UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
 
FORM 10-Q
 
þ    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED March 31, 2020

OR

¨    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

COMMISSION FILE NUMBER: 001-37796

Infrastructure and Energy Alternatives, Inc.
(Exact Name of Registrant as Specified in Charter)
 
Delaware
 
 
 
47-4787177
(State or Other Jurisdiction
of Incorporation)
 
 
 
(IRS Employer
Identification No.)
 
6325 Digital Way
Suite 460
Indianapolis, Indiana
 
46278
(Address of Principal Executive Offices)
 
(Zip Code)
 
Registrant’s telephone number, including area code: (765) 828-2580

Securities registered pursuant to Section 12(b) of the Act:
Title of each class
 
Trading Symbols(s)
 
Name of exchange on which registered
Common Stock, $0.0001 par value
 
IEA
 
The NASDAQ Stock Market LLC
Warrants for Common Stock
 
IEAWW
 
The NASDAQ Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past ninety days. þ Yes ¨ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). þ Yes ¨ No
 
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act:

Large accelerated filer ¨ Accelerated filer ¨ Non-accelerated filer þ Smaller reporting company þ Emerging growth company ¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). ¨ Yes þ No

Number of shares of Common Stock outstanding as of the close of business on May 7, 2020: 22,506,233.




 
Infrastructure and Energy Alternatives, Inc.
 
Table of Contents
 
 
 
 
PART I. FINANCIAL INFORMATION
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Part II. OTHER INFORMATION
 






PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS
INFRASTRUCTURE AND ENERGY ALTERNATIVES, INC.
Condensed Consolidated Balance Sheets
($ in thousands, except per share data)
(Unaudited)
 
March 31, 2020
 
December 31, 2019
Assets
 
 
 
Current assets:
 
 
 
Cash and cash equivalents
58,081

 
147,259

Accounts receivable, net
154,699

 
203,645

Contract assets
193,851

 
179,303

Prepaid expenses and other current assets
22,178

 
16,855

        Total current assets
428,809

 
547,062

 
 
 
 
Property, plant and equipment, net
134,753

 
140,488

Operating lease asset
43,444

 
43,431

Intangible assets, net
33,902

 
37,272

Goodwill
37,373

 
37,373

Company-owned life insurance
4,153

 
4,752

Deferred income taxes
14,072

 
12,992

Other assets
492

 
1,551

        Total assets
$
696,998

 
$
824,921

 
 
 
 
Liabilities and Stockholder's Equity (Deficit)
 
 
 
Current liabilities:
 
 
 
Accounts payable
110,485

 
177,783

Accrued liabilities
121,445

 
158,103

Contract liabilities
107,253

 
115,634

Current portion of finance lease obligations
23,437

 
23,183

Current portion of operating lease obligations
10,191

 
9,628

Current portion of long-term debt
1,693

 
1,946

          Total current liabilities
374,504

 
486,277

 
 
 
 
Finance lease obligations, less current portion
37,826

 
41,055

Operating lease obligations, less current portion
34,131

 
34,572

Long-term debt, less current portion
154,788

 
162,901

Debt - Series B Preferred Stock
175,145

 
166,141

Series B Preferred Stock - warrant obligations
2,200

 
17,591

Deferred compensation
6,593

 
8,004

         Total liabilities
$
785,187

 
$
916,541

 
 
 
 
Commitments and contingencies:

 

 
 
 
 
Series A Preferred Stock, par value, $0.0001 per share; 1,000,000 shares authorized; 17,483 shares and 17,483 shares issued and outstanding at March 31, 2020 and December 31, 2019, respectively
17,483

 
17,483

 
 
 
 
Stockholders' equity (deficit):
 
 
 
Common stock, par value, $0.0001 per share; 100,000,000 shares authorized; 20,700,555 and 20,460,533 shares issued and 20,648,793 and 20,446,811 outstanding at March 31, 2020 and December 31, 2019, respectively
2

 
2

Treasury stock, 51,762 and 13,722 shares at cost at March 31, 2020 and December 31, 2019, respectively.
(160
)
 
(76
)
Additional paid in capital
33,425

 
17,167

Retained earnings (deficit)
(138,939
)
 
(126,196
)
           Total stockholders' equity (deficit)
(105,672
)
 
(109,103
)
           Total liabilities and stockholders' equity (deficit)
$
696,998

 
$
824,921

See accompanying notes to condensed consolidated financial statements.

1



INFRASTRUCTURE AND ENERGY ALTERNATIVES, INC.
Condensed Consolidated Statements of Operations
($ in thousands, except per share data)
(Unaudited)

 
Three Months Ended
 
March 31,
 
2020
 
2019
Revenue
$
358,163

 
$
189,781

Cost of revenue
325,122

 
184,037

Gross profit
33,041

 
5,744

 
 
 
 
Selling, general and administrative expenses
29,484

 
27,754

Income (loss) from operations
3,557

 
(22,010
)
 
 
 
 
Other income (expense), net:
 
 
 
Interest expense, net
(16,065
)
 
(10,367
)
Other expense
(1,102
)
 
(170
)
Loss before benefit for income taxes
(13,610
)
 
(32,547
)
 
 
 
 
Benefit for income taxes
867

 
8,908

 
 
 
 
Net loss
$
(12,743
)
 
$
(23,639
)
 
 
 
 
Net loss per common share - basic
(0.66
)
 
(1.09
)
Net loss per common share - diluted
(0.66
)
 
(1.09
)
Weighted average shares - basic
20,522,216

 
22,188,757

Weighted average shares - diluted
20,522,216

 
22,188,757


See accompanying notes to condensed consolidated financial statements.


2



INFRASTRUCTURE AND ENERGY ALTERNATIVES, INC.
Condensed Consolidated Statements of Stockholders' Equity (Deficit)
($ in thousands)
(Unaudited)
 
 
Common Stock
 
Additional Paid-in Capital
 
Treasury Stock
 
Accumulated Deficit
 
Total Equity (Deficit)
 
 
Shares
Par Value
 
 
Shares
Cost
 
 
Balance at December 31, 2018
 
22,155

2

 
4,751

 


 
(135,931
)
 
(131,178
)
Net loss
 


 

 


 
(23,639
)
 
(23,639
)
Share-based compensation
 


 
1,040

 


 

 
1,040

Share-based payment transaction
 
111


 
235

 
(14
)
(76
)
 

 
159

Merger recapitalization transaction
 


 

 


 
2,754

 
2,754

Cumulative effect from adoption of new accounting standard, net of tax
 


 

 


 
750

 
750

Preferred dividends
 


 
(525
)
 


 

 
(525
)
Balance at March 31, 2019
 
22,266

$
2

 
$
5,501

 
(14
)
$
(76
)
 
$
(156,066
)
 
$
(150,639
)
 
 
 
 
 
 
 
 
 
 
 
 
 
Balance at December 31, 2019
 
20,461

$
2

 
$
17,167

 
(14
)
$
(76
)
 
$
(126,196
)
 
$
(109,103
)
Net loss
 


 

 


 
(12,743
)
 
(12,743
)
Share-based compensation
 


 
1,113

 


 

 
1,113

Share-based payment transactions
 
240


 
280

 
(38
)
(84
)
 

 
196

Series B Preferred Stock - Warrants at close
 


 
15,631

 


 

 
15,631

Preferred dividends
 


 
(766
)
 


 

 
(766
)
Balance at March 31, 2020
 
20,701

$
2

 
$
33,425

 
(52
)
$
(160
)
 
$
(138,939
)
 
$
(105,672
)

See accompanying notes to condensed consolidated financial statements.


3



INFRASTRUCTURE AND ENERGY ALTERNATIVES, INC.
Condensed Consolidated Statements of Cash Flows
($ in thousands)
(Unaudited)
 
Three Months Ended March 31,
 
2020
 
2019
Cash flows from operating activities:
 
 
 
Net loss
$
(12,743
)
 
$
(23,639
)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:

 


   Depreciation and amortization
11,888

 
12,017

   Warrant liability fair value adjustment
1,057

 

   Amortization of debt discounts and issuance costs
2,237

 
1,239

   Share-based compensation expense
1,113

 
1,040

   Deferred compensation
(1,371
)
 
735

   Accrued dividends on Series B Preferred Stock
7,959

 

   Deferred income taxes
(1,080
)
 
(8,908
)
   Other, net
733

 
168

   Change in operating assets and liabilities:
 
 
 
       Accounts receivable
48,931

 
82,383

       Contract assets
(14,548
)
 
(12,405
)
       Prepaid expenses and other assets
(5,212
)
 
(3,149
)
       Accounts payable and accrued liabilities
(104,760
)
 
(110,060
)
       Contract liabilities
(8,381
)
 
23,032

       Net cash used in operating activities
(74,177
)
 
(37,547
)
 
 
 
 
Cash flow from investing activities:
 
 
 
   Company-owned life insurance
599

 
(202
)
   Purchases of property, plant and equipment
(2,231
)
 
(1,908
)
   Proceeds from sale of property, plant and equipment
1,719

 
47

       Net cash provided by (used in) investing activities
87

 
(2,063
)
 
 
 
 
Cash flows from financing activities:
 
 
 
   Proceeds from long-term debt
46,000

 
9,400

   Payments on long-term debt
(55,853
)
 
(16,151
)
   Payments on finance lease obligations
(5,781
)
 
(4,289
)
   Sale-leaseback transaction

 
24,343

   Proceeds from issuance of stock - Series B Preferred Stock
350

 

   Proceeds from stock-based awards, net

196

 
159

   Merger recapitalization transaction

 
2,754

       Net cash provided by (used in) financing activities
(15,088
)
 
16,216

 
 
 
 
Net change in cash and cash equivalents
(89,178
)
 
(23,394
)
 
 
 
 
Cash and cash equivalents, beginning of the period
147,259

 
71,311

 
 
 
 
Cash and cash equivalents, end of the period
$
58,081

 
$
47,917

 
 
 
 

See accompanying notes to condensed consolidated financial statements.

4




INFRASTRUCTURE AND ENERGY ALTERNATIVES, INC.
Condensed Consolidated Statements of Cash Flows
($ in thousands)
(Unaudited)
(Continued)

 
Three Months Ended March 31,
 
2020
 
2019
Supplemental disclosures:
 
 
 
  Cash paid for interest
6,053

 
9,168

  Cash paid (received) for income taxes
(229
)
 
190

Schedule of non-cash activities:
 
 
 
   Acquisition of assets/liabilities through finance lease
2,806

 

   Acquisition of assets/liabilities through operating lease
2,732

 
971

   Preferred dividends declared
766

 
525


See accompanying notes to condensed consolidated financial statements.


5



INFRASTRUCTURE AND ENERGY ALTERNATIVES, INC.
Notes to the Condensed Consolidated Financial Statements
(unaudited)

Note 1. Business, Basis of Presentation and Significant Accounting Policies

Organization and Reportable Segments

Infrastructure and Energy Alternatives, Inc., a Delaware corporation, is a holding company organized on August 4, 2015 (together with its wholly-owned subsidiaries, “IEA” or the “Company”). On March 26, 2018, we became a public company by consummating a merger (the “Merger”) pursuant to an Agreement and Plan of Merger, dated November 3, 2017, with M III Acquisition Corporation (“M III”).

As of December 31, 2019, the Company's total annual gross revenues exceeded $1.07 billion and we are no longer an “emerging growth company,” as defined in the Jumpstart Our Business Startups Act (the “JOBS Act”).

We segregate our business into two reportable segments: the Renewables segment and the Specialty Civil segment. See Note 10. Segments for a description of the reportable segments and their operations.

COVID-19 Pandemic

During March 2020, the World Health Organization declared a global pandemic related to the rapidly growing outbreak of a novel strain of coronavirus (COVID-19). The COVID-19 pandemic has significantly affected economic conditions in the United States and internationally as national, state and local governments reacted to the public health crisis by requiring mitigation measures that have disrupted business activities for an uncertain period of time. The effects of the COVID-19 pandemic could affect the Company’s future business activities and financial results, including; reduced crew productivity, contract amendments/cancellations, higher operating costs and/or delayed project start dates or project shutdowns that may be requested or mandated by governmental authorities or others.

The effects of the COVID-19 pandemic on the Company’s financial results for the three months ended March 31, 2020 has had no negative material impact. Most of the Company’s construction services are currently deemed essential under governmental mitigation orders and substantially all of its business segments continue to operate. Management’s top priority has been to take appropriate actions to protect the health and safety of its employees, customers and business partners, including adjusting its standard operating procedures to respond to evolving health guidelines. Management believes that it is taking appropriate steps to mitigate any potential impact to the Company; however, given the uncertainty regarding the potential effects of the COVID-19 pandemic, any future impacts cannot be quantified or predicted with specificity.

Principles of Consolidation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with the instructions for Quarterly Reports on Form 10-Q and Rule 10-01 of Regulation S-X. Pursuant to these rules and regulations, certain information and footnote disclosures normally included in the annual audited consolidated financial statements prepared in accordance with GAAP have been condensed or omitted.
The unaudited condensed consolidated financial statements include the accounts of IEA and its wholly-owned direct and indirect domestic and foreign subsidiaries and in the opinion of management, these financial statements reflect all adjustments (consisting of normal recurring adjustments) that are necessary to present fairly the results of operations for the interim periods presented. The results of operations for the three months ended March 31, 2020 are not necessarily indicative of the results that may be expected for the year ending December 31, 2020. These financial statements should be read in conjunction with the Company’s audited consolidated financial statements for the year ended December 31, 2019 and notes thereto included in the Company’s 2019 Annual Report on Form 10-K.

Basis of Accounting and Use of Estimates
    
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with GAAP. The preparation of the condensed consolidated financial statements in conformity with GAAP requires the use of estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and the

6



accompanying notes. Key estimates include: the recognition of revenue and project profit or loss; fair value estimates, including those related to Series B Preferred Stock; valuations of goodwill and intangible assets; asset lives used in computing depreciation and amortization; accrued self-insured claims; other reserves and accruals; accounting for income taxes; and the estimated impact of contingencies and ongoing litigation. While management believes that its estimates are reasonable when considered in conjunction with the Company’s consolidated financial position and results of operations, actual results could differ materially from those estimates.

Revenue Recognition

The Company adopted the requirements of Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers, which is also referred to as Accounting Standards Codification (“ASC”) Topic 606, under the modified retrospective transition approach effective January 1, 2019, with application to all existing contracts that were not substantially completed as of January 1, 2019. The Company adopted this standard for interim periods beginning after December 31, 2019, and recorded adjustments to the previously issued quarterly financial statements for the three months ended March 31, 2019. The impacts of adoption on the Company’s retained earnings on January 1, 2019 was primarily related to variable consideration on unapproved change orders. The cumulative impact of adopting Topic 606 required net adjustments of $750,000 to the statement of operations between revenue, cost of revenue and income taxes, thereby reducing income in the March 31, 2019 quarterly financial statements and reducing the December 31, 2019 accumulated deficit. The Company also adjusted the cashflow statement as of March 31, 2019, to reflect adoption.
Under Topic 606, revenue is recognized when control of promised goods and services is transferred to customers, and the amount of revenue recognized reflects the consideration to which an entity expects to be entitled in exchange for the goods and services transferred. Revenue is recognized by the Company primarily over time utilizing the cost-to-cost measure of progress for fixed price contracts and are based on cost for time and materials and other service contracts, consistent with the Company’s previous revenue recognition practices.
Contracts
The Company derives revenue primarily from construction projects performed under contracts for specific projects requiring the construction and installation of an entire infrastructure system or specified units within an infrastructure system. The contracts contain multiple pricing options, including fixed price, time and materials, or unit price. Renewable energy projects are performed for private customers while our Specialty Civil projects are performed for a mix of various governmental entities.
Revenue derived from projects billed on a fixed-price basis totaled 96.0% and 90.2% of consolidated revenue from operations for the three months ended March 31, 2020 and 2019, respectively. Revenue and related costs for construction contracts billed on a time and materials basis are recognized as the services are rendered. Revenue derived from projects billed on a time and materials basis totaled 4.0% and 9.8% of consolidated revenue from operations for the three months ended March 31, 2020 and 2019, respectively.

Revenue from construction contracts is recognized over time using the cost-to-cost measure of progress for fixed price construction contracts. For these contracts, the cost-to-cost measure of progress best depicts the continuous transfer of control of goods or services to the customer. The contractual terms provide that the customer compensates the Company for services rendered.

Contract costs include all direct materials, labor and subcontracted costs, as well as indirect costs related to contract performance, such as indirect labor, supplies, tools, repairs and the operational costs of capital equipment. The cost estimation and review process for recognizing revenue over time under the cost-to-cost method is based on the professional knowledge and experience of the Company’s project managers, engineers and financial professionals. Management reviews estimates of total contract transaction price and total project costs on an ongoing basis. Changes in job performance, job conditions and management’s assessment of expected variable consideration are factors that influence estimates of the total contract transaction price, total costs to complete those contracts and profit recognition. Changes in these factors could result in revisions to revenue and costs of revenue in the period in which the revisions are determined on a prospective basis, which could materially affect the Company’s condensed consolidated results of operations for that period. Provisions for losses on uncompleted contracts are recorded in the period in which such losses are determined.
Performance Obligations
A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of account under Topic 606. The transaction price of a contract is allocated to a distinct performance obligation and recognized

7



as revenue when or as the performance obligation is satisfied. The Company’s contracts often require significant integrated services and, even when delivering multiple distinct services, are generally accounted for as a single performance obligation. Contract amendments and change orders are generally not distinct from the existing contract due to the significant integrated service provided in the context of the contract and are accounted for as a modification of the existing contract and performance obligation. With the exception of certain Specialty Civil service contracts, the majority of the Company’s performance obligations are completed within one year.
When more than one contract is entered into with a customer on or close to the same date, the Company evaluates whether those contracts should be combined and accounted for as a single contract as well as whether those contracts should be accounted for as more than one performance obligation. This evaluation requires significant judgment and is based on the facts and circumstances of the various contracts, which could change the amount of revenue and profit recognition in a given period depending upon the outcome of the evaluation.
Remaining performance obligations represent the amount of unearned transaction prices for contracts, including approved and unapproved change orders. As of March 31, 2020, the amount of the Company’s remaining performance obligations was $1,238.5 million. The Company expects to recognize approximately 81.6% of its remaining performance obligations as revenue during 2020. Revenue recognized from performance obligations satisfied in previous periods was ($2.0) million and $2.8 million, for the three months ended March 31, 2020 and 2019, respectively. 
Variable Consideration
Transaction pricing for the Company’s contracts may include variable consideration, such as unapproved change orders, claims, incentives and liquidated damages. Management estimates variable consideration for a performance obligation utilizing estimation methods that best predict the amount of consideration to which the Company will be entitled. Variable consideration is included in the estimated transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. Management’s estimates of variable consideration and determination of whether to include estimated amounts in transaction price are based on legal opinions, past practices with the customer, specific discussions, correspondence or preliminary negotiations with the customer and all other relevant information that is reasonably available. The effect of a change in variable consideration on the transaction price of a performance obligation is typically recognized as an adjustment to revenue on a cumulative catch-up basis. To the extent unapproved change orders, claims and liquidated damages reflected in transaction price are not resolved in the Company’s favor, or to the extent incentives reflected in transaction price are not earned, there could be reductions in, or reversals of, previously recognized revenue.
As of March 31, 2020 and year ended December 31, 2019, the Company included approximately $60.2 million and $73.3 million, respectively, of unapproved change orders and/or claims in the transaction price for certain contracts that were in the process of being resolved in the normal course of business, including through negotiation, arbitration and other proceedings. These transaction price adjustments are included within Contract Assets or Contract Liabilities as appropriate. The Company actively engages with its customers to complete the final change order approval process, and generally expects these processes to be completed within one year. Amounts ultimately realized upon final acceptance by customers could be higher or lower than such estimated amounts.

8




Disaggregation of Revenue
The following tables disaggregate revenue by customers and services performed, which the Company believes best depicts how the nature, amount, timing and uncertainty of its revenue:
(in thousands)
 
Three months ended
 
 
March 31, 2020
 
March 31, 2019
Renewables
 
 
 
 
   Wind
 
$
248,537

 
$
72,034

   Solar
 
209

 
1,997

 
 
$
248,746

 
$
74,031

 
 
 
 
 
Specialty Civil
 
 
 
 
   Heavy civil
 
$
41,222

 
$
50,115

   Rail
 
47,057

 
42,609

   Environmental
 
21,138

 
23,026

 
 
$
109,417

 
$
115,750

Concentrations
 
The Company had the following approximate revenue and accounts receivable concentrations, net of allowances, for the periods ended:
 
Revenue %
 
 
 
Three months ended
 
Accounts Receivable %
 
2020
 
2019
 
March 31, 2020
 
December 31, 2019
Company A (Specialty Civil Segment)
*

 
21.1
%
 
*
 
*
Company B (Renewable Segment)
*

 
11.9
%
 
*
 
*
Company C (Renewables Segment)
11.5
%
 
*

 
*
 
*
Company D (Renewables Segment)
11.1
%
 
*

 
*
 
*
* Amount was not above 10% threshold

Recently Adopted Accounting Standards - Guidance Adopted in 2020

In August 2018, the FASB issued ASU 2018-13, “Fair Value Measurement (Topic 820), Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement,” which eliminates certain disclosure requirements for recurring and non-recurring fair value measurements, such as the amount of and reason for transfers between Level 1 and Level 2 of the fair value hierarchy, and adds new disclosure requirements for Level 3 measurements. ASU 2018-13 is effective for all entities for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years, with early adoption permitted for any eliminated or modified disclosures. Certain disclosures per ASU 2018-13 are required to be applied on a retrospective basis and others on a prospective basis. We adopted the standard on January 1, 2020, and it did not have an impact on our disclosures for fair value measurements.

In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842), which is effective for annual reporting periods beginning after December 15, 2018. Under Topic 842, lessees will be required to recognize the following for all leases (with the exception of short-term leases) at the commencement date: i) a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis, and ii) a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. Topic 842 requires entities to adopt the new lease standard using a modified retrospective method and initially apply the related guidance at the beginning of the earliest period presented in the financial statements. 

The Company adopted Topic 842 using the modified retrospective method as of January 1, 2019 and for interim periods beginning after December 31, 2019, without adjusting comparative periods in the financial statements. The most

9



significant effect of the new guidance was the recognition of operating lease right-of-use assets and a liability for operating leases as of December 31, 2019. The accounting for finance leases (capital leases) was substantially unchanged. The Company elected to utilize the package of practical expedients that allowed entities to: (1) not reassess whether any expired or existing contracts were or contained leases; (2) retain the existing classification of lease contracts as of the date of adoption; (3) not reassess initial direct costs for any existing leases; and (4) not separate non-lease components for all classes of leased assets.
Recently Issued Accounting Standards Not Yet Adopted
    
In June 2016, the FASB issued ASU 2016-13, “Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments,” which introduced an expected credit loss methodology for the measurement and recognition of credit losses on most financial assets, including trade accounts receivables. The expected credit loss methodology under ASU 2016-13 is based on historical experience, current conditions and reasonable and supportable forecasts, and replaces the probable/incurred loss model for measuring and recognizing expected losses under current GAAP. The ASU also requires disclosure of information regarding how a company developed its allowance, including changes in the factors that influenced management’s estimate of expected credit losses and the reasons for those changes. The ASU and its related clarifying updates are effective for smaller reporting companies for fiscal years beginning after December 15, 2022, and interim periods within those fiscal years, with early adoption permitted. We are still evaluating the new standard but do not expect it to have a material impact on our estimate of the allowance for uncollectable accounts.

In December 2019, the FASB issued ASU No. 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes,” which removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. This ASU is effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years. Depending on the amendment, adoption may be applied on the retrospective, modified retrospective, or prospective basis. We are currently evaluating the potential effects of adopting the provisions of ASU No. 2019-12.

Management has evaluated other recently issued accounting pronouncements and does not believe that they will have a significant impact on the financial statements and related disclosures.

Note 2. Contract Assets and Liabilities

The timing of when we bill our customers is generally dependent upon agreed-upon contractual terms, milestone billings based on the completion of certain phases of the work, or when services are provided. Sometimes, billing occurs subsequent to revenue recognition, resulting in unbilled revenue, which is a contract asset. Also, we sometimes receive advance payments or deposits from our customers before revenue is recognized, resulting in deferred revenue, which is a contract liability.

Contract assets in the Condensed Consolidated Balance Sheets represent the following:

costs and estimated earnings in excess of billings, which arise when revenue has been recorded but the amount has not been billed; and

retainage amounts for the portion of the contract price billed by us for work performed but held for payment by the customer as a form of security until we reach certain construction milestones or complete the project.

Contract assets consist of the following:

(in thousands)
March 31, 2020
 
December 31, 2019
Costs and estimated earnings in excess of billings on uncompleted contracts
$
106,285

 
$
91,543

Retainage receivable
87,566

 
87,760

 
193,851

 
179,303


Contract liabilities consist of the following:

(in thousands)
March 31, 2020
 
December 31, 2019
Billings in excess of costs and estimated earnings on uncompleted contracts
$
107,207

 
$
115,570

Loss on contracts in progress
46

 
64

 
$
107,253

 
$
115,634


The contract receivables amount as of March 31, 2020 and December 31, 2019 includes unapproved change orders of approximately $9.2 million for which the Company is pursuing settlement through dispute resolution.

Revenue recognized for the three months ended March 31, 2020 and 2019 that was included in the contract liability balance at the beginning of each year was approximately $90.9 million and $31.9 million, respectively.

10



    
Activity in the allowance for doubtful accounts for the periods indicated is as follows:

 
Three Months Ended
 
March 31,
(in thousands)
2020
 
2019
Allowance for doubtful accounts at beginning of period
$
75

 
$
42

    Plus: provision for (reduction in) allowance
14

 
30

    Less: write-offs, net of recoveries

 

Allowance for doubtful accounts at period end
$
89

 
$
72


Note 3. Property, Plant and Equipment, Net

Property, plant and equipment consisted of the following:

(in thousands)
March 31, 2020
 
December 31, 2019
Buildings and leasehold improvements
$
3,051

 
$
2,919

Land
17,600

 
17,600

Construction equipment
175,707

 
173,434

Office equipment, furniture and fixtures
3,537

 
3,487

Vehicles
5,375

 
6,087

 
205,270

 
203,527

Accumulated depreciation
(70,517
)
 
(63,039
)
    Property, plant and equipment, net
$
134,753

 
$
140,488


Depreciation expense of property, plant and equipment was $8,516 and $8,476 for the three months ended March 31, 2020 and 2019, respectively.

11





Note 4. Goodwill and Intangible Assets, Net

The following table provides the changes in the carrying amount of goodwill:

(in thousands)
Renewables
 
Specialty Civil
 
Total
January 1, 2019
$
3,020

 
$
37,237

 
$
40,257

   Acquisition adjustments

 
(2,884
)
 
(2,884
)
December 31, 2019
$
3,020

 
$
34,353

 
$
37,373

   Adjustments

 

 

March 31, 2020
$
3,020

 
$
34,353

 
$
37,373


Intangible assets consisted of the following as of the dates indicated:

 
March 31, 2020
 
 
 
December 31, 2019
 
 
($ in thousands)
Gross Carrying Amount
 
Accumulated Amortization
 
Net Carrying Amount
 
Weighted Average Remaining Life
 
Gross Carrying Amount
 
Accumulated Amortization
 
Net Carrying Amount
 
Weighted Average Remaining Life
Customer relationships
$
26,500

 
$
(5,642
)
 
$
20,858

 
5.75 years
 
$
26,500

 
$
(4,695
)
 
$
21,805

 
6 years
Trade name
13,400

 
(3,990
)
 
9,410

 
3.75 years
 
13,400

 
(3,305
)
 
10,095

 
4 years
Backlog
13,900

 
(10,266
)
 
3,634

 
9 months
 
13,900

 
(8,528
)
 
5,372

 
1 year
 
$
53,800

 
$
(19,898
)
 
$
33,902

 
 
 
$
53,800

 
$
(16,528
)
 
$
37,272

 
 

Amortization expense associated with intangible assets for the three months ended March 31, 2020 and 2019, totaled $3.4 million and $3.5 million, respectively.

The following table provides the annual intangible amortization expense currently expected to be recognized for the years 2020 through 2024:

(in thousands)
Remainder of 2020
 
2021
 
2022
 
2023
 
2024
Amortization expense
$
11,837

 
$
6,466

 
$
6,466

 
$
5,841

 
$
3,785


Note 5. Fair Value of Financial Instruments

The Company applies ASC 820, Fair Value Measurement, which establishes a framework for measuring fair value. ASC 820 defines fair value as an exit price, which is the price that would be received for an asset or paid to transfer a liability in the Company’s principal or most advantageous market in an orderly transaction between market participants on the measurement date. The fair value hierarchy established in ASC 820 generally requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Observable inputs reflect the assumptions that market participants would use in pricing the asset or liability and are developed based on market data obtained from sources independent of the reporting entity. Unobservable inputs reflect the entity’s own assumptions based on market data and the entity’s judgments about the assumptions that market participants would use in pricing the asset or liability and are developed based on the best information available in the circumstances.

The valuation hierarchy is composed of three levels. The classification within the valuation hierarchy is based on the lowest level of input that is significant to the fair value measurement. The levels within the valuation hierarchy are described below:

Level 1 — Assets and liabilities with unadjusted, quoted prices listed on active market exchanges. Inputs to the fair value measurement are observable inputs, such as quoted prices in active markets for identical assets or liabilities.

12



Level 2 — Inputs to the fair value measurement are determined using prices for recently traded assets and liabilities with similar underlying terms, as well as direct or indirect observable inputs, such as interest rates and yield curves that are observable at commonly quoted intervals.
Level 3 — Inputs to the fair value measurement are unobservable inputs, such as estimates, assumptions, and valuation techniques when little or no market data exists for the assets or liabilities.

The following table sets forth information regarding the Company's assets measured at fair value on a recurring basis:    

 
March 31, 2020
 
December 31, 2019
(in thousands)
Level 1
 
Level 2
 
Level 3
 
Total
 
Level 1
 
Level 2
 
Level 3
 
Total
Liabilities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Series B Preferred Stock - Series A Conversion Warrants and Exchange Warrants
$

 
$

 
$
1,800

 
$
1,800

 
$

 
$

 
$
4,317

 
$
4,317

Series B-1 Preferred Stock - Additional 6% Warrants

 

 
400

 
400

 

 

 
400

 
400

Series B-3 Preferred - Closing Warrants

 

 

 

 

 

 
11,491

 
11,491

Rights Offering

 

 

 

 

 

 
1,383

 
1,383

Total liabilities
$

 
$

 
$
2,200

 
$
2,200

 
$

 
$

 
$
17,591

 
$
17,591


The following is a reconciliation of the beginning and ending balances of recurring fair value measurements using Level 3 inputs:

(in thousands)
Series B Preferred - Series A Conversion Warrants and Exchange Warrants
 
Series B-1 Preferred Stock - Additional 6% Warrants
 
Series B-3 Preferred - Closing Warrants
 
Rights Offering
Beginning Balance, December 31, 2019
$
4,317

 
$
400

 
$
11,491

 
$
1,383

Fair value adjustment - (gain) loss recognized in other income
(91
)
 

 
1,677

 
(1,383
)
Transfer to non-recurring fair value instrument (equity)
(2,426
)
 

 
(13,168
)
 

Ending Balance, March 31, 2020
$
1,800

 
$
400

 
$

 
$


The Company entered into three Equity Commitment agreements at various dates during 2019 with Ares Management, LLC, on behalf of its affiliated funds, investment vehicles and/or managed accounts (“Ares”) and funds managed by Oaktree Capital Management (“Oaktree”). These resulted in Series B-1 Preferred Stock (the “Series B-1 Preferred Stock”), Series B-2 Preferred Stock (the “Series B-2 Preferred Stock”) and Series B-3 Preferred Stock (the “Series B-3 Preferred Stock”) (collectively referred to as “Series B Preferred Stock”).

The information below describes the balance sheet classification and the recurring/nonrecurring fair value measurement:

Series B Preferred Stock (non-recurring) - The Series B Preferred Stock was a mandatorily redeemable financial instrument under ASC 480 and was recorded at relative fair value as debt which was estimated using a discounted cashflow model based on certain significant unobservable inputs, such as accumulated dividend rates, and projected Adjusted EBITDA for the life of the Series B Preferred Stock. The fair value of the liability for each of the transactions, was a combined $153.7 million and recorded on the balance sheet as debt as of March 31, 2020.

Series B Preferred Stock - Warrants at closing (non-recurring) - The Warrants at closing, with an exercise price of $0.0001, represented (on an if-converted to common stock basis) 10% of the issued and outstanding common stock of the Company based on the Company’s fully diluted share count on May 20, 2019 (including the number of shares of common stock that may be issued pursuant to all restricted stock awards, restricted stock units, stock options and any other securities or rights (directly or indirectly) convertible into, exchangeable for or to subscribe for common stock that are outstanding on May 20,

13



2019 (excluding any shares of common stock issuable (a) pursuant to the merger agreement for our business combination, (b) upon conversion of shares of Series A Preferred Stock, (c) upon the exercise of any warrant with an exercise price of $11.50 or higher or (d) upon the exercise of any equity issued pursuant to the Company’s long term incentive plan or other equity plan with a strike price of $11.50 or higher). The 2,545,934 warrants at closing were valued at the closing stock price of $4.21 on May 20, 2019 which was recorded as additional paid in capital.

On August 30, 2019, warrants for 900,000 shares of common stock were issued and were valued at the closing stock price of $3.75 which was recorded as additional paid in capital.

On November 14, 2019, warrants for 3,568,750 shares of common stock were issued and were valued at the closing stock price of $2.20 and these were recorded as a liability (Series B-3 Preferred - Closing Warrants) and marked to market at December 31, 2019 at a price of $3.22. On January 21, 2020 the Company received shareholder approval for the warrants and the liability was marked to market at a price of $3.69. Upon shareholder approval, the warrants were moved from liability to equity at a fair value of $13,168 on a non-recurring basis.

Series B-3 Exchange Warrants (non-recurring) - On October 29, 2019, the holders of Series A Preferred Stock converted 50% of their shares to Series B Preferred Stock and reduced the number of the potential additional warrants. In the exchange the holders of Series A Preferred Stock were issued warrants for 657,383 shares of common stock at the closing stock price of $2.20 and these were recorded as a liability and marked to market at December 31, 2019 at a price of $3.22. On January 21, 2020 the Company received shareholder approval for the warrants and the liability was marked to market at a price of $3.69. As of March 31, 2020, these warrants reside as part of equity at a fair value of $2,426 on a non-recurring basis.

Series B-1 Preferred Stock - Series A Conversion Warrants (recurring) - On May 20, 2019, the conversion rights for the Series A Preferred Stock were amended to allow the holders of Series A Preferred Stock to convert all or any portion of Series A Preferred Stock outstanding at any point in time. If converted, the holders of the Series B Preferred Stock would be entitled to additional warrants, with an exercise price of $0.0001. These warrants were fair valued using the closing stock price of $4.21 on May 20, 2019, at an estimated if-converted share count and recorded as a liability.

Series B-1 Preferred Stock - Additional 6% Warrants (recurring) - The Additional 6% Warrants are issuable if the Company fails to meet certain Adjusted EBITDA thresholds on a trailing twelve-month basis from May 31, 2020 through April 30, 2021. The Company recorded the Additional 6% Warrants at fair value, which was estimated using a Monte Carlo Simulation based on certain significant unobservable inputs, such as a risk rate premium, Adjusted EBITDA volatility, stock price volatility and projected Adjusted EBITDA for the Company for 2019. The Additional 6% Warrants were recorded as a liability.

Rights offering - The Company conducted a rights offering and each shareholder as of the record date was issued a right to purchase Series B Preferred Stock and warrants. The right that was issued was fair valued using a Black-Scholes model based on certain significant unobservable inputs, such as a risk rate premium, stock price volatility, dividend yield and expected term of rights offering. The rights offering fair value was recorded as a liability and was a deemed dividend to common stockholders and reflected as a reduction in additional paid in capital. On March 4, 2020 we completed the rights offering, removed the liability associated with the fair value (rights offering - recurring) and issued and sold 350 shares of Series B-3 Preferred Stock (Series B-3 Preferred Stock - non-recurring at a fair value of $313,000) and 12,029 warrants (non-recurring Series B Preferred Stock - Warrants at closing - non-recurring at a fair value of $37,000) to purchase common stock.

2020 Commitment - The Company is obligated to sell to, Ares and Oaktree, and they are obligated to purchase, additional shares of Series B Preferred Stock up to approximately $15.0 million based on a failure by the Company to achieve specified debt and liquidity levels. See Note 12. Subsequent Events for further discussion of the transaction.

Other financial instruments of the Company not listed in the table consist of cash and cash equivalents, accounts receivable, accounts payable and other current liabilities that approximate their fair values. Additionally, management believes that the outstanding recorded balance on the line of credit and long-term debt, approximates fair value due to their floating interest rates.

14




Note 6. Debt

Debt consists of the following obligations as of:
(in thousands)
March 31, 2020
 
December 31, 2019
 
 
 
 
Term loan
173,345

 
182,687

Commercial equipment notes
3,946

 
4,456

   Total principal due for long-term debt
177,291

 
187,143

Unamortized debt discount and issuance costs
(20,810
)
 
(22,296
)
Less: Current portion of long-term debt
(1,693
)
 
(1,946
)
   Long-term debt, less current portion
154,788

 
162,901

 
 
 
 
Debt - Series B Preferred Stock
188,755

 
180,444

Unamortized debt discount and issuance costs
(13,610
)
 
(14,303
)
  Long-term Series B Preferred Stock
175,145

 
166,141


The weighted average interest rate for the term loan as of March 31, 2020 and December 31, 2019, was 9.70% and 10.35%, respectively.
Debt Covenants
The term loan is governed by the terms of the Third A&R Credit Agreement, which include customary affirmative and negative covenants and provide for customary events of default, which include, nonpayment of principal or interest and failure to timely deliver financial statements. Under the Third A&R Credit Agreement, the financial covenant provides that the First Lien Net Leverage Ratio (as defined therein) may not exceed (i) prior to the fiscal quarter ending December 31, 2019, 4.75:1.0, (ii) for the four fiscal quarters ending December 31, 2020, 3.50:1.0, (iii) for the four fiscal quarters ending December 31, 2021, 2.75:1.0, and (iv) for all subsequent quarters, 2.25:1.0. Under the Third A&R Credit Agreement, the Company could not use an equity infusion to cure any covenant violations for fiscal quarter ending in 2019, excluding the Series B Preferred Stock. Thereafter, the Company has access to a customary equity cure.

The Third A&R Credit Agreement also includes certain limitations on the payment of cash dividends on the Company's common shares and provides for other restrictions on (subject to certain exceptions) liens, indebtedness (including guarantees and other contingent obligations), investments (including loans, advances and acquisitions), mergers and other fundamental changes and sales and other dispositions of property or assets, among others.

Letters of Credit and Surety Bonds

In the ordinary course of business, the Company is required to post letters of credit and surety bonds to customers in support of performance under certain contracts. Such letters of credit are generally issued by a bank or similar financial institution. The letter of credit or surety bond commits the issuer to pay specified amounts to the holder of the letter of credit or surety bond under certain conditions. If the letter of credit or surety bond issuer were required to pay any amount to a holder, the Company would be required to reimburse the issuer, which, depending upon the circumstances, could result in a charge to earnings. As of March 31, 2020, and December 31, 2019, the Company was contingently liable under letters of credit issued under its Third A&R Credit Agreement, in the amount of $23.7 million and $21.0 million, respectively, related to projects. In addition, as of March 31, 2020 and December 31, 2019, the Company had outstanding surety bonds on projects of $2.5 billion and $2.4 billion, respectively.

15




Contractual Maturities

Contractual maturities of the Company's outstanding principal on debt obligations as of March 31, 2020:
(in thousands)
Maturities
Remainder of 2020
$
1,365

2021
1,228

2022
15,859

2023
29,735

2024
129,104

Thereafter

Total contractual obligations
$
177,291


Note 7. Commitments and Contingencies

In the ordinary course of business, the Company enters into agreements that provide financing for its machinery and equipment, facility and vehicle needs. The Company reviews these agreements for potential lease classification, and at inception, determines whether a lease is an operating or finance lease. Lease assets and liabilities, which generally represent the present value of future minimum lease payments over the term of the lease, are recognized as of the commencement date. Under Topic 842, leases with an initial lease term of twelve months or less are classified as short-term leases and are not recognized in the condensed consolidated balance sheets unless the lease contains a purchase option that is reasonably certain to be exercised.
Lease term, discount rate, variable lease costs and future minimum lease payment determinations require the use of judgment as these are based on the facts and circumstances related to each specific lease. Lease terms are generally based on their initial non-cancelable terms, unless there is a renewal option that is reasonably certain to be exercised. Various factors, including economic incentives, intent, past history and business need are considered to determine if a renewal option is reasonably certain to be exercised. The implicit rate in a lease agreement is used when it can be determined. Otherwise, the Company's incremental borrowing rate, which is based on information available as of the lease commencement date, including applicable lease terms and the current economic environment, is used to determine the value of the lease obligation.
Finance Leases
    
The Company has obligations, exclusive of associated interest, under various finance leases for equipment totaling $61.3 million and $64.2 million at March 31, 2020 and December 31, 2019, respectively. Gross property under this capitalized lease agreement at March 31, 2020 and December 31, 2019, totaled $117.9 million and $116.1 million, less accumulated depreciation of $39.4 million and $34.0 million, respectively, for net balances of $78.5 million and $82.1 million, respectively. Depreciation of assets held under the finance leases are included in cost of revenue in the condensed consolidated statements of operations.

The future minimum payments of finance lease obligations are as follows:
(in thousands)
 
Remainder of 2020
$
20,035

2021
22,344

2022
18,302

2023
4,108

2024
628

Thereafter
157

Future minimum lease payments
65,574

Less: Amount representing interest
4,311

Present value of minimum lease payments
61,263

Less: Current portion of finance lease obligations
23,437

Finance lease obligations, less current portion
$
37,826


16




Operating Leases
    
In the ordinary course of business, the Company enters into non-cancelable operating leases for certain of its facilities, vehicles and equipment. The Company has obligations, exclusive of associated interest, totaling $44.3 million and $44.2 million at March 31, 2020 and December 31, 2019, respectively. Property under these operating lease agreements at March 31, 2020 and December 31, 2019, totaled $43.4 million and $43.4 million, respectively.

The Company has long-term power-by-the-hour equipment rental agreements with a construction equipment manufacturer that have a guaranteed minimum monthly hour requirement. The minimum guaranteed amount based on the Company's current operations is $3.2 million per year. Total expense under these agreements are listed below as variable lease costs.

The future minimum payments under non-cancelable operating leases are as follows:
(in thousands)
 
Remainder of 2020
$
9,784

2021
11,242

2022
8,846

2023
6,220

2024
3,116

Thereafter
20,461

Future minimum lease payments
59,669

Less: Amount representing interest
15,347

Present value of minimum lease payments
44,322

Less: Current portion of operating lease obligations
10,191

Operating lease obligations, less current portion
$
34,131


Lease Information
 
Three months ended
 
March 31, 2020
March 31, 2019
 
 
 
Finance Lease cost:
 
 
   Amortization of right-of-use assets
5,697

5,008

   Interest on lease liabilities
1,186

1,650

Operating lease cost
3,478

1,831

Short-term lease cost
21,635

8,496

Variable lease cost
960

191

Sublease Income
(33
)
(24
)
Total lease cost
$
32,923

$
17,152

 
 
 
Other information:
 
 
Cash paid for amounts included in the measurement of lease liabilities
 
 
   Operating cash flows from finance leases
$
1,186

$
1,650

   Operating cash flows from operating leases
$
3,342

$
3,247

Weighted-average remaining lease term - finance leases
2.73 years

3.36 years

Weighted-average remaining lease term - operating leases
8.02 years

9.94 years

Weighted-average discount rate - finance leases
6.49
%
6.70
%
Weighted-average discount rate - operating leases
7.14
%
6.89
%


17





Note 8. Earnings Per Share

The Company calculates earnings (loss) per share (“EPS”) in accordance with ASC 260, Earnings per Share. Basic EPS is computed by dividing income (loss) available to common stockholders by the weighted average number of common shares of common stock outstanding during the period.

Income (loss) available to common stockholders is computed by deducting the dividends accrued for the period on cumulative preferred stock from net income. If there is a net loss, the amount of the loss is increased by those preferred dividends.

Diluted EPS assumes the dilutive effect of (i) contingently issuable earn-out shares, (ii) Series A cumulative convertible preferred stock, using the if-converted method, and (iii) the assumed exercise of in-the-money stock options and warrants and the assumed vesting of outstanding restricted stock units (“RSUs”), using the treasury stock method.

Whether the Company has net income, or a net loss determines whether potential issuances of common stock are included in the diluted EPS computation or whether they would be anti-dilutive. As a result, if there is a net loss, diluted EPS is computed in the same manner as basic EPS is computed. Similarly, if the Company has net income but its preferred dividend adjustment made in computing income available to common stockholders results in a net loss available to common stockholders, diluted EPS would be computed the same as basic EPS.

The calculations of basic and diluted EPS, are as follows:
 
Three Months Ended
 
March 31,
($ in thousands, except per share data)
2020
 
2019
Numerator:
 
 
 
  Net loss
(12,743
)
 
(23,639
)
  Less: Convertible Preferred Stock dividends
(766
)
 
(524
)
    Net loss available to common stockholders
(13,509
)
 
(24,163
)
 
 
 
 
Denominator:
 
 
 
  Weighted average common shares outstanding - basic and diluted
20,522,216

 
22,188,757

 
 
 
 
Anti-dilutive: (1)(2)
 
 
 
  Convertible Series A Preferred
6,553,041

 
5,045,149

  Series B Preferred - Warrants at closing
7,675,325

 

  RSUs
1,456,359

 
354,106

 
 
 
 
Basic EPS
(0.66
)
 
(1.09
)
Diluted EPS
(0.66
)
 
(1.09
)

(1)
As of March 31, 2020 and 2019, publicly traded warrants to purchase 8,480,000 shares of common stock at $11.50 per share were not considered as dilutive as the warrants’ exercise price was greater than the average market price of the common stock during the period.
    
(2)
As of March 31, 2020 and 2019, there were 591,860 and 646,405 of vested and unvested Options and 141,248 and 169,494 unvested RSUs, respectively. These were also not considered as dilutive as the respective exercise price or average stock price required for vesting of such awards was greater than the average market price of the common stock during the period.

18




Series A Preferred Stock

As of March 31, 2020, we had 17,483 shares of Series A Preferred Stock with a stated value of $1,000 per share plus accumulated dividends. Dividends are paid on the Series A Preferred Stock as, if and when declared by our Board. To extent permitted, dividends are required to be paid in cash quarterly in arrears on each March 31, June 30, September 30 and December 31 on the stated value at a rate of 10% per annum.

If not paid in cash, dividends will accrue on the stated value and will increase the stated value on and effective as of the applicable dividend date without any further action by the Board at 12% per annum.

So long as any shares of Series B Preferred Stock of the Company are currently outstanding or from and after the occurrence of any non-payment event or default event and until cured or waived, the foregoing rates will increase by 2% per annum.

As of March 31, 2020, the Company has accrued a cumulative of $2.5 million in dividends to holders of Series A Preferred Stock as a reduction to additional paid-in capital.

Series B Preferred Stock

As of March 31, 2020, we had 199,474 shares of Series B Preferred Stock outstanding, with each share having a stated value of $1,000 plus accumulated dividends. Our common stock and Series A Preferred Stock are junior to the Series B Preferred Stock. Dividends are paid in cash on the Series B Preferred Stock as, if and when declared by our Board. To the extent not prohibited by applicable law, dividends are required to be declared and paid in cash quarterly in arrears on each March 31, June 30, September 30 and December 31. Any dividend period for which the Total Net Leverage Ratio is greater than 1.50:1.00, the dividend rate is 13.5% per annum and (ii) with respect to any dividend period for which the Total Net Leverage Ratio is less than or equal to 1.50:1.00, at a rate of 12% per annum.

If not paid in cash, dividends will accrue on the stated value and will increase the stated value on Series B Preferred Stock and is effective as of the applicable dividend date without any further action by the Board at a rate of 15%.

The Company has accrued a cumulative of $18.3 million in dividends to holders of Series B Preferred Stock, which is recorded in convertible debt in the Company's condensed consolidated balance sheet for the quarter ended March 31, 2020. See Note 5. Fair Value of Financial Instruments for discussion regarding the Company's valuation of Series B Preferred Stock.

Stock Compensation
    
Under guidance of ASC Topic 718 “Compensation — Stock Compensation,” stock-based compensation expense is measured at the date of grant, based on the calculated fair value of the stock-based award, and is recognized as expense over the employee’s requisite service period (generally the vesting period of the award).

The fair value of the RSUs was based on the closing market price of our common stock on the date of the grant. Stock compensation expense for the RSUs is being amortized using the straight-line method over the service period. For the three months ended March 31, 2020 and 2019, we recognized $1.1 million and $1.0 million in compensation expense, respectively,


Note 9. Income Taxes

The Company’s statutory federal tax rate was 21.00% for the periods ended March 31, 2020 and 2019, respectively. State tax rates for the same period vary among states and range from approximately 0.8% to 12.0%. A small number of states do not impose an income tax.

The effective tax rates for the three months ended March 31, 2020 and 2019 were 6.4% and 27.4%, respectively. The difference between the Company’s effective tax rate and the federal statutory rate primarily results from permanent differences related to the interest accrued for the Series B Preferred Stock, which is not deductible for federal and state income taxes. There were no changes in uncertain tax positions during the periods ended March 31, 2020 and 2019.

On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) was enacted by the US Government in response to the COVID-19 pandemic to provide employment retention incentives. These relief measures did not

19



materially affect the condensed consolidated financial statements for the first quarter of 2020. We are currently assessing the future implications of these provisions on our condensed consolidated financial statements.

Note 10. Segments

We operate our business as two reportable segments: the Renewables segment and the Specialty Civil segment. Each of our reportable segments is comprised of similar business units that specialize in services unique to the respective markets that each segment serves. The classification of revenue and gross profit for segment reporting purposes can at times require judgment on the part of management. Our segments may perform services across industries or perform joint services for customers in multiple industries. To determine reportable segment gross profit, certain allocations, including allocations of shared and indirect costs, such as facility costs, equipment costs and indirect operating expenses, were made based on segment revenue.

Separate measures of the Company’s assets, including capital expenditures and cash flows by reportable segment are not produced or utilized by management to evaluate segment performance. A substantial portion of the Company’s fixed assets are owned by and accounted for in our equipment department, including operating machinery, equipment and vehicles, as well as office equipment, buildings and leasehold improvements, and are used on an interchangeable basis across our reportable segments. As such, for reporting purposes, total under/over absorption of equipment expenses consisting primarily of depreciation is allocated to the Company's two reportable segments based on segment revenue.
    
The following is a brief description of the Company's reportable segments:

Renewables Segment

The Renewables segment operates throughout the United States and specializes in a range of full engineering, procurement and construction (“EPC”) services that include project delivery, design, site development, construction, installation and restoration of infrastructure services for the wind and solar industries.

Specialty Civil Segment

The Specialty Civil segment operates throughout the United States and specializes in a range of services that include:

Heavy civil construction services such as high-altitude road and bridge construction, specialty paving, industrial maintenance and other local, state and government projects.

Environmental remediation services such as site development, environmental site closure and outsourced contract mining and coal ash management services.
  
Rail Infrastructure services such as planning, creation and maintenance of infrastructure projects for major railway and intermodal facilities construction.

Segment Revenue

Revenue by segment was as follows:
 
Three Months Ended March 31,
(in thousands)
2020
 
2019
Segment
Revenue
% of Total Revenue
 
Revenue
% of Total Revenue
Renewables
$
248,746

69.5
%
 
$
74,031

39.0
%
Specialty Civil
109,417

30.5
%
 
115,750

61.0
%
  Total revenue
$
358,163

100.0
%
 
$
189,781

100.0
%

20





Segment Gross Profit

Gross profit by segment was as follows:
 
Three Months Ended March 31,
(in thousands)
2020
 
2019
Segment
Gross Profit
Gross Profit Margin
 
Gross Profit
Gross Profit Margin
Renewables
$
25,829

10.4
%
 
$
1,163

1.6
%
Specialty Civil
7,212

6.6
%
 
4,581

4.0
%
  Total gross profit
$
33,041

9.2
%
 
$
5,744

3.0
%

Note 11. Related Party Transactions

Related Party Shareholders

Type of Equity
Holder
Ownership Percentage
Series A Preferred, Series A Conversion Warrants and Exchange Warrants, Series B-3 Preferred Stock (exchange agreement)
Infrastructure and Energy Alternatives, LLC
100
%
Series B-1 Preferred Stock, Series A Conversion Warrants, Additional 6% Warrants, Warrants at closing
Ares
60
%
Oaktree Power Opportunities Fund III Delaware, L.P.
40
%
2020 Commitment
Ares
50
%
Oaktree Power Opportunities Fund III Delaware, L.P.
50
%
Series B-2 and B-3 Preferred Stock, Warrants at closing
Ares
100
%


Note 12. Subsequent Event

Amendment to Equity Commitment Agreement

On May 6, 2020, the Company entered into an Amendment (the “Amendment”) to the Equity Commitment Agreement, dated as of October 29, 2019 (the “Equity Commitment Agreement”) by and between the Company, Ares and Oaktree. The Amendment amends the Equity Commitment Agreement to extend the period of time required to enter into the 2020 Commitment and purchase additional shares of Series B-3 Preferred Stock and warrants from the Company to July 14, 2020, or such other date as mutually agreed upon. Additionally, the Amendment clarifies that the 2020 Commitment shall in no event exceed $5,650,000.





 

21




ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Forward-Looking Statements

This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The forward-looking statements can be identified by the use of forward-looking terminology including “may,” “should,” “likely,” “will,” “believe,” “expect,” “anticipate,” “estimate,” “forecast,” “seek,” “target,” “continue,” “plan,” “intend,” “project,” or other similar words. All statements, other than statements of historical fact included in this Quarterly Report, regarding expectations for the impact of COVID-19 future financial performance, business strategies, expectations for our business, future operations, liquidity positions, availability of capital resources, financial position, estimated revenues and losses, projected costs, prospects, plans, objectives and beliefs of management are forward-looking statements.

These forward-looking statements are based on information available as of the date of this Quarterly Report and our management’s current expectations, forecasts and assumptions, and involve a number of judgments, risks and uncertainties. Although we believe that the expectations reflected in such forward-looking statements are reasonable, we cannot give any assurance that such expectations will prove correct. Forward-looking statements should not be relied upon as representing our views as of any subsequent date. As a result of a number of known and unknown risks and uncertainties, our actual results or performance may be materially different from those expressed or implied by these forward-looking statements. Some factors that could cause actual results to differ include:

potential risks and uncertainties relating to the ultimate impact of COVID-19, including the geographic spread, the severity of the disease, the duration of the COVID-19 pandemic, actions that may be taken by governmental authorities to contain the COVID-19 pandemic or to treat its impact, and the potential negative impacts of COVID-19 on the global economy and financial markets;
availability of commercially reasonable and accessible sources of liquidity and bonding;
our ability to generate cash flow and liquidity to fund operations;
the timing and extent of fluctuations in geographic, weather and operational factors affecting our customers, projects and the industries in which we operate;
our ability to identify acquisition candidates and integrate acquired businesses;
consumer demand;
our ability to grow and manage growth profitably;
the possibility that we may be adversely affected by economic, business, and/or competitive factors;
market conditions, technological developments, regulatory changes or other governmental policy uncertainty that affects us or our customers;
our ability to manage projects effectively and in accordance with management estimates, as well as the ability to accurately estimate the costs associated with our fixed price and other contracts, including any material changes in estimates for completion of projects;
the effect on demand for our services and changes in the amount of capital expenditures by customers due to, among other things, economic conditions, commodity price fluctuations, the availability and cost of financing, and customer consolidation;
the ability of customers to terminate or reduce the amount of work, or in some cases, the prices paid for services, on short or no notice;
customer disputes related to the performance of services;
disputes with, or failures of, subcontractors to deliver agreed-upon supplies or services in a timely fashion;
our ability to replace non-recurring projects with new projects;
the impact of U.S. federal, local, state, foreign or tax legislation and other regulations affecting the renewable energy industry and related projects and expenditures;
the effect of state and federal regulatory initiatives, including costs of compliance with existing and future safety and environmental requirements;
fluctuations in maintenance, materials, labor and other costs;
our beliefs regarding the state of the renewable wind energy market generally; and
the “Risk Factors” described in our Annual Report on Form 10-K for the year ended December 31, 2019, and in our quarterly reports, other public filings and press releases.

22



We do not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.
Throughout this section, unless otherwise noted “IEA,” “Company,” “we,” “us,” and “our” refer to Infrastructure and Energy Alternatives, Inc. and its consolidated subsidiaries. Certain amounts in this section may not foot due to rounding.

Overview

We are a leading diversified infrastructure construction company with specialized energy and heavy civil expertise throughout the United States. We segregate our business into two reportable segments: the Renewables segment and the Specialty Civil segment.

The Renewables segment operates throughout the United States and specializes in a range of services that include project delivery, design, site development, construction, installation and restoration of infrastructure services for the wind and solar industries. We are one of the larger providers in the renewable energy industry and have completed more than 200 wind and solar projects in 35 states.

The Specialty Civil segment operates throughout the United States and specializes in a range of services that include:

Heavy civil construction services such as high-altitude road and bridge construction, specialty paving, industrial maintenance and other local, state and government projects.

Environmental remediation services such as site development, environmental site closure and outsourced contract mining and coal ash management services.
  
Rail Infrastructure services such as planning, creation and maintenance of infrastructure projects for major railway and intermodal facilities construction.

We believe the Company has transformed its business into a diverse national platform of specialty construction capabilities with market leadership in niche markets, including renewables, environmental remediation and industrial maintenance services, heavy civil and rail.

Coronavirus Pandemic Update

The Coronavirus Disease (“COVID-19”) pandemic continues to significantly impact the United States and the world generally. The impact of COVID-19 on construction businesses such as ours is evolving rapidly and its future effects are uncertain.  We are focused on the safety of our employees and ensuring that our construction sites are managed by taking all reasonable precautions to protect on-site personnel.

We have taken the following actions to address the risks attributable to the COVID-19 pandemic:

We established a dedicated COVID-19 task force representing all parts of the Company to review and implement actions to prepare for the impacts on our operations, including a variety of protocols in the areas of social distancing, working from home, emergency office and project site closures, and travel restrictions.

In addition to our existing site crisis management plans, our operations expanded and implemented their pandemic response plans to ensure a consistent, comprehensive response to various COVID-19 scenarios.

We implemented more stringent office and project site cleaning and hygiene protocols in all locations. We also developed more stringent tool, vehicle and equipment cleaning protocols.

For employees, we established a regularly updated COVID-19 information hub with FAQs, important communications, regularly updated protocols, business planning tools, best practices, signage/flyers and other important resources.

We have significantly increased communications, signage and oversight of personal hygiene requirements to drive better prevention practices.


23



We postponed social gatherings, large in-person training sessions and other activities involving groups of 10 or more.

We have prohibited virtually all Company air travel unless approved by executive leadership. We have also required all employees to report their personal travel schedules so we can closely monitor and take any necessary steps to maintain the safety of our workforce.

We have increased our efforts to reduce SG&A expenses by implementing a hiring freeze, delaying the Company 401(k) match until later in the year, prohibiting all non-essential travel, reducing new initiatives, deferring promotions and salary changes, and canceling any non-essential capital expenditures or consulting work.

To mitigate the effects of working from home and travel bans, we have significantly increased the use of remote communication technologies.

We are actively monitoring this issue, including disease progression, federal, state and local government actions, CDC and WHO responses, supplier and supply chain risks, and prevention and containment measures to maintain business operations. As the COVID-19 pandemic and the responses by federal, state and local governments continue to evolve, we continue to make adjustments to our practices and policies to protect the health of our employees and those we work with at our projects and office locations, while continuing to provide our essential construction services to our clients.

We believe that the foregoing actions have significantly reduced the Company’s exposure to the effects of COVID-19, including our workforce’s exposure to infection from COVID-19. As of today, we have had a drastically low incidence of infection in our workforce, none of which we believe was transmitted at work.

While we have received notices of force majeure from certain of our suppliers and customers, we don’t believe at this time, that any such notices will cause critical project delays. To date, we have not had any work stoppages or indications that any of our key projects will be significantly delayed. However, we cannot predict significant disruptions beyond our control, including quarantines and customer work stoppages, significant force majeure declarations by our suppliers or other equipment providers material to our projects. We are taking actions to preserve our liquidity such as limiting our hiring and delaying spending on non-critical initiatives. At this point, we do not believe that COVID-19 is having a negative impact on our liquidity. We could see a change in this status if we experience work stoppages at our projects which would prevent us from billing customers for new work performed. If the federal, state and local governments proceed with more restrictive measures, and our customers determine to stop work or terminate projects, these actions would negatively impact our business, results of operations, liquidity and prospects. In addition, the Company is unable to predict any changes in the market for bonding by our sureties. The Company's ability to obtain bonding may be negatively impacted by market conditions beyond its control.

Economic and Market Factors

We closely monitor the effects that changes in economic and market conditions may have on our customers. General economic and market conditions can negatively affect demand for our customers’ products and services, which can lead to reductions in our customers’ capital and maintenance budgets in certain end-markets. In the face of increased pricing pressure, we strive to maintain our profit margins through productivity improvements and cost reduction programs. Other market, regulatory and industry factors could also affect demand for our services, such as:

changes to our customers’ capital spending plans;

mergers and acquisitions among the customers we serve;

access to capital for customers in the industries we serve;

changes in tax and other incentives;

new or changing regulatory requirements or other governmental policy uncertainty;

economic, market or political developments; and

changes in technology.


24



We cannot predict the effect that changes in such factors may have on our future results of operations, liquidity and cash flows, and we may be unable to fully mitigate, or benefit from, such changes.
 
Industry Trends

Our industry is composed of national, regional and local companies in a range of industries, including renewable power generation, traditional power generation and the civil infrastructure industries. We believe the following industry trends will help to drive our growth and success over the coming years:

Renewables - We have maintained a focus on construction of renewable power production capacity as renewable energy, particularly from wind and solar, and on December 16, 2019, the federal government implemented an agreement that extended lapsed and expiring tax breaks for wind renewable projects. The extension provides a single year extension of the production tax credit (“PTC”) at a 60% level and the investment tax credit (“ITC”) at an 18% level to qualifying projects for which the construction commencement date is now prior to January 1, 2021. We believe that demand will continue to remain strong even after expiration due to the following factors:

Technological advances in turbines sizes and battery storage continue to drive lower costs of electricity generated from wind and solar farms;

Approximately 40 states, as well as the District of Columbia and four territories, have adopted renewable portfolio standards or goals strengthening the backing for clean energy; and

The Annual Energy Outlook 2020 published by the U.S. Department of Energy (“DOE”) in January 2020 projected the addition of approximately 117 gigawatts of new utility-scale wind and solar capacity from 2020 to 2023. We estimate that EPC services will account for approximately 30% of the estimated $28.4 billion of construction over that time period.

We believe that these factors could challenge our future revenue streams in the Renewables segment:

Reduction of owner financing related to the current COVID-19 environment which could cause delays or cancellations of future projects; and

Market price declines on natural gas and other energy products that undercut the immediate demand for increased renewable infrastructure.

Specialty Civil - Our Specialty Civil revenue has been generated through a combination of heavy civil construction, rail construction and environmental remediation. We believe that demand will continue to remain strong based on the following factors:

Heavy civil - the FMI 2020 Overview Report published in the fourth quarter of 2019 project that nonresidential construction put in place for the United States will be over $850 million per year from 2020 to 2023.

Rail - Fostering Advancements in Shipping And Transportation For The Long-Term Achievement of National Efficiencies (FASTLANE) grants are expected to provide $4.5 billion through 2020 to freight and highway projects of national or regional significance.

Environmental remediation - According to the American Coal Ash Association, more than 102.3 million tons of coal ash was generated in 2018 and 42% of coal ash generated was disposed of.

We believe that these factors could challenge our future revenue streams in the Specialty Civil segment:

Decrease in demand for civil construction resulting from corresponding decreases in state departments of transportation budgets from lack of revenues due to quarantine.

Reduction of future pipeline opportunities in certain portions of the U.S. related to further impact of COVID-19.

25




Impact of Seasonality and Cyclical Nature of Business

Our revenue and results of operations are subject to seasonal and other variations. These variations are influenced by weather, customer spending patterns, bidding seasons, project schedules and timing, in particular, for large non-recurring projects and holidays. Typically, our revenue in our Renewable segment is lowest in the first quarter of the year because cold, snowy or wet conditions experienced in the northern climates are not conducive to efficient or safe construction practices. Revenue in the second quarter is typically higher than in the first quarter, as some projects begin, but continued cold and wet weather and effects from thawing ground conditions can often impact second quarter productivity. The third and fourth quarters are typically the most productive quarters of the year as a greater number of projects are underway and weather is normally more accommodating to construction projects. In the fourth quarter, many projects tend to be completed by customers seeking to spend their capital budgets before the end of the year, which generally has a positive impact on our revenue. Nevertheless, the holiday season and inclement weather can cause delays, which can reduce revenue and increase costs on affected projects. Any quarter may be positively or negatively affected by adverse or unusual weather patterns, including from excessive rainfall, warm winter weather or natural catastrophes such as hurricanes or other severe weather, making it difficult to predict quarterly revenue and margin variations. The Company has started construction on 2020 renewable projects in late 2019 due to the desire of our customers to finish these projects before September 30, 2020. This shift in demand will impact 2020 quarterly revenues, which we currently anticipate will shift revenue from the fourth quarter back into the second and third quarter of 2020.

Our revenue and results of operations for our Specialty Civil segment are also affected by seasonality but to a lesser extent as these projects are more geographically diverse and located in less severe weather areas. While the first and second quarter revenues are typically lower than the third and fourth quarter, this diversity has allowed this segment to be less seasonal over the course of the year.

Our industry is also highly cyclical. Fluctuations in end-user demand within the industries we serve, or in the supply of services within those industries, can impact demand for our services. As a result, our business may be adversely affected by industry declines or by delays in new projects. Variations in project schedules or unanticipated changes in project schedules, in particular, in connection with large construction and installation projects, can create fluctuations in revenue, which may adversely affect us in a given period. In addition, revenue from master service agreements, while generally predictable, can be subject to volatility. The financial condition of our customers and their access to capital, variations in project margins, regional, national and global economic, political and market conditions, regulatory or environmental influences, and acquisitions, dispositions or strategic investments can also materially affect quarterly results. Accordingly, our operating results in any particular period may not be indicative of the results that can be expected for any other period.
 
Critical Accounting Policies and Estimates

This discussion and analysis of our financial condition and results of operations is based upon our condensed consolidated financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of our condensed consolidated financial statements requires the use of estimates and assumptions that affect the amounts reported in our condensed consolidated financial statements and the accompanying notes. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis of making judgments about our operating results, including the results of construction contracts accounted for under the cost-to-cost method, and the carrying values of assets and liabilities that are not readily apparent from other sources. Given that management estimates, by their nature, involve judgments regarding future uncertainties, actual results may differ from these estimates if conditions change or if certain key assumptions used in making these estimates ultimately prove to be inaccurate. Refer to Note 1. Business, Basis of Presentation and Significant Accounting Policies in the notes to our condensed consolidated financial statements and to our 2019 Form 10-K for discussion of our significant accounting policies.

We believe that our key estimates include: the recognition of revenue and project profit or loss ; fair value estimates, including those related to Series B Preferred Stock; valuations of goodwill and intangible assets; asset lives used in computing depreciation and amortization; accrued self-insured claims; other reserves and accruals; accounting for income taxes; and the estimated impact of contingencies and ongoing litigation. While management believes that such estimates are reasonable when considered in conjunction with the Company’s condensed consolidated financial position and results of operations, actual results could differ materially from those estimates.


26



“Emerging Growth Company” Status

As of December 31, 2019, the Company's total annual gross revenues exceed $1.07 billion and we are no longer an “emerging growth company,” as defined in the Jumpstart Our Business Startups Act (the “JOBS Act”). See Note 1. Business, Basis of Presentation and Significant Accounting Policies to our consolidated financial statements for more information.

Results of Operations

Three Months Ended March 31, 2020 and 2019

The following table reflects our condensed consolidated results of operations in dollar and percentage of revenue terms for the periods indicated:

 
 
Three Months Ended March 31,
(in thousands)
 
2020
 
2019
 
 
 
 
 
 
 
Revenue
 
$
358,163

100.0
 %
 
$
189,781

100.0
 %
Cost of revenue
 
325,122

90.8
 %
 
184,037

97.0
 %
Gross profit
 
33,041

9.2
 %
 
5,744

3.0
 %
Selling, general and administrative expenses
 
29,484

8.2
 %
 
27,754

14.6
 %
Income from operations
 
3,557

1.0
 %
 
(22,010
)
(11.6
)%
Interest expense, net
 
(16,065
)
(4.5
)%
 
(10,367
)
(5.5
)%
Other expense
 
(1,102
)
(0.3
)%
 
(170
)
(0.1
)%
Income from continuing operations before income taxes
 
(13,610
)
(3.8
)%
 
(32,547
)
(17.1
)%
Benefit for income taxes
 
867

0.2
 %
 
8,908

4.7
 %
Net income
 
$
(12,743
)
(3.6
)%
 
$
(23,639
)
(12.5
)%

We review our operating results by reportable segment. See Note 10. Segments in the notes to the condensed consolidated financial statements in Part 1. Financial Statements. Management’s review of reportable segment results includes analyses of trends in revenue and gross profit. The following table presents revenue and gross profit by reportable segment for the periods indicated:

 
Three Months Ended March 31,
(in thousands)
2020
 
2019
Segment
Revenue
% of Total Revenue
 
Revenue
% of Total Revenue
Renewables
$
248,746

69.5
%
 
$
74,031

39.0
%
Specialty Civil
109,417

30.5
%
 
115,750

61.0
%
  Total revenue
$
358,163

100.0
%
 
$
189,781

100.0
%
 
 
 
 
 
 
 
Gross Profit
Gross Profit Margin
 
Gross Profit
Gross Profit Margin
Renewables
$
25,829

10.4
%
 
$
1,163

1.6
%
Specialty Civil
7,212

6.6
%
 
4,581

4.0
%
  Total gross profit
$
33,041

9.2
%
 
$
5,744

3.0
%

27




The following discussion and analysis of our results of operations should be read in conjunction with our condensed consolidated financial statements and the notes relating thereto, included in Item 1 of this Quarterly Report on Form 10-Q.

Revenue. Revenue increased 88.7%, or $168.4 million, in the first quarter of 2020, compared to the same period in 2019.

Renewables Segment. Renewables revenue was $248.7 million for the first quarter of 2020, as compared to $74.0 million for the same period in 2019, an increase of $174.7 million, or 236.1%. The increase was primarily due to more favorable weather conditions at job sites, the benefit from mobilization of several wind projects at the end of 2019, and an increase in the number of projects during the quarter.

Specialty Civil Segment. Specialty Civil revenue was $109.4 million for the first quarter of 2020, as compared to $115.8 million for the same period in 2019, a decrease of $6.4 million, or 5.5%. The decrease was primarily due to a reduction of revenue generated from heavy civil construction related to the completion of several civil projects at the end of 2019, offset by higher revenue generated in our rail division.

Gross profit. Gross profit increased 475.2%, or $27.3 million, in the first quarter of 2020, compared to the same period in 2019. As a percentage of revenue, gross profit was 9.2% in the quarter, as compared to 3.0% in the prior-year period. The first quarter of 2020 gross profit included the impact of recognizing increased potential future costs from the COVID-19 pandemic which reduced gross margin by $5.4 million or 1.2% of revenue.

Renewables Segment. Gross profit was $25.8 million for the first quarter of 2020, as compared to $1.2 million for the same period in 2019. As a percentage of revenue, gross profit was 10.4% in the quarter, as compared to 1.6% in the prior-year period. The increase in gross profit percentage and dollars is related to the increased revenue, coupled with reduced adverse weather conditions in the first quarter of 2020 and a larger number of construction projects. In 2019, the reduction of gross profit dollars and margin was negatively impacted by the completion of six construction projects affected by severe weather in 2018. These six projects together produced as gross margin of 0.9% and comprised 23.1% of 2019 first quarter revenue.

Specialty Civil Segment. Gross profit was $7.2 million for the first quarter of 2020, as compared to $4.6 million for the same period in 2019. As a percentage of revenue, gross profit was 6.6% in the quarter, as compared to 4.0% in the prior-year period. The increase in dollars and percentage was related to higher margins generated on the mix of projects under construction in the first quarter 2020 compared to the same period in the prior year.

Selling, general and administrative expenses. Selling, general and administrative expenses increased 6.2%, or $1.7 million, in the first quarter of 2020, compared to the same period in 2019. Selling, general and administrative expenses were 8.2% of revenue in the first quarter of 2020, compared to 14.6% in the same period in 2019. The increase in selling, general and administrative expenses was primarily driven by increased by increased compensation expense related to significantly larger operations in both of the Company's operating segments. In 2019, the percentage of revenue increase was related to higher costs associated with the Company's acquisition integration costs.

Interest expense, net. Interest expense, net increased by $5.7 million, in the first quarter of 2020, compared to the same period in 2019. This increase was primarily driven by accrued dividends on Series B Preferred Stock which are recorded as interest expense, offset by the decreased borrowings under our line of credit and term loan in the first quarter of 2020.

Other expense. Other expense increased by $0.9 million, in the first quarter of 2020, compared to the same period in 2019. This increase was primarily the result of the fair value adjustment related to our Series B Preferred Stock warrants. See further discussion in Note 5. Fair Value of Financial Instruments included in Item 1 of this Quarterly Report on Form 10-Q.

Benefit for income taxes. Benefit for income taxes decreased 90.3%, or $8.0 million, to a benefit of $0.9 million in the first quarter of 2020, compared to a benefit $8.9 million for the same period in 2019. The effective tax rates for the period ended March 31, 2020 and 2019 were 6.4% and 27.4%, respectively. The lower effective tax rate in the first quarter of 2020 was primarily attributable to accrued dividends for the Series B Preferred Stock which are recorded as interest expense and not deductible for federal and state income taxes. There were no changes in uncertain tax positions during the periods ended March 31, 2020 and 2019.

28




Backlog

For companies in the construction industry, backlog can be an indicator of future revenue streams. Estimated backlog represents the amount of revenue we expect to realize from the uncompleted portions of existing construction contracts, including new contracts under which work has not begun and awarded contracts for which the definitive project documentation is being prepared, as well as revenue from change orders and renewal options. Estimated backlog for work under fixed price contracts and cost-reimbursable contracts is determined based on historical trends, anticipated seasonal impacts, experience from similar projects and estimates of customer demand based on communications with our customers. Cost-reimbursable contracts are included in backlog based on the estimated total contract price upon completion.

As of March 31, 2020 and December 31, 2019, our total backlog was approximately $2.0 billion and $2.2 billion, respectively, compared to $2.2 billion as of March 31, 2019. The decrease is primarily related to the Company's traditional seasonality. The Company expects to recognize revenue related to its backlog of 62.2% for the remainder of 2020, 14.9% in 2021, and 22.9% in 2022.

The following table summarizes our backlog by segment for March 31, 2020 and December 31, 2019:

(in millions)
 
 
Segments
March 31, 2020
December 31, 2019
Renewables
1,436.0

1,582.5

Specialty Civil
576.6

588.7

  Total
$
2,012.6

$
2,171.2


Based on historical trends in the Company’s backlog, we believe awarded contracts to be firm and that the revenue for such contracts will be recognized over the life of the project. Timing of revenue for construction and installation projects included in our backlog can be subject to change as a result of customer delays, regulatory factors and/or other project-related factors. These changes could cause estimated revenue to be realized in periods later than originally expected, or not at all. In the past, we have occasionally experienced postponements, cancellations and reductions on construction projects, due to market volatility and regulatory factors. There can be no assurance as to our customers’ requirements or the accuracy of our estimates. As a result, our backlog as of any particular date is an uncertain indicator of future revenue and earnings.

Backlog is not a term recognized under GAAP, although it is a common measurement used in our industry. Our methodology for determining backlog may not be comparable to the methodologies used by others. See ‘‘Item 1A. Risk Factors’’ in our Annual Report on Form 10-K filed with the SEC on March 12, 2020 for a discussion of the risks associated with our backlog.

Liquidity and Capital Resources

Overview

Our primary sources of liquidity are cash flows from operations, our cash balances and availability under our Third A&R Credit Agreement. Our primary liquidity needs are for working capital, debt service, dividends on our Series A Preferred Stock and Series B Preferred Stock, income taxes, capital expenditures, insurance collateral, and strategic acquisitions. As of March 31, 2020, we had approximately $58.1 million in cash, and $26.3 million availability under our Third A&R Credit Agreement.

We anticipate that our existing cash balances, funds generated from operations, and borrowings will be sufficient to meet our cash requirements for the next twelve months. No assurance can be given, however, that these sources will be sufficient, because there are many factors which could affect our liquidity, including some which are beyond our control. Please see “Item 1A. Risk Factors” in our Annual Report on Form 10-K filed with the SEC on March 12, 2020 for a discussion of the risks associated with our liquidity.

Capital Expenditures

For the three months ended March 31, 2020, we incurred $5.8 million in finance lease payments and an additional $2.2 million cash purchases for equipment. We estimate that we will spend approximately two percent of revenue for capital

29



expenditures for 2020 and 2021. Actual capital expenditures may increase or decrease in the future depending upon business activity levels, as well as ongoing assessments of equipment lease versus buy decisions based on short and long-term equipment requirements.

Working Capital

We require working capital to support seasonal variations in our business, primarily due to the effect of weather conditions on external construction and maintenance work and the spending patterns of our customers, both of which influence the timing of associated spending to support related customer demand. Our business is typically slower in the first quarter of each calendar year. Working capital needs are generally lower during the spring when projects are awarded and we receive down payments from customers. Conversely, working capital needs generally increase during the summer or fall months due to increased demand for our services when favorable weather conditions exist in many of the regions in which we operate. Again, working capital needs are typically lower and working capital is converted to cash during the winter months. These seasonal trends, however, can be offset by changes in the timing of projects, which can be affected by project delays or accelerations and/or other factors that may affect customer spending.

Generally, we receive 5% to 10% cash payments from our customers upon the inception of our Renewable projects. Timing of billing milestones and project close-outs can contribute to changes in unbilled revenue. As of March 31, 2020, substantially all of our costs in excess of billings and earnings will be billed to customers in the normal course of business within the next twelve months. Net accounts receivable balances, which consist of contract billings as well as costs and earnings in excess of billings and retainage, decreased to $348.6 million as of March 31, 2020 from $382.9 million as of December 31, 2019, due primarily to lower levels of revenue, timing of project activity, and collection of billings to customers.

Our billing terms are generally net 30 days, and some of our contracts allow our customers to retain a portion of the contract amount (generally, from 5% to 10%) until the job is completed. As part of our ongoing working capital management practices, we evaluate opportunities to improve our working capital cycle time through contractual provisions and certain financing arrangements. Our agreements with subcontractors often may contain a ‘‘pay-if-paid’’ provision, whereby our payments to subcontractors are made only after we are paid by our customers.

Sources and Uses of Cash

Sources and uses of cash are summarized below:
 
 
Three Months Ended March 31,
(in thousands)
 
2020
 
2019
 
 
 
 
 
Net cash used in operating activities
 
(74,177
)
 
(37,547
)
Net cash provided by (used in) investing activities
 
87

 
(2,063
)
Net cash provided by (used in) financing activities
 
(15,088
)
 
16,216


Operating Activities. Net cash used in operating activities for the three months ended March 31, 2020 was $74.2 million, as compared to net cash used by operating activities of $37.5 million over the same period in 2019. The increase in net cash used by operating activities reflects the timing of receipts from customers and payments to vendors in the ordinary course of business. The change was primarily attributable to $33.5 million related to reduced collections of accounts receivable and $31.4 million reduction of contract liabilities, offset by the decrease in net loss.

Investing Activities. Net cash provided by investing activities for the three months ended March 31, 2020 was $0.1 million, as compared to net cash used by investing activities of $2.1 million over the same period in 2019. The increase in net cash provided by investing activities was primarily attributable to proceeds from the sale of property, plant and equipment.

Financing Activities. Net cash used in financing activities for the three months ended March 31, 2020 was $15.1 million, as compared to net cash provided by $16.2 million over the same period in 2019. The reduction of cash provided by financing of activities of $31.3 million was primarily attributable to a sales leaseback transaction of $24.3 million and merger recapitalization costs received in 2019.

30




Series A Preferred Stock

As of March 31, 2020, we had 17,483 shares of Series A Preferred Stock with an initial stated value of $1,000 per share plus accumulated dividends. Dividends are paid on the Series A Preferred Stock as, if and when declared by our Board. To extent permitted, dividends are required to be paid in cash quarterly in arrears on each March 31, June 30, September 30 and December 31 on the stated value at a rate of 10% per annum.

If not paid in cash, dividends will accrue on the stated value and will increase the stated value on and effective as of the applicable dividend date without any further action by the Board at 12% per annum. On March 31, 2020, dividends with respect to the quarter accrued at a rate of 12% and increased the stated value.

So long as any shares of Series B Preferred Stock of the Company are currently outstanding or from and after the occurrence of any non-payment event or default event and until cured or waived, the foregoing rates will increase by 2% per annum.

The Series A Preferred Stock do not have a scheduled redemption date or maturity date. Subject to the terms of the Series B Preferred Stock, we may, at any time and from time to time, redeem all or any portion of the shares of Series A Preferred Stock then outstanding. As a condition to the consummation of any change of control (as described in the certificate governing the Series A Preferred Stock), we are required to redeem all shares of Series A Preferred Stock then outstanding. We are also required to use the net cash proceeds from certain transactions to redeem the maximum number of shares of Series A Preferred Stock that can be redeemed with such net cash proceeds, except as prohibited by the Third A&R Credit Agreement.

Based on the stated value of the Series A Preferred Stock as of March 31, 2020 after giving effect to the accrual of dividends, we would be required to pay quarterly cash dividends in the aggregate of $2.5 million on the Series A Preferred Stock. If our business does not generate enough cash to pay future cash dividends, the dividends will accrue at a rate of 12% per annum and increase the stated value of the Series A Preferred Stock, which will make cash dividends on the Series A Preferred Stock more difficult for us to make in the future. We do not presently expect to pay cash dividends, although an actual decision regarding payment of cash dividends on the Series A Preferred Stock will be made at the time of the applicable dividend payment based upon availability of capital resources, business conditions, other cash requirements, and other relevant factors.

Series B Preferred Stock

As of March 31, 2020, we had 199,474 shares of Series B Preferred Stock outstanding, with each share having an initial stated value of $1,000 plus accumulated dividends. Our common stock and Series A Preferred Stock are junior to the Series B Preferred Stock. Dividends are paid in cash on the Series B Preferred Stock as, if and when declared by our Board. To the extent not prohibited by applicable law, dividends are required to be declared and paid in cash quarterly in arrears on each March 31, June 30, September 30 and December 31. Any dividend period for which the Total Net Leverage Ratio is greater than 1.50:1.00, the dividend rate is 13.5% per annum and (ii) with respect to any dividend period for which the Total Net Leverage Ratio is less than or equal to 1.50:1.00, at a rate of 12% per annum.

If not paid in cash, dividends will accrue on the stated value and will increase the stated value on Series B Preferred Stock and is effective as of the applicable dividend date without any further action by the Board at a rate of 15%. On March 31, 2020, dividends with respect to the quarter accrued at a rate of 15% and increased the stated value.

Until the Series B Preferred Stock is redeemed, neither we nor any of our subsidiaries can declare, pay or set aside any dividends on shares of any other class or series of capital stock, except in limited circumstances. We are required to redeem all shares of Series B Preferred Stock outstanding on February 15, 2025 at the then stated value plus all accumulated and unpaid dividends thereon through the day prior to such redemption. Subject to compliance with the terms of any credit agreement, we are also required to redeem all of the Series B Preferred Stock as a condition to the consummation of certain changes in control (as defined in certificate governing the Series B Preferred Stock), as well as use the net cash proceeds from certain transactions to redeem shares of Series B Preferred Stock.

Based on the stated value of the Series B Preferred Stock as of March 31, 2020 after giving effect to the accrual of dividends, we would be required to pay quarterly cash dividends in the aggregate of $18.3 million on the Series B Preferred Stock. If our business does not generate enough cash to pay future cash dividends, the dividends will accrue at a rate of 15% per annum and increase the stated value of the Series A Preferred Stock, which will make cash dividends on the Series B Preferred Stock more difficult for us to make in the future. We do not presently expect to pay cash dividends, although an

31



actual decision regarding payment of cash dividends on the Series B Preferred Stock will be made at the time of the applicable dividend payment based upon availability of capital resources, business conditions, other cash requirements, and other relevant factors.

Contractual Obligations

The following table sets forth our contractual obligations and commitments for the periods indicated as of March 31, 2020.

 
 
Payments due by period
 
 
 
 
(in thousands)
 
Total
 
Remainder of 2020
 
2021
 
2022
 
2023
 
2024
 
Thereafter
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Debt (principal) (1)
 
366,046

 
1,365

 
1,228

 
15,859

 
29,735

 
129,104

 
188,755

Debt (interest) (2)
 
110,170

 
7,488

 
27,584

 
24,356

 
21,234

 
18,130

 
11,378

Finance leases (3)
 
65,574

 
20,035

 
22,344

 
18,302

 
4,108

 
628

 
157

Operating leases (4)
 
59,669

 
9,784

 
11,242

 
8,846

 
6,220

 
3,116

 
20,461

Total
 
$
601,459

 
$
38,672

 
$
62,398

 
$
67,363

 
$
61,297

 
$
150,978

 
$
220,751

(1)
Represents the contractual principal payment due dates on our outstanding debt, including the convertible debt - Series B Preferred with expected redemption date of February 15, 2025. Future declared dividends have been excluded, as payment determination will be evaluated each quarter resulting in differing accumulated dividend rates.
(2)
Includes variable rate interest using March 31, 2020 rates.
(3)
We have obligations, exclusive of associated interest, recognized under various finance leases for equipment totaling $65.6 million at March 31, 2020. Net amounts recognized within property, plant and equipment, net in the condensed consolidated balance sheet under these financed lease agreements at March 31, 2020 totaled $78.5 million.
(4)
We lease real estate, vehicles, office equipment and certain construction equipment from unrelated parties under non-cancelable leases. Lease terms range from month-to-month to terms expiring through 2038.

For detailed discussion and additional information pertaining to our debt instruments, see Note 6. Debt and Note 7. Commitments and Contingencies in the notes to condensed consolidated financial statements, included in Item 1.

Off-Balance Sheet Arrangements

As is common in our industry, we have entered into certain off-balance sheet arrangements in the ordinary course of business. Our significant off-balance sheet transactions include liabilities associated with letter of credit obligations, surety and performance and payment bonds entered into in the normal course of business, liabilities associated with deferred compensation plans, liabilities associated with certain indemnification and guarantee arrangements.

As of March 31, 2020 and December 31, 2019, the Company was contingently liable under letters of credit issued under its revolving credit facility or its old credit facility, respectively, in the amount of $23.7 million and $21.0 million, respectively, related to projects.

As of March 31, 2020 and December 31, 2019, the Company had outstanding surety bonds on projects of $2.5 billion and $2.4 billion, respectively, including the bonding line of the acquired ACC Companies and Saiia.

See Note 6. Debt in the notes to condensed consolidated financial statements, included in Item 1 of this Quarterly Report on Form 10-Q, for discussion pertaining to our off-balance sheet arrangements. See Note 1. Business, Basis of Presentation and Summary of Significant Accounting Policies and Note 11. Related Party Transactions in the notes to condensed consolidated financial statements, included in Item 1, for discussion pertaining to certain of our investment arrangements.

Recently Issued Accounting Pronouncements

See Note 1. Business, Basis of Presentation and Summary of Significant Accounting Policies in the notes to condensed consolidated financial statements, included in Item 1.


32



Item 3. Quantitative and Qualitative Disclosures About Market Risk

Credit Risk

We are subject to concentrations of credit risk related to our net receivable position with customers, which includes amounts related to billed and unbilled accounts receivable and costs and earnings in excess of billings (‘‘CIEB’’) on uncompleted contracts net of advanced billings with the same customer. We grant credit under normal payment terms, generally without collateral, and as a result, we are subject to potential credit risk related to our customers’ ability to pay for services provided. This risk may be heightened if there is depressed economic and financial market conditions. However, we believe the concentration of credit risk related to billed and unbilled receivables and costs and estimated earnings in excess of billings on uncompleted contracts is limited because of the lack of concentration and the high credit rating of our customers.

Interest Rate Risk

Borrowings under the new credit facility and certain other borrowings are at variable rates of interest and expose us to interest rate risk. If interest rates increase, our debt service obligations on the variable rate indebtedness will increase even though the amount borrowed remains the same, and our net income and cash flows, including cash available for servicing our indebtedness, will correspondingly decrease. The outstanding debt balance as of March 31, 2020 was $177.3 million. A one hundred basis point change in the LIBOR rate would increase or decrease interest expense by $1.8 million. As of March 31, 2020, we had no derivative financial instruments to manage interest rate risk.
  
Item 4. Control and Procedures

Attached as exhibits to this Quarterly Report on Form 10-Q are certifications of IEA’s Chief Executive Officer and Chief Financial Officer that are required in accordance with Rule 13a-14 of the Exchange Act of 1934. This section includes information concerning the controls and controls evaluation referred to in the certifications, and it should be read in conjunction with the certifications.

Evaluation of Disclosure Controls and Procedures

Our management has established and maintains a system of disclosure controls and procedures that are designed to provide reasonable assurance that information required to be disclosed by us in the reports that we file or submit under the Exchange Act, such as this Quarterly Report, is recorded, processed, summarized and reported within the time periods specified in the SEC rules and forms. The disclosure controls and procedures are also designed to provide reasonable assurance that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

As of the end of the period covered by this Quarterly Report, we evaluated the effectiveness of the design and operation of our disclosure controls and procedures pursuant to Rule 13a-15(b) of the Exchange Act. This evaluation was carried out under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer. Based on this evaluation, these officers have concluded that, as of March 31, 2020, our disclosure controls and procedures were effective.

Changes in Internal Control over Financial Reporting

As previously discussed in Item 2. Management Discussion and Analysis, the Company is using remote technology for employees working from home due to COVID-19. Although certain employees are working remotely, there has been no change in our internal control over financial reporting during the quarter ended March 31, 2020, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.


33



Part II. OTHER INFORMATION
Item 1A. Risk Factors

At March 31, 2020, there have been no other material changes from the risk factors previously disclosed in the Company's Annual Report on Form 10-K filed with the SEC on March 12, 2020, which is accessible on the SEC's website at www.sec.gov, except as described below.

The ultimate effects of the current COVID-19 pandemic are unknown and evolving, and could result in negative effects on our business, financial condition, results of operations and prospects.

The COVID-19 pandemic is a rapidly developing situation around the globe that has adversely impacted economic activity and conditions in the United States and worldwide. In particular, efforts to control the spread of COVID-19 have led to local and worldwide shutdowns and stay-at-home orders, stock price declines, employee layoffs, and governmental programs to support the economy.
           
The COVID-19 pandemic could affect us in a number of other ways, including but not limited to:

Inability to properly staff our construction projects due to quarantines and stay at home orders.
Inabilities of customers to fund project obligations due to liquidity issues.
Termination or delay in project construction at our customers’ discretion due to financial uncertainties.
Inability of, or delays by, our subcontractors to deliver equipment and services.
Restrictions on our ability to obtain new business if our customer base is financially constrained.
Inability to obtain bonding from our sureties due to tightening of credit markets.
Decrease in demand for civil construction resulting from corresponding decreases in federal, state and local budgets.

Each of the foregoing would cause project delays, force majeure events and project terminations which could negatively impact our ability to recognize revenues and bill our customers for current costs. In addition, if our customers are unable to finance new projects as a result of their liquidity issues during and in the aftermath of the pandemic, our business outlook will be negatively impacted. A prolonged continuation of the COVID-19 pandemic, or a resurgence of the pandemic even if the current pandemic is significantly reduced, could also result in additional impacts to our business, financial condition, results of operations and prospects. The ultimate effects of the COVID-19 pandemic are unknown at this time. We are continuing to monitor developments but cannot predict at this time whether COVID-19 will have a material impact on our business, financial condition or results of operations.


34



Item 5. Other Information

Amendment to Equity Commitment Agreement

On May 6, 2020, the Company entered into an Amendment (the “Amendment”) to the Equity Commitment Agreement, dated as of October 29, 2019 (the “Equity Commitment Agreement”) by and among the Company, each Commitment Party (as defined in the Equity Commitment Agreement), Oaktree Power Opportunities Fund III Delaware, L.P., a Delaware limited partnership, Infrastructure and Energy Alternatives, LLC, a Delaware limited liability company and OT POF IEA Preferred B Aggregator, L.P., a Delaware limited partnership.

The Amendment amends the Equity Commitment Agreement to extend the period of time the Backstop Parties (as defined in the Equity Commitment Agreement) may be required to enter into the 2020 Commitment (as defined in the Equity Commitment Agreement) and purchase additional shares of Series B-3 Preferred Stock and warrants from the Company to July 14, 2020, or such other date as mutually agreed between the Backstop Parties and the Company. Additionally, the Amendment clarifies that, after giving effect to reductions in the commitment amount to date, the 2020 Commitment shall in no event exceed $5,650,000.

The foregoing description of the Amendment does not purport to be complete and is qualified in its entirety by reference to the full text of the Amendment, which is filed herewith as Exhibit 10.1 and is incorporated in this “Item 5. - Other Information” by reference.

Amended and Restated Annual Incentive Compensation Program
 
                On May 6, 2020, the Company adopted an amended and restated annual incentive compensation program (the “A&R AICP”), which amends and restates the Company’s current annual incentive compensation program. The purpose of the A&R AICP is to encourage excellence and high levels of performance, emphasize safety as a key goal, recognize the contributions of key employees to the overall profitability and safety of the Company, and encourage key employees to cooperate, share information and work together for the overall benefit of the Company and its shareholders.
 
The A&R AICP provides for potential cash bonuses to eligible participants based upon achievement of one or more performance criteria, including Adjusted EBITDA on a consolidated basis, free cash flow, target total reportable incident rate on a consolidated basis or a business unit or operating company division basis, and target gross profit on a business unit or operating company division basis. The Compensation Committee of the Board of Directors of the Company (the “Committee”) is delegated authority to determine target bonus awards, the performance criteria that will be used to determine the payment of target bonuses, as well as any minimum or maximum thresholds that may be used in determining the amount earned with respect to any specific performance criteria. The Committee may assign participants into different classes, with each class being subject to different target bonuses, performance criteria, and weightings.
               
                The foregoing description of the A&R AICP does not purport to be complete and is qualified in its entirety by reference to the full text of the A&R AICP, which is filed herewith as Exhibit 10.2 and is incorporated in this “Item 5. - Other Information” by reference.

Item 6. Exhibits

(a)    Exhibits.
    
Exhibit Number
Description
2.1#

35



2.2
2.3
2.4
2.5
2.6
2.7
2.8#
2.9
3.1
3.2
3.3
3.4
3.5
3.6
3.7

36



3.8
3.9
3.10
4.1
4.2
4.3
4.4
4.5
4.6
4.7
4.8
4.9
4.10
4.11
4.12
4.13
4.14
4.15
10.1*
10.2*†
31.1*

37



31.2*
32.1**
32.2**
101.INS*
XBRL Instance Document
101.SCH*
XBRL Taxonomy Extension Schema Document
101.CAL*
XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF*
XBRL Taxonomy Extension Definition Linkbase Document
101.LAB*
XBRL Taxonomy Extension Label Linkbase Document
101.PRE*
XBRL Taxonomy Extension Presentation Linkbase Document
* Filed herewith.
** Furnished herewith.
† Indicates a management contract or compensatory plan or arrangement.





38



SIGNATURE
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
 
 
 
 
INFRASTRUCTURE AND ENERGY ALTERNATIVES, INC.
 
 
Dated: May 7, 2020
By:
/s/ JP Roehm
 
Name: JP Roehm
 
Title:   Chief Executive Officer
 
 
 
Dated: May 7, 2020
By:
/s/ Peter J. Moerbeek
 
Name: Peter J. Moerbeek
 
Title:   Chief Financial Officer
 
 
 
Dated: May 7, 2020
By:
/s/ Bharat Shah
 
Name: Bharat Shah
 
Title: Chief Accounting Officer


Exhibit


AMENDMENT TO EQUITY COMMITMENT AGREEMENT

This Amendment, dated as of May 6, 2020 (this “Amendment”), to the Equity Commitment Agreement, dated as of October 29, 2019 (the “Equity Commitment Agreement”), is entered into by and among (i) Infrastructure and Energy Alternatives, Inc., a Delaware corporation (the “Company”), (ii) each Commitment Party (as defined in the Equity Commitment Agreement), (iii) Oaktree Power Opportunities Fund III Delaware, L.P., a Delaware limited partnership, (iv) Infrastructure and Energy Alternatives, LLC, a Delaware limited liability company and (v) OT POF IEA Preferred B Aggregator, L.P., a Delaware limited partnership. Capitalized terms used herein and not defined herein have the meanings set forth in the Equity Commitment Agreement.

WHEREAS, the Parties wish to make certain modifications and amendments to the terms of the Equity Commitment Agreement; and

NOW, THEREFORE, in consideration of the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties to this Amendment hereby agree as follows:

1.
Amendment to Section 9.18(d). Section 9.18(d) of the Equity Commitment Agreement is hereby amended and restated in its entirety as set forth below:

(d)    The closing of the purchase of Series B-3 Preferred Stock (and the corresponding 2020 Commitment Warrants) by the Backstop Parties contemplated by this Section 9.18 (the “2020 Commitment Closing”) shall be consummated on or before July 14, 2020, or such other date as mutually agreed by the Backstop Parties and the Company (the “2020 Commitment Closing Date”). At the 2020 Commitment Closing, each Backstop Party shall pay to the Company its 2020 Commitment Purchase Price by wire transfer of immediately payable funds to an account specified in writing by the Company in exchange for (i) a number of fully paid and non-assessable shares of Series B-3 Preferred Stock determined by dividing such Backstop Party’s 2020 Commitment Purchase Price by the Per Share Purchase Price, (ii) a number of warrants to purchase Common Stock equal to the product of (x) such Backstop Party’s 2020 Commitment Purchase Price multiplied by (y) a fraction equal to 5,500,000/160,000,000 (the “2020 Commitment Warrants”, which warrants will be on substantially the same terms as the Warrants (and will be subject to the protections set forth in Section 2.1(a) and Section 5.6), in each case, free and clear of all Liens, (iii) its Backstop Pro Rata Share of the 2020 Commitment Fees by wire transfer of immediately available funds to such accounts as designated by each Backstop Party, and (iv) its Expense Reimbursement Payment to the extent not previously paid (which may be set off against such Backstop Party’s 2020 Commitment Amount, at such Backstop Party’s option).

2.
Acknowledgment. For the avoidance of doubt, the parties hereto hereby acknowledge and agree that as of the date of this Amendment, the 2020 Commitment Reduction

Amount is $9,350,000.00 and therefore the amount of the Called 2020 Commitment shall in no event exceed $5,650,000.00.

3.
Ratification. Except as specifically provided for in this Amendment, the terms of the Equity





Commitment Agreement remain in full force and effect unaffected by this Amendment.

4.
Effect of Amendment. Whenever the Equity Commitment Agreement is referred to in the Equity Commitment Agreement or in any other agreements, documents and instruments, such reference shall be deemed to be to the Equity Commitment Agreement as amended by this Amendment.

5.
Miscellaneous. Sections 9.1 through 9.8 of the Equity Commitment Agreement shall apply mutatis mutandis to this Amendment.

[Remainder of Page Intentionally Left Blank]







IN WITNESS WHEREOF, the undersigned Parties have duly executed this Agreement as of the date first above written.

INFRASTRUCTURE AND ENERGY ALTERNATIVES, INC.
 
 
 
By: /s/ JP Roehm
 
Name: John P. Roehm
 
Title: President and Chief Executive Officer
 
 
 
ARES SPECIAL SITUATIONS FUND IV, L.P.
 
By: ASSF Management IV, L.P., its general partner
 
By: ASSF Management IV GP LLC, its general partner
 
By: /s/ Aaron Rosen
 
Name: Aaron Rosen
 
Title: Partner
 
 
 
ASOF Holding I, L.P.
 
By: ASOF Management, L.P., its general partner
 
By: ASOF Management GP LLC, its general partner
 
 
 
By: /s/ Aaron Rosen
 
Name: Aaron Rosen
 
Title: Partner
 
 
 
Notice Information:
 
c/o Ares Management LLC
 
2000 Avenue of the Stars, 12th Floor
 
Los Angeles, CA 90067
 
Email: sgraves@aresmgmt.com, PI General Counsel@aresmgmt.com
 
Attn: Scott Graves
 
 
 
INFRASTRUCTURE AND ENERGY ALTERNATIVES, LLC
 
 
 
By: /s/ Ian Schapiro
 
Name: Ian Schapiro
 
Title: Authorized Signatory
 
 
 
By: /s/ Peter Jonna
 
Name: Peter Jonna
 
Title: Authorized Signatory
 
 
 
Notice Information:
 
333 South Grand Avenue, 28th Floor
 
Los Angeles, CA 90071
 
Email: ischapiro@oaktreecapital.com, pjonna@oaktreecapital.com
 





Attention: Ian Schapiro, Peter Jonna
 
 
 
OT POF IEA PREFERRED B AGGREGATOR, L.P.
 
 
 
By: OT POF IEA PREFERRED B AGGREGATOR GP, LLC
 
Its: General Partner
 
 
 
By: Oaktree Power Opportunities Fund III Delaware, L.P.
 
Its: Managing Member
 
 
 
By: Oaktree Power Opportunities Fund III Delaware, L.P.
 
Its: General Partner
 
 
 
By: Oaktree Fund GP, LLC
 
Its: General Partner
 
By: Oaktree Fund GP I, L.P.
 
Its: Managing Member
 
 
 
By: /s/ Ian Schapiro
 
Name: Ian Schapiro
 
Title: Authorized Signatory
 
 
 
By: /s/ Peter Jonna
 
Name: Peter Jonna
 
Title: Authorized Signatory
 
 
 
Notice Information:
 
333 South Grand Avenue, 28th Floor
 
Los Angeles, CA 90071
 
Email: ischapiro@oaktreecapital.com, pjonna@oaktreecapital.com
 
Attention: Ian Schapiro, Peter Jonna
 
 
 
OAKTREE POWER OPPORTUNITIES FUND III DELAWARE, L.P.
 
 
 
By: Oaktree Power Opportunities Fund III Delaware, L.P.
 
Its: General Partner
 
 
 
By: Oaktree Fund GP, LLC
 
Its: General Partner
 
By: Oaktree Fund GP I, L.P.
 
Its: Managing Member
 
 
 
By: /s/ Ian Schapiro
 
Name: Ian Schapiro
 
Title: Authorized Signatory
 
 
 





By: /s/ Peter Jonna
 
Name: Peter Jonna
 
Title: Authorized Signatory
 
 
 
Notice Information:
 
333 South Grand Avenue, 28th Floor
 
Los Angeles, CA 90071
 
Email: ischapiro@oaktreecapital.com, pjonna@oaktreecapital.com
 
Attention: Ian Schapiro, Peter Jonna
 



Exhibit




INFRASTRUCTURE AND ENERGY ALTERNATIVES, INC.
AMENDED AND RESTATED
ANNUAL INCENTIVE COMPENSATION PROGRAM

Effective May 6, 2020

1.
Purpose

The Compensation Committee (the “Committee”) of the Board of Directors of Infrastructure and Energy Alternatives, Inc., a Delaware corporation (the “Company”) has determined that it is desirable to maintain an annual incentive compensation program (the “Program”). The purposes of the Program include: (1) encouraging excellence and high levels of performance, (2) emphasizing safety as a key goal of the Company, (3) recognizing the contributions of key employees to the overall profitability and safety of the Company, and (4) encouraging key employees in the Company to cooperate, share information and work together as a team for the overall benefit of the Company and its shareholders. 

2.
Participation

The Committee will determine employees eligible to participate in the Program (“Participants”), and reserves the right to review and change the class of eligible employees at any time.
 
3.
Eligibility

A.Employment/Participation Level

Except in the case of death, disability or retirement, as set forth below, Participants must be employed in good standing at the time the awards are paid, and must have been continuously employed in a designated position for a period of nine months prior to the end of the fiscal year to be eligible to participate in the Program. Base salary for purposes of the Program shall include regular compensation only, and shall not include bonus award payments and any other miscellaneous payments that might be treated as income to the employee. Bonuses shall prorated based on start date as determined by executive management on a case by case basis.

B.Death, Disability and Retirement

If a Participant terminates employment with the Company during the fiscal year prior to December 31 for any reason or as a result of death, disability or retirement, or the Company terminates such Participant during the fiscal year prior to December 31 for any reason such employee will not be eligible to participate in the Program or be entitled to any award hereunder.

C.Military Service

If a Participant is on qualified military leave of absence during part or all of the fiscal year, such Participant will be eligible to participate in the Program if such Participant would have been otherwise eligible to participate. Such Participant’s base salary for purposes of determining any bonus award will be the Participant’s base salary that would have been paid had the Participant not been on military leave.

D.Extraordinary Circumstances

Extraordinary circumstances will be subject to review by the Committee.

4.
Determination of Award and Payment

The Committee has determined that bonus awards may be paid on the basis of one or more of the following factors:

A.Performance Criteria






1. Target Adjusted EBITDA

A Committee approved Company Adjusted EBITDA goal on a consolidated basis (“Target Adjusted EBITDA”) may be used for determining the payment of a bonus award. Adjusted EBITDA for purposes of computing the bonus awards, as set forth herein, shall be calculated on the same basis as disclosed in the Company’s filings with the Securities and Exchange Commission (the “SEC”). The Company’s audited annual financial statements, on a consolidated basis, will be used to determine whether the Target Adjusted EBITDA goal was met. Target Adjusted EBITDA shall be calculated on a basis to include the payment of bonuses under this Program as a deduction.

2. TRIR

The Company’s total reportable incident rate (“TRIR”) may be used for determining the payment of a bonus award. TRIR for purposes of computing the bonus awards, as set forth herein, shall be determined by the Committee and approved by the Board of Directors each year. For certain employees, TRIR may be calculated on the business unit division and/or operating company division as determined by executive management in consultation with the Committee.
 
3. Gross Profit

Target gross profit on a business unit and/or operating company basis (“Target Gross Profit”) may be used for determining the payment of a bonus award. Actual gross profit on a business unit and/or operating company basis will be derived from components of the Company’s financial statements, or portions thereof, as filed with the SEC and shall be determined by executive management in consultation with the Committee.

4.Free Cash Flow

A Committee approved Company free cash flow goal on a consolidated basis (“Target Cash Flow”) may be used for determining the payment of a bonus award. Target Cash Flow for purposes of computing the bonus awards, as set forth herein, shall be determined using the following formula:

(a) cash flow from operations for the period the same basis as disclosed in the Company’s statement of cash flows set forth in its annual consolidated financial statements, included in its filings with the Securities and Exchange Commission (the “SEC”); less

(b) capital expenditures incurred during the same period; plus

(c) payment of any dividends on the Company's Series A or Series B Preferred Stock during the same period.

The Company’s audited annual financial statements, on a consolidated basis, will be used to determine whether the Target Cash Flow goal was met. Target Cash Flow shall be calculated on a basis to include the payment of bonuses under this plan as a deduction.

B.Award Payments

The annual bonus award for a given fiscal year will be paid to Participants in the Program in the year following the performance year after the outside auditors have completed their annual audit of the Company.     
 
5.
Objectives and Formulas for Determination of the Bonus Awards
  
The Committee shall determine, on an annual basis, the percentage of base salary that a Participant is eligible to earn as a bonus under this Program, which may be as specified in any applicable employment agreement (the “Target Bonus”). In addition, the Committee shall determine, on an annual basis, from the performance criteria specified herein, the performance criteria that will be used to determine the payment of Target Bonuses for Participants, as well as any minimum or maximum thresholds that may be used in determining the amount earned with respect to any specific performance criteria. Notwithstanding the foregoing, if the achievement level of a performance criteria is below 80%, no payout will be made for that performance criteria, and if the achievement of a performance criteria is more than 100%, the payout cannot exceed 200% of the target amount allocated to that performance criteria.






The Committee may designate Participants into different classes, with each class of Participant being subject to different Target Bonuses, different performance criteria, different allocations to performance criteria, and different weightings of performance criteria.
In the event of extraordinary operating conditions that were unforeseen or changes in laws or accounting procedures after setting the objectives and percentages in this Program, such circumstances will be considered by the Compensation Committee in making awards.

6.
Miscellaneous

A.Nothing in this Program shall confer upon a Participant any right to continue in the employment of the Company, or to interfere in any way with the right of the Company to terminate the Participant’s employment relationship with the Company at any time. Participation provides no guarantee that any bonus will be paid. The success of the Company as measured by the achievement of financial and safety goals shall determine the extent to which Participants may receive bonuses hereunder. In no event shall any employee be entitled to any amount payable hereunder until such time as the amounts are paid out to employees at the direction of management.

B.The payment made hereunder are intended to comply with, or be exempt from, the requirements of Section 409A of the Internal Revenue Code of 1986, as amended, and the regulations and guidance thereunder (“Section 409A”), and the terms of the Program related thereto shall be construed accordingly. Payments hereunder that are subject to Section 409A shall not be accelerated unless permitted under Section 409A. If a Participant who is a “specified employee” of the Company is entitled to a payment under this Program due to his or her “separation from service” (as such terms are used in Section 409A) and such payment is subject to the Section 409A six-month payment delay rule, then such payment shall not be made until the earlier of (1) the first business day that is more than six months following such Participant’s separation from service or (2) such Participant’s death.

C.The Company shall deduct from any payment made hereunder all applicable federal and state income and employment taxes.



Exhibit
Exhibit 31.1

CERTIFICATION PURSUANT TO
Section 302 of the Sarbanes-Oxley Act of 2002

I, John Paul Roehm, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Infrastructure and Energy Alternatives, 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)) 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 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.



 
 
Dated: May 7, 2020
By:
/s/ John Paul Roehm
 
Name: John Paul Roehm
 
Title:   Chief Executive Officer



Exhibit
Exhibit 31.2

CERTIFICATION PURSUANT TO
Section 302 of the Sarbanes-Oxley Act of 2002

I, Peter Moerbeek, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Infrastructure and Energy Alternatives, 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)) 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 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.
 
 
 
 
 
INFRASTRUCTURE AND ENERGY ALTERNATIVES, INC.
 
 
Dated: May 7, 2020
By:
/s/ Peter J. Moerbeek
 
Name: Peter J. Moerbeek
 
Title:   Chief Financial Officer



Exhibit
Exhibit 32.1

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Infrastructure and Energy Alternatives, Inc. (the “Company”) on Form 10-Q for the quarter ended March 31, 2020, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned officer of the Company certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to such officer's knowledge:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 
 
Dated: May 7, 2020
By:
/s/ John Paul Roehm
 
Name: John Paul Roehm
 
Title:   Chief Executive Officer





Exhibit
Exhibit 32.2

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Infrastructure and Energy Alternatives, Inc. (the “Company”) on Form 10-Q for the quarter ended March 31, 2020, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned officer of the Company certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to such officer's knowledge:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 
 
Dated: May 7, 2020
By:
/s/ Peter J. Moerbeek
 
Name: Peter J. Moerbeek
 
Title:   Chief Financial Officer



v3.20.1
Commitments and contingencies - Lease Narrative (Details) - USD ($)
$ in Thousands
Mar. 31, 2020
Dec. 31, 2019
Commitments and Contingencies Disclosure [Abstract]    
Finance Lease, Liability $ 61,263 $ 64,200
Finance leased assets, gross 117,900 116,100
Finance leased assets, accumulated depreciation (39,400) (34,000)
Finance leased assets, net 78,500 82,100
Operating Lease, Liability 44,322 44,200
Operating Lease, Right-of-Use Asset 43,444 $ 43,431
Other Commitments, Future Minimum Payments, Remainder of Fiscal Year $ 3,200  
v3.20.1
Fair value of financial instruments - Fair Value (Details) - USD ($)
Mar. 31, 2020
Mar. 04, 2020
Jan. 21, 2020
Dec. 31, 2019
Nov. 14, 2019
Oct. 29, 2019
Aug. 30, 2019
May 20, 2019
Series B Preferred Stock Liability [Member]                
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]                
Series B Preferred Stock FV $ 153,700,000              
Series B Preferred Stock   350            
Series B Preferred Stock Warrants at closing[Member]                
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]                
Series B Preferred Stock Warrant Exercise Price               $ 0.0001
10% Warrants at fully diluted share count               0.1
Exercise price of securities excluded at closing (in dollars per share)               $ 11.50
Warrants Issued at Closing of Equity Agreement   12,029     3,568,750   900,000 2,545,934
Share price (in dollars per share)     $ 3.69 $ 3.22 $ 2.20   $ 3.75 $ 4.21
Series B-3 Exchange Warrants [Member]                
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]                
Warrants Issued at Closing of Equity Agreement           657,383    
Share price (in dollars per share)     $ 3.69 $ 3.22   $ 2.20    
Series A Exchange Percentage for Series B-3           50.00%    
Series B Preferred - Series A Conversion Warrants [Member]                
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]                
Series B Preferred Stock Warrant Exercise Price               0.0001
Share price (in dollars per share)               $ 4.21
Series B-1 Preferred Stock 6% Warrants [Member]                
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]                
6% warrants               0.06
Rights Offering Fair Value [Member]                
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]                
Series B Preferred Stock FV   $ 313,000            
Preferred Stock Warrants at Closing FV Nonrecurring   $ 37,000            
2020 Commitment [Member] [Member]                
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]                
Proceeds Received for series b preferred $ 15,000,000              
v3.20.1
Goodwill and Intangible Assets, net (Tables)
3 Months Ended
Mar. 31, 2020
Goodwill and Intangible Assets Disclosure [Abstract]  
Schedule of Goodwill [Table Text Block]
The following table provides the changes in the carrying amount of goodwill:

(in thousands)
Renewables
 
Specialty Civil
 
Total
January 1, 2019
$
3,020

 
$
37,237

 
$
40,257

   Acquisition adjustments

 
(2,884
)
 
(2,884
)
December 31, 2019
$
3,020

 
$
34,353

 
$
37,373

   Adjustments

 

 

March 31, 2020
$
3,020

 
$
34,353

 
$
37,373

Schedule of Finite-Lived Intangible Assets [Table Text Block]
Intangible assets consisted of the following as of the dates indicated:

 
March 31, 2020
 
 
 
December 31, 2019
 
 
($ in thousands)
Gross Carrying Amount
 
Accumulated Amortization
 
Net Carrying Amount
 
Weighted Average Remaining Life
 
Gross Carrying Amount
 
Accumulated Amortization
 
Net Carrying Amount
 
Weighted Average Remaining Life
Customer relationships
$
26,500

 
$
(5,642
)
 
$
20,858

 
5.75 years
 
$
26,500

 
$
(4,695
)
 
$
21,805

 
6 years
Trade name
13,400

 
(3,990
)
 
9,410

 
3.75 years
 
13,400

 
(3,305
)
 
10,095

 
4 years
Backlog
13,900

 
(10,266
)
 
3,634

 
9 months
 
13,900

 
(8,528
)
 
5,372

 
1 year
 
$
53,800

 
$
(19,898
)
 
$
33,902

 
 
 
$
53,800

 
$
(16,528
)
 
$
37,272

 
 
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block]
The following table provides the annual intangible amortization expense currently expected to be recognized for the years 2020 through 2024:

(in thousands)
Remainder of 2020
 
2021
 
2022
 
2023
 
2024
Amortization expense
$
11,837

 
$
6,466

 
$
6,466

 
$
5,841

 
$
3,785

v3.20.1
Earnings per share (Tables)
3 Months Ended
Mar. 31, 2020
Earnings Per Share [Abstract]  
Schedule of basic and diluted EPS
The calculations of basic and diluted EPS, are as follows:
 
Three Months Ended
 
March 31,
($ in thousands, except per share data)
2020
 
2019
Numerator:
 
 
 
  Net loss
(12,743
)
 
(23,639
)
  Less: Convertible Preferred Stock dividends
(766
)
 
(524
)
    Net loss available to common stockholders
(13,509
)
 
(24,163
)
 
 
 
 
Denominator:
 
 
 
  Weighted average common shares outstanding - basic and diluted
20,522,216

 
22,188,757

 
 
 
 
Anti-dilutive: (1)(2)
 
 
 
  Convertible Series A Preferred
6,553,041

 
5,045,149

  Series B Preferred - Warrants at closing
7,675,325

 

  RSUs
1,456,359

 
354,106

 
 
 
 
Basic EPS
(0.66
)
 
(1.09
)
Diluted EPS
(0.66
)
 
(1.09
)


(1)
As of March 31, 2020 and 2019, publicly traded warrants to purchase 8,480,000 shares of common stock at $11.50 per share were not considered as dilutive as the warrants’ exercise price was greater than the average market price of the common stock during the period.
    
(2)
As of March 31, 2020 and 2019, there were 591,860 and 646,405 of vested and unvested Options and 141,248 and 169,494 unvested RSUs, respectively. These were also not considered as dilutive as the respective exercise price or average stock price required for vesting of such awards was greater than the average market price of the common stock during the period.

v3.20.1
Property, plant and equipment, net (Details) - USD ($)
$ in Thousands
3 Months Ended
Mar. 31, 2020
Mar. 31, 2019
Dec. 31, 2019
Property, Plant and Equipment [Line Items]      
Property, plant and equipment, gross $ 205,270   $ 203,527
Accumulated depreciation (70,517)   (63,039)
Property, plant and equipment, net 134,753   140,488
Depreciation expense 8,516 $ 8,476  
Buildings and leasehold improvements      
Property, Plant and Equipment [Line Items]      
Property, plant and equipment, gross 3,051   2,919
Land [Member]      
Property, Plant and Equipment [Line Items]      
Property, plant and equipment, gross 17,600   17,600
Construction equipment      
Property, Plant and Equipment [Line Items]      
Property, plant and equipment, gross 175,707   173,434
Office equipment, furniture and fixtures      
Property, Plant and Equipment [Line Items]      
Property, plant and equipment, gross 3,537   3,487
Vehicles      
Property, Plant and Equipment [Line Items]      
Property, plant and equipment, gross $ 5,375   $ 6,087
v3.20.1
Business, Basis of Presentation and Significant Accounting Policies Schedule of concentrations for revenue and accounts receivable (Details) - Customer Concentration Risk [Member] - Revenue Benchmark [Member]
3 Months Ended
Mar. 31, 2020
Mar. 31, 2019
Concentration Company A [Member]    
Concentration Risk [Line Items]    
Concentration Risk, Percentage   21.10%
Concentration Company B [Member]    
Concentration Risk [Line Items]    
Concentration Risk, Percentage   11.90%
Concentration Company C [Member]    
Concentration Risk [Line Items]    
Concentration Risk, Percentage 11.50%  
Concentration Company D [Member]    
Concentration Risk [Line Items]    
Concentration Risk, Percentage 11.10%  
v3.20.1
Fair value of financial instruments
3 Months Ended
Mar. 31, 2020
Fair Value Disclosures [Abstract]  
Fair value of financial instruments
Fair Value of Financial Instruments

The Company applies ASC 820, Fair Value Measurement, which establishes a framework for measuring fair value. ASC 820 defines fair value as an exit price, which is the price that would be received for an asset or paid to transfer a liability in the Company’s principal or most advantageous market in an orderly transaction between market participants on the measurement date. The fair value hierarchy established in ASC 820 generally requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Observable inputs reflect the assumptions that market participants would use in pricing the asset or liability and are developed based on market data obtained from sources independent of the reporting entity. Unobservable inputs reflect the entity’s own assumptions based on market data and the entity’s judgments about the assumptions that market participants would use in pricing the asset or liability and are developed based on the best information available in the circumstances.

The valuation hierarchy is composed of three levels. The classification within the valuation hierarchy is based on the lowest level of input that is significant to the fair value measurement. The levels within the valuation hierarchy are described below:

Level 1 — Assets and liabilities with unadjusted, quoted prices listed on active market exchanges. Inputs to the fair value measurement are observable inputs, such as quoted prices in active markets for identical assets or liabilities.
Level 2 — Inputs to the fair value measurement are determined using prices for recently traded assets and liabilities with similar underlying terms, as well as direct or indirect observable inputs, such as interest rates and yield curves that are observable at commonly quoted intervals.
Level 3 — Inputs to the fair value measurement are unobservable inputs, such as estimates, assumptions, and valuation techniques when little or no market data exists for the assets or liabilities.

The following table sets forth information regarding the Company's assets measured at fair value on a recurring basis:    

 
March 31, 2020
 
December 31, 2019
(in thousands)
Level 1
 
Level 2
 
Level 3
 
Total
 
Level 1
 
Level 2
 
Level 3
 
Total
Liabilities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Series B Preferred Stock - Series A Conversion Warrants and Exchange Warrants
$

 
$

 
$
1,800

 
$
1,800

 
$

 
$

 
$
4,317

 
$
4,317

Series B-1 Preferred Stock - Additional 6% Warrants

 

 
400

 
400

 

 

 
400

 
400

Series B-3 Preferred - Closing Warrants

 

 

 

 

 

 
11,491

 
11,491

Rights Offering

 

 

 

 

 

 
1,383

 
1,383

Total liabilities
$

 
$

 
$
2,200

 
$
2,200

 
$

 
$

 
$
17,591

 
$
17,591


The following is a reconciliation of the beginning and ending balances of recurring fair value measurements using Level 3 inputs:

(in thousands)
Series B Preferred - Series A Conversion Warrants and Exchange Warrants
 
Series B-1 Preferred Stock - Additional 6% Warrants
 
Series B-3 Preferred - Closing Warrants
 
Rights Offering
Beginning Balance, December 31, 2019
$
4,317

 
$
400

 
$
11,491

 
$
1,383

Fair value adjustment - (gain) loss recognized in other income
(91
)
 

 
1,677

 
(1,383
)
Transfer to non-recurring fair value instrument (equity)
(2,426
)
 

 
(13,168
)
 

Ending Balance, March 31, 2020
$
1,800

 
$
400

 
$

 
$



The Company entered into three Equity Commitment agreements at various dates during 2019 with Ares Management, LLC, on behalf of its affiliated funds, investment vehicles and/or managed accounts (“Ares”) and funds managed by Oaktree Capital Management (“Oaktree”). These resulted in Series B-1 Preferred Stock (the “Series B-1 Preferred Stock”), Series B-2 Preferred Stock (the “Series B-2 Preferred Stock”) and Series B-3 Preferred Stock (the “Series B-3 Preferred Stock”) (collectively referred to as “Series B Preferred Stock”).

The information below describes the balance sheet classification and the recurring/nonrecurring fair value measurement:

Series B Preferred Stock (non-recurring) - The Series B Preferred Stock was a mandatorily redeemable financial instrument under ASC 480 and was recorded at relative fair value as debt which was estimated using a discounted cashflow model based on certain significant unobservable inputs, such as accumulated dividend rates, and projected Adjusted EBITDA for the life of the Series B Preferred Stock. The fair value of the liability for each of the transactions, was a combined $153.7 million and recorded on the balance sheet as debt as of March 31, 2020.

Series B Preferred Stock - Warrants at closing (non-recurring) - The Warrants at closing, with an exercise price of $0.0001, represented (on an if-converted to common stock basis) 10% of the issued and outstanding common stock of the Company based on the Company’s fully diluted share count on May 20, 2019 (including the number of shares of common stock that may be issued pursuant to all restricted stock awards, restricted stock units, stock options and any other securities or rights (directly or indirectly) convertible into, exchangeable for or to subscribe for common stock that are outstanding on May 20, 2019 (excluding any shares of common stock issuable (a) pursuant to the merger agreement for our business combination, (b) upon conversion of shares of Series A Preferred Stock, (c) upon the exercise of any warrant with an exercise price of $11.50 or higher or (d) upon the exercise of any equity issued pursuant to the Company’s long term incentive plan or other equity plan with a strike price of $11.50 or higher). The 2,545,934 warrants at closing were valued at the closing stock price of $4.21 on May 20, 2019 which was recorded as additional paid in capital.

On August 30, 2019, warrants for 900,000 shares of common stock were issued and were valued at the closing stock price of $3.75 which was recorded as additional paid in capital.

On November 14, 2019, warrants for 3,568,750 shares of common stock were issued and were valued at the closing stock price of $2.20 and these were recorded as a liability (Series B-3 Preferred - Closing Warrants) and marked to market at December 31, 2019 at a price of $3.22. On January 21, 2020 the Company received shareholder approval for the warrants and the liability was marked to market at a price of $3.69. Upon shareholder approval, the warrants were moved from liability to equity at a fair value of $13,168 on a non-recurring basis.

Series B-3 Exchange Warrants (non-recurring) - On October 29, 2019, the holders of Series A Preferred Stock converted 50% of their shares to Series B Preferred Stock and reduced the number of the potential additional warrants. In the exchange the holders of Series A Preferred Stock were issued warrants for 657,383 shares of common stock at the closing stock price of $2.20 and these were recorded as a liability and marked to market at December 31, 2019 at a price of $3.22. On January 21, 2020 the Company received shareholder approval for the warrants and the liability was marked to market at a price of $3.69. As of March 31, 2020, these warrants reside as part of equity at a fair value of $2,426 on a non-recurring basis.

Series B-1 Preferred Stock - Series A Conversion Warrants (recurring) - On May 20, 2019, the conversion rights for the Series A Preferred Stock were amended to allow the holders of Series A Preferred Stock to convert all or any portion of Series A Preferred Stock outstanding at any point in time. If converted, the holders of the Series B Preferred Stock would be entitled to additional warrants, with an exercise price of $0.0001. These warrants were fair valued using the closing stock price of $4.21 on May 20, 2019, at an estimated if-converted share count and recorded as a liability.

Series B-1 Preferred Stock - Additional 6% Warrants (recurring) - The Additional 6% Warrants are issuable if the Company fails to meet certain Adjusted EBITDA thresholds on a trailing twelve-month basis from May 31, 2020 through April 30, 2021. The Company recorded the Additional 6% Warrants at fair value, which was estimated using a Monte Carlo Simulation based on certain significant unobservable inputs, such as a risk rate premium, Adjusted EBITDA volatility, stock price volatility and projected Adjusted EBITDA for the Company for 2019. The Additional 6% Warrants were recorded as a liability.

Rights offering - The Company conducted a rights offering and each shareholder as of the record date was issued a right to purchase Series B Preferred Stock and warrants. The right that was issued was fair valued using a Black-Scholes model based on certain significant unobservable inputs, such as a risk rate premium, stock price volatility, dividend yield and expected term of rights offering. The rights offering fair value was recorded as a liability and was a deemed dividend to common stockholders and reflected as a reduction in additional paid in capital. On March 4, 2020 we completed the rights offering, removed the liability associated with the fair value (rights offering - recurring) and issued and sold 350 shares of Series B-3 Preferred Stock (Series B-3 Preferred Stock - non-recurring at a fair value of $313,000) and 12,029 warrants (non-recurring Series B Preferred Stock - Warrants at closing - non-recurring at a fair value of $37,000) to purchase common stock.

2020 Commitment - The Company is obligated to sell to, Ares and Oaktree, and they are obligated to purchase, additional shares of Series B Preferred Stock up to approximately $15.0 million based on a failure by the Company to achieve specified debt and liquidity levels. See Note 12. Subsequent Events for further discussion of the transaction.

Other financial instruments of the Company not listed in the table consist of cash and cash equivalents, accounts receivable, accounts payable and other current liabilities that approximate their fair values. Additionally, management believes that the outstanding recorded balance on the line of credit and long-term debt, approximates fair value due to their floating interest rates.
v3.20.1
Income taxes
3 Months Ended
Mar. 31, 2020
Income Tax Disclosure [Abstract]  
Income taxes
Income Taxes

The Company’s statutory federal tax rate was 21.00% for the periods ended March 31, 2020 and 2019, respectively. State tax rates for the same period vary among states and range from approximately 0.8% to 12.0%. A small number of states do not impose an income tax.

The effective tax rates for the three months ended March 31, 2020 and 2019 were 6.4% and 27.4%, respectively. The difference between the Company’s effective tax rate and the federal statutory rate primarily results from permanent differences related to the interest accrued for the Series B Preferred Stock, which is not deductible for federal and state income taxes. There were no changes in uncertain tax positions during the periods ended March 31, 2020 and 2019.

On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) was enacted by the US Government in response to the COVID-19 pandemic to provide employment retention incentives. These relief measures did not materially affect the condensed consolidated financial statements for the first quarter of 2020. We are currently assessing the future implications of these provisions on our condensed consolidated financial statements.
v3.20.1
Business, Basis of Presentation and Significant Accounting Policies (Notes)
3 Months Ended
Mar. 31, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Organization, Consolidation and Presentation of Financial Statements Disclosure and Significant Accounting Policies [Text Block]
Business, Basis of Presentation and Significant Accounting Policies

Organization and Reportable Segments

Infrastructure and Energy Alternatives, Inc., a Delaware corporation, is a holding company organized on August 4, 2015 (together with its wholly-owned subsidiaries, “IEA” or the “Company”). On March 26, 2018, we became a public company by consummating a merger (the “Merger”) pursuant to an Agreement and Plan of Merger, dated November 3, 2017, with M III Acquisition Corporation (“M III”).

As of December 31, 2019, the Company's total annual gross revenues exceeded $1.07 billion and we are no longer an “emerging growth company,” as defined in the Jumpstart Our Business Startups Act (the “JOBS Act”).

We segregate our business into two reportable segments: the Renewables segment and the Specialty Civil segment. See Note 10. Segments for a description of the reportable segments and their operations.

COVID-19 Pandemic

During March 2020, the World Health Organization declared a global pandemic related to the rapidly growing outbreak of a novel strain of coronavirus (COVID-19). The COVID-19 pandemic has significantly affected economic conditions in the United States and internationally as national, state and local governments reacted to the public health crisis by requiring mitigation measures that have disrupted business activities for an uncertain period of time. The effects of the COVID-19 pandemic could affect the Company’s future business activities and financial results, including; reduced crew productivity, contract amendments/cancellations, higher operating costs and/or delayed project start dates or project shutdowns that may be requested or mandated by governmental authorities or others.

The effects of the COVID-19 pandemic on the Company’s financial results for the three months ended March 31, 2020 has had no negative material impact. Most of the Company’s construction services are currently deemed essential under governmental mitigation orders and substantially all of its business segments continue to operate. Management’s top priority has been to take appropriate actions to protect the health and safety of its employees, customers and business partners, including adjusting its standard operating procedures to respond to evolving health guidelines. Management believes that it is taking appropriate steps to mitigate any potential impact to the Company; however, given the uncertainty regarding the potential effects of the COVID-19 pandemic, any future impacts cannot be quantified or predicted with specificity.

Principles of Consolidation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with the instructions for Quarterly Reports on Form 10-Q and Rule 10-01 of Regulation S-X. Pursuant to these rules and regulations, certain information and footnote disclosures normally included in the annual audited consolidated financial statements prepared in accordance with GAAP have been condensed or omitted.
The unaudited condensed consolidated financial statements include the accounts of IEA and its wholly-owned direct and indirect domestic and foreign subsidiaries and in the opinion of management, these financial statements reflect all adjustments (consisting of normal recurring adjustments) that are necessary to present fairly the results of operations for the interim periods presented. The results of operations for the three months ended March 31, 2020 are not necessarily indicative of the results that may be expected for the year ending December 31, 2020. These financial statements should be read in conjunction with the Company’s audited consolidated financial statements for the year ended December 31, 2019 and notes thereto included in the Company’s 2019 Annual Report on Form 10-K.

Basis of Accounting and Use of Estimates
    
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with GAAP. The preparation of the condensed consolidated financial statements in conformity with GAAP requires the use of estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and the accompanying notes. Key estimates include: the recognition of revenue and project profit or loss; fair value estimates, including those related to Series B Preferred Stock; valuations of goodwill and intangible assets; asset lives used in computing depreciation and amortization; accrued self-insured claims; other reserves and accruals; accounting for income taxes; and the estimated impact of contingencies and ongoing litigation. While management believes that its estimates are reasonable when considered in conjunction with the Company’s consolidated financial position and results of operations, actual results could differ materially from those estimates.

Revenue Recognition

The Company adopted the requirements of Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers, which is also referred to as Accounting Standards Codification (“ASC”) Topic 606, under the modified retrospective transition approach effective January 1, 2019, with application to all existing contracts that were not substantially completed as of January 1, 2019. The Company adopted this standard for interim periods beginning after December 31, 2019, and recorded adjustments to the previously issued quarterly financial statements for the three months ended March 31, 2019. The impacts of adoption on the Company’s retained earnings on January 1, 2019 was primarily related to variable consideration on unapproved change orders. The cumulative impact of adopting Topic 606 required net adjustments of $750,000 to the statement of operations between revenue, cost of revenue and income taxes, thereby reducing income in the March 31, 2019 quarterly financial statements and reducing the December 31, 2019 accumulated deficit. The Company also adjusted the cashflow statement as of March 31, 2019, to reflect adoption.
Under Topic 606, revenue is recognized when control of promised goods and services is transferred to customers, and the amount of revenue recognized reflects the consideration to which an entity expects to be entitled in exchange for the goods and services transferred. Revenue is recognized by the Company primarily over time utilizing the cost-to-cost measure of progress for fixed price contracts and are based on cost for time and materials and other service contracts, consistent with the Company’s previous revenue recognition practices.
Contracts
The Company derives revenue primarily from construction projects performed under contracts for specific projects requiring the construction and installation of an entire infrastructure system or specified units within an infrastructure system. The contracts contain multiple pricing options, including fixed price, time and materials, or unit price. Renewable energy projects are performed for private customers while our Specialty Civil projects are performed for a mix of various governmental entities.
Revenue derived from projects billed on a fixed-price basis totaled 96.0% and 90.2% of consolidated revenue from operations for the three months ended March 31, 2020 and 2019, respectively. Revenue and related costs for construction contracts billed on a time and materials basis are recognized as the services are rendered. Revenue derived from projects billed on a time and materials basis totaled 4.0% and 9.8% of consolidated revenue from operations for the three months ended March 31, 2020 and 2019, respectively.

Revenue from construction contracts is recognized over time using the cost-to-cost measure of progress for fixed price construction contracts. For these contracts, the cost-to-cost measure of progress best depicts the continuous transfer of control of goods or services to the customer. The contractual terms provide that the customer compensates the Company for services rendered.

Contract costs include all direct materials, labor and subcontracted costs, as well as indirect costs related to contract performance, such as indirect labor, supplies, tools, repairs and the operational costs of capital equipment. The cost estimation and review process for recognizing revenue over time under the cost-to-cost method is based on the professional knowledge and experience of the Company’s project managers, engineers and financial professionals. Management reviews estimates of total contract transaction price and total project costs on an ongoing basis. Changes in job performance, job conditions and management’s assessment of expected variable consideration are factors that influence estimates of the total contract transaction price, total costs to complete those contracts and profit recognition. Changes in these factors could result in revisions to revenue and costs of revenue in the period in which the revisions are determined on a prospective basis, which could materially affect the Company’s condensed consolidated results of operations for that period. Provisions for losses on uncompleted contracts are recorded in the period in which such losses are determined.
Performance Obligations
A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of account under Topic 606. The transaction price of a contract is allocated to a distinct performance obligation and recognized as revenue when or as the performance obligation is satisfied. The Company’s contracts often require significant integrated services and, even when delivering multiple distinct services, are generally accounted for as a single performance obligation. Contract amendments and change orders are generally not distinct from the existing contract due to the significant integrated service provided in the context of the contract and are accounted for as a modification of the existing contract and performance obligation. With the exception of certain Specialty Civil service contracts, the majority of the Company’s performance obligations are completed within one year.
When more than one contract is entered into with a customer on or close to the same date, the Company evaluates whether those contracts should be combined and accounted for as a single contract as well as whether those contracts should be accounted for as more than one performance obligation. This evaluation requires significant judgment and is based on the facts and circumstances of the various contracts, which could change the amount of revenue and profit recognition in a given period depending upon the outcome of the evaluation.
Remaining performance obligations represent the amount of unearned transaction prices for contracts, including approved and unapproved change orders. As of March 31, 2020, the amount of the Company’s remaining performance obligations was $1,238.5 million. The Company expects to recognize approximately 81.6% of its remaining performance obligations as revenue during 2020. Revenue recognized from performance obligations satisfied in previous periods was ($2.0) million and $2.8 million, for the three months ended March 31, 2020 and 2019, respectively. 
Variable Consideration
Transaction pricing for the Company’s contracts may include variable consideration, such as unapproved change orders, claims, incentives and liquidated damages. Management estimates variable consideration for a performance obligation utilizing estimation methods that best predict the amount of consideration to which the Company will be entitled. Variable consideration is included in the estimated transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. Management’s estimates of variable consideration and determination of whether to include estimated amounts in transaction price are based on legal opinions, past practices with the customer, specific discussions, correspondence or preliminary negotiations with the customer and all other relevant information that is reasonably available. The effect of a change in variable consideration on the transaction price of a performance obligation is typically recognized as an adjustment to revenue on a cumulative catch-up basis. To the extent unapproved change orders, claims and liquidated damages reflected in transaction price are not resolved in the Company’s favor, or to the extent incentives reflected in transaction price are not earned, there could be reductions in, or reversals of, previously recognized revenue.
As of March 31, 2020 and year ended December 31, 2019, the Company included approximately $60.2 million and $73.3 million, respectively, of unapproved change orders and/or claims in the transaction price for certain contracts that were in the process of being resolved in the normal course of business, including through negotiation, arbitration and other proceedings. These transaction price adjustments are included within Contract Assets or Contract Liabilities as appropriate. The Company actively engages with its customers to complete the final change order approval process, and generally expects these processes to be completed within one year. Amounts ultimately realized upon final acceptance by customers could be higher or lower than such estimated amounts.

Disaggregation of Revenue
The following tables disaggregate revenue by customers and services performed, which the Company believes best depicts how the nature, amount, timing and uncertainty of its revenue:
(in thousands)
 
Three months ended
 
 
March 31, 2020
 
March 31, 2019
Renewables
 
 
 
 
   Wind
 
$
248,537

 
$
72,034

   Solar
 
209

 
1,997

 
 
$
248,746

 
$
74,031

 
 
 
 
 
Specialty Civil
 
 
 
 
   Heavy civil
 
$
41,222

 
$
50,115

   Rail
 
47,057

 
42,609

   Environmental
 
21,138

 
23,026

 
 
$
109,417

 
$
115,750


Concentrations
 
The Company had the following approximate revenue and accounts receivable concentrations, net of allowances, for the periods ended:
 
Revenue %
 
 
 
Three months ended
 
Accounts Receivable %
 
2020
 
2019
 
March 31, 2020
 
December 31, 2019
Company A (Specialty Civil Segment)
*

 
21.1
%
 
*
 
*
Company B (Renewable Segment)
*

 
11.9
%
 
*
 
*
Company C (Renewables Segment)
11.5
%
 
*

 
*
 
*
Company D (Renewables Segment)
11.1
%
 
*

 
*
 
*
* Amount was not above 10% threshold

Recently Adopted Accounting Standards - Guidance Adopted in 2020

In August 2018, the FASB issued ASU 2018-13, “Fair Value Measurement (Topic 820), Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement,” which eliminates certain disclosure requirements for recurring and non-recurring fair value measurements, such as the amount of and reason for transfers between Level 1 and Level 2 of the fair value hierarchy, and adds new disclosure requirements for Level 3 measurements. ASU 2018-13 is effective for all entities for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years, with early adoption permitted for any eliminated or modified disclosures. Certain disclosures per ASU 2018-13 are required to be applied on a retrospective basis and others on a prospective basis. We adopted the standard on January 1, 2020, and it did not have an impact on our disclosures for fair value measurements.

In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842), which is effective for annual reporting periods beginning after December 15, 2018. Under Topic 842, lessees will be required to recognize the following for all leases (with the exception of short-term leases) at the commencement date: i) a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis, and ii) a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. Topic 842 requires entities to adopt the new lease standard using a modified retrospective method and initially apply the related guidance at the beginning of the earliest period presented in the financial statements. 

The Company adopted Topic 842 using the modified retrospective method as of January 1, 2019 and for interim periods beginning after December 31, 2019, without adjusting comparative periods in the financial statements. The most significant effect of the new guidance was the recognition of operating lease right-of-use assets and a liability for operating leases as of December 31, 2019. The accounting for finance leases (capital leases) was substantially unchanged. The Company elected to utilize the package of practical expedients that allowed entities to: (1) not reassess whether any expired or existing contracts were or contained leases; (2) retain the existing classification of lease contracts as of the date of adoption; (3) not reassess initial direct costs for any existing leases; and (4) not separate non-lease components for all classes of leased assets.
Recently Issued Accounting Standards Not Yet Adopted
    
In June 2016, the FASB issued ASU 2016-13, “Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments,” which introduced an expected credit loss methodology for the measurement and recognition of credit losses on most financial assets, including trade accounts receivables. The expected credit loss methodology under ASU 2016-13 is based on historical experience, current conditions and reasonable and supportable forecasts, and replaces the probable/incurred loss model for measuring and recognizing expected losses under current GAAP. The ASU also requires disclosure of information regarding how a company developed its allowance, including changes in the factors that influenced management’s estimate of expected credit losses and the reasons for those changes. The ASU and its related clarifying updates are effective for smaller reporting companies for fiscal years beginning after December 15, 2022, and interim periods within those fiscal years, with early adoption permitted. We are still evaluating the new standard but do not expect it to have a material impact on our estimate of the allowance for uncollectable accounts.

In December 2019, the FASB issued ASU No. 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes,” which removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. This ASU is effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years. Depending on the amendment, adoption may be applied on the retrospective, modified retrospective, or prospective basis. We are currently evaluating the potential effects of adopting the provisions of ASU No. 2019-12.

Management has evaluated other recently issued accounting pronouncements and does not believe that they will have a significant impact on the financial statements and related disclosures.

v3.20.1
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares
Mar. 31, 2020
Dec. 31, 2019
Statement of Financial Position [Abstract]    
Preferred stock, par value (in dollars per share) $ 0.0001 $ 0.0001
Preferred stock, shares authorized 1,000,000 1,000,000
Preferred stock, shares issued (in shares) 17,483 17,483
Preferred stock, shares outstanding 17,483 17,483
Common stock, par value (in dollars per share) $ 0.0001 $ 0.0001
Common stock, shares authorized 100,000,000 100,000,000
Common stock, shares, issued 20,700,555 20,460,533
Common stock, shares, outstanding 20,648,793 20,446,811
Treasury Stock, Shares 51,762 13,722
v3.20.1
Business, Basis of Presentation and Significant Accounting Policies (Policies)
3 Months Ended
Mar. 31, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Basis of Accounting, Policy [Policy Text Block]
The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with GAAP.
Consolidation, Policy [Policy Text Block]
Principles of Consolidation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and with the instructions for Quarterly Reports on Form 10-Q and Rule 10-01 of Regulation S-X. Pursuant to these rules and regulations, certain information and footnote disclosures normally included in the annual audited consolidated financial statements prepared in accordance with GAAP have been condensed or omitted.
The unaudited condensed consolidated financial statements include the accounts of IEA and its wholly-owned direct and indirect domestic and foreign subsidiaries and in the opinion of management, these financial statements reflect all adjustments (consisting of normal recurring adjustments) that are necessary to present fairly the results of operations for the interim periods presented. The results of operations for the three months ended March 31, 2020 are not necessarily indicative of the results that may be expected for the year ending December 31, 2020. These financial statements should be read in conjunction with the Company’s audited consolidated financial statements for the year ended December 31, 2019 and notes thereto included in the Company’s 2019 Annual Report on Form 10-K.

Segment Reporting, Policy [Policy Text Block]
We segregate our business into two reportable segments: the Renewables segment and the Specialty Civil segment. See Note 10. Segments for a description of the reportable segments and their operations.
Use of Estimates, Policy [Policy Text Block]
The preparation of the condensed consolidated financial statements in conformity with GAAP requires the use of estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and the accompanying notes. Key estimates include: the recognition of revenue and project profit or loss; fair value estimates, including those related to Series B Preferred Stock; valuations of goodwill and intangible assets; asset lives used in computing depreciation and amortization; accrued self-insured claims; other reserves and accruals; accounting for income taxes; and the estimated impact of contingencies and ongoing litigation. While management believes that its estimates are reasonable when considered in conjunction with the Company’s consolidated financial position and results of operations, actual results could differ materially from those estimates.

Revenue [Policy Text Block]

Revenue Recognition

The Company adopted the requirements of Accounting Standards Update (“ASU”) 2014-09, Revenue from Contracts with Customers, which is also referred to as Accounting Standards Codification (“ASC”) Topic 606, under the modified retrospective transition approach effective January 1, 2019, with application to all existing contracts that were not substantially completed as of January 1, 2019. The Company adopted this standard for interim periods beginning after December 31, 2019, and recorded adjustments to the previously issued quarterly financial statements for the three months ended March 31, 2019. The impacts of adoption on the Company’s retained earnings on January 1, 2019 was primarily related to variable consideration on unapproved change orders. The cumulative impact of adopting Topic 606 required net adjustments of $750,000 to the statement of operations between revenue, cost of revenue and income taxes, thereby reducing income in the March 31, 2019 quarterly financial statements and reducing the December 31, 2019 accumulated deficit. The Company also adjusted the cashflow statement as of March 31, 2019, to reflect adoption.
Under Topic 606, revenue is recognized when control of promised goods and services is transferred to customers, and the amount of revenue recognized reflects the consideration to which an entity expects to be entitled in exchange for the goods and services transferred. Revenue is recognized by the Company primarily over time utilizing the cost-to-cost measure of progress for fixed price contracts and are based on cost for time and materials and other service contracts, consistent with the Company’s previous revenue recognition practices.
Contracts
The Company derives revenue primarily from construction projects performed under contracts for specific projects requiring the construction and installation of an entire infrastructure system or specified units within an infrastructure system. The contracts contain multiple pricing options, including fixed price, time and materials, or unit price. Renewable energy projects are performed for private customers while our Specialty Civil projects are performed for a mix of various governmental entities.
Revenue derived from projects billed on a fixed-price basis totaled 96.0% and 90.2% of consolidated revenue from operations for the three months ended March 31, 2020 and 2019, respectively. Revenue and related costs for construction contracts billed on a time and materials basis are recognized as the services are rendered. Revenue derived from projects billed on a time and materials basis totaled 4.0% and 9.8% of consolidated revenue from operations for the three months ended March 31, 2020 and 2019, respectively.

Revenue from construction contracts is recognized over time using the cost-to-cost measure of progress for fixed price construction contracts. For these contracts, the cost-to-cost measure of progress best depicts the continuous transfer of control of goods or services to the customer. The contractual terms provide that the customer compensates the Company for services rendered.

Contract costs include all direct materials, labor and subcontracted costs, as well as indirect costs related to contract performance, such as indirect labor, supplies, tools, repairs and the operational costs of capital equipment. The cost estimation and review process for recognizing revenue over time under the cost-to-cost method is based on the professional knowledge and experience of the Company’s project managers, engineers and financial professionals. Management reviews estimates of total contract transaction price and total project costs on an ongoing basis. Changes in job performance, job conditions and management’s assessment of expected variable consideration are factors that influence estimates of the total contract transaction price, total costs to complete those contracts and profit recognition. Changes in these factors could result in revisions to revenue and costs of revenue in the period in which the revisions are determined on a prospective basis, which could materially affect the Company’s condensed consolidated results of operations for that period. Provisions for losses on uncompleted contracts are recorded in the period in which such losses are determined.
Performance Obligations
A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of account under Topic 606. The transaction price of a contract is allocated to a distinct performance obligation and recognized as revenue when or as the performance obligation is satisfied. The Company’s contracts often require significant integrated services and, even when delivering multiple distinct services, are generally accounted for as a single performance obligation. Contract amendments and change orders are generally not distinct from the existing contract due to the significant integrated service provided in the context of the contract and are accounted for as a modification of the existing contract and performance obligation. With the exception of certain Specialty Civil service contracts, the majority of the Company’s performance obligations are completed within one year.
When more than one contract is entered into with a customer on or close to the same date, the Company evaluates whether those contracts should be combined and accounted for as a single contract as well as whether those contracts should be accounted for as more than one performance obligation. This evaluation requires significant judgment and is based on the facts and circumstances of the various contracts, which could change the amount of revenue and profit recognition in a given period depending upon the outcome of the evaluation.
Remaining performance obligations represent the amount of unearned transaction prices for contracts, including approved and unapproved change orders. As of March 31, 2020, the amount of the Company’s remaining performance obligations was $1,238.5 million. The Company expects to recognize approximately 81.6% of its remaining performance obligations as revenue during 2020. Revenue recognized from performance obligations satisfied in previous periods was ($2.0) million and $2.8 million, for the three months ended March 31, 2020 and 2019, respectively. 
Variable Consideration
Transaction pricing for the Company’s contracts may include variable consideration, such as unapproved change orders, claims, incentives and liquidated damages. Management estimates variable consideration for a performance obligation utilizing estimation methods that best predict the amount of consideration to which the Company will be entitled. Variable consideration is included in the estimated transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. Management’s estimates of variable consideration and determination of whether to include estimated amounts in transaction price are based on legal opinions, past practices with the customer, specific discussions, correspondence or preliminary negotiations with the customer and all other relevant information that is reasonably available. The effect of a change in variable consideration on the transaction price of a performance obligation is typically recognized as an adjustment to revenue on a cumulative catch-up basis. To the extent unapproved change orders, claims and liquidated damages reflected in transaction price are not resolved in the Company’s favor, or to the extent incentives reflected in transaction price are not earned, there could be reductions in, or reversals of, previously recognized revenue.
As of March 31, 2020 and year ended December 31, 2019, the Company included approximately $60.2 million and $73.3 million, respectively, of unapproved change orders and/or claims in the transaction price for certain contracts that were in the process of being resolved in the normal course of business, including through negotiation, arbitration and other proceedings. These transaction price adjustments are included within Contract Assets or Contract Liabilities as appropriate. The Company actively engages with its customers to complete the final change order approval process, and generally expects these processes to be completed within one year. Amounts ultimately realized upon final acceptance by customers could be higher or lower than such estimated amounts.

Disaggregation of Revenue
The following tables disaggregate revenue by customers and services performed, which the Company believes best depicts how the nature, amount, timing and uncertainty of its revenue:
(in thousands)
 
Three months ended
 
 
March 31, 2020
 
March 31, 2019
Renewables
 
 
 
 
   Wind
 
$
248,537

 
$
72,034

   Solar
 
209

 
1,997

 
 
$
248,746

 
$
74,031

 
 
 
 
 
Specialty Civil
 
 
 
 
   Heavy civil
 
$
41,222

 
$
50,115

   Rail
 
47,057

 
42,609

   Environmental
 
21,138

 
23,026

 
 
$
109,417

 
$
115,750


New Accounting Pronouncements, Policy [Policy Text Block]
Recently Adopted Accounting Standards - Guidance Adopted in 2020

In August 2018, the FASB issued ASU 2018-13, “Fair Value Measurement (Topic 820), Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement,” which eliminates certain disclosure requirements for recurring and non-recurring fair value measurements, such as the amount of and reason for transfers between Level 1 and Level 2 of the fair value hierarchy, and adds new disclosure requirements for Level 3 measurements. ASU 2018-13 is effective for all entities for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years, with early adoption permitted for any eliminated or modified disclosures. Certain disclosures per ASU 2018-13 are required to be applied on a retrospective basis and others on a prospective basis. We adopted the standard on January 1, 2020, and it did not have an impact on our disclosures for fair value measurements.

In February 2016, the FASB issued ASU 2016-02, “Leases (Topic 842), which is effective for annual reporting periods beginning after December 15, 2018. Under Topic 842, lessees will be required to recognize the following for all leases (with the exception of short-term leases) at the commencement date: i) a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis, and ii) a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. Topic 842 requires entities to adopt the new lease standard using a modified retrospective method and initially apply the related guidance at the beginning of the earliest period presented in the financial statements. 

The Company adopted Topic 842 using the modified retrospective method as of January 1, 2019 and for interim periods beginning after December 31, 2019, without adjusting comparative periods in the financial statements. The most significant effect of the new guidance was the recognition of operating lease right-of-use assets and a liability for operating leases as of December 31, 2019. The accounting for finance leases (capital leases) was substantially unchanged. The Company elected to utilize the package of practical expedients that allowed entities to: (1) not reassess whether any expired or existing contracts were or contained leases; (2) retain the existing classification of lease contracts as of the date of adoption; (3) not reassess initial direct costs for any existing leases; and (4) not separate non-lease components for all classes of leased assets.
Recently Issued Accounting Standards Not Yet Adopted
    
In June 2016, the FASB issued ASU 2016-13, “Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments,” which introduced an expected credit loss methodology for the measurement and recognition of credit losses on most financial assets, including trade accounts receivables. The expected credit loss methodology under ASU 2016-13 is based on historical experience, current conditions and reasonable and supportable forecasts, and replaces the probable/incurred loss model for measuring and recognizing expected losses under current GAAP. The ASU also requires disclosure of information regarding how a company developed its allowance, including changes in the factors that influenced management’s estimate of expected credit losses and the reasons for those changes. The ASU and its related clarifying updates are effective for smaller reporting companies for fiscal years beginning after December 15, 2022, and interim periods within those fiscal years, with early adoption permitted. We are still evaluating the new standard but do not expect it to have a material impact on our estimate of the allowance for uncollectable accounts.

In December 2019, the FASB issued ASU No. 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes,” which removes certain exceptions to the general principles in Topic 740 and also clarifies and amends existing guidance to improve consistent application. This ASU is effective for fiscal years beginning after December 15, 2020, and interim periods within those fiscal years. Depending on the amendment, adoption may be applied on the retrospective, modified retrospective, or prospective basis. We are currently evaluating the potential effects of adopting the provisions of ASU No. 2019-12.

Management has evaluated other recently issued accounting pronouncements and does not believe that they will have a significant impact on the financial statements and related disclosures.
v3.20.1
Segments (Details) - USD ($)
$ in Thousands
3 Months Ended
Mar. 31, 2020
Mar. 31, 2019
Segment Reporting Information [Line Items]    
Revenue $ 358,163 $ 189,781
Segment revenue as a percentage of total revenue 100.00% 100.00%
Gross Profit $ 33,041 $ 5,744
Gross Profit Margin 9.20% 3.00%
Renewables Segment [Member]    
Segment Reporting Information [Line Items]    
Revenue $ 248,746 $ 74,031
Segment revenue as a percentage of total revenue 69.50% 39.00%
Gross Profit $ 25,829 $ 1,163
Gross Profit Margin 10.40% 1.60%
Specialty Civil Segment [Member]    
Segment Reporting Information [Line Items]    
Revenue $ 109,417 $ 115,750
Segment revenue as a percentage of total revenue 30.50% 61.00%
Gross Profit $ 7,212 $ 4,581
Gross Profit Margin 6.60% 4.00%
v3.20.1
Goodwill and Intangible Assets, net (Details) - USD ($)
$ in Thousands
3 Months Ended 12 Months Ended
Mar. 31, 2020
Dec. 31, 2019
Goodwill [Line Items]    
Goodwill, Beginning Balance $ 37,373 $ 40,257
Goodwill, Period Increase (Decrease) 0 (2,884)
Goodwill, Ending Balance 37,373 37,373
Renewables Segment [Member]    
Goodwill [Line Items]    
Goodwill, Beginning Balance 3,020 3,020
Goodwill, Period Increase (Decrease) 0 0
Goodwill, Ending Balance 3,020 3,020
Specialty Civil Segment [Member]    
Goodwill [Line Items]    
Goodwill, Beginning Balance 34,353 37,237
Goodwill, Period Increase (Decrease) 0 (2,884)
Goodwill, Ending Balance $ 34,353 $ 34,353
v3.20.1
Business, Basis of Presentation and Significant Accounting Policies Revenue 606 (Details) - USD ($)
3 Months Ended 12 Months Ended
Mar. 31, 2020
Mar. 31, 2019
Dec. 31, 2019
Revenue 606 [Abstract]      
Effect of Change in Accounting Principle Topic 606   $ 750,000  
Revenue, Remaining Performance Obligation, Amount $ 1,238,500,000    
Revenue, Remaining Performance Obligation, Percentage 81.60%    
Contract with Customer, Performance Obligation Satisfied in Previous Period $ (2,000,000) $ 2,800,000  
Deferred Revenue, Revenue Recognized $ 60,200,000   $ 73,300,000
v3.20.1
Condensed Consolidated Statements of Cash Flows - USD ($)
$ in Thousands
3 Months Ended
Mar. 31, 2020
Mar. 31, 2019
Cash flows from operating activities:    
Net loss $ (12,743) $ (23,639)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:    
Depreciation and amortization 11,888 12,017
Fair Value Adjustment of Warrants 1,057 0
Amortization of Other Deferred Charges 2,237 1,239
Share-based compensation expense 1,113 1,040
Deferred compensation (1,371) 735
Accrued dividends on Series B Preferred Stock 7,959 0
Deferred income taxes (1,080) (8,908)
Other Operating Activities, Cash Flow Statement 733 168
Change in operating assets and liabilities:    
Accounts receivable 48,931 82,383
Increase (Decrease) in Contract with Customer, Asset 14,548 12,405
Prepaid expenses and other assets (5,212) (3,149)
Accounts payable and accrued liabilities (104,760) (110,060)
Increase (Decrease) in Contract with Customer, Liability (8,381) 23,032
Net cash used in operating activities (74,177) (37,547)
Cash flow from investing activities:    
Company-owned life insurance 599 (202)
Purchases of property, plant and equipment (2,231) (1,908)
Proceeds from sale of property, plant and equipment 1,719 47
Net cash provided by (used in) investing activities 87 (2,063)
Cash flows from financing activities:    
Proceeds from Long-term Lines of Credit 46,000 9,400
Repayments of Long-term Lines of Credit (55,853) (16,151)
Payments on finance lease obligations (5,781) (4,289)
Sale Leaseback Transaction, Net Proceeds, Financing Activities 0 24,343
Proceeds from Convertible Debt 350 0
Proceeds, Issuance of Shares, Share-based Payment Arrangement, Including Option Exercised 196 159
Merger recapitalization transaction 0 2,754
Net cash provided by (used in) financing activities (15,088) 16,216
Net change in cash and cash equivalents (89,178) (23,394)
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents Period Start 147,259 71,311
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents Period End 58,081 47,917
Supplemental disclosure of cash and non-cash transactions:    
Interest Paid, Excluding Capitalized Interest, Operating Activities 6,053 9,168
Income Taxes Paid, Net (229) 190
Right-of-Use Asset Obtained in Exchange for Finance Lease Liability 2,806 0
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability 2,732 971
Dividends, Preferred Stock $ 766 $ 525
v3.20.1
Condensed Consolidated Balance Sheets - USD ($)
$ in Thousands
Mar. 31, 2020
Dec. 31, 2019
Current assets:    
Cash and cash equivalents $ 58,081 $ 147,259
Accounts receivable, net 154,699 203,645
Contract Assets 193,851 179,303
Prepaid expenses and other current assets 22,178 16,855
Total current assets 428,809 547,062
Property, plant and equipment, net 134,753 140,488
Operating Lease, Right-of-Use Asset 43,444 43,431
Intangible Assets, Net (Excluding Goodwill) 33,902 37,272
Goodwill 37,373 37,373
Company-owned life insurance 4,153 4,752
Deferred Income Tax Assets, Net 14,072 12,992
Other Assets, Noncurrent 492 1,551
Total assets 696,998 824,921
Current liabilities:    
Accounts Payable, Current 110,485 177,783
Accrued Liabilities, Current 121,445 158,103
Contract Liabilities 107,253 115,634
Current portion of finance lease obligations 23,437 23,183
Operating Lease, Liability, Current 10,191 9,628
Current portion of long-term debt 1,693 1,946
Total current liabilities 374,504 486,277
Finance lease obligations, less current portion 37,826 41,055
Operating Lease, Liability, Noncurrent 34,131 34,572
Long-term Debt 154,788 162,901
Debt - Series B Preferred Stock 175,145 166,141
Series B Preferred Stock - warrant obligations 2,200 17,591
Deferred compensation 6,593 8,004
Total liabilities 785,187 916,541
Commitments and contingencies:
Series A Preferred Stock, par value, $0.0001 per share; 100,000,000 shares authorized; 17,483 shares and 17,483 shares issued and outstanding at March 31, 2020 and December 31, 2019, respectively 17,483 17,483
Stockholders' equity (deficit):    
Common stock, par value, $0.0001 per share; 100,000,000 shares authorized; 20,700,555 and 20,460,533 shares issued and 20,648,793 and 20,446,811 outstanding at March 31, 2020 and December 31, 2019, respectively 2 2
Treasury stock, 51,762 and 13,722 shares at cost at March 31, 2020 and December 31, 2019, respectively. (160) (76)
Additional paid in capital 33,425 17,167
Retained earnings (deficit) (138,939) (126,196)
Total stockholders' equity (deficit) (105,672) (109,103)
Total liabilities and stockholders' equity (deficit) $ 696,998 $ 824,921
v3.20.1
Subsequent Event (Notes)
3 Months Ended
Mar. 31, 2020
Subsequent Event [Abstract]  
Subsequent Events [Text Block]
Subsequent Event

Amendment to Equity Commitment Agreement

On May 6, 2020, the Company entered into an Amendment (the “Amendment”) to the Equity Commitment Agreement, dated as of October 29, 2019 (the “Equity Commitment Agreement”) by and between the Company, Ares and Oaktree. The Amendment amends the Equity Commitment Agreement to extend the period of time required to enter into the 2020 Commitment and purchase additional shares of Series B-3 Preferred Stock and warrants from the Company to July 14, 2020, or such other date as mutually agreed upon. Additionally, the Amendment clarifies that the 2020 Commitment shall in no event exceed $5,650,000.
v3.20.1
Goodwill and Intangible Assets, net (Notes)
3 Months Ended
Mar. 31, 2020
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill and Intangible Assets Disclosure [Text Block]
Goodwill and Intangible Assets, Net

The following table provides the changes in the carrying amount of goodwill:

(in thousands)
Renewables
 
Specialty Civil
 
Total
January 1, 2019
$
3,020

 
$
37,237

 
$
40,257

   Acquisition adjustments

 
(2,884
)
 
(2,884
)
December 31, 2019
$
3,020

 
$
34,353

 
$
37,373

   Adjustments

 

 

March 31, 2020
$
3,020

 
$
34,353

 
$
37,373



Intangible assets consisted of the following as of the dates indicated:

 
March 31, 2020
 
 
 
December 31, 2019
 
 
($ in thousands)
Gross Carrying Amount
 
Accumulated Amortization
 
Net Carrying Amount
 
Weighted Average Remaining Life
 
Gross Carrying Amount
 
Accumulated Amortization
 
Net Carrying Amount
 
Weighted Average Remaining Life
Customer relationships
$
26,500

 
$
(5,642
)
 
$
20,858

 
5.75 years
 
$
26,500

 
$
(4,695
)
 
$
21,805

 
6 years
Trade name
13,400

 
(3,990
)
 
9,410

 
3.75 years
 
13,400

 
(3,305
)
 
10,095

 
4 years
Backlog
13,900

 
(10,266
)
 
3,634

 
9 months
 
13,900

 
(8,528
)
 
5,372

 
1 year
 
$
53,800

 
$
(19,898
)
 
$
33,902

 
 
 
$
53,800

 
$
(16,528
)
 
$
37,272

 
 


Amortization expense associated with intangible assets for the three months ended March 31, 2020 and 2019, totaled $3.4 million and $3.5 million, respectively.

The following table provides the annual intangible amortization expense currently expected to be recognized for the years 2020 through 2024:

(in thousands)
Remainder of 2020
 
2021
 
2022
 
2023
 
2024
Amortization expense
$
11,837

 
$
6,466

 
$
6,466

 
$
5,841

 
$
3,785

v3.20.1
Earnings per share
3 Months Ended
Mar. 31, 2020
Earnings Per Share [Abstract]  
Earnings per share
Earnings Per Share

The Company calculates earnings (loss) per share (“EPS”) in accordance with ASC 260, Earnings per Share. Basic EPS is computed by dividing income (loss) available to common stockholders by the weighted average number of common shares of common stock outstanding during the period.

Income (loss) available to common stockholders is computed by deducting the dividends accrued for the period on cumulative preferred stock from net income. If there is a net loss, the amount of the loss is increased by those preferred dividends.

Diluted EPS assumes the dilutive effect of (i) contingently issuable earn-out shares, (ii) Series A cumulative convertible preferred stock, using the if-converted method, and (iii) the assumed exercise of in-the-money stock options and warrants and the assumed vesting of outstanding restricted stock units (“RSUs”), using the treasury stock method.

Whether the Company has net income, or a net loss determines whether potential issuances of common stock are included in the diluted EPS computation or whether they would be anti-dilutive. As a result, if there is a net loss, diluted EPS is computed in the same manner as basic EPS is computed. Similarly, if the Company has net income but its preferred dividend adjustment made in computing income available to common stockholders results in a net loss available to common stockholders, diluted EPS would be computed the same as basic EPS.

The calculations of basic and diluted EPS, are as follows:
 
Three Months Ended
 
March 31,
($ in thousands, except per share data)
2020
 
2019
Numerator:
 
 
 
  Net loss
(12,743
)
 
(23,639
)
  Less: Convertible Preferred Stock dividends
(766
)
 
(524
)
    Net loss available to common stockholders
(13,509
)
 
(24,163
)
 
 
 
 
Denominator:
 
 
 
  Weighted average common shares outstanding - basic and diluted
20,522,216

 
22,188,757

 
 
 
 
Anti-dilutive: (1)(2)
 
 
 
  Convertible Series A Preferred
6,553,041

 
5,045,149

  Series B Preferred - Warrants at closing
7,675,325

 

  RSUs
1,456,359

 
354,106

 
 
 
 
Basic EPS
(0.66
)
 
(1.09
)
Diluted EPS
(0.66
)
 
(1.09
)


(1)
As of March 31, 2020 and 2019, publicly traded warrants to purchase 8,480,000 shares of common stock at $11.50 per share were not considered as dilutive as the warrants’ exercise price was greater than the average market price of the common stock during the period.
    
(2)
As of March 31, 2020 and 2019, there were 591,860 and 646,405 of vested and unvested Options and 141,248 and 169,494 unvested RSUs, respectively. These were also not considered as dilutive as the respective exercise price or average stock price required for vesting of such awards was greater than the average market price of the common stock during the period.

Series A Preferred Stock

As of March 31, 2020, we had 17,483 shares of Series A Preferred Stock with a stated value of $1,000 per share plus accumulated dividends. Dividends are paid on the Series A Preferred Stock as, if and when declared by our Board. To extent permitted, dividends are required to be paid in cash quarterly in arrears on each March 31, June 30, September 30 and December 31 on the stated value at a rate of 10% per annum.

If not paid in cash, dividends will accrue on the stated value and will increase the stated value on and effective as of the applicable dividend date without any further action by the Board at 12% per annum.

So long as any shares of Series B Preferred Stock of the Company are currently outstanding or from and after the occurrence of any non-payment event or default event and until cured or waived, the foregoing rates will increase by 2% per annum.

As of March 31, 2020, the Company has accrued a cumulative of $2.5 million in dividends to holders of Series A Preferred Stock as a reduction to additional paid-in capital.

Series B Preferred Stock

As of March 31, 2020, we had 199,474 shares of Series B Preferred Stock outstanding, with each share having a stated value of $1,000 plus accumulated dividends. Our common stock and Series A Preferred Stock are junior to the Series B Preferred Stock. Dividends are paid in cash on the Series B Preferred Stock as, if and when declared by our Board. To the extent not prohibited by applicable law, dividends are required to be declared and paid in cash quarterly in arrears on each March 31, June 30, September 30 and December 31. Any dividend period for which the Total Net Leverage Ratio is greater than 1.50:1.00, the dividend rate is 13.5% per annum and (ii) with respect to any dividend period for which the Total Net Leverage Ratio is less than or equal to 1.50:1.00, at a rate of 12% per annum.

If not paid in cash, dividends will accrue on the stated value and will increase the stated value on Series B Preferred Stock and is effective as of the applicable dividend date without any further action by the Board at a rate of 15%.

The Company has accrued a cumulative of $18.3 million in dividends to holders of Series B Preferred Stock, which is recorded in convertible debt in the Company's condensed consolidated balance sheet for the quarter ended March 31, 2020. See Note 5. Fair Value of Financial Instruments for discussion regarding the Company's valuation of Series B Preferred Stock.

Stock Compensation
    
Under guidance of ASC Topic 718 “Compensation — Stock Compensation,” stock-based compensation expense is measured at the date of grant, based on the calculated fair value of the stock-based award, and is recognized as expense over the employee’s requisite service period (generally the vesting period of the award).

The fair value of the RSUs was based on the closing market price of our common stock on the date of the grant. Stock compensation expense for the RSUs is being amortized using the straight-line method over the service period. For the three months ended March 31, 2020 and 2019, we recognized $1.1 million and $1.0 million in compensation expense, respectively,
v3.20.1
Income taxes (Details) - USD ($)
3 Months Ended
Mar. 31, 2020
Mar. 31, 2019
Income Tax Contingency [Line Items]    
Statutory federal tax rate 21.00%  
Effective tax rates 6.40% 27.40%
Increase (decrease) in uncertain tax positions $ 0 $ 0
Minimum    
Income Tax Contingency [Line Items]    
State tax rate 0.80%  
Maximum    
Income Tax Contingency [Line Items]    
State tax rate 12.00%  
v3.20.1
Commitments and contingencies Future minimum payments of finance leases (Details) - USD ($)
$ in Thousands
Mar. 31, 2020
Dec. 31, 2019
Commitments and Contingencies Disclosures [Abstract]    
Remainder of 2020 $ 20,035  
2021 22,344  
2022 18,302  
2023 4,108  
2024 628  
Thereafter 157  
Finance minimum lease payments 65,574  
Less: Amount representing interest 4,311  
Present Value of Minimum Lease Payments 61,263 $ 64,200
Less: Current portion of finance lease obligations 23,437  
Finance lease obligations, less current portion $ 37,826  
v3.20.1
Debt - Long-Term Debt (Details) - USD ($)
$ in Thousands
Mar. 31, 2020
Dec. 31, 2019
Debt Instrument [Line Items]    
Total principal due for long-term debt $ 177,291 $ 187,143
Debt Issuance Costs, Net (20,810) (22,296)
Long-term Debt, Current Maturities (1,693) (1,946)
Long-term debt, less current portion 154,788 162,901
Debt - Series B Preferred Stock 175,145 166,141
Term Loan [Member]    
Debt Instrument [Line Items]    
Total principal due for long-term debt 173,345 182,687
Series B Preferred Stock Liability [Member]    
Debt Instrument [Line Items]    
Total principal due for long-term debt 188,755 180,444
Debt Issuance Costs, Net (13,610) (14,303)
Commercial equipment notes    
Debt Instrument [Line Items]    
Total principal due for long-term debt $ 3,946 $ 4,456
v3.20.1
Property, plant and equipment, net (Tables)
3 Months Ended
Mar. 31, 2020
Property, Plant and Equipment [Abstract]  
Schedule of property plant and equipment
Property, plant and equipment consisted of the following:

(in thousands)
March 31, 2020
 
December 31, 2019
Buildings and leasehold improvements
$
3,051

 
$
2,919

Land
17,600

 
17,600

Construction equipment
175,707

 
173,434

Office equipment, furniture and fixtures
3,537

 
3,487

Vehicles
5,375

 
6,087

 
205,270

 
203,527

Accumulated depreciation
(70,517
)
 
(63,039
)
    Property, plant and equipment, net
$
134,753

 
$
140,488

v3.20.1
Commitments and contingencies (Tables)
3 Months Ended
Mar. 31, 2020
Commitments and Contingencies Disclosure [Abstract]  
Schedule of Future Minimum Lease Payments for Capital Leases [Table Text Block]
The future minimum payments of finance lease obligations are as follows:
(in thousands)
 
Remainder of 2020
$
20,035

2021
22,344

2022
18,302

2023
4,108

2024
628

Thereafter
157

Future minimum lease payments
65,574

Less: Amount representing interest
4,311

Present value of minimum lease payments
61,263

Less: Current portion of finance lease obligations
23,437

Finance lease obligations, less current portion
$
37,826

Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block]
The future minimum payments under non-cancelable operating leases are as follows:
(in thousands)
 
Remainder of 2020
$
9,784

2021
11,242

2022
8,846

2023
6,220

2024
3,116

Thereafter
20,461

Future minimum lease payments
59,669

Less: Amount representing interest
15,347

Present value of minimum lease payments
44,322

Less: Current portion of operating lease obligations
10,191

Operating lease obligations, less current portion
$
34,131

Schedule of Additional Lease Information [Table Text Block]
Lease Information
 
Three months ended
 
March 31, 2020
March 31, 2019
 
 
 
Finance Lease cost:
 
 
   Amortization of right-of-use assets
5,697

5,008

   Interest on lease liabilities
1,186

1,650

Operating lease cost
3,478

1,831

Short-term lease cost
21,635

8,496

Variable lease cost
960

191

Sublease Income
(33
)
(24
)
Total lease cost
$
32,923

$
17,152

 
 
 
Other information:
 
 
Cash paid for amounts included in the measurement of lease liabilities
 
 
   Operating cash flows from finance leases
$
1,186

$
1,650

   Operating cash flows from operating leases
$
3,342

$
3,247

Weighted-average remaining lease term - finance leases
2.73 years

3.36 years

Weighted-average remaining lease term - operating leases
8.02 years

9.94 years

Weighted-average discount rate - finance leases
6.49
%
6.70
%
Weighted-average discount rate - operating leases
7.14
%
6.89
%
v3.20.1
Condensed Consolidated Statement of Operations - USD ($)
$ in Thousands
3 Months Ended
Mar. 31, 2020
Mar. 31, 2019
Revenue $ 358,163 $ 189,781
Cost of revenue 325,122 184,037
Gross profit 33,041 5,744
Selling, general and administrative expenses 29,484 27,754
Income (loss) from operations 3,557 (22,010)
Other income (expense), net:    
Interest expense, net (16,065) (10,367)
Other expense (1,102) (170)
Loss before benefit for income taxes (13,610) (32,547)
Benefit for income taxes 867 8,908
Net loss $ (12,743) $ (23,639)
Earnings Per Share, Basic $ (0.66) $ (1.09)
Earnings Per Share, Diluted $ (0.66) $ (1.09)
Weighted Average Number of Shares Outstanding, Basic 20,522,216 22,188,757
Weighted Average Number of Shares Outstanding, Diluted 20,522,216 22,188,757
v3.20.1
Contract Assets and Liabilities
3 Months Ended
Mar. 31, 2020
Contractors [Abstract]  
Contract Assets and Liabilities
Contract Assets and Liabilities

The timing of when we bill our customers is generally dependent upon agreed-upon contractual terms, milestone billings based on the completion of certain phases of the work, or when services are provided. Sometimes, billing occurs subsequent to revenue recognition, resulting in unbilled revenue, which is a contract asset. Also, we sometimes receive advance payments or deposits from our customers before revenue is recognized, resulting in deferred revenue, which is a contract liability.

Contract assets in the Condensed Consolidated Balance Sheets represent the following:

costs and estimated earnings in excess of billings, which arise when revenue has been recorded but the amount has not been billed; and

retainage amounts for the portion of the contract price billed by us for work performed but held for payment by the customer as a form of security until we reach certain construction milestones or complete the project.

Contract assets consist of the following:

(in thousands)
March 31, 2020
 
December 31, 2019
Costs and estimated earnings in excess of billings on uncompleted contracts
$
106,285

 
$
91,543

Retainage receivable
87,566

 
87,760

 
193,851

 
179,303


Contract liabilities consist of the following:

(in thousands)
March 31, 2020
 
December 31, 2019
Billings in excess of costs and estimated earnings on uncompleted contracts
$
107,207

 
$
115,570

Loss on contracts in progress
46

 
64

 
$
107,253

 
$
115,634



The contract receivables amount as of March 31, 2020 and December 31, 2019 includes unapproved change orders of approximately $9.2 million for which the Company is pursuing settlement through dispute resolution.

Revenue recognized for the three months ended March 31, 2020 and 2019 that was included in the contract liability balance at the beginning of each year was approximately $90.9 million and $31.9 million, respectively.
    
Activity in the allowance for doubtful accounts for the periods indicated is as follows:

 
Three Months Ended
 
March 31,
(in thousands)
2020
 
2019
Allowance for doubtful accounts at beginning of period
$
75

 
$
42

    Plus: provision for (reduction in) allowance
14

 
30

    Less: write-offs, net of recoveries

 

Allowance for doubtful accounts at period end
$
89

 
$
72

v3.20.1
Debt
3 Months Ended
Mar. 31, 2020
Debt Disclosure [Abstract]  
Debt
Debt

Debt consists of the following obligations as of:
(in thousands)
March 31, 2020
 
December 31, 2019
 
 
 
 
Term loan
173,345

 
182,687

Commercial equipment notes
3,946

 
4,456

   Total principal due for long-term debt
177,291

 
187,143

Unamortized debt discount and issuance costs
(20,810
)
 
(22,296
)
Less: Current portion of long-term debt
(1,693
)
 
(1,946
)
   Long-term debt, less current portion
154,788

 
162,901

 
 
 
 
Debt - Series B Preferred Stock
188,755

 
180,444

Unamortized debt discount and issuance costs
(13,610
)
 
(14,303
)
  Long-term Series B Preferred Stock
175,145

 
166,141



The weighted average interest rate for the term loan as of March 31, 2020 and December 31, 2019, was 9.70% and 10.35%, respectively.
Debt Covenants
The term loan is governed by the terms of the Third A&R Credit Agreement, which include customary affirmative and negative covenants and provide for customary events of default, which include, nonpayment of principal or interest and failure to timely deliver financial statements. Under the Third A&R Credit Agreement, the financial covenant provides that the First Lien Net Leverage Ratio (as defined therein) may not exceed (i) prior to the fiscal quarter ending December 31, 2019, 4.75:1.0, (ii) for the four fiscal quarters ending December 31, 2020, 3.50:1.0, (iii) for the four fiscal quarters ending December 31, 2021, 2.75:1.0, and (iv) for all subsequent quarters, 2.25:1.0. Under the Third A&R Credit Agreement, the Company could not use an equity infusion to cure any covenant violations for fiscal quarter ending in 2019, excluding the Series B Preferred Stock. Thereafter, the Company has access to a customary equity cure.

The Third A&R Credit Agreement also includes certain limitations on the payment of cash dividends on the Company's common shares and provides for other restrictions on (subject to certain exceptions) liens, indebtedness (including guarantees and other contingent obligations), investments (including loans, advances and acquisitions), mergers and other fundamental changes and sales and other dispositions of property or assets, among others.

Letters of Credit and Surety Bonds

In the ordinary course of business, the Company is required to post letters of credit and surety bonds to customers in support of performance under certain contracts. Such letters of credit are generally issued by a bank or similar financial institution. The letter of credit or surety bond commits the issuer to pay specified amounts to the holder of the letter of credit or surety bond under certain conditions. If the letter of credit or surety bond issuer were required to pay any amount to a holder, the Company would be required to reimburse the issuer, which, depending upon the circumstances, could result in a charge to earnings. As of March 31, 2020, and December 31, 2019, the Company was contingently liable under letters of credit issued under its Third A&R Credit Agreement, in the amount of $23.7 million and $21.0 million, respectively, related to projects. In addition, as of March 31, 2020 and December 31, 2019, the Company had outstanding surety bonds on projects of $2.5 billion and $2.4 billion, respectively.

Contractual Maturities

Contractual maturities of the Company's outstanding principal on debt obligations as of March 31, 2020:
(in thousands)
Maturities
Remainder of 2020
$
1,365

2021
1,228

2022
15,859

2023
29,735

2024
129,104

Thereafter

Total contractual obligations
$
177,291

v3.20.1
Segments (Notes)
3 Months Ended
Mar. 31, 2020
Segments [Abstract]  
Segment Reporting Disclosure [Text Block]
Segments

We operate our business as two reportable segments: the Renewables segment and the Specialty Civil segment. Each of our reportable segments is comprised of similar business units that specialize in services unique to the respective markets that each segment serves. The classification of revenue and gross profit for segment reporting purposes can at times require judgment on the part of management. Our segments may perform services across industries or perform joint services for customers in multiple industries. To determine reportable segment gross profit, certain allocations, including allocations of shared and indirect costs, such as facility costs, equipment costs and indirect operating expenses, were made based on segment revenue.

Separate measures of the Company’s assets, including capital expenditures and cash flows by reportable segment are not produced or utilized by management to evaluate segment performance. A substantial portion of the Company’s fixed assets are owned by and accounted for in our equipment department, including operating machinery, equipment and vehicles, as well as office equipment, buildings and leasehold improvements, and are used on an interchangeable basis across our reportable segments. As such, for reporting purposes, total under/over absorption of equipment expenses consisting primarily of depreciation is allocated to the Company's two reportable segments based on segment revenue.
    
The following is a brief description of the Company's reportable segments:

Renewables Segment

The Renewables segment operates throughout the United States and specializes in a range of full engineering, procurement and construction (“EPC”) services that include project delivery, design, site development, construction, installation and restoration of infrastructure services for the wind and solar industries.

Specialty Civil Segment

The Specialty Civil segment operates throughout the United States and specializes in a range of services that include:

Heavy civil construction services such as high-altitude road and bridge construction, specialty paving, industrial maintenance and other local, state and government projects.

Environmental remediation services such as site development, environmental site closure and outsourced contract mining and coal ash management services.
  
Rail Infrastructure services such as planning, creation and maintenance of infrastructure projects for major railway and intermodal facilities construction.

Segment Revenue

Revenue by segment was as follows:
 
Three Months Ended March 31,
(in thousands)
2020
 
2019
Segment
Revenue
% of Total Revenue
 
Revenue
% of Total Revenue
Renewables
$
248,746

69.5
%
 
$
74,031

39.0
%
Specialty Civil
109,417

30.5
%
 
115,750

61.0
%
  Total revenue
$
358,163

100.0
%
 
$
189,781

100.0
%


Segment Gross Profit

Gross profit by segment was as follows:
 
Three Months Ended March 31,
(in thousands)
2020
 
2019
Segment
Gross Profit
Gross Profit Margin
 
Gross Profit
Gross Profit Margin
Renewables
$
25,829

10.4
%
 
$
1,163

1.6
%
Specialty Civil
7,212

6.6
%
 
4,581

4.0
%
  Total gross profit
$
33,041

9.2
%
 
$
5,744

3.0
%


v3.20.1
Goodwill and Intangible Assets, net Schedule of annual expected amortization expense (Details)
$ in Thousands
Mar. 31, 2020
USD ($)
Finite-Lived Intangible Assets [Line Items]  
Remainder of 2020 $ 11,837
2021 6,466
2022 6,466
2023 5,841
2024 $ 3,785
v3.20.1
Contract Assets and Liabilities Activity in allowance for doubtful accounts (Details) - USD ($)
$ in Thousands
3 Months Ended
Mar. 31, 2020
Mar. 31, 2019
Dec. 31, 2019
Accounts, Notes, Loans and Financing Receivable [Line Items]      
Accounts Receivable, Allowance for Credit Loss, Beginning of Period $ 75 $ 42  
Accounts Receivable, Allowance for Credit Loss, Writeoff 14 30  
Accounts Receivable, Credit Loss Expense (Reversal) 0 0  
Accounts Receivable, Allowance for Credit Loss, End of Period 89 $ 72  
One Customer [Member]      
Accounts, Notes, Loans and Financing Receivable [Line Items]      
Contracts Receivable, Claims and Uncertain Amounts $ 9,200   $ 9,200
v3.20.1
Business, Basis of Presentation and Significant Accounting Policies Disaggregation of Revenue (Details)
$ in Thousands
3 Months Ended
Mar. 31, 2020
USD ($)
Mar. 31, 2019
USD ($)
Disaggregation of Revenue [Line Items]    
Number of Reportable Segments 2  
Revenue $ 358,163 $ 189,781
Wind Revenue [Member]    
Disaggregation of Revenue [Line Items]    
Revenue 248,537 72,034
Solar Revenue [Member]    
Disaggregation of Revenue [Line Items]    
Revenue 209 1,997
Heavy Civil Revenue [Member]    
Disaggregation of Revenue [Line Items]    
Revenue 41,222 50,115
Rail Construction Revenue [Member]    
Disaggregation of Revenue [Line Items]    
Revenue 47,057 42,609
Environmental Revenue [Member]    
Disaggregation of Revenue [Line Items]    
Revenue 21,138 23,026
Renewables Segment [Member]    
Disaggregation of Revenue [Line Items]    
Revenue 248,746 74,031
Specialty Civil Segment [Member]    
Disaggregation of Revenue [Line Items]    
Revenue $ 109,417 $ 115,750
v3.20.1
Earnings per share - Basic and Diluted EPS (Details) - USD ($)
$ / shares in Units, $ in Thousands
3 Months Ended
Mar. 31, 2020
Mar. 31, 2019
Numerator:    
Net loss $ (12,743) $ (23,639)
Less: Convertible Preferred Stock dividends (766) (524)
Net loss available to common stockholders $ (13,509) $ (24,163)
Denominator:    
Weighted Average Number of Shares Outstanding, Basic 20,522,216 22,188,757
Basic EPS (in dollars per share) $ (0.66) $ (1.09)
Diluted EPS (in dollars per share) $ (0.66) $ (1.09)
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Incremental Common Shares Attributable to Dilutive Effect of Conversion of Preferred Stock 6,553,041 5,045,149
Incremental Common Shares Attributable to Dilutive Effect of Call Options and Warrants 7,675,325 0
Incremental Common Shares Attributable to Dilutive Effect of Share-based Payment Arrangements 1,456,359 354,106
Warrant [Member]    
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Antidilutive securities excluded from computation of earnings per share, amount 8,480,000  
Class of Warrant or Right, Exercise Price of Warrants or Rights $ 11.50  
Share-based Payment Arrangement, Option [Member]    
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Antidilutive securities excluded from computation of earnings per share, amount 591,860 646,405
Restricted Stock Units (RSUs) [Member]    
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Antidilutive securities excluded from computation of earnings per share, amount 141,248 169,494
v3.20.1
Related party transactions (Details)
Mar. 31, 2020
Infrastructure And Energy Alternatives, LLC [Member]  
Related Party Transaction [Line Items]  
IEA LLC Ownership Percentage of Preferred 100.00%
Ares [Member]  
Related Party Transaction [Line Items]  
Series B Preferred Equity Agreement - All Equity Ares 50.00%
Oaktree [Member]  
Related Party Transaction [Line Items]  
Series B Preferred Equity Agreement - All Equity Oaktree 50.00%
Series B Preferred Stock [Member] | Ares [Member]  
Related Party Transaction [Line Items]  
Series B Preferred Equity Agreement - All Equity Ares 60.00%
Series B Preferred Stock [Member] | Oaktree [Member]  
Related Party Transaction [Line Items]  
Series B Preferred Equity Agreement - All Equity Oaktree 40.00%
Series B-2 Preferred Stock [Member] | Ares [Member]  
Related Party Transaction [Line Items]  
Series B Preferred Equity Agreement - All Equity Ares 100.00%
v3.20.1
Commitments and contingencies Schedule of Additional Lease Information (Details) - USD ($)
$ in Thousands
3 Months Ended
Mar. 31, 2020
Mar. 31, 2019
Additional Lease Information [Abstract]    
Finance Lease, Right-of-Use Asset, Amortization $ 5,697 $ 5,008
Finance Lease, Interest Expense 1,186 1,650
Operating Leases, Rent Expense, Net 3,478 1,831
Short-term Lease, Cost 21,635 8,496
Variable Lease, Cost 960 191
Sublease Income (33) (24)
Lease, Cost 32,923 17,152
Operating Cashflow Finance Leases 1,186 1,650
Operating cashflow from operating leases $ 3,342 $ 3,247
Finance Lease, Weighted Average Remaining Lease Term 2 years 8 months 23 days 3 years 4 months 10 days
Operating Lease, Weighted Average Remaining Lease Term 8 years 7 days 9 years 11 months 7 days
Finance Lease, Weighted Average Discount Rate, Percent 6.49% 6.70%
Operating Lease, Weighted Average Discount Rate, Percent 7.14% 6.89%
v3.20.1
Debt - Long Term Debt Obligations (Details)
$ in Thousands
Mar. 31, 2020
USD ($)
Debt Disclosure [Abstract]  
Remainder of 2020 $ 1,365
2021 1,228
2022 15,859
2023 29,735
2024 129,104
Thereafter 0
Contractual Obligation $ 177,291
v3.20.1
Fair value of financial instruments - Reconciliation of Level 3 Inputs (Details)
$ in Thousands
3 Months Ended
Mar. 31, 2020
USD ($)
Series B Preferred - Series A Conversion Warrants [Member]  
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]  
Beginning Balance, December 31, 2019 $ 4,317
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Liability, Gain (Loss) Included in Earnings 91
Transfer to non-recurring fair value instrument (equity) (2,426)
Ending Balance, March 31, 2020 1,800
Series B-1 Preferred Stock 6% Warrants [Member]  
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]  
Beginning Balance, December 31, 2019 400
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Liability, Gain (Loss) Included in Earnings 0
Transfer to non-recurring fair value instrument (equity) 0
Ending Balance, March 31, 2020 400
Series B-3 Preferred Stock Closing Warrants [Member]  
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]  
Beginning Balance, December 31, 2019 11,491
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Liability, Gain (Loss) Included in Earnings 1,677
Transfer to non-recurring fair value instrument (equity) (13,168)
Ending Balance, March 31, 2020 0
Rights Offering Fair Value [Member]  
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]  
Beginning Balance, December 31, 2019 1,383
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Liability, Gain (Loss) Included in Earnings (1,383)
Transfer to non-recurring fair value instrument (equity) 0
Ending Balance, March 31, 2020 $ 0
v3.20.1
Business, Basis of Presentation and Significant Accounting Policies (Tables)
3 Months Ended
Mar. 31, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Disaggregation of Revenue [Table Text Block]
The following tables disaggregate revenue by customers and services performed, which the Company believes best depicts how the nature, amount, timing and uncertainty of its revenue:
(in thousands)
 
Three months ended
 
 
March 31, 2020
 
March 31, 2019
Renewables
 
 
 
 
   Wind
 
$
248,537

 
$
72,034

   Solar
 
209

 
1,997

 
 
$
248,746

 
$
74,031

 
 
 
 
 
Specialty Civil
 
 
 
 
   Heavy civil
 
$
41,222

 
$
50,115

   Rail
 
47,057

 
42,609

   Environmental
 
21,138

 
23,026

 
 
$
109,417

 
$
115,750

Schedule of revenue and accounts receivable concentrations, net of allowances
The Company had the following approximate revenue and accounts receivable concentrations, net of allowances, for the periods ended:
 
Revenue %
 
 
 
Three months ended
 
Accounts Receivable %
 
2020
 
2019
 
March 31, 2020
 
December 31, 2019
Company A (Specialty Civil Segment)
*

 
21.1
%
 
*
 
*
Company B (Renewable Segment)
*

 
11.9
%
 
*
 
*
Company C (Renewables Segment)
11.5
%
 
*

 
*
 
*
Company D (Renewables Segment)
11.1
%
 
*

 
*
 
*
* Amount was not above 10% threshold
v3.20.1
Fair value of financial instruments (Tables)
3 Months Ended
Mar. 31, 2020
Fair Value Disclosures [Abstract]  
Schedule of fair value of liabilities measured on recurring basis
The following table sets forth information regarding the Company's assets measured at fair value on a recurring basis:    

 
March 31, 2020
 
December 31, 2019
(in thousands)
Level 1
 
Level 2
 
Level 3
 
Total
 
Level 1
 
Level 2
 
Level 3
 
Total
Liabilities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Series B Preferred Stock - Series A Conversion Warrants and Exchange Warrants
$

 
$

 
$
1,800

 
$
1,800

 
$

 
$

 
$
4,317

 
$
4,317

Series B-1 Preferred Stock - Additional 6% Warrants

 

 
400

 
400

 

 

 
400

 
400

Series B-3 Preferred - Closing Warrants

 

 

 

 

 

 
11,491

 
11,491

Rights Offering

 

 

 

 

 

 
1,383

 
1,383

Total liabilities
$

 
$

 
$
2,200

 
$
2,200

 
$

 
$

 
$
17,591

 
$
17,591


Schedule of reconciliation of fair value unobservable liabilities measured on recurring basis
The following is a reconciliation of the beginning and ending balances of recurring fair value measurements using Level 3 inputs:

(in thousands)
Series B Preferred - Series A Conversion Warrants and Exchange Warrants
 
Series B-1 Preferred Stock - Additional 6% Warrants
 
Series B-3 Preferred - Closing Warrants
 
Rights Offering
Beginning Balance, December 31, 2019
$
4,317

 
$
400

 
$
11,491

 
$
1,383

Fair value adjustment - (gain) loss recognized in other income
(91
)
 

 
1,677

 
(1,383
)
Transfer to non-recurring fair value instrument (equity)
(2,426
)
 

 
(13,168
)
 

Ending Balance, March 31, 2020
$
1,800

 
$
400

 
$

 
$

v3.20.1
Segments (Tables)
3 Months Ended
Mar. 31, 2020
Segments [Abstract]  
Reconciliation of Revenue from Segments to Consolidated [Table Text Block]
Segment Revenue

Revenue by segment was as follows:
 
Three Months Ended March 31,
(in thousands)
2020
 
2019
Segment
Revenue
% of Total Revenue
 
Revenue
% of Total Revenue
Renewables
$
248,746

69.5
%
 
$
74,031

39.0
%
Specialty Civil
109,417

30.5
%
 
115,750

61.0
%
  Total revenue
$
358,163

100.0
%
 
$
189,781

100.0
%


Reconciliation of Other Significant Reconciling Items from Segments to Consolidated [Table Text Block]
Segment Gross Profit

Gross profit by segment was as follows:
 
Three Months Ended March 31,
(in thousands)
2020
 
2019
Segment
Gross Profit
Gross Profit Margin
 
Gross Profit
Gross Profit Margin
Renewables
$
25,829

10.4
%
 
$
1,163

1.6
%
Specialty Civil
7,212

6.6
%
 
4,581

4.0
%
  Total gross profit
$
33,041

9.2
%
 
$
5,744

3.0
%
v3.20.1
Debt - Narrative (Details)
$ in Thousands
3 Months Ended
Mar. 31, 2020
USD ($)
Dec. 31, 2019
USD ($)
Debt Instrument [Line Items]    
Letters of credit contingently liable for $ 23,652 $ 21,000
Surety bonds $ 2,461,519 $ 2,393,157
Debt Covenant Period, Period One [Member] | Third A&R Credit Agreement [Member]    
Debt Instrument [Line Items]    
Debt Instrument, Covenant Terms, Maximum First Lien Net Leverage Ratio 4.75  
Debt Covenant Period, Period Two [Member] | Third A&R Credit Agreement [Member]    
Debt Instrument [Line Items]    
Debt Instrument, Covenant Terms, Maximum First Lien Net Leverage Ratio 3.50  
Debt Covenant Period, Period Three [Member] [Member] | Third A&R Credit Agreement [Member]    
Debt Instrument [Line Items]    
Debt Instrument, Covenant Terms, Maximum First Lien Net Leverage Ratio 2.75  
Debt Covenant Period, Period Four [Member] [Member] | Third A&R Credit Agreement [Member]    
Debt Instrument [Line Items]    
Debt Instrument, Covenant Terms, Maximum First Lien Net Leverage Ratio 2.25  
Term Loan [Member]    
Debt Instrument [Line Items]    
Debt, Weighted Average Interest Rate 9.70% 10.35%
v3.20.1
Fair value of financial instruments - Fair Value Liabilities Measured on Recurring Basis (Details) - Recurring - USD ($)
$ in Thousands
Mar. 31, 2020
Dec. 31, 2019
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Obligations, Fair Value Disclosure $ 2,200 $ 17,591
Series B Preferred - Series A Conversion Warrants [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Obligations, Fair Value Disclosure 1,800 4,317
Series B-1 Preferred Stock 6% Warrants [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Obligations, Fair Value Disclosure 400 400
Series B Preferred Stock Warrants at closing[Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Obligations, Fair Value Disclosure 0 11,491
Rights Offering Fair Value [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Obligations, Fair Value Disclosure 0 1,383
Quoted Prices in Active Markets for Identical Assets (Level 1)    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Obligations, Fair Value Disclosure 0 0
Quoted Prices in Active Markets for Identical Assets (Level 1) | Series B Preferred - Series A Conversion Warrants [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Obligations, Fair Value Disclosure 0 0
Quoted Prices in Active Markets for Identical Assets (Level 1) | Series B-1 Preferred Stock 6% Warrants [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Obligations, Fair Value Disclosure 0 0
Quoted Prices in Active Markets for Identical Assets (Level 1) | Series B Preferred Stock Warrants at closing[Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Obligations, Fair Value Disclosure 0 0
Quoted Prices in Active Markets for Identical Assets (Level 1) | Rights Offering Fair Value [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Obligations, Fair Value Disclosure 0 0
Significant Other Observable Inputs (Level 2)    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Obligations, Fair Value Disclosure 0 0
Significant Other Observable Inputs (Level 2) | Series B Preferred - Series A Conversion Warrants [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Obligations, Fair Value Disclosure 0 0
Significant Other Observable Inputs (Level 2) | Series B-1 Preferred Stock 6% Warrants [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Obligations, Fair Value Disclosure 0 0
Significant Other Observable Inputs (Level 2) | Series B Preferred Stock Warrants at closing[Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Obligations, Fair Value Disclosure 0 0
Significant Other Observable Inputs (Level 2) | Rights Offering Fair Value [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Obligations, Fair Value Disclosure 0 0
Significant Unobservable Inputs (Level 3)    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Obligations, Fair Value Disclosure 2,200 17,591
Significant Unobservable Inputs (Level 3) | Series B Preferred - Series A Conversion Warrants [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Obligations, Fair Value Disclosure 1,800 4,317
Significant Unobservable Inputs (Level 3) | Series B-1 Preferred Stock 6% Warrants [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Obligations, Fair Value Disclosure 400 400
Significant Unobservable Inputs (Level 3) | Series B Preferred Stock Warrants at closing[Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Obligations, Fair Value Disclosure 0 11,491
Significant Unobservable Inputs (Level 3) | Rights Offering Fair Value [Member]    
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]    
Obligations, Fair Value Disclosure $ 0 $ 1,383
v3.20.1
Commitments and contingencies Future mimum payments of operating leases (Details) - USD ($)
$ in Thousands
Mar. 31, 2020
Dec. 31, 2019
Commitments and Contingencies Disclosures [Abstract]    
Remainder of 2020 $ 9,784  
2021 11,242  
2022 8,846  
2023 6,220  
2024 3,116  
Thereafter 20,461  
Lessee, Operating Lease, Liability, Payments, Due 59,669  
Operating Leases, Future Minimum Payments, Interest Included in Payments 15,347  
Operating Lease, Liability 44,322 $ 44,200
Operating Lease, Liability, Current 10,191 9,628
Operating Lease, Liability, Noncurrent $ 34,131 $ 34,572
v3.20.1
Related party transactions (Tables)
3 Months Ended
Mar. 31, 2020
Related Party Transactions [Abstract]  
Schedule of related party shareholders
Related Party Shareholders

Type of Equity
Holder
Ownership Percentage
Series A Preferred, Series A Conversion Warrants and Exchange Warrants, Series B-3 Preferred Stock (exchange agreement)
Infrastructure and Energy Alternatives, LLC
100
%
Series B-1 Preferred Stock, Series A Conversion Warrants, Additional 6% Warrants, Warrants at closing
Ares
60
%
Oaktree Power Opportunities Fund III Delaware, L.P.
40
%
2020 Commitment
Ares
50
%
Oaktree Power Opportunities Fund III Delaware, L.P.
50
%
Series B-2 and B-3 Preferred Stock, Warrants at closing
Ares
100
%
v3.20.1
Contract Assets and Liabilities (Tables)
3 Months Ended
Mar. 31, 2020
Contractors [Abstract]  
Contract Assets and Contract Liabilities

(in thousands)
March 31, 2020
 
December 31, 2019
Costs and estimated earnings in excess of billings on uncompleted contracts
$
106,285

 
$
91,543

Retainage receivable
87,566

 
87,760

 
193,851

 
179,303


Contract liabilities consist of the following:

(in thousands)
March 31, 2020
 
December 31, 2019
Billings in excess of costs and estimated earnings on uncompleted contracts
$
107,207

 
$
115,570

Loss on contracts in progress
46

 
64

 
$
107,253

 
$
115,634

Accounts Receivable, Allowance for Credit Loss [Table Text Block]
Activity in the allowance for doubtful accounts for the periods indicated is as follows:

 
Three Months Ended
 
March 31,
(in thousands)
2020
 
2019
Allowance for doubtful accounts at beginning of period
$
75

 
$
42

    Plus: provision for (reduction in) allowance
14

 
30

    Less: write-offs, net of recoveries

 

Allowance for doubtful accounts at period end
$
89

 
$
72

v3.20.1
Debt (Tables)
3 Months Ended
Mar. 31, 2020
Debt Disclosure [Abstract]  
Schedule of debt
Debt consists of the following obligations as of:
(in thousands)
March 31, 2020
 
December 31, 2019
 
 
 
 
Term loan
173,345

 
182,687

Commercial equipment notes
3,946

 
4,456

   Total principal due for long-term debt
177,291

 
187,143

Unamortized debt discount and issuance costs
(20,810
)
 
(22,296
)
Less: Current portion of long-term debt
(1,693
)
 
(1,946
)
   Long-term debt, less current portion
154,788

 
162,901

 
 
 
 
Debt - Series B Preferred Stock
188,755

 
180,444

Unamortized debt discount and issuance costs
(13,610
)
 
(14,303
)
  Long-term Series B Preferred Stock
175,145

 
166,141

Contractual maturities of debt and capital lease obligations
Contractual Maturities

Contractual maturities of the Company's outstanding principal on debt obligations as of March 31, 2020:
(in thousands)
Maturities
Remainder of 2020
$
1,365

2021
1,228

2022
15,859

2023
29,735

2024
129,104

Thereafter

Total contractual obligations
$
177,291

v3.20.1
Property, plant and equipment, net
3 Months Ended
Mar. 31, 2020
Property, Plant and Equipment [Abstract]  
Property, plant and equipment, net
Property, Plant and Equipment, Net

Property, plant and equipment consisted of the following:

(in thousands)
March 31, 2020
 
December 31, 2019
Buildings and leasehold improvements
$
3,051

 
$
2,919

Land
17,600

 
17,600

Construction equipment
175,707

 
173,434

Office equipment, furniture and fixtures
3,537

 
3,487

Vehicles
5,375

 
6,087

 
205,270

 
203,527

Accumulated depreciation
(70,517
)
 
(63,039
)
    Property, plant and equipment, net
$
134,753

 
$
140,488



Depreciation expense of property, plant and equipment was $8,516 and $8,476 for the three months ended March 31, 2020 and 2019, respectively.
v3.20.1
Commitments and contingencies
3 Months Ended
Mar. 31, 2020
Commitments and Contingencies Disclosure [Abstract]  
Commitments and contingencies
Commitments and Contingencies

In the ordinary course of business, the Company enters into agreements that provide financing for its machinery and equipment, facility and vehicle needs. The Company reviews these agreements for potential lease classification, and at inception, determines whether a lease is an operating or finance lease. Lease assets and liabilities, which generally represent the present value of future minimum lease payments over the term of the lease, are recognized as of the commencement date. Under Topic 842, leases with an initial lease term of twelve months or less are classified as short-term leases and are not recognized in the condensed consolidated balance sheets unless the lease contains a purchase option that is reasonably certain to be exercised.
Lease term, discount rate, variable lease costs and future minimum lease payment determinations require the use of judgment as these are based on the facts and circumstances related to each specific lease. Lease terms are generally based on their initial non-cancelable terms, unless there is a renewal option that is reasonably certain to be exercised. Various factors, including economic incentives, intent, past history and business need are considered to determine if a renewal option is reasonably certain to be exercised. The implicit rate in a lease agreement is used when it can be determined. Otherwise, the Company's incremental borrowing rate, which is based on information available as of the lease commencement date, including applicable lease terms and the current economic environment, is used to determine the value of the lease obligation.
Finance Leases
    
The Company has obligations, exclusive of associated interest, under various finance leases for equipment totaling $61.3 million and $64.2 million at March 31, 2020 and December 31, 2019, respectively. Gross property under this capitalized lease agreement at March 31, 2020 and December 31, 2019, totaled $117.9 million and $116.1 million, less accumulated depreciation of $39.4 million and $34.0 million, respectively, for net balances of $78.5 million and $82.1 million, respectively. Depreciation of assets held under the finance leases are included in cost of revenue in the condensed consolidated statements of operations.

The future minimum payments of finance lease obligations are as follows:
(in thousands)
 
Remainder of 2020
$
20,035

2021
22,344

2022
18,302

2023
4,108

2024
628

Thereafter
157

Future minimum lease payments
65,574

Less: Amount representing interest
4,311

Present value of minimum lease payments
61,263

Less: Current portion of finance lease obligations
23,437

Finance lease obligations, less current portion
$
37,826



Operating Leases
    
In the ordinary course of business, the Company enters into non-cancelable operating leases for certain of its facilities, vehicles and equipment. The Company has obligations, exclusive of associated interest, totaling $44.3 million and $44.2 million at March 31, 2020 and December 31, 2019, respectively. Property under these operating lease agreements at March 31, 2020 and December 31, 2019, totaled $43.4 million and $43.4 million, respectively.

The Company has long-term power-by-the-hour equipment rental agreements with a construction equipment manufacturer that have a guaranteed minimum monthly hour requirement. The minimum guaranteed amount based on the Company's current operations is $3.2 million per year. Total expense under these agreements are listed below as variable lease costs.

The future minimum payments under non-cancelable operating leases are as follows:
(in thousands)
 
Remainder of 2020
$
9,784

2021
11,242

2022
8,846

2023
6,220

2024
3,116

Thereafter
20,461

Future minimum lease payments
59,669

Less: Amount representing interest
15,347

Present value of minimum lease payments
44,322

Less: Current portion of operating lease obligations
10,191

Operating lease obligations, less current portion
$
34,131



Lease Information
 
Three months ended
 
March 31, 2020
March 31, 2019
 
 
 
Finance Lease cost:
 
 
   Amortization of right-of-use assets
5,697

5,008

   Interest on lease liabilities
1,186

1,650

Operating lease cost
3,478

1,831

Short-term lease cost
21,635

8,496

Variable lease cost
960

191

Sublease Income
(33
)
(24
)
Total lease cost
$
32,923

$
17,152

 
 
 
Other information:
 
 
Cash paid for amounts included in the measurement of lease liabilities
 
 
   Operating cash flows from finance leases
$
1,186

$
1,650

   Operating cash flows from operating leases
$
3,342

$
3,247

Weighted-average remaining lease term - finance leases
2.73 years

3.36 years

Weighted-average remaining lease term - operating leases
8.02 years

9.94 years

Weighted-average discount rate - finance leases
6.49
%
6.70
%
Weighted-average discount rate - operating leases
7.14
%
6.89
%
v3.20.1
Related party transactions
3 Months Ended
Mar. 31, 2020
Related Party Transactions [Abstract]  
Related party transactions
Related Party Transactions

Related Party Shareholders

Type of Equity
Holder
Ownership Percentage
Series A Preferred, Series A Conversion Warrants and Exchange Warrants, Series B-3 Preferred Stock (exchange agreement)
Infrastructure and Energy Alternatives, LLC
100
%
Series B-1 Preferred Stock, Series A Conversion Warrants, Additional 6% Warrants, Warrants at closing
Ares
60
%
Oaktree Power Opportunities Fund III Delaware, L.P.
40
%
2020 Commitment
Ares
50
%
Oaktree Power Opportunities Fund III Delaware, L.P.
50
%
Series B-2 and B-3 Preferred Stock, Warrants at closing
Ares
100
%
v3.20.1
Condensed Statements of Stockholders Equity (Deficit) Statement - USD ($)
shares in Thousands
Total
Common Stock [Member]
Common Stock [Member]
Common Stock [Member]
Additional Paid-in Capital [Member]
Additional Paid-in Capital [Member]
Common Stock [Member]
Treasury Stock [Member]
Treasury Stock [Member]
Treasury Stock [Member]
Retained Earnings [Member]
Beginning Balance Shares, Issued at Dec. 31, 2018   22,155       0    
Beginning Balance Stockholder's equity at Dec. 31, 2018 $ (131,178,000) $ 2,000   $ 4,751,000   $ 0   $ (135,931,000)
Increase (Decrease) in Stockholders' Equity [Roll Forward]                
Net loss (23,639,000)             (23,639,000)
APIC, Share-based Payment Arrangement, Increase for Cost Recognition 1,040,000     1,040,000        
Stock Issued During Period, Shares, New Issues     111          
Stock Issued During Period, Value, New Issues 159,000 $ 0     $ 235,000      
Adjustments to Additional Paid in Capital, Business Combination (2,754,000)             (2,754,000)
Effect of Change in Accounting Principle Topic 606 750,000             750,000
Treasury Stock, Shares             (14)  
Dividends, Preferred Stock, Stock (525,000)     (525,000)        
Ending Balance Shares, Issued at Mar. 31, 2019   22,266       (14)    
Ending Balance Stockholder's equity at Mar. 31, 2019 (150,639,000) $ 2,000   5,501,000   $ (76,000)   (156,066,000)
Increase (Decrease) in Stockholders' Equity [Roll Forward]                
Treasury Stock, Value             $ (76,000)  
Beginning Balance Shares, Issued at Dec. 31, 2019   20,461       (14)    
Beginning Balance Stockholder's equity at Dec. 31, 2019 (109,103,000) $ 2,000   17,167,000   $ (76,000)   (126,196,000)
Increase (Decrease) in Stockholders' Equity [Roll Forward]                
Net loss (12,743,000)             (12,743,000)
APIC, Share-based Payment Arrangement, Increase for Cost Recognition 1,113,000     1,113,000        
Stock Issued During Period, Shares, New Issues     240          
Stock Issued During Period, Value, New Issues 196,000 $ 0     $ 280,000      
Adjustments to Additional Paid in Capital, Warrant Issued 15,631,000     15,631,000        
Treasury Stock, Shares             (38)  
Dividends, Preferred Stock, Stock (766,000)     (766,000)        
Ending Balance Shares, Issued at Mar. 31, 2020   20,701       (52)    
Ending Balance Stockholder's equity at Mar. 31, 2020 $ (105,672,000) $ 2,000   $ 33,425,000   $ (160,000)   $ (138,939,000)
Increase (Decrease) in Stockholders' Equity [Roll Forward]                
Treasury Stock, Value             $ (84,000)  
v3.20.1
Document and Entity Information - shares
3 Months Ended
Mar. 31, 2020
May 07, 2020
Document and Entity Information [Abstract]    
Entity Registrant Name Infrastructure & Energy Alternatives, Inc.  
Entity Central Index Key 0001652362  
Document Type 10-Q  
Document Period End Date Mar. 31, 2020  
Document Fiscal Year Focus 2020  
Amendment Flag false  
Document Fiscal Period Focus Q1  
Current Fiscal Year End Date --12-31  
Entity Filer Category Non-accelerated Filer  
Entity Emerging Growth Company false  
Entity Small Business true  
Entity Current Reporting Status Yes  
Entity Shell Company false  
Entity Interactive Data Current Yes  
Entity Common Stock, Shares Outstanding   22,506,233
v3.20.1
Contract Assets and Liabilities Contract Assets and Contract Liabilities (Details) - USD ($)
$ in Thousands
3 Months Ended
Mar. 31, 2020
Mar. 31, 2019
Dec. 31, 2019
Contractors [Abstract]      
Unbilled Contracts Receivable $ 106,285   $ 91,543
Contract Receivable Retainage 87,566   87,760
Contract Assets 193,851   179,303
Deferred Revenue 107,207   115,570
Provision for Loss on Contracts 46   64
Contract Liabilities 107,253   $ 115,634
Contract with Customer, Liability, Revenue Recognized $ 90,900 $ 31,900  
v3.20.1
Business, Basis of Presentation and Significant Accounting Policies (Details) - Product Concentration Risk [Member] - Revenue Benchmark [Member]
3 Months Ended
Mar. 31, 2020
Mar. 31, 2019
Fixed-price Contract [Member]    
Concentration Risk [Line Items]    
Concentration Risk, Percentage 96.00% 90.20%
Time-and-materials Contract [Member]    
Concentration Risk [Line Items]    
Concentration Risk, Percentage 4.00% 9.80%
v3.20.1
Goodwill and Intangible Assets, net Schedule of intangible assets (Details) - USD ($)
3 Months Ended 12 Months Ended
Mar. 31, 2020
Mar. 31, 2019
Dec. 31, 2019
Finite-Lived Intangible Assets [Line Items]      
Gross Carrying Amount $ 53,800,000   $ 53,800,000
Accumulated Amortization (19,898,000)   (16,528,000)
Net Book Value 33,902,000   37,272,000
Amortization of Intangible Assets 3,370,000 $ 3,500,000  
Customer Relationships [Member]      
Finite-Lived Intangible Assets [Line Items]      
Gross Carrying Amount 26,500,000   26,500,000
Accumulated Amortization (5,642,000)   (4,695,000)
Net Book Value $ 20,858,000   $ 21,805,000
Weighted Average Useful Life 5 years 9 months   6 years
Trade Names [Member]      
Finite-Lived Intangible Assets [Line Items]      
Gross Carrying Amount $ 13,400,000   $ 13,400,000
Accumulated Amortization (3,990,000)   (3,305,000)
Net Book Value $ 9,410,000   $ 10,095,000
Weighted Average Useful Life 3 years 9 months   4 years
Backlog [Member]      
Finite-Lived Intangible Assets [Line Items]      
Gross Carrying Amount $ 13,900,000   $ 13,900,000
Accumulated Amortization (10,266,000)   (8,528,000)
Net Book Value $ 3,634,000   $ 5,372,000
Weighted Average Useful Life 9 months   1 year
v3.20.1
Earnings per share - Narrative (Details) - USD ($)
$ / shares in Units, $ in Thousands
3 Months Ended
Mar. 31, 2020
Mar. 31, 2019
Dec. 31, 2019
Class of Stock [Line Items]      
Preferred stock, shares issued (in shares) 17,483   17,483
Preferred stock, par value (in dollars per share) $ 0.0001   $ 0.0001
Share-based compensation expense $ 1,113 $ 1,040  
Series A Preferred Stock      
Class of Stock [Line Items]      
Preferred stock, shares issued (in shares) 17,483    
Preferred stock, par value (in dollars per share) $ 1,000    
Preferred stock, dividend rate thereafter 10.00%    
Series A Preferred PIK Dividend Rate 18 mos 12.00%    
Default Rate for Uncured Dividends 2.00%    
Dividends Payable $ 2,524    
Series B Preferred Stock [Member]      
Class of Stock [Line Items]      
Preferred stock, par value (in dollars per share) $ 1,000    
SeriesB Preferred Shares to be Issued in Equity Agreement 199,474    
Ratio Net Leverage Ratio for Deleveraging Event 1.50    
Series B Cash Dividend Rate after Deleveraging 13.50%    
Dividend Rate after 1.5:1.0 leverage 12.00%    
Preferred Stock Paid In Kind Dividend Rate 15.00%    
Dividends Payable $ 18,300    
v3.20.1
Subsequent Event (Details)
$ in Thousands
May 06, 2020
USD ($)
Subsequent Event  
Subsequent Event [Line Items]  
Other Commitment $ 5,650