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Delaware
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82-4228671
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
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Title of each class
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Name of each exchange on which registered
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Common Stock, par value $0.01 per share
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New York Stock Exchange
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Large accelerated filer
¨
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Accelerated filer
¨
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Non-accelerated filer
x
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Smaller reporting company
¨
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Emerging growth company
x
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•
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our business strategy;
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•
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our operating cash flows, the availability of capital and our liquidity;
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•
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our future revenue, income and operating performance;
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•
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our ability to sustain and improve our utilization, revenues and margins;
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•
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our ability to maintain acceptable pricing for our services;
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•
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our future capital expenditures;
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•
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our ability to finance equipment, working capital and capital expenditures;
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•
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competition and government regulations;
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•
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our ability to obtain permits and governmental approvals;
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•
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pending legal or environmental matters or liabilities;
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•
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environmental hazards;
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•
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industrial accidents;
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•
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business or asset acquisitions;
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•
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general economic conditions;
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•
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credit markets;
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•
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our ability to successfully develop our research and technology capabilities and to implement technological developments and enhancements;
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•
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uncertainty regarding our future operating results; and
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•
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plans, objectives, expectations and intentions contained in this Annual Report that are not historical.
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•
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Environmental Solutions.
Our Environmental Solutions segment includes remediation and compliance services, as well as byproduct sales offerings. Remediation and compliance services are associated with our customers’ need for multi-year environmental improvement and sustainability initiatives, whether driven by proactive engagement by power generation customers, by regulatory requirements, or by consumer expectations and standards. Byproduct sales support both our power generation customers’ desire to profitably recycle recurring volumes of CCRs and our ultimate end customers’ need for high-quality, cost-effective raw material substitutes.
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•
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Maintenance and Technical Services
. Our Maintenance and Technical Services segment includes fossil services and nuclear services offerings. Fossil services are the recurring and mission-critical management of coal ash and the routine maintenance, outage services and staffing solutions for coal-fired power generation facilities. Nuclear services, which we market under the Allied Power brand name, include routine maintenance, outage services, facility maintenance, and staffing solutions for nuclear power generation facilities. Our Maintenance and Technical Services segment offerings are most closely associated with the ongoing operations of power plants, whether in the form of daily environmental management or required maintenance services (typically during planned outages).
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•
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Remediation and Compliance Services
. Our remediation and compliance services offerings primarily include environmental management of landfills for coal-fired power generation facilities and of new and existing ash ponds (particularly remediation mandates). Service offerings cover all aspects of new and existing active pond management including: clean closure, cap-in-place, and design and construction of new ponds. Additional service offerings cover all aspects of the landfill development, construction, and management process. Our remediation and compliance services teams can also provide site evaluation and characterization; preliminary design and cost estimates with life-cycle analysis; hydrogeological assessments; groundwater and containment modeling; permit application and processing for expansions and greenfield sites; design engineering; construction of landfills and cap and cover systems; conversion of impoundments to landfill sites; quality assurance and quality control and documentation; engineered fills (off-site) and other related services.
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•
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Byproduct Sales
. Our byproduct sales offerings include the recycling of recurring and contracted volumes of coal-fired power generation waste byproducts, such as bottom ash, fly ash, and gypsum byproduct, each of which can be used for various industrial purposes. These waste byproducts can be used in the production of concrete products and other applications. Our dedicated waste byproduct sales and marketing team has a national presence and works with many of the nation’s largest power generators to identify opportunities to improve each customer’s long-term position in the market for sales of coal-fired waste byproducts while providing concrete producers with the consistent fly ash
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•
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Fossil Services
. Our fossil services offerings focus on recurring and mission-critical management of coal ash and routine maintenance, outage services and staffing solutions for coal-fired power generation facilities to fulfill an environmental service need of our customers in handling their waste byproducts. Coal ash management is mission-critical to the daily operations of power plants as they generally only have on-site storage capacity for three to four days of CCR waste accumulation. These services include silo management, on-site ash transportation, landfill management, and capture and disposal of ash byproduct from coal power operations. These operations cover management of a wide variety of combustion byproducts including bottom ash, flue gas desulfurization gypsum disposal, Pozatec/fixated scrubber sludge disposal, and fluidized bed combustion fly ash disposal. We coordinate all aspects of the ash management operation, from processing and screening for sales to facilitating an economical disposal.
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•
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Nuclear Services
. Our nuclear services operations, which we market under the Allied Power brand name, consist of a broad platform of mission-critical professional, technical, and craft services spanning the entire asset life cycle of a nuclear power generator. Our nuclear services offerings include routine maintenance, outage services, facility maintenance, and staffing solutions for nuclear power generation facilities, and we are focused on expanding these offerings to include specialty welding, valve repairs, reactor and turbine support, and specialty engineering, among other services. Additionally, our staffing services and solutions include professional, technical, and craft staffing; managed and turnkey staffing solutions; and staff recruitment and oversight services. A substantial portion of our nuclear services operations are driven by scheduled nuclear maintenance outages, which are typically planned for every 12 to 24 months.
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•
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Resource Conservation and Recovery Act.
The RCRA Subtitle C regulates handling, transporting, and disposing of hazardous waste. RCRA Subtitle D regulates non-hazardous wastes and delegates authority to states to develop solid waste programs. In 1991, the EPA issued final regulations under Subtitle D of the RCRA, which set forth minimum federal performance and design criteria for municipal solid waste garbage landfills. In 2015, the EPA published regulations under RCRA Subtitle D for CCRs generated by the electric utility industry. Subtitle D municipal solid waste regulations are implemented by the states, although states can impose requirements that are more stringent than the Subtitle D standards. The CCR Rule regulates the disposal of CCRs under Subtitle D of the RCRA as non-hazardous wastes, as discussed below.
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•
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EPA CCRs Rule
. As a CCR, coal ash had previously been largely exempted from regulation under the RCRA by the “Bevill amendment” and, therefore, was subject to state solid waste regulations. However, after a major spill at a Tennessee Valley Authority site in Tennessee in 2008, the EPA began a rulemaking process to regulate CCRs. That process ended with the publication in April 2015 of the CCR Rule to regulate the disposal of CCRs, including fly ash, bottom ash, and flue gas desulfurization products generated at coal-fired power plants. The CCR Rule, among other things, regulates CCRs as non-hazardous waste and imposes new standards for location, groundwater monitoring, and dam stability on surface impoundments and requires long-term monitoring of existing and new surface impoundments and landfill facilities. The CCR Rule also preserves an exemption for CCRs when used for beneficial purposes. In March 2018, the EPA issued proposed Phase-1 1-Part rules to reconsider certain sections of the 2015 CCR rules. In July 2018, the EPA issued a final Phase-1 1-Part rule to modify the CCR rules to establish the program to grant states authorization with approved CCR permit programs under the Water Infrastructure Improvements for the Nation Act (the “WIIN Act”). The Phase-1 1-Part rule also allows CCRs to be used during certain closure situations and addresses certain matters remanded to the EPA by the D.C. Circuit Court of Appeals in June 2016. The EPA intends to reconsider and propose additional regulations to address litigation decisions by Courts related to CCRs.
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•
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WIIN Act.
In December 2016, Congress passed the WIIN Act, which, among other things, establishes state primacy for enforcement of the CCR Rule. The WIIN Act directed the EPA to provide guidance to states on issuing state regulations to manage the CCR program. The EPA published the Coal Combustion Residuals State Permit Program Guidance Document (Interim Final) in August 2017. States may now submit their regulatory programs for CCRs
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•
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Clean Air Act
. The federal Clean Air Act of 1970 and subsequent amendments, particularly the Clean Air Act Amendments of 1990, and corresponding state laws and EPA regulations (discussed below), regulate the emission of air pollutants such as SOx, NOx, particulate matter (“PM”), and ozone. The EPA finalized more stringent ambient air quality standards for fine PM in January 2013 and for ozone in October 2015, and issued final policy assessment for NOx in April 2017 and draft policy assessment for SOx in August 2017. The EPA concluded that the current primary NOx standard is adequate, but has not taken additional steps with respect to the SOx standards. To meet emissions limits, utilities have been required to make changes, such as changing fuel sources, installing expensive pollution control equipment, and, in some cases, shutting down plants.
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•
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Cross-State Air Pollution Rule
. In July 2011, the EPA adopted the Cross-State Air Pollution Rule (the “CSAPR”), a cap-and-trade type program requiring utilities to make substantial reductions in SO2 and NOx and emissions that contribute to ozone and in fine PM emissions in order to reduce interstate transport of such pollution. The CSAPR was challenged and vacated by the D.C. Circuit Court of Appeals in August 2012, but that decision was reversed by the U.S. Supreme Court in April 2014. The D.C. Circuit has since lifted its stay on the CSAPR and ruled in favor of the EPA on the remaining significant issues. In January 2016, the EPA filed a brief with the D.C. Circuit addressing the remaining legal challenges left undecided by the U.S. Supreme Court’s 2014 decision. Conforming with a court-ordered schedule, the EPA implemented the first phase of the CSAPR in 2015 and 2016 and the second phase in 2017. In November 2014 and January 2015, the EPA issued notices of data availability outlining emission allowance allocations for existing generating units that began operating before and after 2010. In September 2016, the EPA finalized a rule updating the CSAPR in order to maintain 2008 ozone emission limitations in downwind states by addressing summertime (May-September) transport of ozone pollution. The update, which commenced in May 2017, sets stricter NOx ozone season emission budgets in 22 states and could affect up to 886 coal-fired facilities. These emission control requirements, for both NOx and SO2, can impact the quantity and quality of CCRs produced at a power plant, add to the costs of operating a power plant, and make coal a less attractive fuel alternative in the planning and building of utility power plants.
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•
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Comprehensive Environmental Response, Compensation and Liability Act
. Certain environmental laws, including the Comprehensive Environmental Response, Compensation and Liability Act (the “CERCLA”) and similar state laws, impose strict, joint and several liability on responsible parties for investigation and remediation of regulated materials at contaminated sites, including our sites, customer sites, and sites to which we sent wastes, including CCRs. CCRs may contain materials such as metals that are regulated materials under these laws. Management of CCRs can give rise to liability under the CERCLA and similar laws.
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•
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Mercury and Air Toxics Standards for Power Plants
. In February 2012, under its Mercury and Air Toxics Standards for Power Plants rule, the EPA promulgated final limits on mercury and other toxic chemicals from new and modified power plants. In June 2015, the U.S. Supreme Court ordered the EPA to undertake cost-benefit analysis when promulgating mercury and air toxics standards. In April 2016, the EPA published a supplemental finding pursuant to the U.S. Supreme Court’s directive, which is currently being challenged in the D.C. Circuit. In April 2017, the D.C. Circuit granted the EPA’s motion to stay the litigation while the EPA reconsiders its finding that the rule is “appropriate and necessary” as required under the Clean Air Act. If upheld, requirements to control mercury emissions could result in implementation of additional technologies at power plants that could negatively affect fly ash quality.
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•
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GHG Emissions
. Some states and regions have adopted legislation and regulatory programs to reduce GHG emissions, either directly or through mechanisms such as renewable portfolio standards for electric utilities. These programs require electric utilities to increase their use of renewable energy such as solar and wind power. Federal GHG legislation appears unlikely in the near term. The EPA has initiated review of rules finalized in August 2015 for GHG emissions from new and existing fossil fuel-fired electric power plants and for carbon emissions from existing sources in the power sector (the latter being known as the “Clean Power Plan”). The Clean Power Plan establishes state-specific, rate-based reduction goals for carbon emissions and calls on the power sector to reduce carbon emissions to 32% below 2005 levels by 2030. The EPA proposed rules titled the Affordable Clean Energy Rule (the “ACE Rule”) and sought comments on a framework to replace the Clean Power Plan. Under the ACE Rule, the EPA is proposing to allow efficiency improvements at existing coal plants and proposes to regulate emissions from new power plants at different levels and has taken an inside the fence approach to emissions limitations. If the proposed replacement ACE Rule is finalized by the EPA, various states’ utility companies may be encouraged to substitute electricity generation from low-emitting coal and natural gas plants and zero-emitting renewable sources for generation from higher-emitting coal plants. Such changes in the energy market could impact the quantity of CCRs produced by our suppliers, add to the cost of operating power plants, and make coal-fired power plants a less attractive option in the planning and commissioning of new energy generating facilities.
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•
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EPA Water Quality Regulations
. The EPA is addressing water quality impacts from coal-fired power plants and coal mining operations. In September 2015, the EPA finalized new effluent limitations under the Clean Water Act for steam electric power generating facilities. The final rule requires operators of coal plants with a generating capacity over 50 megawatts to store fly ash and bottom ash in dry landfills, rather than containment ponds. Approximately 12% of coal plants will be affected, and some marginal operations may shut down rather than face the expense of complying with the new effluent discharge requirements. Multiple challenges to the effluent limitation guidelines were consolidated and are pending before the Court of Appeals for the Fifth Circuit. In September 2017, the EPA issued a rulemaking postponing certain compliance dates under the effluent limitation guidelines. In addition, the EPA finalized new regulations to minimize adverse environmental impacts to aquatic life from cooling water intake structures at existing electric generating plants, which were challenged by environmental and industry groups at the Fifth and Second Circuit Courts of Appeals, which remain pending. More stringent regulation of coal-fired power plants and coal mining operations could increase the cost for utilities and, thus, indirectly impact the availability and cost of fly ash for our CCR activities.
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•
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requiring us to dedicate a substantial portion of our cash flows from operations to the repayment of debt, which reduces the cash available for other business purposes;
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•
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the failure of securities analysts to continue to cover our common stock or changes in financial estimates or recommendations by analysts;
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•
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announcements by us or our competitors of significant contracts, acquisitions, or capital commitments;
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•
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changes in market valuation or earnings of our competitors;
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•
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variations in quarterly operating results;
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•
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internal control failures;
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•
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changes in management;
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•
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availability of capital;
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•
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general economic conditions;
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•
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terrorist acts;
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•
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legislation;
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•
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future sales of our common stock; and
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•
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investor perception of us and the power generation industry.
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•
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permits BCP and its respective affiliates to conduct business that competes with us and to make investments in any kind of property in which we may make investments; and
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•
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provides that if BCP or its respective affiliates, or any employee, partner, member, manager, officer or director of BCP or its respective affiliates who is also one of our directors or officers, becomes aware of a potential business opportunity, transaction, or other matter, they will have no duty to communicate or offer that opportunity to us.
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•
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after BCP and its affiliates no longer collectively hold more than 35% of the voting power of our common stock, providing that all vacancies, including newly created directorships, may, except as otherwise required by law or, if applicable, the rights of holders of a series of preferred stock, only be filled by the affirmative vote of a majority of directors then in office, even if less than a quorum (prior to such time, vacancies may also be filled by stockholders holding a majority of the outstanding shares entitled to vote);
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•
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after BCP and its affiliates no longer collectively hold more than 35% of the voting power of our common stock, permitting any action by stockholders to be taken only at an annual meeting or special meeting rather than by a written consent of the stockholders, subject to the rights of any series of preferred stock with respect to such rights;
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•
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after BCP and its affiliates no longer collectively hold more than 35% of the voting power of our common stock, permitting our amended and restated certificate of incorporation and amended and restated bylaws to be amended by the affirmative vote of the holders of at least two-thirds of our then outstanding shares of stock entitled to vote thereon;
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•
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after BCP and its affiliates no longer collectively hold more than 35% of the voting power of our common stock, permitting special meetings of our stockholders to be called only by our board of directors pursuant to a resolution adopted by the affirmative vote of a majority of the total number of authorized directors whether or not there exist any vacancies in previously authorized directorships (prior to such time, a special meeting may also be called at the request of stockholders holding a majority of the outstanding shares entitled to vote);
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•
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after BCP and its affiliates no longer collectively hold more than 35% of the voting power of our common stock, requiring the affirmative vote of the holders of at least 75% in voting power of all then outstanding common stock
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•
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dividing our board of directors into three classes of directors, with each class serving staggered three-year terms;
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•
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prohibiting cumulative voting in the election of directors;
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•
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establishing advance notice provisions for stockholder proposals and nominations for elections to the board of directors to be acted upon at meetings of stockholders; and
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•
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providing that the board of directors is expressly authorized to adopt, or to alter or repeal our amended and restated bylaws.
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Name
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Age
|
Positions with Charah Solutions
|
|
|
|
Scott A. Sewell
|
39
|
President, Chief Executive Officer and Director
|
|
|
|
Nicholas W. Jacoby
|
37
|
Interim Chief Financial Officer and Treasurer
|
|
|
|
Dorsey “Ron” McCall
|
71
|
Senior Vice President and Director
|
|
Successor
|
|
Predecessor
|
||||||||||||
|
For the year ended December 31, 2018
|
|
Period from
January 13,
2017 through
December 31, 2017 |
|
Period from
January 1,
2017 through
January 12,
2017
|
|
For the year ended
December 31, 2016 |
||||||||
|
(in thousands, except per share data)
|
||||||||||||||
Statement of Operations:
|
|
|
|
|
|
|
|
||||||||
Revenue:
|
|
|
|
|
|
|
|
||||||||
Environmental Solutions
|
$
|
343,105
|
|
|
$
|
232,581
|
|
|
$
|
7,451
|
|
|
$
|
218,051
|
|
Maintenance and Technical Services
|
397,357
|
|
|
188,658
|
|
|
1,679
|
|
|
47,017
|
|
||||
Total revenue
|
740,462
|
|
|
421,239
|
|
|
9,130
|
|
|
265,068
|
|
||||
Cost of sales
|
642,734
|
|
|
338,908
|
|
|
7,301
|
|
|
203,228
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Gross profit:
|
|
|
|
|
|
|
|
||||||||
Environmental Solutions
|
69,464
|
|
|
64,433
|
|
|
1,412
|
|
|
51,282
|
|
||||
Maintenance and Technical Services
|
28,264
|
|
|
17,898
|
|
|
417
|
|
|
10,558
|
|
||||
Total gross profit
|
97,728
|
|
|
82,331
|
|
|
1,829
|
|
|
61,840
|
|
||||
General and administrative expenses
|
76,752
|
|
|
48,495
|
|
|
3,170
|
|
|
35,170
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Operating income (loss)
|
20,976
|
|
|
33,836
|
|
|
(1,341
|
)
|
|
26,670
|
|
||||
Interest expense, net
|
(32,226
|
)
|
|
(14,146
|
)
|
|
(4,181
|
)
|
|
(6,244
|
)
|
||||
Income from equity method investment
|
2,407
|
|
|
816
|
|
|
48
|
|
|
2,703
|
|
||||
|
|
|
|
|
|
|
|
||||||||
(Loss) income before income taxes
|
(8,843
|
)
|
|
20,506
|
|
|
(5,474
|
)
|
|
23,129
|
|
|
Successor
|
|
Predecessor
|
||||||||||||
|
For the year ended December 31, 2018
|
|
Period from
January 13,
2017 through
December 31, 2017 |
|
Period from
January 1,
2017 through
January 12,
2017
|
|
For the year ended
December 31, 2016 |
||||||||
Income tax benefit
|
(2,427
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Net (loss) income
|
(6,416
|
)
|
|
20,506
|
|
|
(5,474
|
)
|
|
23,129
|
|
||||
Less income attributable to non-controlling interest
(1)
|
(2,486
|
)
|
|
(2,190
|
)
|
|
(54
|
)
|
|
(2,198
|
)
|
||||
Net (loss) income attributable to Charah Solutions, Inc.
|
$
|
(8,902
|
)
|
|
$
|
18,316
|
|
|
$
|
(5,528
|
)
|
|
$
|
20,931
|
|
Basic (loss) earnings per share
|
$
|
(0.33
|
)
|
|
$
|
0.77
|
|
|
N/A
|
|
N/A
|
||||
Diluted (loss) earnings per share
|
$
|
(0.33
|
)
|
|
$
|
0.75
|
|
|
N/A
|
|
N/A
|
||||
|
|
|
|
|
|
|
|
||||||||
Pro forma net (loss) income information (unaudited):
|
|
|
|
|
|
|
|
||||||||
Net (loss) income attributable to Charah Solutions, Inc. before provision for income taxes
|
$
|
(11,329
|
)
|
|
$
|
18,316
|
|
|
$
|
(5,528
|
)
|
|
$
|
20,931
|
|
Pro forma provision for income taxes
|
(2,214
|
)
|
|
6,960
|
|
|
(2,101
|
)
|
|
7,954
|
|
||||
Pro forma net (loss) income attributable to Charah Solutions, Inc.
|
$
|
(9,115
|
)
|
|
$
|
11,356
|
|
|
$
|
(3,427
|
)
|
|
$
|
12,977
|
|
|
|
|
|
|
|
|
|
||||||||
Statements of Cash Flows Data:
|
|
|
|
|
|
|
|
||||||||
Cash flows (used in) provided by operating activities
|
$
|
(13,633
|
)
|
|
$
|
57,792
|
|
|
$
|
(4,418
|
)
|
|
$
|
8,351
|
|
Cash flows (used in) provided by investing activities
|
$
|
(40,368
|
)
|
|
$
|
(7,270
|
)
|
|
$
|
—
|
|
|
$
|
(15,885
|
)
|
Cash flows provided by (used in) financing activities
|
$
|
28,637
|
|
|
$
|
(19,304
|
)
|
|
$
|
4,463
|
|
|
$
|
7,298
|
|
|
|
|
|
|
|
|
|
||||||||
Other Financial Data:
|
|
|
|
|
|
|
|
||||||||
Adjusted EBITDA
(2)
|
$
|
98,772
|
|
|
$
|
76,430
|
|
|
$
|
(422
|
)
|
|
$
|
58,965
|
|
Adjusted EBITDA margin
(2)
|
13.3
|
%
|
|
18.1
|
%
|
|
(4.6)
|
%
|
|
22.7
|
%
|
||||
|
|
|
|
|
|
|
|
||||||||
Balance Sheet Data (as of the end of the periods indicated):
|
|
|
|
|
|
|
|
||||||||
Total assets
|
$
|
458,901
|
|
|
$
|
377,651
|
|
|
|
|
|
||||
Long-term debt
|
$
|
230,821
|
|
|
$
|
227,698
|
|
|
|
|
|
||||
Total liabilities
|
$
|
365,511
|
|
|
$
|
329,332
|
|
|
|
|
|
||||
Total equity
|
$
|
93,390
|
|
|
$
|
48,319
|
|
|
|
|
|
(1)
|
Relates to one of our joint ventures.
|
(2)
|
Adjusted EBITDA and Adjusted EBITDA margin are non-GAAP financial measures. For a definition of Adjusted EBITDA and Adjusted EBITDA margin, as well as a reconciliation to our most directly comparable financial measures calculated and presented in accordance with GAAP, please read “—Non-GAAP Financial Measures.”
|
•
|
Revenues;
|
•
|
Gross Profit;
|
•
|
Operating Income;
|
•
|
Adjusted EBITDA; and
|
•
|
Adjusted EBITDA Margin.
|
|
Successor
|
|
|
Predecessor
|
|
|
|
|
|||||||||||
|
For the year ended December 31, 2018
|
|
Period from
January 13, 2017 through December 31, 2017 |
|
|
Period from
January 1,
2017 through
January 12, 2017 |
|
Change
|
|||||||||||
|
|
|
|
|
$
|
|
%
|
||||||||||||
|
(in thousands)
|
|
|
|
|
||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Environmental Solutions
|
$
|
343,105
|
|
|
$
|
232,581
|
|
|
|
$
|
7,451
|
|
|
$
|
103,073
|
|
|
42.9
|
%
|
Maintenance and Technical Services
|
397,357
|
|
|
188,658
|
|
|
|
1,679
|
|
|
207,020
|
|
|
108.8
|
%
|
||||
Total revenue
|
740,462
|
|
|
421,239
|
|
|
|
9,130
|
|
|
310,093
|
|
|
72.1
|
%
|
||||
Cost of sales
|
642,734
|
|
|
338,908
|
|
|
|
7,301
|
|
|
296,525
|
|
|
85.6
|
%
|
||||
Gross profit:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Environmental Solutions
|
69,464
|
|
|
64,433
|
|
|
|
1,412
|
|
|
3,619
|
|
|
5.5
|
%
|
||||
Maintenance and Technical Services
|
28,264
|
|
|
17,898
|
|
|
|
417
|
|
|
9,949
|
|
|
54.3
|
%
|
||||
Total gross profit
|
97,728
|
|
|
82,331
|
|
|
|
1,829
|
|
|
13,568
|
|
|
16.1
|
%
|
||||
General and administrative expenses
|
76,752
|
|
|
48,495
|
|
|
|
3,170
|
|
|
25,087
|
|
|
48.6
|
%
|
||||
Operating income (loss)
|
20,976
|
|
|
33,836
|
|
|
|
(1,341
|
)
|
|
(11,519
|
)
|
|
(35.4
|
)%
|
||||
Interest expense, net
|
(32,226
|
)
|
|
(14,146
|
)
|
|
|
(4,181
|
)
|
|
(13,899
|
)
|
|
75.8
|
%
|
||||
Income from equity method investment
|
2,407
|
|
|
816
|
|
|
|
48
|
|
|
1,543
|
|
|
178.6
|
%
|
||||
(Loss) income before taxes
|
(8,843
|
)
|
|
20,506
|
|
|
|
(5,474
|
)
|
|
(23,875
|
)
|
|
(158.8
|
)%
|
||||
Income tax benefit
|
(2,427
|
)
|
|
—
|
|
|
|
—
|
|
|
(2,427
|
)
|
|
100.0
|
%
|
||||
Net (loss) income
|
(6,416
|
)
|
|
20,506
|
|
|
|
(5,474
|
)
|
|
(21,448
|
)
|
|
(142.7
|
)%
|
||||
Less income attributable to non-controlling interest
|
(2,486
|
)
|
|
(2,190
|
)
|
|
|
(54
|
)
|
|
(242
|
)
|
|
10.8
|
%
|
||||
Net (loss) income attributable to Charah Solutions, Inc.
|
$
|
(8,902
|
)
|
|
$
|
18,316
|
|
|
|
$
|
(5,528
|
)
|
|
$
|
(21,690
|
)
|
|
(169.6
|
)%
|
Adjusted EBITDA
(1)
|
$
|
98,772
|
|
|
$
|
76,430
|
|
|
|
$
|
(422
|
)
|
|
$
|
22,764
|
|
|
29.9
|
%
|
Adjusted EBITDA margin
(1)
|
13.3%
|
|
18.1%
|
|
|
(4.6)%
|
|
(4.3)%
|
|
N/A
|
(1)
|
Adjusted EBITDA and Adjusted EBITDA margin are non-GAAP financial measures. For a definition of Adjusted EBITDA and Adjusted EBITDA margin, as well as a reconciliation to our most directly comparable financial measures calculated and presented in accordance with GAAP, please read “—Non-GAAP Measures” below.
|
•
|
First, under percentage of completion accounting, we accelerated revenues and expenses (including depreciation and amortization) related to this project from 2019 into the third and fourth quarters of 2018. This had a net benefit
|
•
|
Second, we had an increase of unbilled costs on our balance sheet, shown as costs and estimated earnings in excess of billings, or CIE, which reduced operating cash flow by $79 million and thereby resulted in cash flow used in operations of $13.6 million for the year ended December 31, 2018. As we expect to substantially recover this amount in 2019, these working capital balances will reverse and generate significant cash flow.
|
|
Successor
|
|
|
Predecessor
|
|
|
|
|
|||||||||||
|
Period from January 13, 2017 through December 31, 2017
|
|
|
Period from January 1, 2017 through January 12, 2017
|
|
For the year ended December 31, 2016
|
|
Change
|
|||||||||||
|
|
|
|
|
$
|
|
%
|
||||||||||||
|
(in thousands)
|
|
|
|
|
||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Environmental Solutions
|
$
|
232,581
|
|
|
|
$
|
7,451
|
|
|
$
|
218,051
|
|
|
$
|
21,981
|
|
|
10.1
|
%
|
Maintenance and Technical Services
|
188,658
|
|
|
|
1,679
|
|
|
47,017
|
|
|
143,320
|
|
|
304.8
|
%
|
||||
Total revenue
|
421,239
|
|
|
|
9,130
|
|
|
265,068
|
|
|
165,301
|
|
|
62.4
|
%
|
||||
Cost of sales
|
338,908
|
|
|
|
7,301
|
|
|
203,228
|
|
|
142,981
|
|
|
70.4
|
%
|
||||
Gross profit:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Environmental Solutions
|
64,433
|
|
|
|
1,412
|
|
|
51,282
|
|
|
14,563
|
|
|
28.4
|
%
|
||||
Maintenance and Technical Services
|
17,898
|
|
|
|
417
|
|
|
10,558
|
|
|
7,757
|
|
|
73.5
|
%
|
||||
Total gross profit
|
82,331
|
|
|
|
1,829
|
|
|
61,840
|
|
|
22,320
|
|
|
36.1
|
%
|
||||
General and administrative expenses
|
48,495
|
|
|
|
3,170
|
|
|
35,170
|
|
|
16,495
|
|
|
46.9
|
%
|
||||
Operating income (loss)
|
33,836
|
|
|
|
(1,341
|
)
|
|
26,670
|
|
|
5,825
|
|
|
21.8
|
%
|
||||
Interest expense, net
|
(14,146
|
)
|
|
|
(4,181
|
)
|
|
(6,244
|
)
|
|
12,083
|
|
|
193.5
|
%
|
||||
Income from equity method investment
|
816
|
|
|
|
48
|
|
|
2,703
|
|
|
(1,839
|
)
|
|
(68.0
|
)%
|
||||
Income (loss) before taxes
|
20,506
|
|
|
|
(5,474
|
)
|
|
23,129
|
|
|
(8,097
|
)
|
|
(35.0
|
)%
|
||||
Income tax benefit
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
%
|
||||
Net income (loss)
|
20,506
|
|
|
|
(5,474
|
)
|
|
23,129
|
|
|
(8,097
|
)
|
|
(35.0
|
)%
|
||||
Less income attributable to non-controlling interest
|
(2,190
|
)
|
|
|
(54
|
)
|
|
(2,198
|
)
|
|
(46
|
)
|
|
(2.1
|
)%
|
||||
Net income (loss) attributable to Charah Solutions, Inc.
|
$
|
18,316
|
|
|
|
$
|
(5,528
|
)
|
|
$
|
20,931
|
|
|
$
|
(8,143
|
)
|
|
(38.9
|
)%
|
Adjusted EBITDA
(1)
|
$
|
76,430
|
|
|
|
$
|
(422
|
)
|
|
$
|
58,965
|
|
|
$
|
17,043
|
|
|
28.9
|
%
|
Adjusted EBITDA margin
(1)
|
18.1%
|
|
|
(4.6)%
|
|
22.7%
|
|
(5.0)%
|
|
N/A
|
(1)
|
Adjusted EBITDA and Adjusted EBITDA margin are non-GAAP financial measures. For a definition of Adjusted EBITDA and Adjusted EBITDA margin, as well as a reconciliation to the most directly comparable financial measures calculated and presented in accordance with GAAP, please read “—Non-GAAP Measures” below.
|
|
Successor
|
|
Predecessor
|
|
Change
|
|||||||||||||
|
For the year ended December 31, 2018
|
|
Period from
January 13, 2017 through December 31, 2017 |
|
Period from
January 1, 2017 through January 12, 2017 |
|
$
|
|
%
|
|||||||||
|
(in thousands)
|
|||||||||||||||||
Cash flows (used in) provided by operating activities
|
$
|
(13,633
|
)
|
|
$
|
57,792
|
|
|
$
|
(4,418
|
)
|
|
$
|
(67,007
|
)
|
|
(125.5
|
)%
|
Cash flows used in investing activities
|
$
|
(40,368
|
)
|
|
$
|
(7,270
|
)
|
|
$
|
—
|
|
|
$
|
(33,098
|
)
|
|
455.3
|
%
|
Cash flows provided by (used in) financing activities
|
$
|
28,637
|
|
|
$
|
(19,304
|
)
|
|
$
|
4,463
|
|
|
$
|
43,478
|
|
|
(293.0
|
)%
|
Net change in cash
|
$
|
(25,364
|
)
|
|
$
|
31,218
|
|
|
$
|
45
|
|
|
$
|
(56,627
|
)
|
|
(181.1
|
)%
|
|
Successor
|
|
Predecessor
|
|
Change
|
|||||||||||||
|
Period from
January 13, 2017 through December 31, 2017 |
|
Period from
January 1, 2017 through January 12, 2017 |
|
For the year ended December 31, 2016
|
|
$
|
|
%
|
|||||||||
|
(in thousands)
|
|||||||||||||||||
Cash flows provided by (used in) operating activities
|
$
|
57,792
|
|
|
$
|
(4,418
|
)
|
|
$
|
8,351
|
|
|
$
|
45,023
|
|
|
539.1
|
%
|
Cash flows used in investing activities
|
$
|
(7,270
|
)
|
|
$
|
0
|
|
|
$
|
(15,885
|
)
|
|
$
|
8,615
|
|
|
54.2
|
%
|
Cash flows (used in) provided by financing activities
|
$
|
(19,304
|
)
|
|
$
|
4,463
|
|
|
$
|
7,298
|
|
|
$
|
(22,139
|
)
|
|
(303.4
|
)%
|
Net change in cash
|
$
|
31,218
|
|
|
$
|
45
|
|
|
$
|
(236
|
)
|
|
$
|
31,449
|
|
|
13,325.8
|
%
|
|
Total
|
|
2019
|
|
2020
|
|
2021
|
|
2022
|
|
2023
|
|
Thereafter
|
||||||||||||||
|
(in thousands)
|
||||||||||||||||||||||||||
Term Loan
|
$
|
202,438
|
|
|
$
|
10,250
|
|
|
$
|
11,531
|
|
|
$
|
15,375
|
|
|
$
|
16,656
|
|
|
$
|
148,626
|
|
|
$
|
—
|
|
Revolving Loan
|
19,799
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
19,799
|
|
|
—
|
|
|||||||
Equipment Financing Facilities
|
35,104
|
|
|
13,018
|
|
|
4,977
|
|
|
5,251
|
|
|
5,539
|
|
|
4,288
|
|
|
2,031
|
|
|||||||
Interest on Outstanding Loans
|
50,061
|
|
|
12,314
|
|
|
11,447
|
|
|
10,498
|
|
|
9,420
|
|
|
6,309
|
|
|
73
|
|
|||||||
Operating Lease Obligations
(1)
|
11,514
|
|
|
4,462
|
|
|
3,549
|
|
|
1,285
|
|
|
451
|
|
|
451
|
|
|
1,316
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Total
(2)
|
$
|
318,916
|
|
|
$
|
40,044
|
|
|
$
|
31,504
|
|
|
$
|
32,409
|
|
|
$
|
32,066
|
|
|
$
|
179,473
|
|
|
$
|
3,420
|
|
(1)
|
We lease equipment and office facilities under non-cancellable operating leases.
|
(2)
|
Uncertain tax positions, the purchase option liability, contingent payments for acquisitions, and the asset retirement obligation are not included in the table above because timing of such payments is uncertain.
|
|
Successor
|
|
|
Predecessor
|
||||||||||||
|
For the year ended December 31, 2018
|
|
Period from January 13, 2017 through December 31, 2017
|
|
|
Period from
January 1, 2017
through January 12, 2017
|
|
For the year ended December 31, 2016
|
||||||||
|
|
|
|
|
||||||||||||
|
|
|
|
|
||||||||||||
|
|
|
|
|
||||||||||||
|
(in thousands)
|
|||||||||||||||
Net (loss) income attributable to Charah Solutions, Inc.
|
$
|
(8,902
|
)
|
|
$
|
18,316
|
|
|
|
$
|
(5,528
|
)
|
|
$
|
20,931
|
|
Interest expense, net
|
32,226
|
|
|
14,146
|
|
|
|
4,181
|
|
|
6,244
|
|
||||
Income tax benefit
|
(2,427
|
)
|
|
—
|
|
|
|
—
|
|
|
—
|
|
||||
Depreciation and amortization
|
42,308
|
|
|
25,719
|
|
|
|
763
|
|
|
15,601
|
|
||||
Elimination of certain non-recurring legal costs and expenses
(1)
|
25,428
|
|
|
8,650
|
|
|
|
—
|
|
|
—
|
|
||||
Elimination of certain non-recurring startup costs
(2)
|
1,480
|
|
|
6,167
|
|
|
|
—
|
|
|
—
|
|
||||
Equity-based compensation
|
4,127
|
|
|
2,429
|
|
|
|
—
|
|
|
7,352
|
|
||||
Elimination of legacy expenses
(3)
|
—
|
|
|
—
|
|
|
|
—
|
|
|
3,910
|
|
||||
Non-acquired business line
(4)
|
—
|
|
|
—
|
|
|
|
—
|
|
|
3,768
|
|
||||
Transaction related expenses and other items
|
4,532
|
|
|
1,003
|
|
|
|
162
|
|
|
1,159
|
|
||||
Adjusted EBITDA
|
$
|
98,772
|
|
|
$
|
76,430
|
|
|
|
$
|
(422
|
)
|
|
$
|
58,965
|
|
Adjusted EBITDA margin
(5)
|
13.3%
|
|
18.1%
|
|
|
(4.6)%
|
|
22.7%
|
(1)
|
Represents non-recurring legal costs and expenses, which amounts are not representative of those that we historically incur in the ordinary course of our business.
|
(2)
|
Represents non-recurring startup costs associated with the startup of Allied and our nuclear services offerings, including the setup of financial operations systems and modules, pre-contract expenses to obtain initial contracts, and the hiring of operational staff. Because these costs are associated with the initial setup of the Allied business to initiate the operations involved in our nuclear services offerings, these costs are non-recurring in the normal course of our business.
|
(3)
|
Primary components include a change in charitable giving and other business expense policies associated with the BCP investment.
|
(4)
|
Non-acquired business line item adjusts for a legacy operation of Charah that was transferred to a stockholder of CEP Holdings, Inc. in January 2017 prior to the BCP investment.
|
(5)
|
Adjusted EBITDA margin is a non-GAAP financial measure that represents the ratio of Adjusted EBITDA to total revenues (which for the year ended December 31, 2016 were less revenues ($5,045) of a non-acquired business line). We use Adjusted EBITDA margin to measure the success of our businesses in managing our cost base and improving profitability.
|
Description
|
|
Page Number
|
|
||
|
||
|
||
|
||
|
||
|
Exhibit
Number
|
|
Description
|
|
Master Reorganization Agreement, dated June 13, 2018, by and among Charah Solutions, Inc. and the other parties named therein (incorporated by reference to Exhibit 2.1 to the Current Report on Form 8‑K filed on June 19, 2018 (File No. 001‑38523)).
|
|
|
Amended and Restated Certificate of Incorporation of Charah Solutions, Inc. (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8‑K filed June 22, 2018 (File No. 001‑38523)).
|
|
|
Amended and Restated Bylaws of Charah Solutions, Inc. (incorporated by reference to Exhibit 3.2 to the Current Report on Form 8‑K filed June 22, 2018 (File No. 001‑38523)).
|
|
|
Registration Rights Agreement (incorporated by reference to Exhibit 4.1 to the Current Report on Form 8‑K filed June 22, 2018 (File No. 001‑38523)).
|
|
|
Stockholders’ Agreement (incorporated by reference to Exhibit 4.2 to the Current Report on Form 8‑K filed June 22, 2018 (File No. 001‑38523)).
|
|
|
Credit Agreement, dated as of September 21, 2018, by and among Charah Solutions, Inc., certain of the Charah Solutions, Inc.'s subsidiaries, as guarantors, Bank of America, N.A., as administrative agent, swingline lender and letter of credit issuer, and the other lenders party thereto (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed September 25, 2018 (File No. 001-38523)).
|
|
|
Information Rights Agreement, dated October 9, 2018, by and between Charah Solutions, Inc. and Bernhard Capital Partners Management, LP (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed October 10, 2018 (File No. 001-38523)).
|
|
|
Mutual Release Agreement, effective as of December 13, 2018, by and between Charah Solutions, Inc. and Bernhard Capital Partners Management, LP (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed December 18, 2018 (File No.001-38523)).
|
Exhibit
Number
|
|
Description
|
|
ABL Credit Agreement, dated October 25, 2017, by and among Charah, LLC, Allied Power Management, LLC and Allied Power Services, LLC, as borrowers, Charah Sole Member LLC and Allied Power Sole Member, LLC, as guarantors, the lenders party thereto from time to time, and Regions Bank, as administrative agent, collateral agent, swingline lender and letter of credit issuer (incorporated by reference to Exhibit 10.3 to the Registration Statement on Form S-1/A filed May 18, 2018 (File No. 333-225051)).
|
|
|
First Amendment to ABL Credit Agreement, dated December 8, 2017, by and among Charah, LLC, Allied Power Management, LLC and Allied Power Services, LLC, as borrowers, Charah Sole Member LLC and Allied Power Sole Member, LLC, as guarantors, the lenders party thereto from time to time, and Regions Bank, as administrative agent, collateral agent, swingline lender and letter of credit issuer (incorporated by reference to Exhibit 10.4 to the Registration Statement on Form S-1 filed May 18, 2018 (File No. 333-225051)).
|
|
|
Second Amendment to ABL Credit Agreement, dated April 27, 2018, by and among Charah, LLC, Allied Power Management, LLC and Allied Power Services, LLC, as borrowers, Charah Sole Member LLC and Allied Power Sole Member, LLC, as guarantors, the lenders party thereto from time to time, and Regions Bank, as administrative agent, collateral agent, swingline lender and letter of credit issuer (incorporated by reference to Exhibit 10.5 to the Registration Statement on Form S-1 filed May 18, 2018 (File No. 333-225051)).
|
|
|
Term Loan Credit Agreement, dated October 25, 2017, by and among Charah, LLC and Allied Power Management, LLC, as borrowers, Charah Sole Member LLC and Allied Power Sole Member, LLC, as guarantors, the lenders party thereto from time to time, and Credit Suisse AG, Cayman Islands Branch, as administrative agent and collateral agent (incorporated by reference to Exhibit 10.6 to the Registration Statement on Form S-1 filed May 18, 2018 (File No. 333-225051)).
|
|
|
First Amendment to Term Loan Credit Agreement, dated April 27, 2018, by and among Charah, LLC and Allied Power Management, LLC, as borrowers, Charah Sole Member LLC and Allied Power Sole Member, LLC, as guarantors, the lenders party thereto from time to time, and Credit Suisse AG, Cayman Islands Branch, as administrative agent and collateral agent (incorporated by reference to Exhibit 10.7 to the Registration Statement on Form S-1 filed May 18, 2018 (File No. 333-225051)).
|
|
|
Charah Solutions, Inc. 2018 Omnibus Incentive Plan (incorporated by reference to Exhibit 4.4 to the Registration Statement on Form S-8 filed June 19, 2018 (File No. 333-225717)).
|
|
|
Form of Restricted Stock Agreement under the Charah Solutions, Inc. 2018 Omnibus Incentive Plan (Time Based) (incorporated by reference to Exhibit 4.5 to the Registration Statement on Form S-8 filed June 19, 2018 (File No. 333‑225717)).
|
|
|
Form of Restricted Stock Agreement under the Charah Solutions, Inc. 2018 Omnibus Incentive Plan (Time and Performance Based) (incorporated by reference to Exhibit 4.6 to the Registration Statement on Form S-8 filed June 19, 2018 (File No. 333‑225717)).
|
|
|
Form of Restricted Stock Unit Agreement under the Charah Solutions, Inc. 2018 Omnibus Plan.
|
|
|
Letter Agreement between Charah Solutions, Inc. and Scott Sewell, dated January 23, 2019 (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed January 24, 2019 (File No.001-38523)).
|
|
|
Employment Agreement with Charles E. Price, dated December 23, 2016 (incorporated by reference to Exhibit 10.8 to the Registration Statement on Form S-1 filed May 18, 2018 (File No. 333-225051)).
|
|
|
Amendment to Employment Agreement with Charles E. Price, dated May 11, 2017.
|
|
|
Second Amendment to Employment Agreement with Charles E. Price, dated June 1, 2018 (incorporated by reference to Exhibit 10.11 to the Registration Statement on Form S-1/A filed June 4, 2018 (File No. 333-225051)).
|
|
|
Employment Agreement with Bruce Kramer, dated January 13, 2017 (incorporated by reference to Exhibit 10.9 to the Registration Statement on Form S-1 filed May 18, 2018 (File No. 333-225051)).
|
|
|
First Amendment to Employment Agreement with Bruce Kramer, dated June 1, 2018 (incorporated by reference to Exhibit 10.12 to the Registration Statement on Form S-1/A filed June 4, 2018 (File No. 333-225051)).
|
|
|
Amended and Restated Employment Agreement with Dorsey “Ron” McCall, dated July 12, 2017 (incorporated by reference to Exhibit 10.10 to the Registration Statement on Form S-1 filed May 18, 2018 (File No. 333-225051)).
|
|
|
First Amendment to Employment Agreement with Dorsey "Ron" McCall, dated June 5, 2018 (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed June 19, 2018 (File No. 001-38523)).
|
|
|
Form of Indemnification Agreement (incorporated by reference to Exhibit 10.2 to the Registration Statement on Form S-1 filed May 18, 2018 (File No. 333-225051)).
|
|
|
List of Subsidiaries of Charah Solutions, Inc.
|
|
|
Consent of Deloitte & Touche LLP, Independent Registered Public Accounting Firm.
|
Exhibit
Number
|
|
Description
|
|
Certification of Principal Executive Officer pursuant to Rule 13a‑14(a)/15d‑14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
Certification of Principal Financial Officer pursuant to Rule 13a‑14(a)/15d‑14(a) as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
|
Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
101.CAL*
|
|
XBRL Calculation Linkbase Document.
|
101.DEF*
|
|
XBRL Definition Linkbase Document.
|
101.INS*
|
|
XBRL Instance Document.
|
101.LAB*
|
|
XBRL Labels Linkbase Document.
|
101.PRE*
|
|
XBRL Presentation Linkbase Document.
|
101.SCH*
|
|
XBRL Schema Document.
|
††
|
Schedules and similar attachments have been omitted pursuant to Item 601(b)(2) of Regulation S-K. The registrant will furnish a supplemental copy of any omitted schedule or similar attachment to the SEC upon request.
|
|
|
|
|
CHARAH SOLUTIONS, INC.
|
|
|
|
|
|
|
|
March 27, 2019
|
By:
|
/s/ Scott A. Sewell
|
|
Name:
|
Scott A. Sewell
|
|
Title:
|
President, Chief Executive Officer and Director
|
|
|
(Principal Executive Officer)
|
|
|
|
|
|
Signature
|
Title
|
|
|
|
|
/s/ Scott A. Sewell
|
President, Chief Executive Officer and Director
|
Scott A. Sewell
|
(Principal Executive Officer)
|
|
|
|
|
/s/ Nicholas W. Jacoby
|
Interim Chief Financial Officer and Treasurer
|
Nicholas W. Jacoby
|
(Principal Financial Officer and
|
|
Principal Accounting Officer)
|
|
|
/s/ Claire Babineaux-Fontenot
|
Director
|
Claire Babineaux-Fontenot
|
|
|
|
|
|
/s/ Jack A. Blossman, Jr.
|
Director
|
Jack A. Blossman, Jr.
|
|
|
|
|
|
/s/ Mignon L. Clyburn
|
Director
|
Mignon L. Clyburn
|
|
|
|
|
|
/s/ Brian K. Ferraioli
|
Director
|
Brian K. Ferraioli
|
|
|
|
Signature
|
Title
|
|
|
|
|
/s/ Robert C. Flexon
|
Director
|
Robert C. Flexon
|
|
|
|
|
|
/s/ Dorsey “Ron” McCall
|
Director
|
Dorsey “Ron” McCall
|
|
|
|
|
|
/s/ Mark Spender
|
Director
|
Mark Spender
|
|
|
|
|
|
/s/ Stephen R. Tritch
|
Director
|
Stephen R. Tritch
|
|
|
|
|
|
Date: March 27, 2019
|
|
|
December 31,
2018 |
|
December 31, 2017
|
||||
|
|
|
|
||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash
|
$
|
6,900
|
|
|
$
|
32,264
|
|
Trade accounts receivable
|
60,742
|
|
|
47,227
|
|
||
Receivable from affiliates
|
894
|
|
|
38
|
|
||
Costs and estimated earnings in excess of billings (“CIE”)
|
86,710
|
|
|
7,959
|
|
||
Inventory
|
25,797
|
|
|
1,666
|
|
||
Prepaid expenses and other current assets
|
5,133
|
|
|
4,644
|
|
||
Total current assets
|
186,176
|
|
|
93,798
|
|
||
Property and equipment:
|
|
|
|
||||
Plant, machinery and equipment
|
74,896
|
|
|
42,565
|
|
||
Structural fill site improvements
|
55,760
|
|
|
55,760
|
|
||
Vehicles
|
17,407
|
|
|
16,478
|
|
||
Office equipment
|
1,623
|
|
|
638
|
|
||
Buildings and leasehold improvements
|
262
|
|
|
240
|
|
||
Structural fill sites
|
7,110
|
|
|
7,110
|
|
||
Construction in progress
|
3,488
|
|
|
—
|
|
||
Total property and equipment
|
160,546
|
|
|
122,791
|
|
||
Less accumulated depreciation and amortization
|
(71,605
|
)
|
|
(22,861
|
)
|
||
Property and equipment, net
|
88,941
|
|
|
99,930
|
|
||
Other assets:
|
|
|
|
||||
Trade name, net
|
34,920
|
|
|
34,330
|
|
||
Customer relationship, net
|
63,898
|
|
|
71,032
|
|
||
Technology, net
|
1,853
|
|
|
—
|
|
||
Non-compete and other agreements, net
|
180
|
|
|
—
|
|
||
Other intangible assets, net
|
22
|
|
|
87
|
|
||
Goodwill
|
74,213
|
|
|
73,468
|
|
||
Other assets
|
891
|
|
|
—
|
|
||
Deferred tax asset
|
2,747
|
|
|
—
|
|
||
Equity method investments
|
5,060
|
|
|
5,006
|
|
||
Total assets
|
$
|
458,901
|
|
|
$
|
377,651
|
|
|
|
|
|
||||
See notes to consolidated & combined financial statements (Continued)
|
|
December 31,
2018 |
|
December 31, 2017
|
||||
Liabilities and stockholders’ and members’ equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
24,821
|
|
|
$
|
15,247
|
|
Billings in excess of costs and estimated earnings (“BIE”)
|
1,352
|
|
|
15,882
|
|
||
Notes payable, current maturities
|
23,268
|
|
|
19,996
|
|
||
Accrued payroll and bonuses
|
15,480
|
|
|
16,036
|
|
||
Asset retirement obligation
|
14,704
|
|
|
1,072
|
|
||
Purchase option liability, current portion
|
10,017
|
|
|
5,061
|
|
||
Accrued expenses
|
22,473
|
|
|
7,959
|
|
||
Other liabilities
|
—
|
|
|
198
|
|
||
Total current liabilities
|
112,115
|
|
|
81,451
|
|
||
Long-term liabilities:
|
|
|
|
||||
Purchase option liability, less current portion
|
—
|
|
|
20,183
|
|
||
Contingent payments for acquisitions
|
11,214
|
|
|
—
|
|
||
Asset retirement obligation
|
11,361
|
|
|
—
|
|
||
Line of credit
|
19,799
|
|
|
—
|
|
||
Notes payable, less current maturities
|
211,022
|
|
|
227,698
|
|
||
Total liabilities
|
365,511
|
|
|
329,332
|
|
||
Commitments and contingencies (see Note 14)
|
|
|
|
||||
Stockholders’ and members’ equity
|
|
|
|
||||
Retained earnings
|
9,414
|
|
|
18,316
|
|
||
Common Stock - Charah Solutions, Inc.—$0.01 par value; 200,000,000 shares authorized, 29,082,988 shares issued and outstanding as of December 31, 2018
|
291
|
|
|
—
|
|
||
Additional paid in capital - Charah Solutions, Inc.
|
82,880
|
|
|
—
|
|
||
Members’ interest—Charah, LLC Series A, no par, 200,000,000 members’ interest authorized (104,109,890 issued and outstanding) as of December 31, 2017. Series B, no par, 100,000,000 members’ interest authorized (35,199,063 issued and outstanding) as of December 31, 2017
|
—
|
|
|
19,718
|
|
||
Members’ interest—Allied Power Management, LLC, Series A, no par, 200,000,000 members’ interest authorized (7,210,555 issued and outstanding) as of December 31, 2017. Series B, no par, 100,000,000 members’ interest authorized (2,437,855 issued and outstanding) as of December 31, 2017
|
—
|
|
|
9,687
|
|
||
Total stockholders’ and members’ equity
|
92,585
|
|
|
47,721
|
|
||
Non-controlling interest
|
805
|
|
|
598
|
|
||
Total equity
|
93,390
|
|
|
48,319
|
|
||
Total liabilities and equity
|
$
|
458,901
|
|
|
$
|
377,651
|
|
|
Successor
|
|
|
Predecessor
|
||||||||||||
|
For the year ended December 31, 2018
|
|
Period from January 13, 2017 through December 31, 2017
|
|
|
Period from
January 1,
2017 through
January 12,
2017
|
|
For the year ended December 31, 2016
|
||||||||
Revenue
|
$
|
740,462
|
|
|
$
|
421,239
|
|
|
|
$
|
9,130
|
|
|
$
|
265,068
|
|
Cost of sales
|
642,734
|
|
|
338,908
|
|
|
|
7,301
|
|
|
203,228
|
|
||||
Gross profit
|
97,728
|
|
|
82,331
|
|
|
|
1,829
|
|
|
61,840
|
|
||||
General and administrative expenses
|
76,752
|
|
|
48,495
|
|
|
|
3,170
|
|
|
35,170
|
|
||||
Operating income (loss)
|
20,976
|
|
|
33,836
|
|
|
|
(1,341
|
)
|
|
26,670
|
|
||||
Interest expense, net
|
(32,226
|
)
|
|
(14,146
|
)
|
|
|
(4,181
|
)
|
|
(6,244
|
)
|
||||
Income from equity method investment
|
2,407
|
|
|
816
|
|
|
|
48
|
|
|
2,703
|
|
||||
(Loss) income before income taxes
|
(8,843
|
)
|
|
20,506
|
|
|
|
(5,474
|
)
|
|
23,129
|
|
||||
Income tax benefit
|
(2,427
|
)
|
|
—
|
|
|
|
—
|
|
|
—
|
|
||||
Net (loss) income
|
(6,416
|
)
|
|
20,506
|
|
|
|
(5,474
|
)
|
|
23,129
|
|
||||
Less income attributable to non-controlling interest
|
2,486
|
|
|
2,190
|
|
|
|
54
|
|
|
2,198
|
|
||||
Net (loss) income attributable to Charah Solutions, Inc.
|
$
|
(8,902
|
)
|
|
$
|
18,316
|
|
|
|
$
|
(5,528
|
)
|
|
$
|
20,931
|
|
Basic (loss) earnings per share
|
$
|
(0.33
|
)
|
|
$
|
0.77
|
|
|
|
N/A
|
|
N/A
|
||||
Diluted (loss) earnings per share
|
$
|
(0.33
|
)
|
|
$
|
0.75
|
|
|
|
N/A
|
|
N/A
|
||||
Pro forma net (loss) income information (see Note 1) (unaudited):
|
|
|
|
|
|
|
|
|
||||||||
Net (loss) income attributable to Charah Solutions, Inc. before provision for income taxes (unaudited)
|
$
|
(11,329
|
)
|
|
$
|
18,316
|
|
|
|
$
|
(5,528
|
)
|
|
$
|
20,931
|
|
Pro forma provision for income taxes (unaudited)
|
(2,214
|
)
|
|
6,960
|
|
|
|
(2,101
|
)
|
|
7,954
|
|
||||
Pro forma net (loss) income attributable to Charah Solutions, Inc. (unaudited)
|
$
|
(9,115
|
)
|
|
$
|
11,356
|
|
|
|
$
|
(3,427
|
)
|
|
$
|
12,977
|
|
|
|
Charah, LLC Members
|
|
Non-Controlling
Interest
|
|
Total
|
||||||||||||||||||||||||||||
|
|
Voting Shares
|
|
Non-voting Shares
|
|
Retained
Earnings
(Accumulated
Deficit)
|
|
Total
|
|
|||||||||||||||||||||||||
|
|
Number
of
Shares
|
|
Common
Stock
|
|
Number
of
Shares
|
|
Common
Stock
|
|
Additional
Paid-In
Capital
|
|
|||||||||||||||||||||||
Predecessor
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Balance, January 1, 2016
|
|
18,750
|
|
|
$
|
24
|
|
|
168,750
|
|
|
$
|
216
|
|
|
$
|
54
|
|
|
$
|
(540
|
)
|
|
$
|
(246
|
)
|
|
$
|
691
|
|
|
$
|
445
|
|
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
20,931
|
|
|
20,931
|
|
|
2,198
|
|
|
23,129
|
|
|||||||
Issuance of stock
|
|
—
|
|
|
—
|
|
|
49,860
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Repurchase of stock
|
|
—
|
|
|
—
|
|
|
(49,860
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Distributions
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(25
|
)
|
|
(25
|
)
|
|
(2,203
|
)
|
|
(2,228
|
)
|
|||||||
Balance, December 31, 2016
|
|
18,750
|
|
|
$
|
24
|
|
|
168,750
|
|
|
$
|
216
|
|
|
$
|
54
|
|
|
$
|
20,366
|
|
|
$
|
20,660
|
|
|
$
|
686
|
|
|
$
|
21,346
|
|
Net (loss) income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5,528
|
)
|
|
(5,528
|
)
|
|
54
|
|
|
(5,474
|
)
|
|||||||
Distributions
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(20,660
|
)
|
|
(20,660
|
)
|
|
—
|
|
|
(20,660
|
)
|
|||||||
Balance, January 12, 2017
|
|
18,750
|
|
|
$
|
24
|
|
|
168,750
|
|
|
$
|
216
|
|
|
$
|
54
|
|
|
$
|
(5,822
|
)
|
|
$
|
(5,528
|
)
|
|
$
|
740
|
|
|
$
|
(4,788
|
)
|
|
|
Charah, LLC and Allied Power Management, LLC
Combined
|
|
Non-Controlling
Interest
|
|
Total
|
||||||||||||||||||
|
|
Charah,
LLC
Members’
Interest
|
|
Allied Power
Management, LLC
Members’ Interest
|
|
Retained
Earnings
|
|
Total
|
|
|||||||||||||||
Successor
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Balance, January 13, 2017
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
740
|
|
|
$
|
740
|
|
Net income
|
|
—
|
|
|
—
|
|
|
18,316
|
|
|
18,316
|
|
|
2,190
|
|
|
20,506
|
|
||||||
Issuance of original Series A member interests
|
|
116,418
|
|
|
—
|
|
|
—
|
|
|
116,418
|
|
|
—
|
|
|
116,418
|
|
||||||
Issuance of original Series B member interests
|
|
36,643
|
|
|
—
|
|
|
—
|
|
|
36,643
|
|
|
—
|
|
|
36,643
|
|
||||||
Issuance of Series A and B member interests
|
|
486
|
|
|
9,514
|
|
|
—
|
|
|
10,000
|
|
|
—
|
|
|
10,000
|
|
||||||
Share-based compensation - Series A and B interests
|
|
1,945
|
|
|
135
|
|
|
—
|
|
|
2,080
|
|
|
—
|
|
|
2,080
|
|
||||||
Share-based compensation -
Series C profits interests
|
|
311
|
|
|
38
|
|
|
—
|
|
|
349
|
|
|
—
|
|
|
349
|
|
||||||
Distributions
|
|
(136,085
|
)
|
|
—
|
|
|
—
|
|
|
(136,085
|
)
|
|
(2,332
|
)
|
|
(138,417
|
)
|
||||||
Balance, December 31, 2017
|
|
$
|
19,718
|
|
|
$
|
9,687
|
|
|
$
|
18,316
|
|
|
$
|
47,721
|
|
|
$
|
598
|
|
|
$
|
48,319
|
|
|
|
Charah Solutions, Inc.
|
|||||||||||||||||||||||||||||||||
|
|
Common Stock (Shares)
|
|
Common Stock (Amount)
|
|
Additional Paid In Capital
|
|
Charah,
LLC
Members’
Interest
|
|
Allied Power
Management,
LLC
Members’ Interest
|
|
Retained
Earnings
|
|
Total
|
|
Non-Controlling
Interest
|
|
Total
|
|||||||||||||||||
Successor
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Balance, December 31, 2017
|
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
19,718
|
|
|
$
|
9,687
|
|
|
$
|
18,316
|
|
|
$
|
47,721
|
|
|
$
|
598
|
|
|
$
|
48,319
|
|
Net (loss) income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(8,902
|
)
|
|
(8,902
|
)
|
|
2,486
|
|
|
(6,416
|
)
|
||||||||
Share based compensation expense
|
|
—
|
|
|
—
|
|
|
—
|
|
|
214
|
|
|
—
|
|
|
—
|
|
|
214
|
|
|
—
|
|
|
214
|
|
||||||||
Distributions
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(686
|
)
|
|
—
|
|
|
—
|
|
|
(686
|
)
|
|
(2,279
|
)
|
|
(2,965
|
)
|
||||||||
Conversion from members
’
interest to common stock
|
|
23,436,398
|
|
|
234
|
|
|
28,699
|
|
|
(19,246
|
)
|
|
(9,687
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Issuance of shares
|
|
5,294,117
|
|
|
53
|
|
|
59,188
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
59,241
|
|
|
—
|
|
|
59,241
|
|
||||||||
Share based common stock issued
|
|
372,169
|
|
|
4
|
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Shares repurchased
|
|
(19,696
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Share based compensation expense
|
|
—
|
|
|
—
|
|
|
3,913
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,913
|
|
|
—
|
|
|
3,913
|
|
||||||||
Deferred offering costs
|
|
—
|
|
|
—
|
|
|
(8,916
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(8,916
|
)
|
|
—
|
|
|
(8,916
|
)
|
||||||||
Balance, December 31, 2018
|
|
29,082,988
|
|
|
$
|
291
|
|
|
$
|
82,880
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
9,414
|
|
|
$
|
92,585
|
|
|
$
|
805
|
|
|
$
|
93,390
|
|
|
Successor
|
|
|
Predecessor
|
||||||||||||
|
For the year ended December 31, 2018
|
|
Period from January 13, 2017 through December 31, 2017
|
|
|
Period
from
January 1
2017,
through
January 12,
2017
|
|
For the year ended December 31, 2016
|
||||||||
Cash flows from operating activities:
|
|
|
|
|
|
|
|
|
||||||||
Net (loss) income
|
$
|
(6,416
|
)
|
|
$
|
20,506
|
|
|
|
$
|
(5,474
|
)
|
|
$
|
23,129
|
|
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities:
|
|
|
|
|
|
|
|
|
||||||||
Depreciation and amortization
|
42,308
|
|
|
25,719
|
|
|
|
763
|
|
|
15,601
|
|
||||
Amortization of debt issuance costs
|
11,631
|
|
|
4,150
|
|
|
|
—
|
|
|
664
|
|
||||
Deferred income tax benefit
|
(2,995
|
)
|
|
—
|
|
|
|
—
|
|
|
—
|
|
||||
Loss on sale of assets
|
899
|
|
|
1,332
|
|
|
|
123
|
|
|
(1,798
|
)
|
||||
Income from equity method investment
|
(2,407
|
)
|
|
(816
|
)
|
|
|
(48
|
)
|
|
(2,703
|
)
|
||||
Distributions received from equity investment
|
2,353
|
|
|
1,099
|
|
|
|
—
|
|
|
840
|
|
||||
Non-cash share-based compensation
|
4,127
|
|
|
2,429
|
|
|
|
—
|
|
|
7,352
|
|
||||
Payment related to deferred stock plan
|
—
|
|
|
(18,888
|
)
|
|
|
—
|
|
|
(15,666
|
)
|
||||
(Gain) loss on interest rate swap
|
(1,089
|
)
|
|
198
|
|
|
|
—
|
|
|
—
|
|
||||
Interest accreted on contingent payments for acquisition
|
200
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
||||
Increase (decrease) in cash due to changes in:
|
|
|
|
|
|
|
|
|
||||||||
Trade accounts receivable
|
(7,595
|
)
|
|
4,814
|
|
|
|
(3,977
|
)
|
|
(6,930
|
)
|
||||
Receivable from affiliates
|
(857
|
)
|
|
195
|
|
|
|
—
|
|
|
(30
|
)
|
||||
Costs and estimated earnings in excess of billing
|
(78,752
|
)
|
|
(7,959
|
)
|
|
|
2,185
|
|
|
3,351
|
|
||||
Inventory
|
(5,720
|
)
|
|
(1,428
|
)
|
|
|
278
|
|
|
(243
|
)
|
||||
Prepaid expenses and other current assets
|
(360
|
)
|
|
(3,535
|
)
|
|
|
71
|
|
|
(1,161
|
)
|
||||
Accounts payable
|
9,086
|
|
|
(3,296
|
)
|
|
|
4,380
|
|
|
(15,365
|
)
|
||||
Billings in excess of costs and estimated earnings
|
(14,530
|
)
|
|
15,882
|
|
|
|
6
|
|
|
1,352
|
|
||||
Accrued payroll and bonuses
|
(556
|
)
|
|
13,502
|
|
|
|
(318
|
)
|
|
24
|
|
||||
Asset retirement obligation
|
24,993
|
|
|
207
|
|
|
|
—
|
|
|
865
|
|
||||
Accrued expenses and other liabilities
|
12,047
|
|
|
3,681
|
|
|
|
(2,407
|
)
|
|
(931
|
)
|
||||
Net cash (used in) provided by operating activities
|
(13,633
|
)
|
|
57,792
|
|
|
|
(4,418
|
)
|
|
8,351
|
|
||||
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
||||||||
Proceeds from the sale of equipment
|
1,682
|
|
|
2,062
|
|
|
|
—
|
|
|
4,730
|
|
||||
Purchases of property and equipment
|
(22,036
|
)
|
|
(12,690
|
)
|
|
|
—
|
|
|
(10,065
|
)
|
||||
Investment in equity method investment
|
—
|
|
|
—
|
|
|
|
—
|
|
|
(3,378
|
)
|
||||
Payments for business acquisitions, net of cash received
|
(19,983
|
)
|
|
—
|
|
|
|
—
|
|
|
—
|
|
||||
Purchase of intangible assets
|
(31
|
)
|
|
—
|
|
|
|
—
|
|
|
—
|
|
||||
Decrease (increase) in restricted cash
|
—
|
|
|
3,358
|
|
|
|
—
|
|
|
(3,358
|
)
|
||||
Change in loan to related party, net
|
—
|
|
|
—
|
|
|
|
—
|
|
|
(3,814
|
)
|
||||
Net cash used in investing activities
|
(40,368
|
)
|
|
(7,270
|
)
|
|
|
—
|
|
|
(15,885
|
)
|
|
Successor
|
|
|
Predecessor
|
||||||||||||
|
For the year ended December 31, 2018
|
|
Period from January 13, 2017 through December 31, 2017
|
|
|
Period
from
January 1
2017,
through
January 12,
2017
|
|
For the year ended December 31, 2016
|
||||||||
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
||||||||
Net proceeds (payments) on line of credit
|
19,799
|
|
|
(43,800
|
)
|
|
|
4,605
|
|
|
(3,301
|
)
|
||||
Proceeds from long-term debt
|
217,255
|
|
|
395,004
|
|
|
|
298
|
|
|
32,887
|
|
||||
Principal payments on long-term debt
|
(255,777
|
)
|
|
(242,090
|
)
|
|
|
(440
|
)
|
|
(20,060
|
)
|
||||
Payments of offering costs
|
(8,916
|
)
|
|
—
|
|
|
|
—
|
|
|
—
|
|
||||
Capital contribution to Allied Power Management, LLC
|
—
|
|
|
10,000
|
|
|
|
—
|
|
|
—
|
|
||||
Issuance of common stock
|
59,241
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
||||
Distributions to non-controlling interest
|
(2,279
|
)
|
|
(2,333
|
)
|
|
|
—
|
|
|
(2,203
|
)
|
||||
Distributions to members
|
(686
|
)
|
|
(136,085
|
)
|
|
|
—
|
|
|
(25
|
)
|
||||
Net cash provided by (used in) financing activities
|
28,637
|
|
|
(19,304
|
)
|
|
|
4,463
|
|
|
7,298
|
|
||||
Net (decrease) increase in cash
|
(25,364
|
)
|
|
31,218
|
|
|
|
45
|
|
|
(236
|
)
|
||||
Cash, beginning of period
|
32,264
|
|
|
1,046
|
|
|
|
1,001
|
|
|
1,237
|
|
||||
Cash, end of period
|
$
|
6,900
|
|
|
$
|
32,264
|
|
|
|
$
|
1,046
|
|
|
$
|
1,001
|
|
Supplemental disclosures of cash flow information:
|
|
|
|
|
|
|
|
|
||||||||
Cash paid during the year for interest
|
$
|
22,842
|
|
|
$
|
9,747
|
|
|
|
$
|
104
|
|
|
$
|
5,550
|
|
Cash paid during the year for taxes
|
$
|
3,334
|
|
|
$
|
—
|
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
Plant, machinery and equipment
|
|
2 - 15 years
|
Vehicles
|
|
2 - 10 years
|
Office equipment
|
|
2 - 10 years
|
Buildings and leasehold improvements
|
|
5 - 40 years
|
•
|
Final capping and closure involves the installation of drainage and compacted soil layers and topsoil over areas where total airspace capacity has been consumed. Asset retirement obligations are recorded on a units-of-consumption basis as airspace is consumed (see Note 22). The liability is based on estimates of the discounted cash flows.
|
•
|
Post closure involves the maintenance and monitoring of the structural fill sites. Generally, we are required to maintain and monitor the structural fill sites for a
30
-year period. These maintenance and monitoring costs are recorded as an asset retirement obligation as airspace is consumed over the life of the structural fill sites. Post-closure obligations are recorded over the life of the structural fill sites on a units-of-consumption basis as airspace is consumed (see Note 22), based on estimates of the discounted cash flows associated with performing post-closure activities.
|
Definite Lived Intangible
|
Useful Life
|
Customer relationships
|
10 years
|
Technology
|
10 years
|
Non-compete agreement
|
2 years
|
SCB trade name
|
5 years
|
Rail easement
|
2 years
|
Fair value of liability recognized at January 13, 2017 (Successor)
|
$
|
29,883
|
|
Amortization in the period from January 13, 2017 to December 31, 2017 (Successor)
|
(4,639
|
)
|
|
Balance, December 31, 2017 (Successor)
|
25,244
|
|
|
Amortization in the year ended December 31, 2018 (Successor)
|
(15,227
|
)
|
|
Balance, December 31, 2018 (Successor)
|
$
|
10,017
|
|
Net working capital
|
$
|
26,704
|
|
Net operating assets/liabilities
|
9,679
|
|
|
Property, plant and equipment
|
107,876
|
|
|
Rail easement
|
110
|
|
|
Purchase option liability
|
(29,883
|
)
|
|
Trade name intangible assets
|
34,330
|
|
|
Customer relationship intangible assets
|
78,200
|
|
|
Goodwill
|
73,468
|
|
|
Total purchase price
|
$
|
300,484
|
|
Cash acquired
|
$
|
17
|
|
Net working capital, excluding cash
|
21,255
|
|
|
Property, plant and equipment
|
5,300
|
|
|
Trade name intangible assets
|
694
|
|
|
Customer relationship intangible assets
|
742
|
|
|
Technology
|
1,972
|
|
|
Non-compete and other agreements
|
289
|
|
|
Goodwill
|
745
|
|
|
Total purchase price
|
$
|
31,014
|
|
|
Successor
|
|
Predecessor
|
||||||||
|
For the year ended December 31, 2018
|
|
Period from January 13, 2017 through December 31, 2017
|
|
Period from
January 1,
2017 through
January 12,
2017
|
||||||
Pro forma revenue
|
$
|
757,285
|
|
|
$
|
496,687
|
|
|
$
|
11,158
|
|
Pro forma net (loss) income attributable to Charah Solutions, Inc.
|
$
|
(7,972
|
)
|
|
$
|
18,877
|
|
|
$
|
(5,447
|
)
|
|
December 31,
2018 |
|
December 31,
2017 |
||||
Current assets
|
$
|
2,619
|
|
|
$
|
1,946
|
|
Noncurrent assets
|
508
|
|
|
764
|
|
||
Total assets
|
$
|
3,127
|
|
|
$
|
2,710
|
|
Current liabilities
|
607
|
|
|
298
|
|
||
Equity of Charah
|
5,060
|
|
|
5,006
|
|
||
Equity of joint venture partner
|
(2,540
|
)
|
|
(2,594
|
)
|
||
Total liabilities and members’ equity
|
$
|
3,127
|
|
|
$
|
2,710
|
|
|
Successor
|
|
|
Predecessor
|
||||||||||||
|
For the year ended December 31, 2018
|
|
Period from January 13, 2017 through December 31, 2017
|
|
|
Period from
January 1
2017, through
January 12,
2017
|
|
For the year ended December 31, 2016
|
||||||||
Operating Data
|
|
|
|
|
|
|
|
|
||||||||
Revenues
|
$
|
11,076
|
|
|
$
|
7,573
|
|
|
|
$
|
300
|
|
|
$
|
11,384
|
|
Net income
|
$
|
4,813
|
|
|
$
|
1,632
|
|
|
|
$
|
96
|
|
|
$
|
5,405
|
|
The Company’s share of net income
|
$
|
2,407
|
|
|
$
|
816
|
|
|
|
$
|
48
|
|
|
$
|
2,703
|
|
|
Successor
|
|
|
Predecessor
|
||||||||||||
|
For the year ended December 31, 2018
|
|
Period from January 13, 2017 through December 31, 2017
|
|
|
Period from
January 1
2017, through
January 12,
2017
|
|
For the year ended December 31, 2016
|
||||||||
|
|
|
||||||||||||||
Opening balance
|
$
|
5,006
|
|
|
$
|
5,289
|
|
|
|
$
|
5,241
|
|
|
$
|
—
|
|
Contributions
|
—
|
|
|
—
|
|
|
|
—
|
|
|
3,378
|
|
||||
Distributions
|
(2,353
|
)
|
|
(1,099
|
)
|
|
|
—
|
|
|
(840
|
)
|
||||
Share of net income
|
2,407
|
|
|
816
|
|
|
|
48
|
|
|
2,703
|
|
||||
Closing balance
|
$
|
5,060
|
|
|
$
|
5,006
|
|
|
|
$
|
5,289
|
|
|
$
|
5,241
|
|
|
December 31, 2018
|
|
December 31, 2017
|
||||||||||||
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
||||||||
Definite-lived intangibles
|
|
|
|
|
|
|
|
|
|||||||
Customer relationships
|
$
|
78,942
|
|
|
$
|
(15,044
|
)
|
|
$
|
78,200
|
|
|
$
|
(7,168
|
)
|
Rail easement
|
110
|
|
|
(88
|
)
|
|
110
|
|
|
(23
|
)
|
||||
Technology
|
2,003
|
|
|
(150
|
)
|
|
—
|
|
|
—
|
|
||||
Non-compete and other agreements
|
289
|
|
|
(109
|
)
|
|
—
|
|
|
—
|
|
||||
SCB trade name
|
694
|
|
|
(104
|
)
|
|
—
|
|
|
—
|
|
||||
Total
|
$
|
82,038
|
|
|
$
|
(15,495
|
)
|
|
$
|
78,310
|
|
|
$
|
(7,191
|
)
|
|
|
|
|
|
|
|
|
||||||||
Indefinite-lived intangibles
|
|
|
|
|
|
|
|
|
|||||||
Charah trade name
|
$
|
34,330
|
|
|
|
|
$
|
34,330
|
|
|
|
||||
Goodwill
|
74,213
|
|
|
|
|
73,468
|
|
|
|
||||||
Total
|
$
|
108,543
|
|
|
|
|
|
$
|
107,798
|
|
|
|
|
December 31,
2018 |
|
December 31, 2017
|
||||
Various equipment notes entered into in November 2017, payable in monthly installments ranging from $5 to $24, including interest at 5.2%, maturing in December 2022 through December 2023. The notes are secured by equipment with a net book value of $4,464 as of December 31, 2018 (Successor).
|
$
|
4,949
|
|
|
$
|
5,910
|
|
Various equipment notes entered into in 2018, payable in monthly installments ranging from $1 to $39, including interest ranging from 5.61% to 6.80%, maturing in March 2023 through May 2025. The notes are secured by equipment with a net book value of $11,791 as of December 31, 2018 (Successor).
|
12,293
|
|
|
—
|
|
||
In June 2018, the Company entered into a $12,000 non-revolving credit note with a bank. The credit note will convert to a term loan on April 10, 2019, with a maturity date of April 10, 2024. Interest on borrowings prior to the conversion date is calculated using a floating rate equal to 2% in excess of LIBOR. At the conversion date, interest can be either calculated based on the aforementioned rate or at a fixed rate equal to 2% in excess of the 5-year Swap Rate in effect at the conversion date, based on the Company’s preference. The note is secured by equipment with a net book value of $8,038 as of December 31, 2018 (Successor).
|
8,299
|
|
|
—
|
|
||
A $10,000 equipment line with a bank, entered into in December 2017, secured by all equipment purchased with the proceeds of the loan. Interest is calculated on any outstanding amounts using a fixed rate of 4.5%. The equipment line converted to a term loan in September 2018, with a maturity date of June 22, 2023. The term loan is secured by equipment with a net book value of $8,445 as of December 31, 2018 (Successor).
|
9,563
|
|
|
3,244
|
|
||
A credit agreement with a bank, entered into in October 2017, providing for a senior secured term loan B facility with an initial commitment of $250,000 (the “Term Loan”). The interest rates per annum applicable to the loans under the Term Loan were based on a fluctuating rate of interest measured by reference to, at the Company’s election, either (i) LIBOR plus a 6.25% borrowing margin, or (ii) an alternative base rate plus a 5.25% borrowing margin. The principal amount of the Term Loan amortized at a rate of 7.5% per annum with all remaining outstanding amounts under the Term Loan due on the Term Loan maturity date. A portion of the IPO proceeds was used to prepay scheduled principal payments which would otherwise have been required through June 2020. The Term Loan had a scheduled maturity date of October 25, 2024. The Term Loan was secured by substantially all the assets of the Company and was subject to certain financial covenants. The loan was repaid in full in September 2018.
|
—
|
|
|
250,000
|
|
||
A term loan entered into in September 2018 as part of the Syndicated Credit Facility (see also Note 7). The interest rate applicable to the term loan is based on a fluctuating rate of interest measured by reference to, at the Company’s election, either (i) the Eurodollar rate, currently the LIBOR rate, or (ii) an alternative base rate (see also Note 7). Principal payments of $2,563 are required quarterly through September 2020, $3,844 through September 2022, and $5,125 through September 2023. The remaining outstanding amounts will be due in September 2023. The term loan is secured by substantially all the assets of the Company and is subject to certain financial covenants.
|
202,438
|
|
|
—
|
|
||
Total
|
237,542
|
|
|
259,154
|
|
||
Less debt issuance costs
|
(3,252
|
)
|
|
(11,460
|
)
|
||
|
234,290
|
|
|
247,694
|
|
||
Less current maturities
|
(23,268
|
)
|
|
(19,996
|
)
|
||
Notes payable due after one year
|
$
|
211,022
|
|
|
$
|
227,698
|
|
|
December 31,
2018 |
|
December 31,
2017 |
||||
Costs incurred on uncompleted contracts
|
$
|
314,700
|
|
|
$
|
151,963
|
|
Estimated earnings
|
96,176
|
|
|
53,356
|
|
||
Total costs and earnings
|
410,876
|
|
|
205,319
|
|
||
Less billings to date
|
(325,518
|
)
|
|
(213,242
|
)
|
||
Costs and estimated earnings in excess of billings
|
$
|
85,358
|
|
|
$
|
(7,923
|
)
|
|
December 31,
2018 |
|
December 31,
2017 |
||||
Costs and estimated earnings in excess of billings
|
$
|
86,710
|
|
|
$
|
7,959
|
|
Billings in excess of costs and estimated earnings
|
(1,352
|
)
|
|
(15,882
|
)
|
||
Net balance in process
|
$
|
85,358
|
|
|
$
|
(7,923
|
)
|
|
|
Shares
|
|
Weighted Average Grant Date Fair Value
|
|
Weighted Average Remaining Contractual Terms (Years)
|
|
Aggregate Intrinsic Value
|
|||||
Granted to replace Charah and Allied Series C Profits Interests
|
|
1,215,996
|
|
|
$
|
12.00
|
|
|
|
|
|
||
Granted
|
|
361,910
|
|
|
11.46
|
|
|
|
|
|
|||
Forfeited
|
|
(6,994
|
)
|
|
12.00
|
|
|
|
|
|
|||
Vested
|
|
(372,169
|
)
|
|
12.00
|
|
|
|
|
|
|||
Outstanding as of December 31, 2018
|
|
1,198,743
|
|
|
$
|
11.84
|
|
|
0.77
|
|
$
|
10,009
|
|
•
|
Assets contributed to the multiemployer plans by one employer may be used to provide benefits to employees of other participating employers.
|
•
|
If a participating employer stops contributing to the multiemployer plans, the unfunded obligations of the multiemployer plans may be borne by the remaining participating employers.
|
•
|
If AMS chooses to stop participating in the multiemployer plans, AMS may be required to pay the multiemployer plans an amount based on the underfunded status of the multiemployer plans, referred to as a withdrawal liability.
|
|
|
|
|
|
|
|
|
Successor
|
|
|
Predecessor
|
|
|
|
|
||||||||||||
|
|
|
|
Pension
|
|
FIP/RP
|
|
Year ended December 31, 2018
|
|
Period from
January 13,
2017 through
December 31,
2017
|
|
|
Period from
January 1
2017 through
January 12,
2017
|
|
Year ended December 31, 2016
|
|
|
|
Expiration
Date of
|
||||||||
Pension Fund
|
|
EIN/Pension
Plan Number
|
|
Protection
Act Zone
Status
|
|
Status
Pending/
Implemented
|
|
Contributions
to Funds by
AMS
|
|
Contributions
to Funds by
AMS
|
|
|
Contributions
to Funds by
AMS
|
|
Contributions
to Funds by
AMS
|
|
Surcharge
Imposed
|
|
Collective
Bargaining
Agreement
|
||||||||
Central states, southeast and southwest areas pension plan
|
|
36-6044243
|
|
Red - Critical and declining
|
|
Progress under FIP or RP
|
|
$
|
34
|
|
|
$
|
59
|
|
|
|
$
|
—
|
|
|
$
|
78
|
|
|
No
|
|
Continuous with notice period by either party
|
Employer Teamsters Locals 175 & 505 pension trust fund
|
|
55-6021850
|
|
Red - Critical
|
|
Progress under FIP or RP
|
|
$
|
92
|
|
|
$
|
—
|
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Yes
|
|
2021
|
Successor
|
|
|
|
|
|
|
|
||||||||
For the year ended December 31, 2018
|
ES
|
|
M&TS
|
|
All
Other
|
|
Total
|
||||||||
Revenue
|
$
|
343,105
|
|
|
$
|
397,357
|
|
|
$
|
—
|
|
|
$
|
740,462
|
|
Segment gross profit
|
69,464
|
|
|
28,264
|
|
|
—
|
|
|
97,728
|
|
||||
Segment depreciation and amortization expense
|
27,943
|
|
|
6,394
|
|
|
7,971
|
|
|
42,308
|
|
||||
Expenditures for segment assets
|
11,728
|
|
|
10,284
|
|
|
24
|
|
|
22,036
|
|
||||
Period from January 13, 2017 through December 31, 2017
|
ES
|
|
M&TS
|
|
All
Other
|
|
Total
|
||||||||
Revenue
|
$
|
232,581
|
|
|
$
|
188,658
|
|
|
$
|
—
|
|
|
$
|
421,239
|
|
Segment gross profit
|
64,433
|
|
|
17,898
|
|
|
—
|
|
|
82,331
|
|
||||
Segment depreciation and amortization expense
|
23,169
|
|
|
2,361
|
|
|
189
|
|
|
25,719
|
|
||||
Expenditures for segment assets
|
6,107
|
|
|
6,583
|
|
|
—
|
|
|
12,690
|
|
||||
Predecessor
|
|
|
|
|
|
|
|
||||||||
Period from January 1, 2017 through January 12, 2017
|
ES
|
|
M&TS
|
|
All
Other
|
|
Total
|
||||||||
Revenue
|
$
|
7,451
|
|
|
$
|
1,679
|
|
|
$
|
—
|
|
|
$
|
9,130
|
|
Segment gross profit
|
1,412
|
|
|
417
|
|
|
—
|
|
|
1,829
|
|
||||
Segment depreciation and amortization expense
|
688
|
|
|
70
|
|
|
5
|
|
|
763
|
|
||||
Expenditures for segment assets
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
For the year ended December 31, 2016
|
ES
|
|
M&TS
|
|
All
Other
|
|
Total
|
||||||||
Revenue
|
$
|
218,051
|
|
|
$
|
47,017
|
|
|
$
|
—
|
|
|
$
|
265,068
|
|
Segment gross profit
|
51,282
|
|
|
10,558
|
|
|
—
|
|
|
61,840
|
|
||||
Segment depreciation and amortization expense
|
10,228
|
|
|
5,263
|
|
|
110
|
|
|
15,601
|
|
||||
Expenditures for segment assets
|
6,668
|
|
|
3,044
|
|
|
353
|
|
|
10,065
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Successor
|
|
|
|
|
|
|
|
||||||||
As of December 31, 2018
|
ES
|
|
M&TS
|
|
All
Other
|
|
Total
|
||||||||
Segment property and equipment, net
|
$
|
47,467
|
|
|
$
|
41,155
|
|
|
$
|
319
|
|
|
$
|
88,941
|
|
Segment goodwill
|
57,591
|
|
|
16,622
|
|
|
—
|
|
|
74,213
|
|
||||
As of December 31, 2017
|
ES
|
|
M&TS
|
|
All
Other
|
|
Total
|
||||||||
Segment property and equipment, net
|
$
|
75,764
|
|
|
$
|
23,725
|
|
|
$
|
441
|
|
|
$
|
99,930
|
|
Segment goodwill
|
56,846
|
|
|
16,622
|
|
|
—
|
|
|
73,468
|
|
|
Successor
|
|
|
Predecessor
|
||||||||||||
|
For the year ended December 31, 2018
|
|
Period from January 13, 2017 through December 31, 2017
|
|
|
Period from
January 1,
2017
through
January 12,
2017
|
|
For the year ended December 31, 2016
|
||||||||
|
|
|
|
|
||||||||||||
Segment gross profit
|
$
|
97,728
|
|
|
$
|
82,331
|
|
|
|
$
|
1,829
|
|
|
$
|
61,840
|
|
General and administrative expenses
|
(76,752
|
)
|
|
(48,495
|
)
|
|
|
(3,170
|
)
|
|
(35,170
|
)
|
||||
Interest expense, net
|
(32,226
|
)
|
|
(14,146
|
)
|
|
|
(4,181
|
)
|
|
(6,244
|
)
|
||||
Income from equity method investment
|
2,407
|
|
|
816
|
|
|
|
48
|
|
|
2,703
|
|
||||
Income tax benefit
|
2,427
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
||||
Net (loss) income
|
$
|
(6,416
|
)
|
|
$
|
20,506
|
|
|
|
$
|
(5,474
|
)
|
|
$
|
23,129
|
|
|
As of December 31, 2018
|
|
As of December 31, 2017
|
||||
Segment property and equipment, net
|
$
|
88,941
|
|
|
$
|
99,930
|
|
Segment goodwill
|
74,213
|
|
|
73,468
|
|
||
Non-segment assets
|
295,747
|
|
|
204,253
|
|
||
Total assets
|
$
|
458,901
|
|
|
$
|
377,651
|
|
Successor
|
|
|
|
|
|
|
|
||||||||
For the year ended December 31, 2018
|
Products
|
|
Percentage of Completion
|
|
Services
|
|
Total
|
||||||||
Revenue
|
$
|
80,851
|
|
|
$
|
255,410
|
|
|
$
|
404,201
|
|
|
$
|
740,462
|
|
Period from January 13, 2017 through December 31, 2017
|
Products
|
|
Percentage of Completion
|
|
Services
|
|
Total
|
||||||||
Revenue
|
$
|
22,865
|
|
|
$
|
196,833
|
|
|
$
|
201,541
|
|
|
$
|
421,239
|
|
Predecessor
|
|
|
|
|
|
|
|
||||||||
Period from January 1, 2017 through January 12, 2017
|
Products
|
|
Percentage of Completion
|
|
Services
|
|
Total
|
||||||||
Revenue
|
$
|
885
|
|
|
$
|
6,377
|
|
|
$
|
1,868
|
|
|
$
|
9,130
|
|
For the year ended December 31, 2016
|
Products
|
|
Percentage of Completion
|
|
Services
|
|
Total
|
||||||||
Revenue
|
$
|
28,114
|
|
|
$
|
176,496
|
|
|
$
|
60,458
|
|
|
$
|
265,068
|
|
Income tax benefit at the federal statutory rate (21%)
|
$
|
(1,857
|
)
|
State income tax benefit, net of federal tax benefit
|
(907
|
)
|
|
Income tax expense upon conversion to corporation
|
1,818
|
|
|
Non-controlling interest
|
(522
|
)
|
|
Stock compensation
|
374
|
|
|
Income prior to conversion
|
(1,446
|
)
|
|
Other
|
113
|
|
|
Benefit from income taxes
|
$
|
(2,427
|
)
|
Fixed assets, including land
|
$
|
(9,641
|
)
|
Asset retirement obligation
|
6,489
|
|
|
Purchase option liability
|
2,494
|
|
|
Accrued bonus
|
1,622
|
|
|
Other accrued expenses and reserves
|
2,636
|
|
|
Prepaid expenses
|
(885
|
)
|
|
Loss carryovers
|
850
|
|
|
Intangible assets
|
(818
|
)
|
|
Deferred tax asset, net
|
$
|
2,747
|
|
For the Year Ending December 31,
|
Operating Leases
|
|
|
2019
|
$
|
4,462
|
|
2020
|
3,549
|
|
|
2021
|
1,285
|
|
|
2022
|
451
|
|
|
2023
|
451
|
|
|
Thereafter
|
1,316
|
|
|
Total
|
$
|
11,514
|
|
|
Successor
|
|
|
Predecessor
|
||||||||||||
|
For the year ended December 31, 2018
|
|
Period from January 13, 2017 through December 31, 2017
|
|
|
Period from
January 1,
2017
through
January 12,
2017
|
|
For the year ended December 31, 2016
|
||||||||
|
|
|
|
|
||||||||||||
Numerator:
|
|
|
|
|
|
|
|
|
||||||||
Net (loss) income attributable to Charah Solutions, Inc.
|
$
|
(8,902
|
)
|
|
$
|
18,316
|
|
|
|
$
|
(5,528
|
)
|
|
$
|
20,931
|
|
|
|
|
|
|
|
|
|
|
||||||||
Denominator (in thousands):
|
|
|
|
|
|
|
|
|
||||||||
Weighted average shares outstanding
|
26,610
|
|
|
23,710
|
|
|
|
N/A
|
|
|
N/A
|
|
||||
Dilutive share-based awards
|
—
|
|
|
822
|
|
|
|
N/A
|
|
|
N/A
|
|
||||
Total weighted average shares outstanding, including dilutive shares
|
26,610
|
|
|
24,532
|
|
|
|
N/A
|
|
|
N/A
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Basic (loss) earnings per share
|
$
|
(0.33
|
)
|
|
$
|
0.77
|
|
|
|
N/A
|
|
|
N/A
|
|
||
Diluted (loss) earnings per share
|
$
|
(0.33
|
)
|
|
$
|
0.75
|
|
|
|
N/A
|
|
|
N/A
|
|
|
December 31, 2018
|
|
December 31, 2017
|
||||
Opening balance
|
$
|
1,072
|
|
|
$
|
865
|
|
Obligations incurred
|
24,673
|
|
|
154
|
|
||
Interest accretion
|
320
|
|
|
53
|
|
||
Ending balance
|
26,065
|
|
|
1,072
|
|
||
Less current portion
|
(14,704
|
)
|
|
(1,072
|
)
|
||
Non-current portion
|
$
|
11,361
|
|
|
$
|
—
|
|
|
First Quarter
|
Second Quarter
|
Third Quarter
|
Fourth Quarter
|
||||||||
2018
|
||||||||||||
Revenue
|
$
|
155,529
|
|
$
|
195,723
|
|
$
|
186,002
|
|
$
|
203,208
|
|
Operating income (loss)
|
4,717
|
|
11,612
|
|
(5,919
|
)
|
10,566
|
|
||||
Net income (loss) attributable to Charah Solutions, Inc.
|
806
|
|
3,220
|
|
(17,395
|
)
|
4,467
|
|
||||
Basic earnings (loss) per share
|
0.03
|
|
0.13
|
|
(0.60
|
)
|
0.15
|
|
||||
Diluted earnings (loss) per share
|
0.03
|
|
0.13
|
|
(0.60
|
)
|
0.15
|
|
|
January 1, 2017 through January 12, 2017
|
|
|
January 13, 2017 through March 31, 2017
|
Second Quarter
|
Third Quarter
|
Fourth Quarter
|
||||||||||
2017
|
|
|
|
|
|
|
|
||||||||||
Revenue
|
$
|
9,130
|
|
|
|
$
|
58,965
|
|
$
|
74,404
|
|
$
|
118,911
|
|
$
|
168,959
|
|
Operating (loss) income
|
(1,341
|
)
|
|
|
9,214
|
|
13,031
|
|
3,212
|
|
8,379
|
|
|||||
Net (loss) income attributable to Charah Solutions, Inc.
|
(5,528
|
)
|
|
|
8,095
|
|
10,771
|
|
1,057
|
|
(1,607
|
)
|
|||||
Basic earnings (loss) per share
|
N/A
|
|
|
|
0.34
|
|
0.45
|
|
0.04
|
|
(0.07
|
)
|
|||||
Diluted earnings (loss) per share
|
N/A
|
|
|
|
0.33
|
|
0.44
|
|
0.04
|
|
(0.07
|
)
|
|
1
|
|
Vesting Date
|
Percentage of RSUs
|
August 11, 2019
|
100%
|
|
2
|
|
|
3
|
|
|
4
|
|
|
5
|
|
|
6
|
|
CHARAH SOLUTIONS, INC.
|
||
|
|
|
|
|
|
By:
|
|
|
|
|
|
|
|
|
Name:
|
|
|
|
|
|
|
|
|
Title:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
PARTICIPANTS
|
||
|
|
|
|
|
|
Name:
|
|
|
|
|
|
|
|
|
|
7
|
|
CHARAH, LLC
|
|
CHARLES E. PRICE
|
|
||
|
|
|
|
|
|
/s/ Charles Price
|
|
/s/ Charles Price
|
|
||
|
|
|
|
|
|
By:
|
Charles Price
|
|
|
|
|
|
|
|
|
|
|
Its:
|
President & CEO
|
|
|
|
|
Entity
|
|
State or Other Jurisdiction of Incorporation or Organization
|
|
|
|
Charah Sole Member LLC
|
|
Delaware
|
Allied Power Sole Member, LLC
|
|
Delaware
|
Charah, LLC
|
|
Kentucky
|
Allied Power Management, LLC
|
|
Delaware
|
Ash Management Services, LLC
|
|
Kentucky
|
Green Meadow, LLC
|
|
North Carolina
|
Ash Venture LLC
|
|
North Carolina
|
CV Ash, LLC
|
|
Texas
|
Allied Power Services, LLC
|
|
Delaware
|
Charah Plant Services, LLC
|
|
Delaware
|
Allied Power Resources, LLC
|
|
Delaware
|
Charah Management LLC
|
|
Delaware
|
Allied Power Holdings, LLC
|
|
Delaware
|
Allied Power International, LLC
|
|
Delaware
|
SCB International Holdings, LLC
|
|
Delaware
|
Mercury Capture Intellectual Property, LLC
|
|
Delaware
|
SCB Trading, LLC
|
|
Connecticut
|
Mercury Capture Beneficiation, LLC
|
|
Delaware
|
Nutek Micro-Grinding, LLC
|
|
Connecticut
|
Oreco Trading, Inc.
|
|
Panama
|
SCB Europe S.a.R.L.
|
|
Italy
|
1.
|
I have reviewed this Annual Report on Form 10-K of Charah Solutions, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
c.
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/ Scott A. Sewell
|
|
|
|
|
|
Scott A. Sewell
|
||
|
|
|
President and Chief Executive Officer
|
||
|
|
|
(Principal Executive Officer)
|
1.
|
I have reviewed this Annual Report on Form 10-K of Charah Solutions, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
c.
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
/s/ Nicholas W. Jacoby
|
|
|
|
|
|
Nicholas W. Jacoby
|
||
|
|
|
Interim Chief Financial Officer and Treasurer
|
||
|
|
|
(Principal Financial Officer)
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/s/ Scott A. Sewell
|
|
|
|
|
|
Scott A. Sewell
|
||
|
|
|
President and Chief Executive Officer
|
||
|
|
|
(Principal Executive Officer)
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/s/ Nicholas W. Jacoby
|
|
|
|
|
|
Nicholas W. Jacoby
|
||
|
|
|
Interim Chief Financial Officer and Treasurer
|
||
|
|
|
(Principal Financial Officer)
|