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ý
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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46-5399422
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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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1251 Waterfront Place, Suite 201
Pittsburgh, Pennsylvania
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15222
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(Address of principal executive offices)
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(Zip Code)
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Title of Each Class
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Trading Symbol(s)
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Name of Each Exchange on Which Registered
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Common Stock, par value $0.0001 per share
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LMB
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The Nasdaq Stock Market LLC
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•
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Healthcare, including research, acute care and inpatient hospitals for regional and national hospital groups, and pharmaceutical and biotech laboratories and manufacturing facilities;
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•
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Education, including both public and private colleges, universities, research centers and K-12 facilities;
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•
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Sports and entertainment, including sports arenas, entertainment facilities (including casinos) and amusement rides;
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•
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Infrastructure, including passenger terminals and maintenance facilities for rail and airports;
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•
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Government, including various facilities for federal, state and local agencies;
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•
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Hospitality, including hotels and resorts;
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•
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Commercial, including office building and other commercial structures;
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•
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Mission critical facilities, including data centers; and
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•
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Industrial manufacturing facilities.
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•
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Barton Malow
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•
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Hathaway Dinwiddie
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•
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Hensel Phelps Construction
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•
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John Moriarty & Associates
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•
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Whiting-Turner
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•
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Beaumont Health System
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•
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Cardinal Health
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•
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Constellation Energy
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•
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Disney’s Facility Group
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•
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Disney’s Imagineering
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•
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Honda
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•
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Hospital Corporation of America
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•
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Johns Hopkins University
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•
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Marriott
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•
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Michigan State University
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•
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Ohio Health
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•
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Ohio State University
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•
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Orlando Health
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•
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PPG Industries
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•
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Steward
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•
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Tyco
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•
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UHS
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•
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Washington Gas
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•
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on-site conditions that differ from those described in the original bid or contract;
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•
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failure to include required materials, equipment, or work in a bid, or the failure to estimate properly the quantities or costs needed to complete a lump sum or guaranteed maximum price contract;
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•
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contract or project modifications creating unanticipated costs not covered by change orders;
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•
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failure by the customer, owner or general contractor to properly approve and authorize change orders for work that is required and as a result, the inability to bill and collect for the value of the work performed;
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•
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failure by suppliers, vendors, subcontractors, designers, engineers, consultants, joint venture partners or customers to perform their obligations;
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•
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delays in quickly identifying and taking measures to address issues which arise during contract execution;
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changes in availability, proximity and costs of materials and equipment, including pipe, sheet metal, other construction materials and mechanical HVAC, electrical and plumbing equipment;
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•
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claims or demands from third parties for alleged damages arising from the design, construction or use and operation of a project of which our work is part;
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•
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difficulties in obtaining required governmental permits or approvals;
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availability and skill level of workers in the geographic location of a project;
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citations issued by any governmental authority, including the Occupational Safety and Health Administration;
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unexpected labor conditions, shortages or work stoppages causing delays in completion, or acceleration of the contracted work to maintain milestone completion dates, which could cause losses due to not meeting estimated production targets;
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•
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installation productivity rates different than the rate that was estimated;
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•
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changes in applicable tariffs, laws and regulations;
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•
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delays caused by weather conditions;
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•
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fraud, theft or other improper activities by suppliers, vendors, subcontractors, designers, engineers, consultants, joint venture partners, customers or our own personnel; and
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•
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mechanical or performance problems with equipment.
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•
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our estimates of headcount requirements and our ability to manage attrition;
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•
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efficiency in scheduling projects and our ability to minimize downtime between project assignments;
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•
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productivity;
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•
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labor disputes; and
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•
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availability of skilled labor at any given time.
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•
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limit our ability to obtain additional financing for working capital, capital expenditures, debt service requirements, acquisitions and general corporate or other purposes;
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•
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restrict us from making strategic acquisitions or cause us to make non-strategic divestitures;
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•
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increase our vulnerability to general economic and industry conditions; and
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•
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require a substantial portion of cash flow from operations to be dedicated to the payment of principal and interest on our borrowings, thereby reducing our ability to use cash flow to fund our operations, capital expenditures and future business opportunities.
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•
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Our controls related to monthly project reviews and the review of our work-in-process schedule did not operate effectively for the year ended December 31, 2018. Specifically, in certain limited instances, management determined that monthly project reviews were ineffective in properly identifying project claim and pending change order (“PCO”) situations, thereby resulting in improper and untimely accounting for these issues. In those instances, our primary controls did not operate at a precision level sufficient to detect errors in project accounting.
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•
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the assumption of material liabilities (including for environmental-related costs and multiemployer pension plans);
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•
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failure of due diligence to uncover situations that could result in legal exposure or to quantify the true liability exposure from known risks;
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•
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the diversion of management’s attention from the management of daily operations to the integration of operations;
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difficulties in the assimilation and retention of employees, in the assimilation of different cultures and practices, in the assimilation of broad and geographically dispersed personnel and operations, and the retention of employees generally;
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•
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the risk of additional financial and accounting challenges and complexities in areas such as tax planning, treasury management, financial reporting and internal controls;
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the assumption of multiemployer pension plans (“MEPP”) liability in the event of an acquisition with existing unions, and an increased exposure to challenges to the structure of our union and non-union subsidiaries and operations if an open shop business is acquired; and
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potential inability to realize the cost savings or other financial benefits anticipated prior to the acquisition.
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curtailment of services;
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•
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suspension of operations;
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•
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inability to meet performance schedules in accordance with contracts and potential liability for liquidated damages;
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injuries or fatalities;
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•
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weather related damage to facilities;
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•
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disruption of information systems;
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•
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inability to receive machinery, equipment and materials at jobsites; and
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loss of productivity.
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actual or anticipated variations in our quarterly results of operations;
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•
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recommendations by securities analysts;
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•
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operating and stock price performance of other companies that investors deem comparable to us;
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•
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political and economic conditions, such as a recession;
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•
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news reports relating to trends, concerns and other issues in the financial services industry generally;
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•
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perceptions in the marketplace regarding us and/or our competitors;
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new technology used, or services offered, by competitors; and
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•
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changes in government regulations.
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Location
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Owned or Leased
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Approximate Size
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Warrington, Pennsylvania (Eastern Pennsylvania)
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Leased
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27,443 square feet
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Orlando, Florida (Limbach Engineering & Design Center)
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Leased
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20,445 square feet
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Pontiac, Michigan
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Owned
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74,000 square feet
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Lansing, Michigan
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Leased
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18,692 square feet
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Laurel, Maryland (Mid-Atlantic)
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Leased
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50,133 square feet
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Wilmington, Massachusetts (New England)
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Leased
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30,995 square feet
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East Brunswick, New Jersey
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Leased
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4,200 square feet
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Columbus, Ohio (3 locations)
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Leased
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110,144 square feet
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Pittsburgh, Pennsylvania (Corporate)
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Leased
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19,165 square feet
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Athens, Ohio
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Leased
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3,000 square feet
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Lake Mary, Florida
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Leased
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48,054 square feet
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Seal Beach, California (Southern California)
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Leased
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88,507 square feet
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Tampa, Florida (2 locations)
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Leased
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13,739 square feet
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Pittsburgh, Pennsylvania (Western Pennsylvania)
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Leased
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67,025 square feet
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Greensburg, Pennsylvania (Western Pennsylvania/Westmoreland County)
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Leased
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5,000 square feet
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Bronxville, New York
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Leased
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1,000 square feet
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Detroit, Michigan
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Leased
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2,155 square feet
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Sanford, Florida
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Leased
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6,200 square feet
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Boynton Beach, Florida
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Leased
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9,631 square feet
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•
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Healthcare, including research, acute care and inpatient hospitals, for regional and national hospital groups;
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•
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Education, including both public and private colleges, universities, research centers and K-12 facilities;
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•
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Sports and entertainment, including sports arenas, entertainment facilities (including casinos) and amusement rides;
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•
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Infrastructure, including passenger terminals and maintenance facilities for rail and airports;
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•
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Government, including various facilities for federal, state and local agencies facilities;
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•
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Hospitality, including hotels and resorts;
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•
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Commercial, including office buildings and other commercial structures;
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•
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Mission critical facilities, including data centers; and
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•
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Industrial manufacturing facilities.
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•
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Competitive lump sum bidding (including plan and specification bidding with select qualified competitors);
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•
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Design/Assist services, for which we typically contract on a negotiated basis to maintain a project budget, and occasionally are contracted on a lump sum basis;
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•
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Design/Build, which services are provided on either a negotiated basis or through competitive bidding; and
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•
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Performance contracting, for which we assess a building owner’s facilities and offer a proposal to reduce energy and operating costs, and when successful, we often perform ongoing maintenance of the building systems.
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•
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Maintenance of HVAC, plumbing and/or electrical systems;
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•
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Service projects for system and equipment upgrades, including energy retrofits;
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•
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Emergency service work, which we refer to as “Spot Work”;
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•
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Automatic temperature controls (“ATC”);
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•
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Specialty contracting, including the design and construction of HVAC, plumbing and/or electrical systems within commercial and institutional buildings; and
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•
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Energy monitoring.
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For the years ended
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||||||||||||
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December 31, 2019
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December 31, 2018
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||||||||||
(Amounts in thousands except for percentages)
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($)
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(%)
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($)
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(%)
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||||||
Statement of Operations Data:
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||||||
Revenue:
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||||||
Construction
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$
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438,196
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79.2
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%
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(3)
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$
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438,229
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80.2
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%
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(3)
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Service
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115,138
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20.8
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%
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(3)
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108,297
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19.8
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%
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(3)
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Total revenue
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553,334
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100.0
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%
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|
546,526
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|
|
100.0
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%
|
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||
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|
|
|
|
|
|
|
|
|
||||||
Gross profit:
|
|
|
|
|
|
|
|
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||||||
Construction
|
|
43,493
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|
|
9.9
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%
|
(1)
|
36,721
|
|
|
8.4
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%
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(1)
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Service
|
|
28,384
|
|
|
24.7
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%
|
(2)
|
22,710
|
|
|
21.0
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%
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(2)
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||
Total gross profit
|
|
71,877
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|
|
13.0
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%
|
|
59,431
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|
|
10.9
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%
|
|
||
|
|
|
|
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|
|
|
|
|
||||||
Selling, general and administrative:
|
|
|
|
|
|
|
|
|
|
||||||
Construction
|
|
28,356
|
|
|
6.5
|
%
|
(1)
|
27,307
|
|
|
6.2
|
%
|
(1)
|
||
Service
|
|
17,367
|
|
|
15.1
|
%
|
(2)
|
15,003
|
|
|
13.9
|
%
|
(2)
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||
Corporate
|
|
17,445
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|
|
3.2
|
%
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(3)
|
14,779
|
|
|
2.7
|
%
|
(3)
|
||
Total selling, general and administrative expenses
|
|
63,168
|
|
|
11.4
|
%
|
|
57,089
|
|
|
10.4
|
%
|
|
||
|
|
|
|
|
|
|
|
|
|
||||||
Amortization of intangibles
|
|
642
|
|
|
0.1
|
%
|
(3)
|
1,272
|
|
|
0.2
|
%
|
(3)
|
||
|
|
|
|
|
|
|
|
|
|
||||||
Operating income (loss):
|
|
|
|
|
|
|
|
|
|
||||||
Construction
|
|
15,137
|
|
|
3.5
|
%
|
(1)
|
9,414
|
|
|
2.1
|
%
|
(1)
|
||
Service
|
|
11,017
|
|
|
9.6
|
%
|
(2)
|
7,707
|
|
|
7.1
|
%
|
(2)
|
||
Corporate
|
|
(18,087
|
)
|
|
—
|
%
|
|
(16,051
|
)
|
|
—
|
%
|
|
||
Total operating income
|
|
8,067
|
|
|
1.5
|
%
|
(3)
|
1,070
|
|
|
0.2
|
%
|
(3)
|
||
|
|
|
|
|
|
|
|
|
|
||||||
Other expenses:
|
|
|
|
|
|
|
|
|
|
||||||
Other expenses (Corporate)
|
|
(5,765
|
)
|
|
(1.0
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)%
|
(3)
|
(3,550
|
)
|
|
(0.6
|
)%
|
(3)
|
||
Impairment of goodwill (Construction)
|
|
(4,359
|
)
|
|
(1.0
|
)%
|
(1)
|
—
|
|
|
—
|
%
|
(1)
|
||
Total other expenses
|
|
(10,124
|
)
|
|
(1.8
|
)%
|
(3)
|
(3,550
|
)
|
|
(0.6
|
)%
|
(3)
|
||
Loss before benefit from income taxes
|
|
(2,057
|
)
|
|
(0.4
|
)%
|
(3)
|
(2,480
|
)
|
|
(0.5
|
)%
|
(3)
|
||
Income tax benefit
|
|
(282
|
)
|
|
(0.1
|
)%
|
(3)
|
(635
|
)
|
|
(0.1
|
)%
|
(3)
|
||
|
|
|
|
|
|
|
|
|
|
||||||
Net loss
|
|
$
|
(1,775
|
)
|
|
(0.3
|
)%
|
(3)
|
$
|
(1,845
|
)
|
|
(0.3
|
)%
|
(3)
|
(1)
|
As a percentage of Construction revenue.
|
(2)
|
As a percentage of Service revenue.
|
(3)
|
As a percentage of Total revenue.
|
|
For the years ended
|
|
|
|
|||||||||||
|
December 31, 2019
|
|
December 31, 2018
|
|
|
Increase/(Decrease)
|
|||||||||
(Amounts in thousands except for percentages)
|
($)
|
|
($)
|
|
|
$
|
|
%
|
|||||||
Revenue:
|
|
|
|
|
|
|
|
|
|||||||
Construction
|
$
|
438,196
|
|
|
$
|
438,229
|
|
|
|
$
|
(33
|
)
|
|
—
|
%
|
Service
|
115,138
|
|
|
108,297
|
|
|
|
6,841
|
|
|
6.3
|
%
|
|||
Total revenue
|
$
|
553,334
|
|
|
$
|
546,526
|
|
|
|
$
|
6,808
|
|
|
1.2
|
%
|
|
For the years ended
|
|
|
|||||||||||
|
December 31, 2019
|
|
December 31, 2018
|
|
Increase/(Decrease)
|
|||||||||
(Amounts in thousands except for percentages)
|
($)
|
|
($)
|
|
$
|
|
%
|
|||||||
Gross profit:
|
|
|
|
|
|
|
|
|||||||
Construction
|
$
|
43,493
|
|
|
$
|
36,721
|
|
|
$
|
6,772
|
|
|
18.4
|
%
|
Service
|
28,384
|
|
|
22,710
|
|
|
5,674
|
|
|
25.0
|
%
|
|||
Total gross profit
|
$
|
71,877
|
|
|
$
|
59,431
|
|
|
$
|
12,446
|
|
|
20.9
|
%
|
Total gross profit as a percentage of consolidated total revenue
|
13.0
|
%
|
|
10.9
|
%
|
|
|
|
|
|||||
Construction segment gross profit
|
9.9
|
%
|
|
8.4
|
%
|
|
|
|
|
|||||
Service segment gross profit
|
24.7
|
%
|
|
21.0
|
%
|
|
|
|
|
|
For the years ended
|
|
|
|||||||||||
|
December 31, 2019
|
|
December 31, 2018
|
|
Increase/(Decrease)
|
|||||||||
(Amounts in thousands except for percentages)
|
($)
|
|
($)
|
|
$
|
|
%
|
|||||||
Selling, general and administrative expenses:
|
|
|
|
|
|
|
|
|||||||
Construction
|
$
|
28,356
|
|
|
$
|
27,307
|
|
|
$
|
1,049
|
|
|
3.8
|
%
|
Service
|
17,367
|
|
|
15,003
|
|
|
2,364
|
|
|
15.8
|
%
|
|||
Corporate
|
17,445
|
|
|
14,779
|
|
|
2,666
|
|
|
18.0
|
%
|
|||
Total selling, general and administrative expenses
|
$
|
63,168
|
|
|
$
|
57,089
|
|
|
$
|
6,079
|
|
|
10.6
|
%
|
Total selling, general and administrative expenses as a percentage of consolidated total revenue
|
11.4
|
%
|
|
10.4
|
%
|
|
|
|
|
|
For the years ended
|
|
|
|||||||||||
|
December 31, 2019
|
|
December 31, 2018
|
|
Increase/(Decrease)
|
|||||||||
(Amounts in thousands except for percentages)
|
($)
|
|
($)
|
|
$
|
|
%
|
|||||||
Amortization of intangibles
|
$
|
642
|
|
|
$
|
1,272
|
|
|
$
|
(630
|
)
|
|
(49.5
|
)%
|
|
For the years ended
|
|
|
|||||||||||
|
December 31, 2019
|
|
December 31, 2018
|
|
Increase/(Decrease)
|
|||||||||
(Amounts in thousands except for percentages)
|
($)
|
|
($)
|
|
$
|
|
%
|
|||||||
Other income (expenses):
|
|
|
|
|
|
|
|
|||||||
Interest income (expense), net
|
$
|
(6,285
|
)
|
|
$
|
(3,305
|
)
|
|
$
|
2,980
|
|
|
90.2
|
%
|
Loss on debt modification
|
—
|
|
|
(335
|
)
|
|
(335
|
)
|
|
(100.0
|
)%
|
|||
Loss on debt extinguishment
|
(513
|
)
|
|
—
|
|
|
513
|
|
|
100.0
|
%
|
|||
Gain (loss) on sale of property and equipment
|
57
|
|
|
90
|
|
|
33
|
|
|
36.7
|
%
|
|||
Gain on change in fair value of warrant liability
|
588
|
|
|
—
|
|
|
(588
|
)
|
|
100.0
|
%
|
|||
Gain on embedded derivative
|
388
|
|
|
—
|
|
|
(388
|
)
|
|
100.0
|
%
|
|||
Impairment of goodwill
|
(4,359
|
)
|
|
—
|
|
|
4,359
|
|
|
100.0
|
%
|
|||
Total other expenses
|
$
|
(10,124
|
)
|
|
$
|
(3,550
|
)
|
|
$
|
6,574
|
|
|
185.2
|
%
|
•
|
Identification of projects that have been shut down and methods for seeking to preserve any contractual entitlement that may exist;
|
•
|
Establishment of a task force to identify possible types and areas of impact from COVID-19 for both shutdown and continuing operations;
|
•
|
Examination of the Company's productivity and potential impact on gross profit as a result of COVID-19;
|
•
|
Implementation of the Company's pandemic response plan;
|
•
|
Implemented furlough, work schedule reduction plans and permanent reductions in force;
|
•
|
Suspension of all discretionary, non-essential expenditures, including by not limited to, auto allowances, deferral of rent ranging between 1 and 3 months, 10% salary reduction for a select group of Corporate and region management and cost reduction opportunities identified by our external consultant; and
|
•
|
Continued our hiring freeze.
|
|
For the years ended
|
||||||
(in thousands)
|
December 31, 2019
|
|
December 31, 2018
|
||||
Net cash provided by (used in):
|
|
|
|
|
|
||
Operating activities
|
$
|
(926
|
)
|
|
$
|
25,322
|
|
Investing activities
|
(2,491
|
)
|
|
(3,680
|
)
|
||
Financing activities
|
10,142
|
|
|
(20,649
|
)
|
||
Net increase in cash
|
$
|
6,725
|
|
|
$
|
993
|
|
|
|
|
|
||||
Noncash investing and financing transactions:
|
|
|
|
|
|
||
Debt issuance costs related to 2019 Refinancing Agreement paid-in-kind
|
$
|
1,000
|
|
|
$
|
—
|
|
Property and equipment acquired financed with capital leases
|
—
|
|
|
3,260
|
|
||
Right of use assets obtained in exchange for new operating lease liabilities
|
3,355
|
|
|
—
|
|
||
Right of use assets obtained in exchange for new finance lease liabilities
|
3,578
|
|
|
—
|
|
||
Right of use assets disposed or adjusted modifying operating leases liabilities
|
1,651
|
|
|
—
|
|
||
Right of use assets disposed or adjusted modifying finance leases liabilities
|
(78
|
)
|
|
—
|
|
||
Interest paid
|
4,607
|
|
|
2,714
|
|
||
Interest paid on finance leases
|
$
|
—
|
|
|
$
|
—
|
|
|
As of December 31,
|
||||||
(in thousands, except ratios)
|
2019
|
|
2018
|
||||
Current assets
|
$
|
195,380
|
|
|
$
|
204,986
|
|
Current liabilities
|
(156,869
|
)
|
|
(182,138
|
)
|
||
|
|
|
|
||||
Net working capital
|
$
|
38,511
|
|
|
$
|
22,848
|
|
Current ratio*
|
1.25
|
|
|
1.13
|
|
*
|
Current ratio is calculated by dividing current assets by current liabilities.
|
(in thousands)
|
December 31,
2019 |
|
December 31,
2018 |
||||
Current liability — workers’ compensation and general liability
|
$
|
703
|
|
|
$
|
352
|
|
Current liability — medical and dental
|
821
|
|
|
607
|
|
||
Non-current liability
|
382
|
|
|
820
|
|
||
Total liability
|
$
|
1,906
|
|
|
$
|
1,779
|
|
Restricted cash
|
$
|
113
|
|
|
$
|
113
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
/s/Crowe LLP
|
|
|
We have served as the Company’s auditor since 2012.
|
|
|
|
Atlanta, Georgia
|
|
May 12, 2020
|
|
(in thousands, except share data)
|
December 31,
2019 |
|
December 31,
2018 |
||||
|
|
|
|
||||
ASSETS
|
|
|
|
||||
Current assets
|
|
|
|
||||
Cash and cash equivalents
|
$
|
8,344
|
|
|
$
|
1,619
|
|
Restricted cash
|
113
|
|
|
113
|
|
||
Accounts receivable, net
|
105,067
|
|
|
135,687
|
|
||
Contract assets
|
77,188
|
|
|
—
|
|
||
Costs and estimated earnings in excess of billings on uncompleted contracts
|
—
|
|
|
32,698
|
|
||
Advances to and equity in joint ventures, net
|
8
|
|
|
12
|
|
||
Other current assets
|
4,660
|
|
|
34,857
|
|
||
Total current assets
|
195,380
|
|
|
204,986
|
|
||
|
|
|
|
||||
Property and equipment, net
|
21,287
|
|
|
20,527
|
|
||
Intangible assets, net
|
12,311
|
|
|
12,953
|
|
||
Goodwill
|
6,129
|
|
|
10,488
|
|
||
Operating lease right-of-use assets
|
21,056
|
|
|
—
|
|
||
Deferred tax asset
|
4,786
|
|
|
4,409
|
|
||
Other assets
|
668
|
|
|
271
|
|
||
Total assets
|
$
|
261,617
|
|
|
$
|
253,634
|
|
LIABILITIES
|
|
|
|
||||
Current liabilities
|
|
|
|
||||
Current portion of long-term debt
|
$
|
4,425
|
|
|
$
|
3,141
|
|
Current operating lease liabilities
|
3,750
|
|
|
—
|
|
||
Accounts payable, including retainage
|
86,267
|
|
|
74,353
|
|
||
Contract liabilities
|
42,370
|
|
|
—
|
|
||
Billings in excess of costs and estimated earnings on uncompleted contracts
|
—
|
|
|
50,843
|
|
||
Accrued income taxes
|
12
|
|
|
—
|
|
||
Accrued expenses and other current liabilities
|
20,045
|
|
|
53,801
|
|
||
Total current liabilities
|
156,869
|
|
|
182,138
|
|
||
Long-term debt
|
38,868
|
|
|
23,614
|
|
||
Long-term operating lease liabilities
|
18,247
|
|
|
—
|
|
||
Other long-term liabilities
|
763
|
|
|
1,514
|
|
||
Total liabilities
|
214,747
|
|
|
207,266
|
|
||
Commitments and contingencies
|
|
|
|
|
|
||
Redeemable convertible preferred stock, net, par value $0.0001, 1,000,000 shares authorized, no shares issued and outstanding as of December 31, 2019 and December 31, 2018 ($0 redemption value as of December 31, 2019 and December 31, 2018)
|
—
|
|
|
—
|
|
||
STOCKHOLDERS’ EQUITY
|
|
|
|
||||
Common stock, $.0001 par value; 100,000,000 shares authorized, 7,688,958 issued and outstanding at December 31, 2019 and 7,592,911 at December 31, 2018
|
1
|
|
|
1
|
|
||
Additional paid-in capital
|
56,557
|
|
|
54,791
|
|
||
Accumulated deficit
|
(9,688
|
)
|
|
(8,424
|
)
|
||
Total stockholders’ equity
|
46,870
|
|
|
46,368
|
|
||
Total liabilities and stockholders’ equity
|
$
|
261,617
|
|
|
$
|
253,634
|
|
(in thousands, except share and per share data)
|
For the Year Ended
|
||||||
December 31, 2019
|
|
December 31, 2018
|
|||||
Revenue
|
$
|
553,334
|
|
|
$
|
546,526
|
|
Cost of revenue
|
481,457
|
|
|
487,095
|
|
||
Gross profit
|
71,877
|
|
|
59,431
|
|
||
Operating expenses:
|
|
|
|
||||
Selling, general and administrative
|
63,168
|
|
|
57,089
|
|
||
Amortization of intangibles
|
642
|
|
|
1,272
|
|
||
Total operating expenses
|
63,810
|
|
|
58,361
|
|
||
Operating income
|
8,067
|
|
|
1,070
|
|
||
Other income (expense):
|
|
|
|
||||
Interest income (expense), net
|
(6,285
|
)
|
|
(3,305
|
)
|
||
Loss on debt modification
|
—
|
|
|
(335
|
)
|
||
Loss on debt extinguishment
|
(513
|
)
|
|
—
|
|
||
Gain on sale of property and equipment
|
57
|
|
|
90
|
|
||
Gain on change in fair value of warrant liability
|
588
|
|
|
—
|
|
||
Gain on embedded derivative
|
388
|
|
|
—
|
|
||
Impairment of goodwill
|
(4,359
|
)
|
|
—
|
|
||
Total other expenses
|
(10,124
|
)
|
|
(3,550
|
)
|
||
Loss before income taxes
|
(2,057
|
)
|
|
(2,480
|
)
|
||
Income tax benefit
|
(282
|
)
|
|
(635
|
)
|
||
Net loss
|
(1,775
|
)
|
|
(1,845
|
)
|
||
Dividends on cumulative redeemable convertible preferred stock
|
—
|
|
|
113
|
|
||
Premium paid on partial preferred redemption
|
—
|
|
|
(2,219
|
)
|
||
Net loss attributable to Limbach Holdings, Inc. common stockholders
|
$
|
(1,775
|
)
|
|
$
|
(3,951
|
)
|
|
|
|
|
||||
EPS
|
|
|
|
||||
Net loss per share attributable to Limbach Holdings, Inc. common stockholders:
|
|
|
|
||||
Basic
|
$
|
(0.23
|
)
|
|
$
|
(0.52
|
)
|
Diluted
|
$
|
(0.23
|
)
|
|
$
|
(0.52
|
)
|
Weighted average number of shares outstanding:
|
|
|
|
||||
Basic
|
7,662,362
|
|
|
7,562,586
|
|
||
Diluted
|
7,662,362
|
|
|
7,562,586
|
|
(in thousands, except share amounts)
|
Common Stock
|
|
Additional
paid-in
capital
|
|
Accumulated
deficit
|
|
Stockholders’
equity
|
|||||||||||
Number of
shares
outstanding
|
|
Par value
amount
|
|
|
|
|||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||
Balance at January 1, 2018
|
7,504,133
|
|
|
$
|
1
|
|
|
$
|
54,738
|
|
|
$
|
(6,579
|
)
|
|
$
|
48,160
|
|
Exercise of warrants
|
10,627
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Shares issued related to vested restricted stock units
|
78,151
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
2,159
|
|
|
—
|
|
|
2,159
|
|
||||
Premium paid on redemption of redeemable convertible preferred stock
|
—
|
|
|
—
|
|
|
(2,219
|
)
|
|
—
|
|
|
(2,219
|
)
|
||||
Dividends on redeemable convertible preferred stock
|
—
|
|
|
—
|
|
|
113
|
|
|
—
|
|
|
113
|
|
||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,845
|
)
|
|
(1,845
|
)
|
||||
Balance at December 31, 2018
|
7,592,911
|
|
|
$
|
1
|
|
|
$
|
54,791
|
|
|
$
|
(8,424
|
)
|
|
$
|
46,368
|
|
Cumulative effect of accounting change - ASC Topic 606
|
—
|
|
|
—
|
|
|
—
|
|
|
639
|
|
|
639
|
|
||||
Cumulative effect of accounting change - ASC Topic 842
|
—
|
|
|
—
|
|
|
—
|
|
|
(128
|
)
|
|
(128
|
)
|
||||
Shares issued related to vested restricted stock units
|
96,047
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Stock-based compensation
|
—
|
|
|
—
|
|
|
1,766
|
|
|
—
|
|
|
1,766
|
|
||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,775
|
)
|
|
(1,775
|
)
|
||||
Balance at December 31, 2019
|
7,688,958
|
|
|
$
|
1
|
|
|
$
|
56,557
|
|
|
$
|
(9,688
|
)
|
|
$
|
46,870
|
|
(in thousands)
|
January 1, 2019 through December 31, 2019
|
|
January 1, 2018 through December 31, 2018
|
||||
Cash flows from operating activities:
|
|
|
|
||||
Net loss
|
$
|
(1,775
|
)
|
|
$
|
(1,845
|
)
|
Adjustments to reconcile net loss to cash provided by (used in) operating activities:
|
|
|
|
||||
Depreciation and amortization
|
6,286
|
|
|
5,683
|
|
||
Noncash operating lease expense
|
3,799
|
|
|
—
|
|
||
Impairment of goodwill
|
4,359
|
|
|
—
|
|
||
Provision for doubtful accounts
|
95
|
|
|
64
|
|
||
Stock-based compensation expense
|
1,766
|
|
|
2,159
|
|
||
Loss on debt modification
|
—
|
|
|
335
|
|
||
Loss on debt extinguishment
|
513
|
|
|
—
|
|
||
Amortization of debt discount and issuance costs
|
1,392
|
|
|
373
|
|
||
Deferred tax benefit
|
(609
|
)
|
|
(745
|
)
|
||
Change in fair value of warrant liability
|
(588
|
)
|
|
—
|
|
||
Gain on embedded derivative
|
(388
|
)
|
|
—
|
|
||
Gain on sale of property and equipment
|
(57
|
)
|
|
(90
|
)
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Accounts receivable
|
659
|
|
|
(6,408
|
)
|
||
Contract assets
|
(13,378
|
)
|
|
—
|
|
||
Costs and estimated earnings in excess of billings on uncompleted contracts
|
—
|
|
|
308
|
|
||
Other current assets
|
30,139
|
|
|
(31,162
|
)
|
||
Other assets
|
—
|
|
|
—
|
|
||
Accounts payable, including retainage
|
11,914
|
|
|
6,914
|
|
||
Contract liabilities
|
(6,446
|
)
|
|
—
|
|
||
Billings in excess of costs and estimated earnings on uncompleted contracts
|
—
|
|
|
22,301
|
|
||
Prepaid income taxes
|
58
|
|
|
(2,753
|
)
|
||
Accrued taxes payable
|
12
|
|
|
—
|
|
||
Accrued expenses and other current liabilities
|
(34,686
|
)
|
|
29,535
|
|
||
Operating lease liabilities
|
(3,654
|
)
|
|
—
|
|
||
Other long-term liabilities
|
(337
|
)
|
|
653
|
|
||
Net cash provided by (used in) operating activities
|
(926
|
)
|
|
25,322
|
|
||
Cash flows from investing activities:
|
|
|
|
||||
Proceeds from sale of property and equipment
|
168
|
|
|
198
|
|
||
Advances to joint ventures
|
4
|
|
|
(1
|
)
|
||
Purchase of property and equipment
|
(2,663
|
)
|
|
(3,877
|
)
|
||
Net cash used in investing activities
|
(2,491
|
)
|
|
(3,680
|
)
|
||
Cash flows from financing activities:
|
|
|
|
||||
Bank overdrafts
|
(1,333
|
)
|
|
(6,446
|
)
|
||
Payments on Credit Agreement term loan
|
(14,335
|
)
|
|
(3,300
|
)
|
||
Proceeds from Credit Agreement revolver
|
17,500
|
|
|
109,650
|
|
||
Payments on Credit Agreement revolver
|
(17,500
|
)
|
|
(115,308
|
)
|
||
Proceeds from 2019 Revolving Credit Facility
|
32,500
|
|
|
—
|
|
||
Payments on 2019 Revolving Credit Facility
|
(32,500
|
)
|
|
—
|
|
||
Proceeds from 2019 Refinancing Term Loan, net of debt discount
|
38,644
|
|
|
—
|
|
||
Warrants issued in conjunction with the 2019 Refinancing Term Loan
|
969
|
|
|
—
|
|
||
Embedded derivative associated with the 2019 Refinancing Term Loan
|
388
|
|
|
—
|
|
||
Proceeds from Bridge Term Loan
|
—
|
|
|
10,000
|
|
||
Payments on Bridge Term Loan
|
(7,736
|
)
|
|
(2,264
|
)
|
||
Payments on finance leases
|
(2,547
|
)
|
|
(1,939
|
)
|
||
Convertible preferred stock redeemed
|
—
|
|
|
(9,191
|
)
|
||
Convertible preferred stock dividends paid
|
—
|
|
|
(875
|
)
|
||
Taxes paid related to net-share settlement of equity awards
|
(131
|
)
|
|
(211
|
)
|
||
Payments of debt issuance costs
|
(3,777
|
)
|
|
(765
|
)
|
||
Net cash provided by (used in) financing activities
|
10,142
|
|
|
(20,649
|
)
|
||
Increase in cash, cash equivalents and restricted cash
|
6,725
|
|
|
993
|
|
||
Cash, cash equivalents and restricted cash, beginning of year
|
1,732
|
|
|
739
|
|
||
Cash, cash equivalents and restricted cash, end of year
|
$
|
8,457
|
|
|
$
|
1,732
|
|
|
|
|
|
||||
Supplemental disclosures of cash flow information
|
|
|
|
||||
Noncash investing and financing transactions:
|
|
|
|
||||
Debt issuance costs related to 2019 Refinancing Agreement paid-in-kind
|
$
|
1,000
|
|
|
$
|
—
|
|
Property and equipment acquired financed with capital leases
|
—
|
|
|
3,260
|
|
||
Right of use assets obtained in exchange for new operating lease liabilities
|
3,355
|
|
|
—
|
|
||
Right of use assets obtained in exchange for new finance lease liabilities
|
3,578
|
|
|
—
|
|
||
Right of use assets disposed or adjusted modifying operating leases liabilities
|
1,651
|
|
|
—
|
|
||
Right of use assets disposed or adjusted modifying finance leases liabilities
|
(78
|
)
|
|
—
|
|
||
Interest paid
|
$
|
4,607
|
|
|
$
|
2,714
|
|
1.
|
Identify the contract
|
2.
|
Identify performance obligations
|
3.
|
Determine the transaction price
|
4.
|
Allocate the transaction price
|
5.
|
Recognize revenue
|
•
|
The completeness and accuracy of the original bid;
|
•
|
costs associated with scope changes;
|
•
|
expected, or actual, resolution terms for claims;
|
•
|
achievement of contract incentives;
|
•
|
changes in costs of labor and/or materials;
|
•
|
extended overhead and other costs due to owner, weather and other delays;
|
•
|
subcontractor performance issues;
|
•
|
changes in productivity expectations;
|
•
|
site conditions that differ from those assumed in the original bid;
|
•
|
changes from original design on design-build projects;
|
•
|
the availability and skill level of workers in the geographic location of the project;
|
•
|
a change in the availability and proximity of equipment and materials;
|
•
|
our ability to fully and promptly recover on claims and backcharges for additional contract costs, and
|
•
|
the customer's ability to properly administer the contract.
|
•
|
the amount of the initial measurement of the lease liability;
|
•
|
any lease payment made at or before the commencement date, minus any lease incentives received; and
|
•
|
any initial direct costs incurred.
|
•
|
Level 1 — inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that are accessible at the measurement date;
|
•
|
Level 2 — inputs other than quoted prices included in Level 1 that are observable for the asset or liability either directly or indirectly such as quoted prices in active markets for similar assets and liabilities, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of assets or liabilities; and
|
•
|
Level 3 — unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.
|
Stock price
|
|
|
$
|
3.78
|
|
|
Exercise price
|
|
|
$
|
7.63
|
|
|
Time until expiration (years)
|
|
|
4.3
|
|
|
|
Expected volatility
|
|
|
70
|
%
|
|
|
Risk-free interest rate
|
|
|
1.7
|
%
|
|
|
Expected dividend yield
|
|
|
—
|
%
|
|
|
For the Years Ended
|
||||
|
December 31, 2019
|
|
December 31, 2018
|
||
In-the-money warrants
|
—
|
|
|
—
|
|
Out-of-the-money warrants
|
4,576,799
|
|
|
4,576,799
|
|
Preferred stock
|
—
|
|
|
16,877
|
|
Service-based RSUs
|
80,718
|
|
|
48,307
|
|
Performance and market-based RSUs (1)
|
375
|
|
|
—
|
|
In-the-money UPOs
|
—
|
|
|
1,308
|
|
Out-of-the-money UPOs
|
15,067
|
|
|
8,550
|
|
Total
|
4,672,959
|
|
|
4,651,841
|
|
|
For the Years Ended
|
||||||
(in thousands, except per share amounts)
|
December 31, 2019
|
|
December 31, 2018
|
||||
EPS numerator:
|
|
|
|
||||
Net loss
|
$
|
(1,775
|
)
|
|
$
|
(1,845
|
)
|
Less: Undistributed preferred stock dividends
|
—
|
|
|
113
|
|
||
Less: Premium paid on partial preferred redemption
|
—
|
|
|
(2,219
|
)
|
||
Net loss attributable to Limbach Holdings, Inc. common stockholders
|
$
|
(1,775
|
)
|
|
$
|
(3,951
|
)
|
|
|
|
|
||||
EPS denominator:
|
|
|
|
||||
Weighted average shares outstanding – basic
|
7,662
|
|
|
7,563
|
|
||
Weighted average shares outstanding – diluted
|
7,662
|
|
|
7,563
|
|
||
|
|
|
|
||||
Net loss per share attributable to Limbach Holdings, Inc. common stockholders:
|
|
|
|
||||
Basic
|
$
|
(0.23
|
)
|
|
$
|
(0.52
|
)
|
Diluted
|
$
|
(0.23
|
)
|
|
$
|
(0.52
|
)
|
(in thousands)
|
December 31, 2019
|
|
December 31, 2018
|
||||
Cash and cash equivalents
|
$
|
8,344
|
|
|
$
|
1,619
|
|
Restricted cash
|
113
|
|
|
113
|
|
||
Total cash, cash equivalents and restricted cash
|
8,457
|
|
|
1,732
|
|
CONSOLIDATED BALANCE SHEET
|
|
|
|
|
|
|
|
||||
(in thousands)
|
Balance as of December 31, 2018 (a)
|
|
Adjustments due to ASC Topic 606
|
|
Adjustments due to ASC Topic 842
|
|
Balance as of January 1, 2019
|
||||
Assets
|
|
|
|
|
|
|
|
||||
Accounts receivable, net (b)
|
135,687
|
|
|
(29,867
|
)
|
|
—
|
|
|
105,820
|
|
Contract assets
|
—
|
|
|
63,810
|
|
|
—
|
|
|
63,810
|
|
Costs and estimated earnings in excess of billings on uncompleted contracts
|
32,698
|
|
|
(32,698
|
)
|
|
—
|
|
|
—
|
|
Operating lease right-of-use assets (c)
|
—
|
|
|
—
|
|
|
19,830
|
|
|
19,830
|
|
Deferred tax asset
|
4,409
|
|
|
(233
|
)
|
|
—
|
|
|
4,176
|
|
|
|
|
|
|
|
|
|
||||
Liabilities
|
|
|
|
|
|
|
|
||||
Contract liabilities
|
—
|
|
|
48,816
|
|
|
—
|
|
|
48,816
|
|
Billings in excess of costs and estimated earnings on uncompleted contracts
|
50,843
|
|
|
(50,843
|
)
|
|
—
|
|
|
—
|
|
Accrued expenses and other current liabilities
|
53,801
|
|
|
2,400
|
|
|
—
|
|
|
56,201
|
|
Current portion of long-term debt
|
3,141
|
|
|
—
|
|
|
62
|
|
|
3,203
|
|
Current operating lease liabilities (c)
|
—
|
|
|
—
|
|
|
3,240
|
|
|
3,240
|
|
Long-term debt
|
23,614
|
|
|
—
|
|
|
65
|
|
|
23,679
|
|
Long-term operating lease liabilities (c)
|
—
|
|
|
—
|
|
|
17,385
|
|
|
17,385
|
|
Other long-term liabilities
|
1,514
|
|
|
—
|
|
|
(794
|
)
|
|
720
|
|
|
|
|
|
|
|
|
|
||||
Stockholders' Equity
|
|
|
|
|
|
|
|
||||
Accumulated deficit
|
(8,424
|
)
|
|
639
|
|
|
(128
|
)
|
|
(7,913
|
)
|
CONSOLIDATED BALANCE SHEET
|
As of December 31, 2019
|
||||||||||
(in thousands)
|
Balance Without Adoption of ASC Topic 606 and ASC Topic 842
|
|
Adjustments due to ASC Topic 606
|
|
Adjustments due to ASC Topic 842
|
|
As Reported
|
||||
Assets
|
|
|
|
|
|
|
|
||||
Accounts receivable, net (a)
|
137,940
|
|
|
(32,873
|
)
|
|
—
|
|
|
105,067
|
|
Contract assets
|
(81
|
)
|
|
77,269
|
|
|
—
|
|
|
77,188
|
|
Costs and estimated earnings in excess of billings on uncompleted contracts
|
43,033
|
|
|
(43,033
|
)
|
|
—
|
|
|
—
|
|
Operating lease right-of-use assets (b)
|
—
|
|
|
—
|
|
|
21,056
|
|
|
21,056
|
|
Deferred tax asset
|
5,194
|
|
|
(408
|
)
|
|
—
|
|
|
4,786
|
|
|
|
|
|
|
|
|
|
||||
Liabilities
|
|
|
|
|
|
|
|
||||
Current portion of long-term debt
|
4,365
|
|
|
—
|
|
|
60
|
|
|
4,425
|
|
Current operating lease liabilities (b)
|
—
|
|
|
—
|
|
|
3,750
|
|
|
3,750
|
|
Contract liabilities
|
316
|
|
|
42,054
|
|
|
—
|
|
|
42,370
|
|
Accrued expenses and other current liabilities
|
17,159
|
|
|
2,886
|
|
|
—
|
|
|
20,045
|
|
Billings in excess of costs and estimated earnings on uncompleted contracts
|
45,076
|
|
|
(45,076
|
)
|
|
—
|
|
|
—
|
|
Long-term debt
|
38,802
|
|
|
—
|
|
|
66
|
|
|
38,868
|
|
Long-term operating lease liabilities (b)
|
—
|
|
|
—
|
|
|
18,247
|
|
|
18,247
|
|
Other long-term liabilities
|
1,702
|
|
|
—
|
|
|
(939
|
)
|
|
763
|
|
|
|
|
|
|
|
|
|
||||
Stockholders' Equity
|
|
|
|
|
|
|
|
||||
Accumulated deficit (c)
|
(10,651
|
)
|
|
1,091
|
|
|
(128
|
)
|
|
(9,688
|
)
|
CONSOLIDATED STATEMENT OF OPERATIONS
|
As of December 31, 2019
|
||||||||||||||
(in thousands)
|
Balance Without Adoption of ASC Topic 606 and ASC Topic 842
|
|
Adjustments due to ASC Topic 606
|
|
Adjustments due to ASC Topic 842
|
|
As Reported
|
||||||||
Revenue
|
|
|
|
|
|
|
|
||||||||
Construction
|
$
|
438,179
|
|
|
$
|
17
|
|
|
$
|
—
|
|
|
$
|
438,196
|
|
Service
|
115,222
|
|
|
(84
|
)
|
|
—
|
|
|
115,138
|
|
||||
Total revenue
|
553,401
|
|
|
(67
|
)
|
|
—
|
|
|
553,334
|
|
||||
Cost of revenue
|
|
|
|
|
|
|
|
||||||||
Construction
|
395,272
|
|
|
(569
|
)
|
|
—
|
|
|
394,703
|
|
||||
Service
|
86,871
|
|
|
(117
|
)
|
|
—
|
|
|
86,754
|
|
||||
Total cost of revenue
|
482,143
|
|
|
(686
|
)
|
|
—
|
|
|
481,457
|
|
||||
Gross profit
|
71,258
|
|
|
619
|
|
|
—
|
|
|
71,877
|
|
||||
Operating expenses:
|
|
|
|
|
|
|
|
||||||||
Selling, general and administrative expenses
|
63,168
|
|
|
—
|
|
|
—
|
|
|
63,168
|
|
||||
Amortization of intangibles
|
642
|
|
|
—
|
|
|
—
|
|
|
642
|
|
||||
Total operating expenses
|
63,810
|
|
|
—
|
|
|
—
|
|
|
63,810
|
|
||||
Operating income
|
7,448
|
|
|
619
|
|
|
—
|
|
|
8,067
|
|
||||
Other income (expenses):
|
|
|
|
|
|
|
|
||||||||
Impairment of goodwill
|
(4,359
|
)
|
|
—
|
|
|
—
|
|
|
(4,359
|
)
|
||||
Interest expense, net
|
(6,285
|
)
|
|
—
|
|
|
—
|
|
|
(6,285
|
)
|
||||
Loss on debt extinguishment
|
(513
|
)
|
|
—
|
|
|
—
|
|
|
(513
|
)
|
||||
Gain on change in fair value of warrant liability
|
588
|
|
|
—
|
|
|
—
|
|
|
588
|
|
||||
Gain on embedded derivative
|
388
|
|
|
—
|
|
|
—
|
|
|
388
|
|
||||
Gain on disposition of property and equipment
|
57
|
|
|
—
|
|
|
—
|
|
|
57
|
|
||||
Total other expenses
|
(10,124
|
)
|
|
—
|
|
|
—
|
|
|
(10,124
|
)
|
||||
Loss before income taxes
|
(2,676
|
)
|
|
619
|
|
|
—
|
|
|
(2,057
|
)
|
||||
Income tax benefit
|
$
|
(449
|
)
|
|
167
|
|
|
—
|
|
|
(282
|
)
|
|||
Net loss
|
$
|
(2,227
|
)
|
|
$
|
452
|
|
|
$
|
—
|
|
|
$
|
(1,775
|
)
|
(in thousands)
|
December 31, 2019
|
|
January 1, 2019 *
|
||||
Accounts receivable – trade
|
$
|
105,373
|
|
|
$
|
106,063
|
|
Allowance for doubtful accounts
|
(306
|
)
|
|
(243
|
)
|
||
Accounts receivable, net
|
$
|
105,067
|
|
|
$
|
105,820
|
|
(in thousands)
|
December 31, 2019
|
|
January 1, 2019 *
|
|
Change
|
||||||
Contract assets
|
|
|
|
|
|
||||||
Costs in excess of billings and estimated earnings
|
$
|
44,315
|
|
|
$
|
33,943
|
|
|
$
|
10,372
|
|
Retainage receivable
|
32,873
|
|
|
29,867
|
|
|
3,006
|
|
|||
Total contract assets
|
$
|
77,188
|
|
|
$
|
63,810
|
|
|
$
|
13,378
|
|
(in thousands)
|
December 31, 2019
|
|
January 1, 2019 *
|
|
Change
|
||||||
Contract liabilities
|
|
|
|
|
|
||||||
Billings in excess of costs and estimated earnings
|
$
|
40,662
|
|
|
$
|
46,968
|
|
|
$
|
(6,306
|
)
|
Provisions for losses
|
1,708
|
|
|
1,848
|
|
|
(140
|
)
|
|||
Total contract liabilities
|
$
|
42,370
|
|
|
$
|
48,816
|
|
|
$
|
(6,446
|
)
|
(in thousands)
|
December 31, 2019
|
|
January 1, 2019 *
|
||
Revenue earned on uncompleted contracts
|
726,215
|
|
|
737,043
|
|
Less: Billings to date
|
(722,562
|
)
|
|
(750,068
|
)
|
Net underbilling (overbilling)
|
3,653
|
|
|
(13,025
|
)
|
(in thousands)
|
December 31, 2019
|
|
January 1, 2019 *
|
||
Costs in excess of billings and estimated earnings
|
44,315
|
|
|
33,943
|
|
Billings in excess of costs and estimated earnings
|
(40,662
|
)
|
|
(46,968
|
)
|
Net underbilling (overbilling)
|
3,653
|
|
|
(13,025
|
)
|
(in thousands)
|
December 31, 2019
|
|
December 31, 2018
|
||||
Land and improvements
|
$
|
400
|
|
|
$
|
400
|
|
Buildings and leasehold improvements
|
7,701
|
|
|
7,022
|
|
||
Machinery and equipment
|
18,853
|
|
|
14,165
|
|
||
Finance leases - vehicles (1)
|
11,081
|
|
|
10,748
|
|
||
Gross property and equipment
|
38,035
|
|
|
32,335
|
|
||
Less: Accumulated amortization on finance leases
|
(4,669
|
)
|
|
(5,394
|
)
|
||
Less: Accumulated depreciation
|
(12,079
|
)
|
|
(6,414
|
)
|
||
Property and equipment, net of accumulated amortization and depreciation
|
$
|
21,287
|
|
|
$
|
20,527
|
|
•
|
The Company’s planned reduction and elimination of certain large-scale construction projects resulting in a change in management’s long-term outlook for the Construction segment during the third quarter of 2019;
|
•
|
The Company experienced significant negative operating cash flows during the nine months ended September 30, 2019, which the Company believes is attributable to delays experienced in resolving certain claims, unapproved change orders and project write-downs experienced in the Southern California region, resulting in management’s
|
•
|
The Company failed its Total Leverage Ratio covenant under the 2019 Refinancing Agreement and the 2019 ABL Credit Agreement as of August 31, 2019; and
|
•
|
The Company’s stock price declined significantly during the third quarter.
|
•
|
The Company’s planned reduction and elimination of certain large-scale construction projects that typically require a large amount of working capital, an increased risk of claims and low historical margins;
|
•
|
Management’s strategic focus to only allow certain regions to bid on large-scale construction projects based on past performance and the labor capacity available within that region; and
|
•
|
Management’s continued focus on expanding its service reporting unit which includes special projects and other work performed directly for facility owners, much of which is smaller in contract value than work performed in our Construction reporting unit; and recurring revenue from contractual maintenance agreements and the associated time and material and emergency or “spot work” project opportunities.
|
•
|
Weighted average cost of capital (“WACC”), the risk-adjusted rate used to discount the projected cash flows;
|
•
|
Cash flows generated from existing work and new awards; and
|
•
|
Projected operating margins.
|
(in thousands)
|
Construction
|
|
Service
|
|
Total
|
||||||
December 31, 2018
|
$
|
4,359
|
|
|
$
|
6,129
|
|
|
$
|
10,488
|
|
Third quarter 2019 impairment
|
(4,359
|
)
|
|
—
|
|
|
(4,359
|
)
|
|||
December 31, 2019
|
$
|
—
|
|
|
$
|
6,129
|
|
|
$
|
6,129
|
|
(in thousands)
|
Gross
carrying
amount
|
|
Accumulated
amortization
|
|
Net intangible
assets
|
||||||
December 31, 2019
|
|
|
|
|
|
||||||
Amortized intangible assets:
|
|
|
|
|
|
||||||
Backlog – Construction
|
$
|
4,830
|
|
|
$
|
(4,830
|
)
|
|
$
|
—
|
|
Customer Relationships – Service
|
4,710
|
|
|
(2,655
|
)
|
|
2,055
|
|
|||
Favorable Leasehold Interests
|
530
|
|
|
(234
|
)
|
|
296
|
|
|||
Total amortized intangible assets
|
10,070
|
|
|
(7,719
|
)
|
|
2,351
|
|
|||
Unamortized intangible assets:
|
|
|
|
|
|
||||||
Trade Name
|
9,960
|
|
|
—
|
|
|
9,960
|
|
|||
Total unamortized intangible assets
|
9,960
|
|
|
—
|
|
|
9,960
|
|
|||
Total amortized and unamortized assets, excluding goodwill
|
$
|
20,030
|
|
|
$
|
(7,719
|
)
|
|
$
|
12,311
|
|
(in thousands)
|
Gross
carrying
amount
|
|
Accumulated
amortization
|
|
Net intangible
assets
|
||||||
December 31, 2018
|
|
|
|
|
|
||||||
Amortized intangible assets:
|
|
|
|
|
|
||||||
Backlog – Construction
|
$
|
4,830
|
|
|
$
|
(4,830
|
)
|
|
$
|
—
|
|
|
|
|
|
|
|
||||||
Customer Relationships – Service
|
4,710
|
|
|
(2,081
|
)
|
|
2,629
|
|
|||
Favorable Leasehold Interests
|
530
|
|
|
(166
|
)
|
|
364
|
|
|||
Total amortized intangible assets
|
10,070
|
|
|
(7,077
|
)
|
|
2,993
|
|
|||
Unamortized intangible assets:
|
|
|
|
|
|
||||||
Trade Name
|
9,960
|
|
|
—
|
|
|
9,960
|
|
|||
Total unamortized intangible assets
|
9,960
|
|
|
—
|
|
|
9,960
|
|
|||
Total amortized and unamortized assets, excluding goodwill
|
$
|
20,030
|
|
|
$
|
(7,077
|
)
|
|
$
|
12,953
|
|
Asset
|
|
Amortization Method
|
|
Estimated Remaining Useful
Life
|
Customer Relationships – Service
|
|
Pattern of economic benefit
|
|
11.0 years
|
Favorable Leasehold Interests
|
|
Straight line
|
|
9.17 years
|
(in thousands)
|
|
Estimated Amortization Expense
|
||
2020
|
|
$
|
525
|
|
2021
|
|
431
|
|
|
2022
|
|
357
|
|
|
2023
|
|
245
|
|
|
2024
|
|
198
|
|
|
2025 and thereafter
|
|
595
|
|
|
Total
|
|
$
|
2,351
|
|
(in thousands)
|
December 31, 2019
|
|
January 1, 2019 *
|
||||
Accrued payroll and related liabilities
|
$
|
4,999
|
|
|
$
|
5,146
|
|
Accrued bonus and commissions
|
448
|
|
|
342
|
|
||
Accrued insurance liabilities
|
1,543
|
|
|
1,060
|
|
||
Accrued job costs
|
8,563
|
|
|
10,783
|
|
||
Bank overdraft
|
—
|
|
|
1,334
|
|
||
Legal settlements
|
—
|
|
|
32,578
|
|
||
Assurance-type warranty liabilities
|
2,886
|
|
|
2,400
|
|
||
Other accrued liabilities
|
1,606
|
|
|
2,558
|
|
||
Total
|
$
|
20,045
|
|
|
$
|
56,201
|
|
(in thousands)
|
December 31, 2019
|
|
January 1, 2019 *
|
||||
Balance at the beginning of the period
|
$
|
2,400
|
|
|
$
|
2,584
|
|
Accruals for warranties issued
|
272
|
|
|
436
|
|
||
Accruals related to pre-existing warranties (including changes in estimates)
|
1,691
|
|
|
465
|
|
||
Settlements made
|
(1,477
|
)
|
|
(1,085
|
)
|
||
Balance at the end of the period
|
$
|
2,886
|
|
|
$
|
2,400
|
|
(in thousands)
|
December 31, 2019
|
|
January 1, 2019 *
|
||||
Credit Agreement – revolver(1)
|
$
|
—
|
|
|
$
|
—
|
|
Bridge Term Loan – term loan payable in quarterly installments of principal, plus interest through April 2019(1)
|
—
|
|
|
7,736
|
|
||
Credit Agreement – term loan payable in quarterly installments of principal, plus interest through March 2020(1)
|
—
|
|
|
14,335
|
|
||
2019 Revolving Credit Facility
|
—
|
|
|
—
|
|
||
2019 Refinancing Term Loan – term loan payable in quarterly installments of principal, (commencing in September 2020) plus interest through April 2022
|
41,000
|
|
|
—
|
|
||
2019 Refinancing Term Loan embedded derivative
|
—
|
|
|
—
|
|
||
Finance leases – collateralized by vehicles, payable in monthly installments of principal, plus interest ranging from 4.95% to 6.2% through 2024
|
6,585
|
|
|
5,272
|
|
||
Total debt
|
$
|
47,585
|
|
|
$
|
27,343
|
|
Less - Current portion of long-term debt
|
(4,425
|
)
|
|
(3,203
|
)
|
||
Less - Unamortized discount and debt issuance costs
|
(4,292
|
)
|
|
(461
|
)
|
||
Long-term debt
|
$
|
38,868
|
|
|
$
|
23,679
|
|
(in thousands)
|
Year ending
December 31 |
||
2020
|
$
|
4,425
|
|
2021
|
5,985
|
|
|
2022
|
36,557
|
|
|
2023
|
615
|
|
|
2024
|
3
|
|
|
Total
|
$
|
47,585
|
|
Level
|
|
Senior Leverage Ratio
|
|
Additional Margin for
Base Rate loans
|
|
Additional Margin for
Libor Rate loans
|
|
Commitment Fee
|
|||
I
|
|
Greater than or equal to 2.50 to 1.00
|
|
3.00
|
%
|
|
4.00
|
%
|
|
0.50
|
%
|
II
|
|
Less than 2.50 to 1.00, but greater than or equal to 2.00 to 1.00
|
|
2.75
|
%
|
|
3.75
|
%
|
|
0.50
|
%
|
III
|
|
Less than 2.00 to 1.00, but greater than or equal to 1.50 to 1.00
|
|
2.50
|
%
|
|
3.50
|
%
|
|
0.50
|
%
|
IV
|
|
Less than 1.50 to 1.00
|
|
2.25
|
%
|
|
3.25
|
%
|
|
0.50
|
%
|
|
For the Years Ended
|
||||||
(in thousands)
|
December 31, 2019
|
|
December 31, 2018
|
||||
Current tax provision
|
|
|
|
||||
U.S. Federal
|
$
|
69
|
|
|
$
|
16
|
|
State and local
|
258
|
|
|
94
|
|
||
Total current tax provision
|
327
|
|
|
110
|
|
||
|
|
|
|
||||
Deferred tax benefit
|
|
|
|
||||
U.S. Federal
|
(356
|
)
|
|
(421
|
)
|
||
State and local
|
(253
|
)
|
|
(324
|
)
|
||
Total deferred tax benefit
|
(609
|
)
|
|
(745
|
)
|
||
Benefit from income taxes
|
$
|
(282
|
)
|
|
$
|
(635
|
)
|
(in thousands)
|
As of
December 31, 2019 |
|
As of
January 1, 2019 |
||||
Deferred tax assets:
|
|
|
|
||||
Accrued expenses
|
$
|
850
|
|
|
$
|
231
|
|
Allowance for doubtful accounts
|
81
|
|
|
64
|
|
||
Intangibles
|
987
|
|
|
1,186
|
|
||
Goodwill
|
4,257
|
|
|
3,613
|
|
||
Startup costs
|
101
|
|
|
112
|
|
||
Deferred rent
|
—
|
|
|
184
|
|
||
Percentage of completion
|
105
|
|
|
67
|
|
||
Stock-based compensation
|
679
|
|
|
566
|
|
||
Net operating losses and credits
|
841
|
|
|
1,434
|
|
||
Interest
|
507
|
|
|
289
|
|
||
Lease liabilities
|
5,960
|
|
|
—
|
|
||
Other
|
176
|
|
|
40
|
|
||
Total deferred tax assets
|
14,544
|
|
|
7,786
|
|
||
|
|
|
|
||||
Deferred tax liabilities:
|
|
|
|
||||
Fixed assets
|
(3,897
|
)
|
|
(3,610
|
)
|
||
Right-of-use assets
|
(5,586
|
)
|
|
—
|
|
||
Debt discounts
|
(275
|
)
|
|
—
|
|
||
Total deferred tax liabilities
|
(9,758
|
)
|
|
(3,610
|
)
|
||
|
|
|
|
||||
Net deferred tax asset
|
$
|
4,786
|
|
|
$
|
4,176
|
|
|
For the Years Ended
|
||||
|
December 31, 2019
|
|
December 31, 2018
|
||
Federal statutory income tax rate
|
21.0
|
%
|
|
21.0
|
%
|
State income taxes, net of federal tax effect
|
0.8
|
%
|
|
5.5
|
%
|
Change in uncertain tax benefits
|
(8.0
|
)%
|
|
—
|
%
|
Stock based compensation – restricted stock
|
(7.5
|
)%
|
|
(1.2
|
)%
|
Return to provision adjustment
|
4.8
|
%
|
|
7.3
|
%
|
Permanent differences
|
(9.8
|
)%
|
|
(12.4
|
)%
|
Tax credits
|
10.8
|
%
|
|
5.2
|
%
|
Other
|
1.6
|
%
|
|
0.2
|
%
|
Effective tax rate
|
13.7
|
%
|
|
25.6
|
%
|
|
December 31, 2019
|
|
December 31, 2018
|
||||
Balance at beginning of period
|
$
|
—
|
|
|
$
|
—
|
|
Gross increases in prior period tax positions
|
722
|
|
|
—
|
|
||
Gross increases in current period tax positions
|
408
|
|
|
—
|
|
||
Balance at end of period
|
$
|
1,130
|
|
|
$
|
—
|
|
|
For the Years Ended
|
||||||
|
December 31, 2019
|
|
December 31, 2018
|
||||
(in thousands)
|
|
|
|
||||
Statement of Operations Data:
|
|
|
|
||||
Revenue:
|
|
|
|
||||
Construction
|
$
|
438,196
|
|
|
$
|
438,229
|
|
Service
|
115,138
|
|
|
108,297
|
|
||
Total revenue
|
553,334
|
|
|
546,526
|
|
||
|
|
|
|
||||
Gross profit:
|
|
|
|
||||
Construction
|
43,493
|
|
|
36,721
|
|
||
Service
|
28,384
|
|
|
22,710
|
|
||
Total gross profit
|
71,877
|
|
|
59,431
|
|
||
|
|
|
|
||||
Selling, general and administrative expenses:
|
|
|
|
||||
Construction
|
28,356
|
|
|
27,307
|
|
||
Service
|
17,367
|
|
|
15,003
|
|
||
Corporate
|
17,445
|
|
|
14,779
|
|
||
Total selling, general and administrative expenses
|
63,168
|
|
|
57,089
|
|
||
Amortization of intangibles
|
642
|
|
|
1,272
|
|
||
Operating income
|
$
|
8,067
|
|
|
$
|
1,070
|
|
|
|
|
|
||||
Operating income for reportable segments
|
$
|
8,067
|
|
|
$
|
1,070
|
|
Other expenses:
|
|
|
|
||||
Impairment of goodwill (Construction)
|
(4,359
|
)
|
|
—
|
|
||
Less Unallocated amounts:
|
|
|
|
||||
Interest expense
|
(6,285
|
)
|
|
(3,305
|
)
|
||
Loss on debt modification
|
—
|
|
|
(335
|
)
|
||
Loss on debt extinguishment
|
(513
|
)
|
|
—
|
|
||
Gain on change in fair value of warrant liability
|
588
|
|
|
—
|
|
||
Gain on embedded derivative
|
388
|
|
|
—
|
|
||
Gain (loss) on sale of property and equipment
|
57
|
|
|
90
|
|
||
Total unallocated amounts
|
(5,765
|
)
|
|
(3,550
|
)
|
||
Total consolidated income (loss) before income taxes
|
$
|
(2,057
|
)
|
|
$
|
(2,480
|
)
|
|
|
|
|
||||
Other Data:
|
|
|
|
||||
Depreciation and amortization:
|
|
|
|
||||
Construction
|
$
|
3,738
|
|
|
$
|
2,812
|
|
Service
|
997
|
|
|
749
|
|
||
Corporate
|
1,551
|
|
|
2,122
|
|
||
Total other data
|
$
|
6,286
|
|
|
$
|
5,683
|
|
(in thousands)
|
Classification on the Consolidated Balance Sheet
|
|
December 31, 2019
|
||
Assets
|
|
|
|
||
Operating
|
Operating lease right-of-use assets (a)
|
|
$
|
21,056
|
|
Finance
|
Property, plant and equipment, net (b)
|
|
6,412
|
|
|
Total lease assets
|
|
|
$
|
27,468
|
|
|
|
|
|
||
Liabilities
|
|
|
|
||
Current
|
|
|
|
||
Operating
|
Current operating lease liabilities
|
|
$
|
3,750
|
|
Finance
|
Current portion of long-term debt
|
|
2,424
|
|
|
Noncurrent
|
|
|
|
||
Operating
|
Long-term lease liabilities
|
|
18,247
|
|
|
Finance
|
Long-term debt
|
|
4,161
|
|
|
Total lease liabilities
|
|
|
$
|
28,582
|
|
(in thousands)
|
Classification on the Consolidated Statement of Operations
|
|
December 31, 2019
|
||
Operating lease cost
|
Cost of revenue(a)
|
|
$
|
3,497
|
|
Operating lease cost
|
Selling, general and administrative expenses(a)
|
|
1,351
|
|
|
Finance lease cost
|
|
|
|
||
Amortization
|
Cost of revenue(b)
|
|
2,517
|
|
|
Interest
|
Interest expense, net(b)
|
|
333
|
|
|
Total lease cost
|
|
|
$
|
7,698
|
|
Year ending December 31:
|
Finance
Leases |
|
Operating
Leases |
||||
2020
|
$
|
2,736
|
|
|
$
|
4,721
|
|
2021
|
2,172
|
|
|
4,500
|
|
||
2022
|
1,642
|
|
|
4,331
|
|
||
2023
|
630
|
|
|
3,287
|
|
||
2024
|
3
|
|
|
2,685
|
|
||
Thereafter
|
—
|
|
|
6,101
|
|
||
Total minimum lease payments
|
$
|
7,183
|
|
|
$
|
25,625
|
|
Amounts representing interest
|
(598
|
)
|
|
|
|||
Present value of net minimum lease payments
|
$
|
6,585
|
|
|
|
|
|
December 31, 2019
|
|
Weighted average lease term (in years)
|
|
|
|
Operating
|
|
6.20
|
|
Finance
|
|
2.96
|
|
|
|
|
|
Weighted average discount rate
|
|
|
|
Operating
|
|
4.80
|
%
|
Finance
|
|
5.69
|
%
|
(in thousands)
|
|
December 31, 2019
|
||
Cash paid for amounts included in the measurement of lease liabilities
|
|
|
||
Operating cash flows from operating leases
|
|
$
|
4,722
|
|
Operating cash flows from finance leases
|
|
333
|
|
|
Financing cash flows from finance leases
|
|
2,469
|
|
|
Right-of-use assets exchanged for lease liabilities
|
|
|
||
Operating leases
|
|
$
|
3,355
|
|
Finance leases
|
|
3,578
|
|
|
Right-of-use assets disposed or adjusted modifying operating leases liabilities
|
|
$
|
1,651
|
|
Right-of-use assets disposed or adjusted modifying finance leases liabilities
|
|
$
|
(78
|
)
|
(in thousands)
|
December 31,
2019 |
|
December 31,
2018 |
||||
Current liability — workers' compensation and general liability
|
$
|
703
|
|
|
$
|
352
|
|
Current liability — medical and dental
|
821
|
|
|
607
|
|
||
Non-current liability
|
382
|
|
|
820
|
|
||
Total liability
|
$
|
1,906
|
|
|
$
|
1,779
|
|
Restricted cash
|
$
|
113
|
|
|
$
|
113
|
|
Pension Fund
|
EIN/Pension
Plan Number
|
|
PPA Zone Status
|
|
FIP/RP Status
|
|
Contributions (in
thousands)
|
|
Contributions
greater than
5% of total
contributions
|
|
Surcharge
Imposed
|
|
Expiration date
of CBA
|
||||||||
|
2019
|
|
2018
|
|
|
2019
|
|
2018
|
|
|
|
||||||||||
Heating, Piping and Refrigeration Pension Fund
|
52-1058013 / 001
|
|
Green
|
|
Green
|
|
N/A
|
|
$
|
1,101
|
|
|
$
|
1,763
|
|
|
No
|
|
N/A
|
|
Jul-22
|
Plumbers Local No 98 Defined Benefit Pension Fund
|
38-3031916 / 001
|
|
Yellow
|
|
Yellow
|
|
Implemented
|
|
1,140
|
|
|
1,480
|
|
|
Yes
|
|
N/A
|
|
May-25
|
||
Plumbers and Pipefitters National Pension Fund
|
52-6152779 / 001
|
|
Yellow
|
|
Yellow
|
|
Implemented
|
|
1,040
|
|
|
1,443
|
|
|
No
|
|
N/A
|
|
Ranging from May-20 - Aug-26
|
||
Pipefitters Local 636 Defined Benefit Pension Fund
|
38-3009873 / 001
|
|
Yellow
|
|
Yellow
|
|
Implemented
|
|
1,369
|
|
|
1,393
|
|
|
No
|
|
N/A
|
|
May-22
|
||
Sheet Metal Workers' Pension Plan of Southern California, Arizona and Nevada
|
95-6052257 / 001
|
|
Yellow
|
|
Yellow
|
|
Implemented
|
|
1,908
|
|
|
1,392
|
|
|
No
|
|
N/A
|
|
Jun-20
|
||
Sheet Metal Workers’ National Pension Fund
|
52-6112463 / 001
|
|
Yellow
|
|
Yellow
|
|
Implemented
|
|
1,509
|
|
|
1,283
|
|
|
No
|
|
N/A
|
|
Ranging from Apr-20 – June-23
|
||
Sheet Metal Workers Local Union No. 80 Pension Fund
|
38-6105633 / 001
|
|
Yellow
|
|
Yellow
|
|
Implemented
|
|
1,033
|
|
|
1,217
|
|
|
Yes
|
|
N/A
|
|
May-21
|
||
Sheet Metal Workers Local 98 Pension Fund
|
31-6171213 / 001
|
|
Yellow
|
|
Yellow
|
|
Implemented
|
|
927
|
|
|
1,133
|
|
|
Yes
|
|
N/A
|
|
May-23
|
||
Steamfitters Local Union No. 420 Pension Fund
|
23-2004424 / 001
|
|
Red
|
|
Red
|
|
Implemented
|
|
825
|
|
|
902
|
|
|
No
|
|
No
|
|
May-20
|
||
Pipefitters Union Local No. 537 Pension Fund
|
51-6030859 / 001
|
|
Green
|
|
Green
|
|
N/A
|
|
1,579
|
|
|
805
|
|
|
No
|
|
N/A
|
|
Aug-21
|
Plumbers & Pipefitters Local No 189 Pension Plan
|
31-0894807 / 001
|
|
Green
|
|
Green
|
|
N/A
|
|
544
|
|
|
637
|
|
|
Yes
|
|
N/A
|
|
May-22
|
||
Plumbers & Pipefitters of Local Union No. 333 Pension Fund
|
38-3545518 / 005
|
|
Yellow
|
|
Yellow
|
|
Implemented
|
|
645
|
|
|
535
|
|
|
Yes
|
|
N/A
|
|
May-21
|
||
Southern California Pipe Trades Retirement Fund
|
51-6108443 / 001
|
|
Green
|
|
Green
|
|
N/A
|
|
1,015
|
|
|
529
|
|
|
No
|
|
N/A
|
|
Aug-26
|
||
Electrical Workers Local No. 26 Pension Trust Fund
|
52-6117919 / 001
|
|
Green
|
|
Green
|
|
N/A
|
|
341
|
|
|
404
|
|
|
No
|
|
N/A
|
|
May-21
|
||
Plumbers Union Local No. 12 Pension
|
04-6023174 / 001
|
|
Green
|
|
Green
|
|
N/A
|
|
322
|
|
|
277
|
|
|
No
|
|
N/A
|
|
Aug-21
|
||
Sheet Metal Workers Local 7, Zone 1 Pension Plan
|
38-6234066 / 001
|
|
Yellow
|
|
Yellow
|
|
Implemented
|
|
350
|
|
|
235
|
|
|
No
|
|
N/A
|
|
Apr-20
|
||
Plumbers & Steamfitters Local 577 Pension Plan
|
31-6134953 /001
|
|
Yellow
|
|
Red
|
|
Implemented
|
|
217
|
|
|
194
|
|
|
No
|
|
N/A
|
|
May-23
|
||
Plumbers Local Union No. 690 Pension Fund
|
23-6405018 / 001
|
|
Green
|
|
Green
|
|
N/A
|
|
399
|
|
|
163
|
|
|
No
|
|
N/A
|
|
Apr-24
|
||
Laborers District Council Pension and Disability Trust Fund No. 2
|
52-0749130 / 001
|
|
Yellow
|
|
Orange
|
|
Implemented
|
|
49
|
|
|
119
|
|
|
No
|
|
N/A
|
|
Oct-21
|
||
National Electrical Benefit Fund
|
53-0181657 / 001
|
|
Green
|
|
Green
|
|
N/A
|
|
105
|
|
|
110
|
|
|
No
|
|
N/A
|
|
May-21
|
||
Airconditioning and Refrigeration Industry Retirement Trust Fund
|
95-6035386 / 001
|
|
Green
|
|
Green
|
|
N/A
|
|
144
|
|
|
93
|
|
|
No
|
|
N/A
|
|
Aug-24
|
||
Plumbers and Steamfitters Local 486 Pension Fund
|
52-6124449 / 001
|
|
Green
|
|
Green
|
|
N/A
|
|
44
|
|
|
93
|
|
|
No
|
|
N/A
|
|
Dec-19
|
||
Steamfitters Local #449 Pension Plan
|
25-6032401 / 001
|
|
Green
|
|
Green
|
|
N/A
|
|
185
|
|
|
38
|
|
|
No
|
|
N/A
|
|
May-23
|
||
United Association Local Union No. 322 Pension Plan
|
21-6016638 / 001
|
|
Red
|
|
Red
|
|
Implemented
|
|
38
|
|
|
26
|
|
|
No
|
|
Yes
|
|
Apr-20
|
||
Sheet Metal Workers Local 224 Pension Fund
|
31-6171353 / 001
|
|
Yellow
|
|
Yellow
|
|
Implemented
|
|
17
|
|
|
19
|
|
|
No
|
|
N/A
|
|
May-20
|
||
Plumbers Local 27 Pension Fund
|
25-6034928 / 001
|
|
Green
|
|
Green
|
|
N/A
|
|
56
|
|
|
18
|
|
|
No
|
|
N/A
|
|
May-23
|
||
All other plans (8 as of December 31, 2019)
|
|
|
|
|
|
|
|
|
150
|
|
|
138
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Contributions
|
|
$
|
17,052
|
|
|
$
|
16,439
|
|
|
|
|
|
|
|
|
Awards
|
|
Weighted-Average
Grant Date
Fair Values
|
|||
Unvested at January 1, 2018
|
176,965
|
|
|
$
|
13.25
|
|
Granted
|
81,574
|
|
|
13.37
|
|
|
Vested
|
(77,084
|
)
|
|
13.25
|
|
|
Forfeited
|
(8,368
|
)
|
|
13.32
|
|
|
Unvested at December 31, 2018
|
173,087
|
|
|
$
|
13.30
|
|
Granted
|
268,851
|
|
|
6.32
|
|
|
Vested
|
(103,381
|
)
|
|
12.99
|
|
|
Forfeited
|
(9,982
|
)
|
|
8.58
|
|
|
Unvested at December 31, 2019
|
328,575
|
|
|
$
|
7.83
|
|
|
Awards
|
|
Weighted-Average
Grant Date
Fair Values
|
|||
Unvested at January 1, 2018
|
66,500
|
|
|
$
|
13.25
|
|
Granted
|
61,307
|
|
|
13.44
|
|
|
Vested
|
—
|
|
|
—
|
|
|
Forfeited
|
(3,750
|
)
|
|
13.25
|
|
|
Unvested at December 31, 2018
|
124,057
|
|
|
$
|
13.34
|
|
Granted
|
6,000
|
|
|
4.98
|
|
|
Vested
|
—
|
|
|
—
|
|
|
Forfeited
|
(67,750
|
)
|
|
13.27
|
|
|
Unvested at December 31, 2019
|
62,307
|
|
|
$
|
12.62
|
|
Risk-free interest rate
|
1.56
|
%
|
|
Dividend yield
|
0
|
%
|
|
Remaining performance period (years)
|
3.92
|
|
|
Expected volatility
|
28.54
|
%
|
|
Estimated grant date fair value (per share)
|
$
|
6.58
|
|
Derived service period (years)
|
1.96
|
|
Exhibit
|
Description
|
|
LIMBACH HOLDINGS, INC.
|
|
|
|
/s/ Charles A. Bacon, III
|
|
Charles A. Bacon, III
|
|
President, Chief Executive Officer and Director
|
Signature
|
|
Title
|
Date
|
|
|
|
|
/s/ Charles A. Bacon, III
|
|
President, Chief Executive Officer and Director
|
May 12, 2020
|
Charles A. Bacon III
|
|
(principal executive officer)
|
|
|
|
|
|
/s/ Jayme L. Brooks
|
|
Chief Financial Officer
|
May 12, 2020
|
Jayme L. Brooks
|
|
(principal financial and accounting officer)
|
|
|
|
|
|
/s/ Gordon G. Pratt
|
|
Director and Chairman
|
May 12, 2020
|
Gordon G. Pratt
|
|
|
|
|
|
|
|
/s/ Larry G. Swets, Jr
|
|
Director
|
May 12, 2020
|
Larry G. Swets, Jr
|
|
|
|
|
|
|
|
/s/ Michael F. McNally
|
|
Director
|
May 12, 2020
|
Michael F. McNally
|
|
|
|
|
|
|
|
/s/ Norbert W. Young
|
|
Director
|
May 12, 2020
|
Norbert W. Young
|
|
|
|
|
|
|
|
/s/ Laurel J. Krzeminski
|
|
Director
|
May 12, 2020
|
Laurel J. Krzeminski
|
|
|
|
|
|
|
|
/s/ Joshua S. Horowitz
|
|
Director
|
May 12, 2020
|
Joshua S. Horowitz
|
|
|
|
•
|
$60,000 annual cash fee for Board service;
|
•
|
$50,000 annual cash fee for the Chair of Board;
|
•
|
$40,000 annual cash fee for the Chair of the Audit Committee;
|
•
|
$40,000 annual cash fee for the Chair of the Finance and Capital Markets Committee (formerly known as the Finance Committee);
|
•
|
$20,000 annual cash fee for the Chair of the Compensation Committee; and
|
•
|
$20,000 annual cash fee for the Chair of the Nominating and Corporate Governance Committee.
|
1.
|
I have reviewed this Annual Report on Form 10-K for the year ended December 31, 2019 of Limbach Holdings, 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(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
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.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
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
|
d.
|
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(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
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.
|
Date: May 12, 2020
|
|
|
/s/ Charles A. Bacon, III
|
|
Charles A. Bacon, III
|
|
Chief Executive Officer
|
1.
|
I have reviewed this Annual Report on Form 10-K for the year ended December 31, 2019 of Limbach Holdings, 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(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
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.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
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
|
d.
|
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(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
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.
|
Date: May 12, 2020
|
|
|
/s/ Jayme L. Brooks
|
|
Jayme L. Brooks
|
|
Chief 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.
|
Date: May 12, 2020
|
|
|
/s/ Charles A. Bacon, III
|
|
Charles A. Bacon, III
|
|
Chief 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.
|
Date: May 12, 2020
|
|
|
/s/ Jayme L. Brooks
|
|
Jayme L. Brooks
|
|
Chief Financial Officer
|