enable us to
both expand geographically in North America and abroad, and
broaden our product and service offerings.
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Boilers and Furnaces.
We replace low efficiency
boilers and furnaces with higher efficiency equipment. In
addition, to reduce emissions, we can install emissions controls
or either modify existing equipment or install new equipment to
use cleaner fuels. We can also install biomass boilers for
customers that have access to organic materials, such as waste
from agricultural or food processing activities.
Chillers.
Small buildings are cooled by air
conditioners and large buildings are cooled by chillers. We
replace older low efficiency chillers with new higher efficiency
chillers capable of delivering the same cooling with less energy
input, often eliminating the use of atmospheric ozone depleting
chlorofluorocarbon-based refrigerants in the process. We
retrofit existing chillers with new, more sophisticated,
automated controls, high efficiency motors and variable speed
drives to improve efficiency in cases where complete equipment
replacement is not necessary. If the customer has an
on-site
source of recoverable waste heat, we may replace an electric
chiller with an absorption chiller that can utilize the waste
heat to directly produce cooling with reduced need to purchase
energy for chiller operation.
Central Plants.
Customers that have multiple
buildings in close proximity on a site may benefit from
installation of a single central plant to provide power, heat or
cooling to these buildings. The central plant typically contains
multiple large boilers, chillers or combined heat and power, or
CHP, systems to handle the combined requirements of all site
buildings. Pipes are installed to distribute steam, hot water or
chilled water from the central plant to the individual
buildings. Any centrally generated power is delivered via
interconnection with the existing site-wide electrical
distribution system. A central plant allows the multiple smaller
and less energy efficient individual building heating and
cooling plants to be decommissioned. In addition to improved
energy efficiency, centralization can create other scale
benefits in operating labor, equipment maintenance and operating
reliability. Where a customer already has a central plant, we
can improve the efficiency of the plant by implementing improved
equipment controls and by retrofit or replacement of existing
equipment for enhanced energy efficiency.
Cogeneration or Combined Heat and Power.
CHP systems
produce both heat and power simultaneously at a customer site,
displacing power purchases from the utility grid and
conventional sources of heat generation at the customer
facility. When utilities produce power at large central station
plants, the heat produced as a byproduct of the power generation
process is
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typically wasted via disposal to the atmosphere or a nearby
waterway. This wasted heat is generally a majority of the energy
value of the input fuel to the power generation process. With on
site power generation, the waste heat can be recovered from the
power generation process and used as a substitute for heat that
would otherwise be generated using site purchased fuels. Through
use of heat driven chillers, also known as absorption chillers,
this recovered heat can also be employed to provide building
cooling. For facilities with large and relatively constant needs
for power and heat or cooling, the cost of fuel for the
cogeneration system operation can often be less than the cost of
the purchased utility power and conventional heating fuel that
is displaced. Installing a CHP that uses a lower-cost fossil
fuel or a renewable fuel source can create further economic
benefits.
Energy Management Systems.
Automating building
system adjustments for optimum performance under changing
building operating conditions is one of the most cost effective
energy saving strategies. We install energy management system,
or EMS, projects consisting of small computers, wiring or
wireless communication systems, and sensors and controllers
located at energy-using equipment and at locations that need
monitoring for such conditions as temperature and flow.
Equipment that may be controlled through an energy management
system includes lights, boilers, chillers, and fans and pumps
that move energy throughout a building. We program the computers
to automatically turn the equipment on and off or to adjust
equipment operating setpoints for lower energy use in response
to monitored conditions. For example, when the outdoor air is
cool and the building requires cooling, instead of turning on
the chillers to cool the building, the EMS may turn on building
fans to draw the cool outside air into the building and
significantly reduce the energy use under that condition. Both
we and the customer can access the EMS information through a
personal computer and reprogram the energy-saving strategies
through secure, hard-wired or web-based communications systems.
Lighting.
We replace lighting system components with
more efficient components in both indoor and outdoor lighting
systems. We may alternatively redesign and install a new
lighting system. Typical measures include replacing incandescent
lighting with compact fluorescent lighting, metal halide
lighting with fluorescent lighting and low efficiency
fluorescent lighting with higher efficiency fluorescent
lighting. Also, lighting controls may be installed to turn off
lights when the lit space is unoccupied or if natural light
through windows or skylights is adequate.
Retro-commissioning.
Over time, the performance of
building systems can degrade due to a variety of factors, such
as a failure of dampers, actuators and switches to operate in
accordance with the building control system or modifications to
equipment without taking into account their interaction with
other building systems. Cumulatively, these factors can lead to
significant increased energy consumption and reduce the quality
of the indoor environment. Through a retro-commissioning
process, we systematically repair and restore building equipment
and systems so that they function together in an optimal manner
to enhance overall building performance.
Motors.
The energy cost over the life of a motor is
often many times the original cost of the motor. We replace
older low efficiency motors with new higher efficiency motors.
Often, motors are over-sized for the application and additional
savings can be attained by replacing an existing motor with an
appropriately sized motor. We may also replace the sheave and
belt drives associated with motors so that the motor output is
transmitted to the driven device with reduced energy loss.
Variable Speed Drives or Variable Frequency
Drives.
Motors driving building equipment such as fans,
pumps, chillers and elevators are typically selected and
operated at the size and speed necessary to deliver services
under worst case or peak load conditions. This causes
inefficiencies when operating at less than peak load conditions.
We install electronic devices called variable speed drives, or
VSDs, that automatically adjust the characteristics of the power
supplied to a motor so that the motor is operated at only the
speed necessary to meet the load conditions at any time.
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Electric Load Shaping.
Many customers pay an energy
charge per kWh of electricity used and a demand charge based on
their highest or peak use of electricity in a 15 minute period
during the month. By installing an EMS or an
on-site
generator and controlling the system using our monitoring and
analysis of the customers electricity use, we can reduce
the customers peak electricity use and thus its demand
charge. We may also shift energy use from expensive on-peak
(weekday) periods to less expensive off-peak periods (nights and
weekends). For example, by adding chilled water storage tanks to
a facility, cooling systems can be operated at night to generate
stored chilled water and the chilled water can then be withdrawn
to cool the building during the next day without operating the
cooling equipment during daytime peak periods.
Utility Rate Reductions.
A customers cost of
gas and electricity is a function of how much energy is used and
what rate the customer is charged for the energy. We analyze a
customers energy use and the various utility rates that
the customer is eligible to select. By switching a customer to
the optimal rate, the customer can typically save energy costs.
We may be able to switch a customer into a better rate by
installing an EMS or an
on-site
generator.
Geothermal Heat Pumps.
Heat pumps are designed to
efficiently provide both heat and cooling to a facility. The
geothermal heat pump system works to store and recapture energy
from the ground on a seasonally advantageous basis. Beneath the
surface, the earth is warmer than the air in winter and cooler
than the air in summer. Using the heat pump, heat removed from a
building to cool it during the summer can be stored in the
ground. This stored heat can then be withdrawn by the heat pump
in the winter to provide necessary building heating. We install
piping loops in the ground and heat pumps in buildings. Water
piped underground captures the stored geothermal energy and heat
pumps deliver the energy efficiently to the building interior.
Window Replacement.
Existing windows are often the
most inefficient component of a building envelope. We may
replace existing inefficient windows with new windows with
features that more effectively control the sources of window
heat transfer.
Roofs.
An existing roof with inadequate insulation
levels or with water damage compromising the effectiveness of
insulation is a source of unnecessary energy waste. We replace
existing roofs with new roofs with higher insulation levels to
reduce heat losses in winter and heat gains in summer. We may
employ membrane roof technology for better protection of the
insulation against degradation.
Insulation.
Insulating materials reduce unwanted
transfer of heat that can increase energy usage. We apply
additional insulation to building shell components, such as
walls, ceilings, floors and foundations, to reduce heat loss in
winter and heat gain in summer. We may add to or fully replace
existing insulation on equipment such as piping, storage tanks
and heat exchangers to reduce energy losses and the equipment
inefficiency that results from these losses.
Asset Planning.
Asset planning tools enable
organizations to identify and prioritize current and future
facility renewal requirements and associated capital-investment
needs. We have developed software that helps organizations
measure the condition of their facilities, the costs necessary
to improve the facilities and make them more energy efficient
and the funding alternatives for any such improvements. Our
asset planning tools enable customers to develop facility
renewal plans that will effectively leverage their available
sources of capital and meet their future needs.
Demand Response and Demand-Side Management.
Electric
utilities and regional or independent system operators, or ISOs,
are responsible for ensuring that power is available at all
times throughout a regions electrical transmission and
distribution system. It is expensive to provide power during
peak times such as a hot summer afternoon when customers are
turning on their air conditioners and chillers. Utilities and
ISOs seek to reduce the peak load demand and are willing to pay
customers to reduce their power usage at these times, either
during pre-arranged hours or in response to a call to reduce
power. We help utilities and ISOs to attract customers to their
programs and coordinate the customers participation in the
programs. Typically we enter
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into a contract with a utility or ISO, market the program to
customers, and share contract payments with the customers.
Utility Data Management.
We have developed
proprietary software and systems that allow us to efficiently
collect, optically scan, enter into a data base and perform
analysis on information from customer utility bills. Using these
systems, we can deliver a variety of services, including
centralized and automated collection, processing and preparation
for payment of utility billing information; identification of
errors in utility metering or billings; aggregation of multiple
location billings from a single utility to facilitate payment;
modeling of available utility tariff rates against a database of
historical energy use to identify the most economical rate; and
analysis of utility use data in multiple ways to identify and
report usage and cost trends, variances and performance relative
to benchmarks.
Carbon Emissions Tracking.
Our carbon management
program provides greenhouse gas, or GHG, emissions accounting
and reporting services to our customers. With an international,
multi-tiered approach, we can support a wide variety of GHG
accounting and reporting standards, including utility-based GHG
and full ISO 14064 compliance reporting. This service helps
customers, for example, to develop corporate social
responsibility reports and prepare for an audit of their GHG
emissions.
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63
Chairman of the Board of Directors, President and Chief
Executive Officer
50
Executive Vice President, Business Development and Director
41
Senior Vice President, Renewable Energy
51
Executive Vice President, General Counsel and Secretary and
Director
51
Senior Vice President, Corporate Government Relations
53
Executive Vice President, Engineering and Operations
50
Executive Vice President and General Manager, Federal Operations
51
President, Ameresco Canada
43
Executive Vice President and General Manager, Central Region
54
Vice President and Chief Financial Officer
76
Director(3)
63
Director(2)(3)
53
Director(1), (2)
84
Director(1), (3)
62
Director(1), (2)
(1)
Member of audit committee.
(2)
Member of compensation committee.
(3)
Member of nominating and corporate governance committee.
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the class I directors are Messrs. Anderson, Bulger and
Nichols, and their term expires at the annual meeting of
stockholders to be held in 2011;
the class II directors are Messrs. Corrsin, Sakellaris
and Sutton, and their term expires at the annual meeting of
stockholders to be held in 2012; and
the class III directors are Messrs. Jesanis and Foy,
and their term expires at the annual meeting of stockholders to
be held in 2013.
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is an executive officer of another company which is indebted to
us, or to which we are indebted, unless the total amount of
either companys indebtedness to the other is more than one
percent of the total consolidated assets of the company he or
she serves as an executive officer; or
serves as an officer, director or trustee of a tax exempt
organization, unless our discretionary contributions to such
organization are more than the greater of $1 million or two
percent of that organizations consolidated gross revenue.
appointing, approving the compensation of, and assessing the
independence of our registered public accounting firm;
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overseeing the work of our registered public accounting firm,
including through the receipt and consideration of reports from
such firm;
reviewing and discussing with management and our registered
public accounting firm our annual and quarterly financial
statements and related disclosures;
monitoring our internal control over financial reporting,
disclosure controls and procedures and code of business conduct
and ethics;
overseeing our internal audit function;
overseeing our risk assessment and risk management policies;
establishing policies regarding hiring employees from our
registered public accounting firm and procedures for the receipt
and retention of accounting related complaints and concerns;
meeting independently with our internal auditing staff,
registered public accounting firm and management;
reviewing and approving or ratifying any related person
transactions; and
preparing the audit committee report required by SEC rules to be
included in our proxy statement for our annual meeting of
stockholders.
annually reviewing and approving corporate goals and objectives
relevant to CEO compensation;
determining our CEOs compensation;
reviewing and approving, or making recommendations to our board
of directors with respect to, the compensation of our other
executive officers;
overseeing an evaluation of our senior executives;
overseeing and administering our cash and equity incentive plans;
reviewing and making recommendations to our board of directors
with respect to director compensation;
reviewing and discussing annually with management our
Compensation Discussion and Analysis, which is
included beginning on page 96 of this prospectus; and
preparing the compensation committee report required by SEC
rules to be included in our proxy statement for our annual
meeting of stockholders.
identifying individuals qualified to become members of our board
of directors;
recommending to our board of directors the persons to be
nominated for election as directors and to each of the
committees of our board of directors;
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reviewing and making recommendations to our board of directors
with respect to our board of directors leadership
structure;
reviewing and making recommendations to our board of directors
with respect to management succession planning;
developing and recommending to our board of directors corporate
governance principles; and
overseeing an annual evaluation of our board of directors.
our boards principal responsibility is to oversee the
management of Ameresco;
a majority of the members of our board of directors shall be
independent directors;
the non-management directors meet regularly in executive session;
directors have full and free access to management and employees
of our company, and the right to hire and consult with
independent advisors at our expense;
new directors participate in an orientation program and all
directors are expected to participate in continuing director
education on an ongoing basis; and
at least annually, our board of directors and its committees
will conduct self-evaluations to determine whether they are
functioning effectively.
chairing any meeting of our non-management or independent
directors in executive session;
meeting with any director who is not adequately performing his
or her duties as a member of our board of directors or any
committee;
facilitating communications between other members of our board
of directors and the chairman of our board of directors
and/or
the
chief executive officer; however, each director is free to
communicate directly with the chairman of our board of directors
and with the chief executive officer;
monitoring, with the assistance of our general counsel,
communications from stockholders and other interested parties
and providing copies or summaries to the other directors as he
considers appropriate;
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working with the chairman of our board in the preparation of the
agenda for each board of directors meeting and in determining
the need for special meetings of the board of directors; and
otherwise consulting with the chairman of our board of directors
and/or
the
chief executive officer on matters relating to corporate
governance and the performance of our board of directors.
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reward the achievement of our annual and long-term operating and
strategic goals;
recognize individual contributions;
align the interests of our executives with those of our
stockholders by rewarding performance that meets or exceeds
established goals, with the ultimate objective of increasing
stockholder value; and
retain and build our executive management team.
base salaries;
annual incentive bonuses;
equity incentive awards; and
other employee benefits.
the executive officers skills and experience;
the particular importance of the executive officers
position to us;
the executive officers individual performance;
the executive officers growth in his or her
position; and
base salaries for comparable positions within our company and at
other companies.
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Target
Result
$
470
million
$
429
million
$
37.0
million
$
35.4
million
$
800
million
$
836
million
$
1.70
billion
$
1.73
billion
*
This differs from adjusted EBITDA as reported in the Summary
Consolidated Financial Data table on page 8 and in
Selected Consolidated Financial Data because this
measure excludes certain items that we consider to be
non-recurring in nature. Adjusted EBITDA from ongoing operations
is a non-GAAP financial measure and should not be considered as
an alternative to operating income or any other measure of
financial performance calculated and presented in accordance
with GAAP.
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provide our executive officers with a strong link to our
long-term performance by enhancing their accountability for
long-term decision making;
help balance the short-term orientation of our annual incentive
bonus program;
create an ownership culture by aligning the interests of our
executive officers with the creation of value for our
stockholders; and
further our goal of executive retention.
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Option
All Other
Name and
Salary
Bonus
Awards
Compensation
Total
($)
($)
($)(1)
($)(2)
($)
500,000
2,049,424
26,785
2,576,209
Executive Officer
220,000
55,000
16,816
14,504
306,320
Chief Financial Officer
250,000
76,000
119,658
15,870
461,528
250,000
100,000
15,314
365,314
General Manager, Federal Operations
250,000
50,000
20,834
15,175
336,009
(1)
Value is equal to the aggregate grant date fair value of stock
options computed in accordance with ASC Topic 718. These amounts
do not represent the actual amounts paid to or realized by the
named executive officer with respect to these option grants. The
assumptions used by us with respect to the valuation of option
awards are the same as those set forth in Note 11 to our
consolidated financial statements included elsewhere in this
prospectus.
(2)
Amounts represent the value of perquisites and other personal
benefits, which are further detailed below.
Matched 401(k)
Group Life
Auto
Contribution ($)
Insurance ($)
Insurance ($)
Total ($)
14,700
10,585
1,500
26,785
13,521
983
14,504
14,700
1,170
15,870
14,205
1,109
15,314
14,005
1,170
15,175
(3)
Mr. Sakellaris is also a member of our board of directors,
but does not receive any additional compensation in his capacity
as a director.
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All Other
Grant
Option
Date
Awards:
Exercise
Fair
Number of
or Base
Market
Value of
Securities
Price of
Price on
Stock and
Underlying
Option
Grant
Option
Grant
Approval
Options
Awards
Date
Awards
Date
Date
(#) (1)
($/Sh)
($/Sh)
($)
9/30/2009
9/30/2009
600,000
6.055
11.00
6,600,000
7/22/2009
7/22/2009
100,000
6.055
9.00
900,000
7/22/2009
7/22/2009
50,000
6.055
9.00
450,000
Option Awards (1)
Number of
Number of
Securities
Securities
Underlying
Underlying
Unexercised
Unexercised
Option
Option
Options (#)
Options (#)
Exercise
Expiration
Exercisable
Unexercisable
Price ($)
Date
600,000
6.055
9/30/2019
300,000
0.875
4/25/2012
100,000
1.875
10/16/2013
65,000
35,000
3.25
7/26/2016
200,000
2.75
6/25/2014
75,000
25,000
3.25
1/27/2016
90,000
110,000
4.22
7/25/2017
100,000
6.055
7/22/2019
200,000
2.75
7/20/2014
55,000
45,000
3.41
1/24/2017
50,000
6.055
7/22/2019
(1)
All option awards and stock awards listed in this table were
granted under the 2000 stock plan. Each option listed above
vests or has vested as to 20% of the shares on the first
anniversary of the grant date, and as to an additional five
percent of the shares at the end of each successive three-month
period of employment with us until the fifth anniversary of the
grant date. Under the terms of the individual stock option
agreements we have entered into with our named executive
officers, if, an Acquisition Event (as defined in
the 2000 stock plan) involving us occurs, and prior to the
one-year anniversary of such Acquisition Event the
executives employment is terminated without Cause (as
defined in the 2000 stock plan) or the executive voluntarily
terminates his or her employment for Good Reason (as defined in
the 2000 stock plan) prior to such anniversary, then the number
of shares subject to the option which would have vested and
become exercisable had the last 24 months (or if less than
24 months remained, such lesser period) of scheduled
vesting been accelerated shall vest and become exercisable
immediately prior to such named executive officers
termination date.
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Option Awards
Stock Awards
Number of Shares
Value Realized on
Number of Shares
Value Realized on
Acquired on Exercise
Exercise
Acquired on Vesting
Vesting
(#)
($)
(#)
($) (1)
2,000,000
12,110,000
(1)
There was no public market for our Class A common stock on
the date that these shares of restricted stock vested. The value
realized has been calculated by multiplying the fair value of
our Class A common stock as of the date that such shares
vested, based on the fair value that had been most recently
determined by our board of directors, by the number of vested
shares.
Value of Additional
Severance
Vested Option
Total
Name
Payments
Awards($)(1)
Benefits
(2)
(3)
(4)
250,000
(5)
250,000
(6)
(1)
Valuation of acceleration of these options is determined by
subtracting the exercise price of such option from a price per
share of our Class A common stock of
$ , which is the midpoint of the
estimated price range shown on the cover of this prospectus, and
multiplying the resulting difference by the number of shares
subject to acceleration by the option.
(2)
Upon termination without cause or resignation for good reason
prior to the one-year anniversary of a sale of our company,
options to purchase 270,000 shares of Class A common
stock would vest and become immediately exercisable.
(3)
Upon termination without cause or resignation for good reason
prior to the one-year anniversary of a sale of our company,
options to purchase 35,000 shares of Class A common
stock would vest and become immediately exercisable.
(4)
Upon termination without cause or resignation for good reason
prior to the one-year anniversary of a sale of our company,
options to purchase 150,000 shares of Class A common
stock would vest and become immediately exercisable.
(5)
Upon termination without cause or resignation for good reason
prior to the one-year anniversary of a sale of our company,
options to purchase 100,000 shares of Class A common
stock would vest and become immediately exercisable.
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(6)
Upon termination without cause or resignation for good reason
prior to the one-year anniversary of a sale of our company,
options to purchase 22,500 shares of Class A common
stock would vest and become immediately exercisable.
the number of shares of our Class A common stock covered by
the award and the dates upon which the award will vest;
with respect to options, the exercise price and period of
exercise; and
with respect to restricted stock and other stock-based awards,
the terms and conditions of such awards, including conditions
for repurchase, issue price and repurchase price.
provide that all outstanding awards shall be assumed or
substituted by the successor corporation;
upon written notice to a participant, provide that the
participants unexercised options or awards will terminate
immediately prior to the consummation of such transaction unless
exercised by the participant;
provide that outstanding awards will become exercisable,
realizable or deliverable, or restrictions applicable to an
award will lapse, in whole or in part, prior to or upon the
reorganization event;
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in the event of a reorganization event pursuant to which holders
of our Class A common stock will receive a cash payment for
each share surrendered in the reorganization event, make or
provide for a cash payment to the participants equal to the
excess, if any, of the acquisition price times the number of
shares of our Class A common stock subject to such
outstanding awards (to the extent then exercisable at prices not
in excess of the acquisition price), over the aggregate exercise
price of all such outstanding awards and any applicable tax
withholdings, in exchange for the termination of such
awards; and
provide that, in connection with a liquidation or dissolution,
awards convert into the right to receive liquidation proceeds.
any breach of the directors duty of loyalty to us or our
stockholders;
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any act or omission not in good faith or that involves
intentional misconduct or a knowing violation of law;
any unlawful payments related to dividends or unlawful stock
repurchases, redemptions or other distributions; or
any transaction from which the director derived an improper
personal benefit.
we will indemnify our directors and officers to the fullest
extent permitted by law;
we may indemnify our other employees and other agents to the
same extent that we indemnify our officers and directors, unless
otherwise determined by our board of directors; and
we will advance expenses to our directors and officers in
connection with legal proceedings in connection with a legal
proceeding to the fullest extent permitted by law.
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each of our directors;
each of our named executive officers;
each person, or group of affiliated persons, who is known by us
to beneficially own more than five percent of our Class A and
Class B common stock;
all of our directors and executive officers as a group; and
each selling stockholder.
Shares of
Class A
Shares Beneficially Owned Prior to Offering
Common
Shares Beneficially Owned After Offering
Class A
Class B
% Total
Stock
Class A
Class B
% Total
Common Stock
Common Stock
Voting
Being
Common Stock
Common Stock
Voting
Shares
%
Shares
%
Power
Offered(12)
Shares
%
Shares
%
Power
3,350,000
22.24
18,000,000
100.00
88.85
18,000,000
100.00
1,738,620
11.24
1.65
1,600,000
10.62
1.52
1,020,000
6.77
*
*
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Shares of
Class A
Shares Beneficially Owned Prior to Offering
Common
Shares Beneficially Owned After Offering
Class A
Class B
% Total
Stock
Class A
Class B
% Total
Common Stock
Common Stock
Voting
Being
Common Stock
Common Stock
Voting
Shares
%
Shares
%
Power
Offered(12)
Shares
%
Shares
%
Power
910,000
5.90
*
*
480,000
3.09
*
*
430,000
2.78
*
*
10,000
*
*
*
270,000
1.76
*
*
1,500,000
9.96
1.43
*
150,000
*
*
*
*
*
150,000
*
*
*
1,000,000
6.64
*
*
9,807,500
55.99
18,000,000
100.00
92.83
18,000,000
100.00
637,500
4.19
*
*
55,000
*
*
*
204,000
1.35
*
*
344,500
2.27
*
*
66,100
*
*
*
61,000
*
*
*
76,500
*
*
*
329,000
2.14
*
*
128,000
*
*
*
100,000
*
*
*
420,000
2.71
*
*
70,000
*
*
*
367,250
2.42
*
*
165,000
1.08
*
*
37,000
*
*
*
60,000
*
*
*
120,000
*
*
*
40,000
*
*
*
40,000
*
*
*
390,000
2.52
*
*
87,000
*
*
*
153,000
1.02
*
*
68,300
*
*
*
204,000
1.35
*
*
60,000
*
*
*
Table of Contents
Shares of
Class A
Shares Beneficially Owned Prior to Offering
Common
Shares Beneficially Owned After Offering
Class A
Class B
% Total
Stock
Class A
Class B
% Total
Common Stock
Common Stock
Voting
Being
Common Stock
Common Stock
Voting
Shares
%
Shares
%
Power
Offered(12)
Shares
%
Shares
%
Power
43,000
*
*
*
180,000
1.19
*
*
37,000
*
*
*
30,000
*
*
*
50,000
*
*
*
115,000
*
*
*
40,000
*
*
*
75,000
*
*
*
255,000
1.69
*
*
150,000
*
*
*
204,000
1.35
*
*
440,000
2.92
*
*
40,000
*
*
*
366,666
2.42
*
*
(1)
Mr. Sakellaris address is c/o Ameresco, Inc., 111 Speen
Street, Framingham, Massachusetts 01701. Includes
12,000,000 shares of our Class B common stock held by
the Ameresco 2010 Annuity Trust, of which Mr. Sakellaris is
trustee and the sole beneficiary. The shares of Class A
common stock being offered by Mr. Sakellaris represent
shares of restricted Class A common stock granted by us to
Mr. Sakellaris as consideration for the personal indemnity
provided by Mr. Sakellaris to our sureties.
(2)
Includes 405,286 shares of our Class A common stock
issuable upon the exercise of an exercisable warrant held by
Mr. Byrne. Mr. Byrnes address is
c/o CrossHarbor
Capital Partners LLC, One Boston Place, Suite 2300, Boston,
Massachusetts 02108. The shares of our Class A common stock
being offered by Mr. Byrne were purchased directly from us
by Mr. Byrne.
(3)
Arthur P. Sakellaris address is c/o Ameresco, Inc., 111
Speen Street, Framingham, Massachusetts 01701.
(4)
Mr. Anderson is our employee. Mr. Andersons address is c/o
Ameresco, Inc., 111 Speen Street, Framingham, Massachusetts
01701. The shares of our Class A common stock being offered
by Mr. Anderson consist of shares of restricted stock
granted to him under our 2000 stock plan.
(5)
Includes 350,000 shares of our Class A common stock
issuable upon the exercise of options that are exercisable
within 60 days of May 31, 2010.
Mr. Castonguays address is c/o Ameresco, Inc.,
111 Speen Street, Framingham, Massachusetts 01701.
(6)
Consists of shares of our Class A common stock
issuable upon the exercise of options that are exercisable
within 60 days of May 31, 2010.
(7)
Consists of shares of our Class A common stock issuable upon the
exercise of options that are exercisable within 60 days of
May 31, 2010. The shares of our Class A common stock
being offered by Mr. Maltezos are issuable to him upon the
exercise of an option granted to him pursuant to our 2000 stock
plan that will be exercised in connection with this offering.
(8)
Consists of shares of our Class A common stock issuable
upon the exercise of options that are exercisable within
60 days of May 31, 2010. The shares being offered by
Mr. Derrington are issuable to him upon the exercise an
option granted to him pursuant to our 2000 stock plan that will
be exercised in connection with this offering.
(9)
The shares of our Class A common stock being offered by
Mr. Corrsin consist of shares of restricted stock granted
to him under our 2000 stock plan.
Table of Contents
(10)
Consists of shares of our Class A common stock held by
Sutton Ventures LP. Mr. Sutton is managing member of Sutton
Ventures Group LLC, which is the general partner of Sutton
Ventures LP.
(11)
Includes 2,450,000 shares of our Class A common stock
issuable upon the exercise of options that are exercisable
within 60 days of May 31, 2010.
(12)
If the underwriters overallotment option is exercised in
full, the additional shares to be sold by selling stockholders
would be allocated as follows:
Shares Subject to Overallotment Option
(13)
Unless otherwise indicated in the footnotes below, (i) each
other selling stockholder is our employee and (ii) the
shares of our Class A common stock being offered by each of
the other selling stockholders represent either shares of
restricted stock granted to him or her under our 2000 stock
plan, shares issued to him or her upon the exercise of options
granted to him or her pursuant to our 2000 stock plan, or shares
that are issuable to him or her upon the exercise of an option
granted to him or her under our 2000 stock plan that will be
exercised in connection with this offering.
(14)
Includes shares of our Class A common stock issuable upon
the exercise of options that are exercisable within 60 days
of May 31, 2010.
(15)
Mr. Clune is a former employee. The shares being offered by
Mr. Clune were issued to him upon the exercise of options
granted to him pursuant to our 2000 stock plan in his capacity
as our employee.
(16)
Mr. Morgan is a consultant to us. The shares being offered
by Mr. Morgan are issuable to him upon the exercise an
option granted to him pursuant to our 2000 stock plan in his
capacity as our consultant that will be exercised in connection
with this offering.
113
Table of Contents
15,065,490 shares of our Class A common stock
outstanding, held of record by 42 stockholders;
18,000,000 shares of our Class B common stock
outstanding, held of record by one stockholder, Mr. Sakellaris,
our president and chief executive officer;
405,286 shares of our Class A common stock issuable
upon the exercise of a warrant outstanding and exercisable as of
May 31, 2010 at an exercise price of $0.005 per share,
which will remain outstanding after this offering if not
exercised prior to this offering; and
9,593,594 shares of our Class A common stock issuable
upon the exercise of stock options outstanding as of
May 31, 2010 at a weighted-average exercise price of $3.88
per share.
114
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115
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116
Table of Contents
117
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Shares Eligible for Sale
Shares sold in the offering and shares that can be sold under
Rule 144 that are not subject to a lock-up
Shares that are not subject to a lock-up and can be sold under
Rule 144
Lock-up released; shares can be sold under Rule 144
118
Table of Contents
for our Class B common stock: one percent of the number of
the total number of shares of our Class A and Class B
common stock then outstanding, which will equal
approximately shares
immediately after this offering; and
for our Class B common stock converted to Class A
common stock and our Class A common stock, the greater of
(a) one percent of the number of the aggregate number of
shares of our Class A and Class B common stock then
outstanding, which will equal
approximately shares
immediately after this offering or (b) the average weekly
trading volume in our Class A common stock on the NYSE
during the four calendar weeks preceding either (i) to the
extent that the seller is required to file a notice on
Form 144 with respect to such sale, the date of filing such
notice, (ii) date of receipt of the order to execute the
transaction by the broker or (iii) the date of execution of
the transaction with the market maker.
119
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if, during the last 17 days of the
180-day
restricted period, we issue an earnings release or announce
material news or a material event, the restrictions described in
the preceding paragraph will continue to apply until the
expiration of the
18-day
period beginning on the issuance of the earnings release or the
announcement of the material news or material event; or
if, prior to the expiration of the
180-day
restricted period, we announce that we will release earnings
results or become aware that other material news or a material
event will occur during the
16-day
period beginning on the last day of the
180-day
period, the restrictions described in the preceding paragraph
will continue to apply until the expiration of the
18-day
period beginning on the issuance of the earnings release or the
occurrence of the material news or material event, as applicable.
120
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121
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an individual who is a citizen or resident of the United States;
a corporation, or other entity treated as a corporation for
U.S. federal income tax purposes, created or organized in
or under the laws of the United States or of any political
subdivision of the United States;
an estate the income of which is subject to U.S. federal
income taxation regardless of its source; or
a trust, if a U.S. court is able to exercise primary
supervision over the administration of the trust and one or more
U.S. persons have authority to control all substantial
decisions of the trust or if the trust has a valid election to
be treated as a U.S. person under applicable
U.S. Treasury Regulations.
insurance companies;
tax-exempt organizations;
financial institutions;
brokers or dealers in securities;
regulated investment companies;
pension plans;
controlled foreign corporations;
passive foreign investment companies;
owners that hold our Class A common stock as part of a
straddle, hedge, conversion transaction, synthetic security or
other integrated investment; and
certain U.S. expatriates.
122
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the gain is effectively connected with the
non-U.S. holders
conduct of a trade or business in the United States, and, if an
applicable income tax treaty so provides, the gain is
attributable to a permanent establishment maintained by the
non-U.S. holder
in the United States; in these cases, the
non-U.S. holder
will be taxed on a net income basis at the regular graduated
rates and in the manner applicable to U.S. persons, and, if
the
non-U.S. holder
is a foreign corporation, an additional branch profits tax at a
rate of 30%, or a lower rate as may be specified by an
applicable income tax treaty, may also apply;
123
Table of Contents
the
non-U.S. holder
is an individual present in the United States for 183 days
or more in the taxable year of the disposition and certain other
conditions are met, in which case the
non-U.S. holder
will be subject to a 30% tax (or such lower rate as may be
specified by an applicable income tax treaty) on the net gain
derived from the disposition; or
we are or have been, at any time during the five-year period
preceding such disposition (or the
non-U.S. holders
holding period, if shorter) a U.S. real property
holding corporation unless our Class A common stock
is regularly traded on an established securities market and the
non-U.S. holder
held no more than five percent of our outstanding Class A
common stock, directly or indirectly, during the shorter of the
five-year
period ending on the date of the disposition or the period that
the
non-U.S. holder
held our Class A common stock. Generally, a corporation is
a U.S. real property holding corporation if the
fair market value of its U.S. real property
interests equals or exceeds 50% of the sum of the fair
market value of its worldwide real property interests plus its
other assets used or held for use in a trade or business. We
believe that we are not currently, and we do not anticipate
becoming, a U.S. real property holding
corporation for U.S. federal income tax purposes.
124
Table of Contents
Number
of Shares
Per Share
Without Option
With Option
$
$
$
$
$
$
$
$
$
$
$
$
125
Table of Contents
offer, pledge, sell or contract to sell any common stock;
sell any option or contract to purchase any common stock;
purchase any option or contract to sell any common stock;
grant any option, right or warrant for the sale of any common
stock;
lend or otherwise dispose of or transfer any common stock;
request or demand that we file a registration statement related
to the common stock; or
enter into any swap or other agreement that transfers, in whole
or in part, the economic consequence of ownership of any common
stock whether any such swap or transaction is to be settled by
delivery of shares or other securities, in cash or otherwise.
126
Table of Contents
the valuation multiples of publicly-traded companies that the
representative believes to be comparable to us;
our financial information;
the history of, and the prospects for, our company and the
industry in which we compete;
an assessment of our management, its past and present
operations, and the prospects for, and timing of, our future
revenue; and
the above factors in relation to market values and various
valuation measures of other companies engaged in activities
similar to ours.
127
Table of Contents
128
Table of Contents
129
Table of Contents
130
Table of Contents
131
Table of Contents
132
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Table of Contents
F-2
Table of Contents
F-3
Table of Contents
Year Ended December 31,
2007
2008
2009
$
345,935,912
$
325,031,789
$
340,635,122
32,541,298
70,821,940
87,881,467
378,477,210
395,853,729
428,516,589
285,966,267
259,018,970
282,344,502
26,071,557
59,550,958
66,472,031
312,037,824
318,569,928
348,816,533
66,439,386
77,283,801
79,700,056
25,892,212
30,288,750
28,273,987
8,062,996
13,106,407
9,599,862
13,087,106
9,212,872
16,532,355
47,042,314
52,608,029
54,406,204
19,397,072
24,675,772
25,293,852
(3,138,067
)
(5,187,545
)
1,562,910
16,259,005
19,488,227
26,856,762
(5,713,590
)
(1,215,127
)
(6,949,614
)
10,545,415
18,273,100
19,907,148
3,306,152
(5,059,128
)
3,530,723
$
13,851,567
$
13,213,972
$
23,437,871
$
0.95
$
1.71
$
1.99
$
0.28
$
0.54
$
0.61
11,121,022
10,678,110
9,991,912
37,552,953
33,990,547
32,705,617
F-4
Table of Contents
Accumulated
Other
Series A Preferred
Additional
Comprehensive
Total
Stock
Common Stock
Paid-in
Retained
Treasury Stock
Income
Stockholders
Shares
Amount
Shares
Amount
Capital
Earnings
Shares
Amount
(Loss)
Equity
3,210,000
$
321
14,080,168
$
1,408
$
6,583,437
$
49,426,862
2,504,000
$
(103,239
)
$
1,054,223
$
56,963,012
(269,540
)
(269,540
)
728,050
(2,521,245
)
(2,521,245
)
152,000
15
74,000
74,015
2,678,638
2,678,638
3,306,152
3,306,152
10,545,415
10,545,415
3,210,000
$
321
14,232,168
$
1,423
$
9,336,075
$
59,702,737
3,238,050
$
(2,624,484
)
$
4,360,375
$
70,776,447
1,333,334
(4,914,169
)
(4,914,169
)
(7,998,001
)
(7,998,001
)
28,000
3
67,247
67,250
2,940,756
2,940,756
(5,059,128
)
(5,059,128
)
18,273,100
18,273,100
3,210,000
$
321
14,260,168
$
1,426
$
4,346,077
$
77,975,837
4,571,384
$
(7,538,653
)
$
(698,753
)
$
74,086,255
2,000,000
200
2,076,928
2,077,128
144,500
(874,948
)
(874,948
)
1,738,000
174
874,586
874,760
3,168,721
3,168,721
3,530,723
3,530,723
19,907,148
19,907,148
3,210,000
$
321
17,998,168
$
1,800
$
10,466,312
$
97,882,985
4,715,884
$
(8,413,601
)
$
2,831,970
$
102,769,787
F-5
Table of Contents
Year Ended December 31,
2007
2008
2009
$
10,545,415
$
18,273,100
$
19,907,148
2,845,131
2,713,407
5,260,805
1,056,197
1,064,859
1,372,885
1,997,003
3,500,000
323,587
238,454
254,705
208,159
1,092,294
552,368
(5,850,479
)
(2,300,217
)
(691,292
)
1,365,813
2,831,524
(2,263,802
)
2,678,638
2,940,756
3,168,721
(3,630,780
)
(2,071,600
)
3,400,628
20,720,436
25,519,347
33,051,426
(8,063,037
)
(3,227,279
)
(11,033,926
)
(3,692,345
)
(115,488
)
5,029,832
(9,320,783
)
(26,301,019
)
(52,900,979
)
(63,196
)
(3,821,507
)
3,222,762
7,163,330
3,939,285
(3,651,857
)
2,830,274
(2,337,926
)
(1,591,213
)
(2,851,011
)
(3,623,396
)
1,987,761
(200,471
)
(1,934,563
)
3,846,224
(4,019,297
)
(2,472,682
)
27,280,548
9,847,732
(4,602,608
)
6,819,869
6,224,033
(6,932,531
)
8,945
(3,404,810
)
2,525,472
2,264,752
30,259,801
1,347,420
45,296,310
(1,789,416
)
(1,863,243
)
(1,797,949
)
(21,019,927
)
(41,158,695
)
(19,841,648
)
(10,780,467
)
(674,110
)
(33,589,810
)
(43,021,938
)
(22,313,707
)
F-6
Table of Contents
Year Ended December 31,
2007
2008
2009
(73,652
)
(880,044
)
(2,804,759
)
74,015
67,250
874,760
(2,521,245
)
(4,914,169
)
(874,948
)
(7,998,001
)
34,493,460
(14,578,242
)
(2,500,000
)
(2,500,000
)
6,173,948
9,277,043
28,196,538
(2,400,580
)
(3,092,590
)
(4,382,782
)
(2,940,368
)
(3,592,073
)
$
(3,229,716
)
$
22,204,591
$
4,128,686
$
1,998,055
$
(3,273,211
)
$
2,667,108
(4,561,670
)
(22,743,138
)
29,778,395
45,453,953
40,892,283
18,149,145
$
40,892,283
$
18,149,145
$
47,927,540
$
2,481,849
$
2,431,534
$
2,904,970
$
8,063,883
$
5,304,148
$
2,145,742
$
2,419,386
$
$
3,575,968
132,500
18,177
78,613
113,842
7,645,805
2,492,165
(2,440,437
)
(345,181
)
(422,839
)
(1,222,340
)
(382,553
)
(208,529
)
$
10,780,467
$
$
674,110
$
21,957,882
$
11,925,101
$
27,088,849
F-7
Table of Contents
1.
DESCRIPTION
OF BUSINESS
2.
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES
F-8
Table of Contents
2007
2008
2009
$
1,331,280
$
1,539,439
$
1,049,711
249,631
385,418
1,670,589
(41,472
)
(875,146
)
(1,118,221
)
$
1,539,439
$
1,049,711
$
1,602,079
F-9
Table of Contents
Five years
Five years
Lesser of term of lease or five years
Five years
F-10
Table of Contents
F-11
Table of Contents
F-12
Table of Contents
F-13
Table of Contents
F-14
Table of Contents
F-15
Table of Contents
Year Ended December 31,
2007
2008
2009
$
10,545,415
$
18,273,100
$
19,907,148
11,121,022
10,678,110
9,991,912
19,260,000
19,260,000
19,260,000
3,576,712
3,647,523
3,048,675
3,595,219
404,914
405,030
37,552,953
33,990,547
32,705,617
F-16
Table of Contents
F-17
Table of Contents
3.
BUSINESS
ACQUISITIONS AND RELATED TRANSACTIONS
2007
2008
2009
$
692,007
$
$
2,419,386
3,575,968
132,500
18,177
78,613
113,842
7,645,805
2,492,165
(2,440,437
)
(345,181
)
(422,839
)
(1,222,340
)
(382,553
)
(208,529
)
$
11,472,474
$
$
674,110
$
10,780,467
$
$
674,110
$
11,472,474
$
$
1,896,450
F-18
Table of Contents
4.
PROPERTY
AND EQUIPMENT
2008
2009
$
1,211,596
$
1,271,569
6,903,526
8,453,230
823,635
1,311,625
424,088
505,029
9,362,845
11,541,453
5,649,627
7,168,197
$
3,713,218
$
4,373,256
5.
PROJECT
ASSETS
2008
2009
$
117,935,266
$
137,957,879
14,881,913
20,319,889
$
103,053,353
$
117,637,990
F-19
Table of Contents
6.
UNCOMPLETED
CONTRACTS
2008
2009
$
510,818,791
$
822,280,622
96,436,131
161,849,274
607,254,922
984,129,896
(618,359,542
)
(998,287,184
)
$
(11,104,620
)
$
(14,157,288
)
2008
2009
$
9,755,691
$
14,009,076
(20,860,311
)
(28,166,364
)
$
(11,104,620
)
$
(14,157,288
)
7.
LONG-TERM
DEBT
2008
2009
$
29,234,584
$
33,411,009
34,493,460
19,915,218
5,132,000
4,115,000
6,248,569
5,415,426
6,035,625
5,220,000
3,039,683
2,901,845
11,939,299
12,866,491
27,055,230
96,123,220
110,900,219
5,142,757
8,093,016
$
90,980,463
$
102,807,203
F-20
Table of Contents
$
8,093,016
22,754,963
3,023,020
2,360,278
1,685,031
72,983,911
$
110,900,219
F-21
Table of Contents
F-22
Table of Contents
8.
SUBORDINATED
DEBT
9.
INCOME
TAXES
2007
2008
2009
$
10,194,751
$
15,333,845
$
22,702,229
6,064,254
4,154,382
4,154,533
$
16,259,005
$
19,488,227
$
26,856,762
F-23
Table of Contents
2007
2008
2009
$
5,214,147
$
(565,975
)
$
(1,415,107
)
1,522,594
1,862,654
548,246
2,607,629
1,990,048
4,146,311
9,344,370
3,286,727
3,279,450
(2,483,856
)
(3,517,257
)
7,095,001
(1,146,924
)
(1,029,898
)
587,252
2,475,555
(4,012,089
)
(3,630,780
)
(2,071,600
)
3,670,164
$
5,713,590
$
1,215,127
$
6,949,614
2008
2009
$
3,745,551
$
1,852,578
431,672
1,940,919
3,058,596
2,500,316
877,518
349,654
76,270
264,467
444,523
1,690,268
801,180
786,169
9,540,208
9,279,473
(4,430,097
)
(7,645,315
)
(3,749,313
)
(3,147,505
)
(3,981,314
)
(338,435
)
(770,390
)
(12,160,724
)
(11,901,645
)
$
(2,620,516
)
$
(2,622,172
)
F-24
Table of Contents
2007
2008
2009
$
16,259,005
$
19,488,227
$
26,856,762
$
5,690,652
$
6,820,879
$
9,399,917
748,190
595,632
1,259,719
(141,358
)
(997,011
)
66,986
87,068
88,798
131,621
177,972
459,439
(1,212,142
)
(7,965,383
)
(2,973,669
)
210,140
1,359,105
(413,467
)
(309,752
)
78,143
281,212
435,640
$
5,713,590
$
1,215,127
$
6,949,614
2007
2008
2009
35.0
%
35.0
%
35.0
%
4.6
%
3.1
%
4.7
%
%
(.7
)%
(3.7
)%
.4
%
.4
%
.3
%
.8
%
.9
%
1.7
%
(7.5
)%
(40.9
)%
(11.1
)%
1.3
%
7.0
%
(1.5
)%
%
%
(1.2
)%
.5
%
1.4
%
1.6
%
35.1
%
6.2
%
25.8
%
2008
2009
$
3,500,000
$
4,500,000
1,300,000
100,000
(300,000
)
(200,000
)
$
4,500,000
$
4,400,000
F-25
Table of Contents
10.
STOCKHOLDERS
EQUITY
F-26
Table of Contents
11.
STOCK
INCENTIVE PLAN
F-27
Table of Contents
Weighted-
Average
Number of
Exercise
Options
Price
10,013,300
$
1.705
1,407,000
3.93
(152,000
)
(0.485
)
(225,800
)
(2.94
)
11,042,500
1.98
303,000
5.60
(28,000
)
(2.40
)
(582,000
)
(2.945
)
10,735,500
2.03
862,000
6.055
(1,738,000
)
(0.505
)
(409,300
)
(2.02
)
9,450,200
$
2.68
7,033,550
$
2.145
1,880,164
$
4.69
8,428,306
$
1.535
F-28
Table of Contents
Outstanding Options
Weighted-
Exercisable Options
Average
Weighted-
Weighted-
Remaining
Average
Average
Number
Contractual
Exercise
Number
Exercise
Outstanding
Life
Price
Exercisable
Price
32,000
0.86
$
0.0084
32,000
$
0.0084
406,000
1.10
0.45
406,000
0.45
500,000
1.97
0.75
500,000
0.75
1,776,200
2.55
0.875
1,776,200
0.875
50,000
3.08
1.50
50,000
1.50
410,000
3.53
1.75
410,000
1.75
200,000
3.73
1.875
200,000
1.875
1,510,000
4.52
2.75
1,510,000
2.75
60,000
5.07
3.00
57,000
3.00
1,387,000
3.71
3.25
1,032,650
3.25
1,083,000
3.54
3.41
601,100
3.41
970,000
4.21
4.22
409,000
4.22
1,076,000
5.92
6.055
59,600
6.055
9,450,200
7,033,550
Years Ended December 31,
2007
2008
2009
$
$
$
4.26-4.84%
2.90-5.07%
2.00-2.94%
32%-43%
48%-54%
57%-59%
6.5 years
6.5 years
6.5 years
F-29
Table of Contents
12.
EMPLOYEE
BENEFITS
13.
COMMITMENTS
AND CONTINGENCIES
Operating
Leases
$
2,194,694
1,064,930
753,758
491,144
254,148
762,443
$
5,521,117
F-30
Table of Contents
14.
GEOGRAPHIC
INFORMATION
2008
2009
$
251,179,388
$
322,599,256
40,847,585
52,945,352
$
292,026,973
$
375,544,608
F-31
Table of Contents
2007
2008
2009
$
278,074,041
$
308,559,860
$
341,607,504
100,403,169
84,070,159
83,632,845
3,223,710
3,276,240
$
378,477,210
$
395,853,729
$
428,516,589
15.
RELATED
PARTY TRANSACTIONS
16.
OTHER
INCOME (EXPENSE), NET
2007
2008
2009
$
$
$
2,493,980
(1,365,813
)
(2,831,524
)
2,263,802
(1,448,667
)
(2,117,567
)
(2,993,250
)
(323,587
)
(238,454
)
(201,622
)
$
(3,138,067
)
$
(5,187,545
)
$
1,562,910
17.
FAIR
VALUE MEASUREMENT
Table of Contents
Fair Value as of December 31,
Level
2008
2009
2
$
4,197,337
$
1,933,535
$
4,197,337
$
1,933,535
18.
DERIVATIVE
INSTRUMENTS AND HEDGING ACTIVITIES
Liability Derivatives as of December 31,
2008
2009
Balance Sheet
Balance Sheet
Location
Fair Value
Location
Fair Value
Other liabilities
$
4,197,337
Other liabilities
$
1,933,535
Location of Gain
Amount of (Loss) Gain Recognized in
(Loss) Recognized in
Income on Derivative for the Years Ended
Income on
December 31, are as follows:
Derivative
2007
2008
2009
Interest (expense) income
$
(1,365,813
)
$
(2,831,524
)
$
2,263,802
Interest (expense) income
$
$
$
2,493,980
19.
BUSINESS
SEGMENT INFORMATION
F-33
Table of Contents
Fiscal 2009 Segment Reporting
US
Central
Other
All
Federal
U. S. Region
U.S. Regions
Canada
Other
Total
$
87,579,580
$
88,067,983
$
77,828,302
$
83,632,845
$
91,407,879
$
428,516,589
$
$
$
$
23,511
$
74,439
$
97,950
$
$
$
$
$
(1,464,960
)
$
(1,464,960
)
$
91,884
$
17,900
$
$
254,110
$
6,269,796
$
6,633,690
$
11,276,053
$
10,121,160
$
5,076,943
$
4,154,533
$
(3,771,927
)
$
26,856,762
$
66,104,336
$
25,501,159
$
109,502,883
$
52,945,352
$
121,490,878
$
375,544,608
$
113,515
$
8,528
$
780,576
$
914,980
$
19,821,998
$
21,639,597
Fiscal 2008 Segment Reporting
US
Central
Other
All
Federal
U. S. Region
U.S. Regions
Canada
Other
Total
$
69,325,020
$
74,989,373
$
78,708,984
$
84,000,159
$
88,830,193
$
395,853,729
$
2,911
$
$
$
186,101
$
18,031
$
207,043
$
67
$
$
$
$
5,394,521
$
5,394,588
$
103,869
$
24,305
$
$
164,731
$
3,485,361
$
3,778,266
$
5,016,832
$
8,156,402
$
12,833,182
$
4,154,382
$
(10,672,571
)
$
19,488,227
$
46,348,552
$
8,334,915
$
67,758,222
$
40,847,585
$
128,737,699
$
292,026,973
$
76,367
$
24,422
$
1,372,869
$
160,653
$
41,387,627
$
43,021,938
F-34
Table of Contents
Fiscal 2007 Segment Reporting
US
Central
Other
All
Federal
U. S. Region
U.S. Regions
Canada
Other
Total
$
62,213,324
$
65,700,900
$
81,045,485
$
100,211,169
$
69,306,332
$
378,477,210
$
$
$
$
290,038
$
28,284
$
319,051
$
35,438
$
$
$
$
3,421,680
$
3,457,118
$
98,890
$
8,496
$
$
265,933
$
3,528,009
$
3,901,328
$
4,231,306
$
8,778,343
$
7,649,433
$
6,064,254
$
(10,464,331
)
$
16,259,005
$
37,489,816
$
10,675,350
$
78,468,049
$
52,914,033
$
82,676,578
$
262,223,826
$
187,387
$
7,878
$
1,361,282
$
242,149
$
21,010,647
$
22,809,343
20.
SUBSEQUENT
EVENTS
F-35
Table of Contents
F-36
Table of Contents
Three Months Ended March 31,
2009
2010
(Unaudited)
$
57,228,057
$
74,887,569
16,159,024
30,741,017
73,387,081
105,628,586
46,770,268
62,524,147
12,923,828
24,705,410
59,694,096
87,229,557
13,692,985
18,399,029
6,065,740
8,157,029
2,737,707
3,129,437
4,222,161
4,549,938
13,025,608
15,836,404
667,377
2,562,625
(24,441
)
(855,689
)
642,936
1,706,936
(225,027
)
(429,258
)
417,909
1,277,678
(320,227
)
(663,738
)
993,899
$
(245,829
)
$
1,951,350
$
0.04
$
0.10
$
0.01
$
0.03
9,621,351
13,282,284
32,957,183
36,587,847
F-37
Table of Contents
Accumulated
Other
Series A Preferred
Additional
Comprehensive
Total
Stock
Common Stock
Paid-in
Retained
Treasury Stock
Income
Stockholders
Shares
Amount
Shares
Amount
Capital
Earnings
Shares
Amount
(Loss)
Equity
3,210,000
$
321
17,998,168
$
1,800
$
10,466,312
$
97,882,985
4,715,884
$
(8,413,601
)
$
2,831,970
$
102,769,787
439,086
439,086
993,899
993,899
(320,227
)
(320,227
)
1,277,678
1,277,678
3,210,000
$
321
17,998,168
$
1,800
$
10,905,398
$
99,160,663
4,715,884
$
(8,413,601
)
$
3,505,642
$
105,160,223
F-38
Table of Contents
Three Months Ended March 31,
2009
2010
(Unaudited)
$
417,909
$
1,277,678
803,407
1,755,132
303,194
387,531
65,202
70,350
229,316
17,834
682,367
(133,591
)
616,600
439,086
2,400,493
1,602,408
2,188,442
214,939
10,109,426
10,914,236
(756,789
)
(3,294,743
)
(1,944,586
)
1,850,132
(584,885
)
(543,415
)
(8,258,230
)
(2,704,612
)
755,176
(3,516,043
)
(516,366
)
132,260
1,404,315
1,199,776
(10,334,494
)
(28,098,390
)
(3,760,182
)
(705,848
)
(11,264,490
)
933,533
(2,209,367
)
266,389
(19,653,542
)
(17,935,358
)
(376,548
)
(424,376
)
(9,487,717
)
(5,874,481
)
(9,864,265
)
(6,298,857
)
(70,063
)
(186,078
)
(874,948
)
5,865,896
5,017,004
15,093,753
812,398
(230,382
)
(4,309,781
)
(1,153,221
)
(1,342,551
)
$
18,631,035
$
(9,008
)
$
(332,306
)
$
677,162
(11,219,078
)
(23,566,061
)
18,149,145
47,927,540
$
6,930,067
$
24,361,479
$
897,096
$
817,393
$
266,613
$
959,060
F-39
Table of Contents
1.
DESCRIPTION
OF BUSINESS
2.
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES
F-40
Table of Contents
2009
2010
$
1,049,711
$
1,602,079
229,316
17,834
(10,417
)
(32,356
)
$
1,268,610
$
1,587,557
F-41
Table of Contents
Five years
Five years
Lesser of term of lease or five years
Five years
F-42
Table of Contents
F-43
Table of Contents
F-44
Table of Contents
F-45
Table of Contents
F-46
Table of Contents
F-47
Table of Contents
Period Ended March 31,
2009
2010
$
417,909
$
1,277,678
9,621,351
13,282,284
19,260,000
19,260,000
3,670,881
3,640,446
404,951
405,117
32,957,183
36,587,847
F-48
Table of Contents
3.
INCOME
TAXES
4.
STOCK
INCENTIVE PLAN
F-49
Table of Contents
Weighted-
Average
Number of
Exercise
Options
Price
9,450,200
2.68
(47,000
)
(3.43
)
9,403,200
$
2.805
7,189,650
$
2.190
1,723,156
$
4.765
7,033,550
$
2.145
Outstanding Options
Weighted-
Exercisable Options
Average
Weighted-
Weighted-
Remaining
Average
Average
Number
Contractual
Exercise
Number
Exercise
Outstanding
Life
Price
Exercisable
Price
416,000
0.85
$
0.45
416,000
$
0.45
480,000
1.72
0.75
480,000
0.75
1,778,200
2.31
0.875
1,778,200
0.875
50,000
2.83
1.50
50,000
1.50
410,000
3.29
1.75
410,000
1.75
200,000
3.49
1.875
200,000
1.875
1,517,000
4.28
2.75
1,517,000
2.75
60,000
4.83
3.00
60,000
3.00
1,379,000
3.47
3.25
1,096,800
3.25
1,083,000
3.29
3.41
655,250
3.41
964,000
3.96
4.22
455,100
4.22
1,066,000
5.68
6.055
71,300
6.055
9,403,200
7,189,650
F-50
Table of Contents
Year Ended
December 31,
2009
$
2.00-2.94%
57%-59%
6.5 years
5.
COMMITMENTS
AND CONTINGENCIES
F-51
Table of Contents
6.
GEOGRAPHIC
INFORMATION
December 31,
March 31,
2009
2010
$
322,599,256
$
327,502,566
52,945,352
52,912,776
$
375,544,608
$
380,415,342
$
59,524,733
$
86,912,684
12,980,153
18,569,416
882,195
146,486
$
73,387,081
$
105,628,586
7.
RELATED
PARTY TRANSACTIONS
F-52
Table of Contents
8.
OTHER
INCOME (EXPENSES), NET
2009
2010
$
682,367
$
(133,591
)
(641,606
)
(651,748
)
(65,202
)
(70,350
)
$
(24,441
)
$
(855,689
)
9.
FAIR
VALUE MEASUREMENT
Fair Value as of
March 31,
December 31,
Level
2010
2009
2
$
2,567,480
$
1,933,535
2
$
2,567,480
$
1,933,535
F-53
Table of Contents
10.
DERIVATIVE
INSTRUMENTS AND HEDGING ACTIVITIES
Liability Derivatives as of
December 31, 2009
March 31, 2010
Balance Sheet
Balance Sheet
Location
Fair Value
Location
Fair Value
Other liabilities
$
1,933,535
Other liabilities
$
2,067,126
Other liabilities
$
Other liabilities
$
500,354
Amount of Gain (Loss) Recognized in Income
on Derivative for the Periods Ended
Location of Gain (Loss) Recognized
March 31, are as follows:
in Income on Derivative
2009
2010
Interest income (expense)
$
682,367
$
(133,591
)
As of March 31, 2010
Gain (Loss)
Gain (Loss)
Recognized in
Reclassified from
Accumulated Other
Accumulated Other
Comprehensive
Comprehensive
Income
Income
$
(500,034
)
$
(53,947
)
11.
BUSINESS
SEGMENT INFORMATION
F-54
Table of Contents
Fiscal First Quarter 2010 Segment Reporting
US
Central
Other
All
Federal
U. S. Region
U.S. Regions
Canada
Other
Total
$
24,878,648
$
18,606,701
$
21,682,401
$
18,353,817
$
22,107,019
$
105,628,586
$
$
$
$
7,191
$
306
$
7,497
$
$
$
$
51
$
863,135
$
863,186
$
20,400
$
1,266
$
$
102,185
$
2,018,812
$
2,142,663
$
1,982,606
$
1,035,080
$
2,209,480
$
393,796
$
(3,914,026
)
$
1,706,936
$
88,780,644
$
15,619,554
$
67,280,695
$
52,912,776
$
157,604,210
$
382,197,879
$
12,991
$
7,638
$
353,509
$
982,961
$
4,941,758
$
6,298,857
Fiscal First Quarter 2009 Segment Reporting
US
Central
Other
All
Federal
U. S. Region
U.S. Regions
Canada
Other
Total
$
12,008,969
$
11,110,105
$
17,410,661
$
12,966,529
$
19,890,817
$
73,387,081
$
209
$
$
$
15,173
$
1,735
$
17,117
$
182
$
$
$
1,463
$
39,913
$
41,558
$
22,125
$
6,564
$
$
34,223
$
1,043,689
$
1,106,601
$
1,442,983
$
209,779
$
1,247,145
$
62,385
$
(2,319,356
)
$
642,936
$
46,523,965
$
9,404,100
$
68,612,936
$
33,255,883
$
133,888,583
$
291,685,467
$
8,458
$
731
$
110,109
$
251,800
$
9,493,167
$
9,864,265
12.
SUBSEQUENT
EVENTS
F-55
Table of Contents
Table of Contents
Item 13.
Other
Expenses of Issuance and Distribution
Amount
$
8,913
13,000
*
*
1,300,000
5,000
15,000
130,000
*
$
*
Item 14.
Indemnification
of Directors and Officers
II-1
Table of Contents
Item 15.
Recent
Sales of Unregistered Securities
II-2
Table of Contents
Item 16.
Exhibits
Item 17.
Undertakings
II-3
Table of Contents
By:
Chairman of the Board of Directors, President and Chief
Executive Officer (Principal Executive Officer)
June 18, 2010
Chief Financial Officer
(Principal Financial and
Accounting Officer)
June 18, 2010
Director
June 18, 2010
Director
June 18, 2010
Director
June 18, 2010
Director
June 18, 2010
Director
June 18, 2010
Director
June 18, 2010
Director
June 18, 2010
* By:
Attorney-in-Fact
II-4
Table of Contents
Exhibit
1
.1
Form of Underwriting Agreement
3
.1
Form of Amended and Restated Certificate of Incorporation of the
Registrant, to be filed and effective prior to the closing of
the offering
3
.2
Form of Amended and Restated Certificate of Incorporation of the
Registrant, to be filed promptly following the closing of the
offering
3
.3
Form of Amended and Restated By-Laws of the Registrant, to be
effective prior to the closing of the offering
4
.1
Specimen Certificate evidencing shares of Class A common
stock
5
.1*
Opinion of Wilmer Cutler Pickering Hale and Dorr LLP
10
.1*
Lease dated November 20, 2000 between Ameresco, Inc. and
BCIA New England Holdings, LLC
10
.2*
First Amendment to Lease dated November 2001 by and between
Ameresco, Inc. and BCIA New England Holdings, LLC
10
.3*
Second Amendment to Lease and Extension Agreement dated
April 8, 2005 by and between Ameresco, Inc. and BCIA New
England Holdings, LLC
10
.4*
Third Amendment to Lease dated April 17, 2007 by and
between RREEF America REIT III-Z1 LLC and Ameresco, Inc.
10
.5*
Amended and Restated Credit and Security Agreement dated
June 10, 2008 among Ameresco, Inc., certain guarantors
party thereto, certain lenders party thereto from time to time
and Bank of America, N.A. as Administrative Agent
10
.6*
Ameresco, Inc. 2000 Stock Incentive Plan
10
.7*
Form of Incentive Stock Option Agreement granted under Ameresco,
Inc. 2000 Stock Incentive Plan
10
.8*
Form of Non-Qualified Stock Option Agreement granted under
Ameresco, Inc. 2000 Stock Incentive Plan
10
.9*
Form of Restricted Stock Agreement granted under Ameresco, Inc.
2000 Stock Incentive Plan
10
.10
Ameresco, Inc. 2010 Stock Incentive Plan
10
.11
Form of Incentive Stock Option Agreement granted under Ameresco,
Inc. 2010 Stock Incentive Plan
10
.12
Form of Director Stock Option Agreement granted under Ameresco,
Inc. 2010 Stock Incentive Plan
10
.13
Form of Executive Employment Agreement
10
.14*
Stockholder Agreement dated as of September 25, 2008 by and
among the Registrant, Samuel T. Byrne, AMCAP Holdings, Ltd.,
George P. Sakellaris and such other persons who from time to
time become party thereto
10
.15
Form of Indemnification Agreement entered into between the
Registrant and each non-employee director
10
.16*+
Revised Final Proposal, DOE Savannah River Site, Biomass
Cogeneration Facility and K and L Area Heating Plants, submitted
by Ameresco Federal Solutions, under DOE Contract
No. DE-AM36-02NT41457,
May 11, 2009
10
.17*
Fourth Amendment to Lease dated January 1, 2010 by and
between RREEF America REIT III-Z1 LLC and Ameresco, Inc.
10
.18
Form of Indemnification Agreement entered into between the
Registrant and each employee director
21
.1*
Subsidiaries of the Registrant
23
.1
Consent of Caturano and Company, P.C.
23
.2
Consent of Wilmer Cutler Pickering Hale and Dorr LLP (included
in Exhibit 5.1)
23
.3*
Consent of Frost & Sullivan
24
.1*
Powers of Attorney of David J. Anderson, William M. Bulger, Guy
W. Nichols and Joseph W. Sutton (included on signature page)
24
.2*
Power of Attorney of Michael E. Jesanis
24
.3
Power of Attorney of Douglas I. Foy
*
Previously filed
+
Confidential treatment requested as to certain portions, which
portions have been omitted and filed separately with the
Securities and Exchange Commission.
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Very truly yours,
AMERESCO, INC. |
||||
By | ||||
Title: | ||||
l | ||||
By | ||||
As Attorney-in-Fact acting on behalf of | ||||
the Selling Shareholder(s) named in
Schedule B hereto |
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MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED |
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By | ||||
Authorized Signatory | ||||
32
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AMERESCO, INC.
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By: | ||||
Name: | ||||
Title: | President | |||
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AMERESCO, INC.
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By: | ||||
Name: | ||||
Title: | President | |||
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Page | ||||||
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ARTICLE I | ||||||
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STOCKHOLDERS | ||||||
1.1
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Place of Meetings | 1 | ||||
1.2
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Annual Meeting | 1 | ||||
1.3
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Special Meetings | 1 | ||||
1.4
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Notice of Meetings | 1 | ||||
1.5
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Voting List | 2 | ||||
1.6
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Quorum | 2 | ||||
1.7
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Adjournments | 3 | ||||
1.8
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Voting and Proxies | 3 | ||||
1.9
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Action at Meeting | 3 | ||||
1.10
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Nomination of Directors | 4 | ||||
1.11
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Notice of Business at Annual Meetings | 8 | ||||
1.12
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Conduct of Meetings | 11 | ||||
1.13
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No Action by Consent in Lieu of a Meeting | 12 | ||||
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ARTICLE II | ||||||
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DIRECTORS | ||||||
2.1
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General Powers | 13 | ||||
2.2
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Number, Election and Qualification | 13 | ||||
2.3
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Chairman of the Board; Vice Chairman of the Board | 13 | ||||
2.4
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Classes of Directors | 13 | ||||
2.5
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Terms of Office | 13 | ||||
2.6
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Quorum | 14 | ||||
2.7
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Action at Meeting | 14 | ||||
2.8
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Removal | 14 |
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2.9
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Vacancies | 14 | ||||
2.10
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Resignation | 15 | ||||
2.11
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Regular Meetings | 15 | ||||
2.12
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Special Meetings | 15 | ||||
2.13
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Notice of Special Meetings | 15 | ||||
2.14
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Meetings by Conference Communications Equipment | 15 | ||||
2.15
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Action by Consent | 16 | ||||
2.16
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Committees | 16 | ||||
2.17
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Compensation of Directors | 17 | ||||
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ARTICLE III | ||||||
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OFFICERS | ||||||
3.1
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Titles | 17 | ||||
3.2
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Election | 17 | ||||
3.3
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Qualification | 17 | ||||
3.4
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Tenure | 17 | ||||
3.5
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Resignation and Removal | 17 | ||||
3.6
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Vacancies | 18 | ||||
3.7
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President; Chief Executive Officer | 18 | ||||
3.8
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Vice Presidents | 18 | ||||
3.9
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Secretary and Assistant Secretaries | 19 | ||||
3.10
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Treasurer and Assistant Treasurers | 19 | ||||
3.11
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Salaries | 20 | ||||
3.12
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Delegation of Authority | 20 | ||||
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ARTICLE IV | ||||||
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CAPITAL STOCK | ||||||
4.1
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Issuance of Stock | 20 | ||||
4.2
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Stock Certificates; Uncertificated Shares | 20 | ||||
4.3
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Transfers | 21 |
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4.4
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Lost, Stolen or Destroyed Certificates | 22 | ||||
4.5
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Record Date | 22 | ||||
4.6
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Regulations | 22 | ||||
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ARTICLE V | ||||||
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GENERAL PROVISIONS | ||||||
5.1
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Fiscal Year | 23 | ||||
5.2
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Corporate Seal | 23 | ||||
5.3
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Waiver of Notice | 23 | ||||
5.4
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Voting of Securities | 23 | ||||
5.5
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Evidence of Authority | 23 | ||||
5.6
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Certificate of Incorporation | 24 | ||||
5.7
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Severability | 24 | ||||
5.8
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Pronouns | 24 | ||||
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ARTICLE VI | ||||||
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AMENDMENTS | 24 |
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AMERESCO |
INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE |
CUSIP 02361E 10 8 |
FULLY PAID AND NONASSESSABLE SHARES OF CLASS A COMMON STOCK, $0.0001 PAR VALUE PER SHARE, OF |
AMERESCO, INC. |
transferable on the books of the Corporation by the holder hereof in person or by duly authorized Attorney upon surrender of this certificate properly endorsed. This certificate is not valid until countersigned by the Transfer Agent and registered by the Registrar. WITNESS the facsimile seal of the Corporation and the facsimile signatures of its duly authorized officers. |
TEN COM
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| as tenants in common | UNIF GIFT MIN ACT | Custodian | ||||
TEN ENT
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| as tenants by the entireties | (Cust) (Minor) | |||||
JT TEN
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as joint tenants with right of
survivorship and not as tenants |
under Uniform Gifts to Minors
Act |
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in common | (State) |
PLEASE INSERT SOCIAL SECURITY OR OTHER
|
IDENTIFYING NUMBER OF ASSIGNEE
|
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Shares |
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Attorney |
X
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NOTICE:
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THE SIGNATURE(S) TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME(S) AS WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR, WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATEVER. |
By
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THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS, STOCK- BROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM), PURSUANT TO S.E.C. RULE 17Ad-15. |
1. | Purpose |
2. | Eligibility |
3. | Administration and Delegation |
4. | Stock Available for Awards |
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5. | Stock Options |
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6. | Stock Appreciation Rights |
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7. | Restricted Stock; Restricted Stock Units |
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8. | Other Stock-Based Awards |
9. | Adjustments for Changes in Class A Common Stock and Certain Other Events |
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10. | General Provisions Applicable to Awards |
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11. | Miscellaneous |
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1. | Grant of Option . |
2. | Vesting Schedule . |
3. | Exercise of Option . |
1 | This must be at least 100% of the fair market value of the Common Stock on the date of grant (or 110% in the case of a Participant that owns more than 10% of the total combined voting power of all classes of stock of the Company or its parent or subsidiary (a 10% Shareholder)) for the option to qualify as an incentive stock option (an ISO) under Section 422 of the Code. | |
2 | If the Board would like the Participant to be eligible to make payment using the forms of payment in clause (3) (delivery of shares) or clause (5) (delivery of a promissory note) of Section 5(f) of the Plan and not have the use of such forms of payment cause this option to lose its ISO status, the additional forms of payment should be |
included in this ISO agreement at the date of grant and should be listed here. Furthermore, allowing additional forms of payment after the option has been granted, in certain cases, may cause a new measurement date for accounting purposes, resulting in a charge to earnings. |
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4. | Tax Matters . |
5. | Transfer Restrictions. |
6. | Provisions of the Plan . |
AMERESCO, INC.
|
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By: | ||||
Name: | ||||
Title: |
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PARTICIPANT:
|
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Address: | ||||
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1 | This must be the fair market value of the Common Stock on the date of grant. |
2 | If the Board would like the Participant to be eligible to make payment using the forms of payment in clause (3) (delivery of shares) or clause (5) (delivery of a promissory note) of Section 5(f) of the Plan and not have the use of such forms of payment cause this option to lose its ISO status, the additional forms of payment should be included in this ISO agreement at the date of grant and should be listed here. Furthermore, allowing additional forms of payment after the option has been granted, in certain cases, may cause a new measurement date for accounting purposes, resulting in a charge to earnings. |
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AMERESCO, INC.
|
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By: | ||||
Name: | ||||
Title: |
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PARTICIPANT:
|
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Address: | ||||
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AMERESCO, INC. | |||||||||
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EMPLOYEE | ||||||||
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Print Name of Employee | |||||||||
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Signature | |||||||||
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Address: | ||||||||
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Signature | Title | Date | ||
/s/ Douglas I. Foy | Director | June 12, 2010 | ||
Douglas I. Foy |