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Note 14 - Subsequent Events

6 Months Ended

Jun. 30, 2015

14.

Subsequent Events

CFO Departure

Effective July 3, 2015, Thomas R. Wright resigned as Executive Vice President, Chief Financial Officer, Chief Accounting Officer and Treasurer of the Company. The Company elected Kevan M. Blair, former Senior Vice President, Corporate Finance to replace Mr. Wright as the Company's Chief Financial Officer and Chief Accounting Officer on an interim basis, as of July 3, 2015. Mr. Blair remains Vice President & Chief Financial Officer of the Company’s Ralph L. Wadsworth Construction Company subsidiary. The Company has launched an internal and external search for a new Chief Financial Officer. In connection with Mr. Wright's departure, he entered into a Separation & Release Agreement with the Company. The following description of the Separation & Release Agreement is qualified in its entirety by reference to the full text of the agreement itself, which has been filed with the SEC as Exhibit 10.1 to the Company’s Form 8-K dated July 3, 2015.

The Separation & Release Agreement provided for (a) the award to Mr. Wright of a discretionary bonus consisting of 106,478 shares of the Company's common stock; (b) the vesting of his outstanding 55,536 shares of restricted common stock; and (c) the reimbursement to him (on a pre-tax basis) of his COBRA premiums for a year. The Company expensed $0.5 million in July 2015 related to severance received by Mr. Wright. In consideration of the foregoing, the agreement required Mr. Wright to be available for consulting with the Company in his area of expertise. His consulting obligations will not be so time-consuming as to prevent him from seeking or engaging in full-time employment. The agreement also contained a general release as well as a release under the Age Discrimination in Employment Act by Mr. Wright.

Assets Held for Sale

The Company provides credit in the normal course of business, principally to public (government) owners, and performs ongoing credit evaluations, as deemed necessary, but generally does not require collateral to support such receivables. In an effort to reduce its credit exposure, as well as accelerate its cash flows, the Company plans to sell, on a non-recourse basis, its only long-term contract receivable pursuant to a factoring agreement with a related party. Under the letter of intent agreement, the Company expects to receive approximately $7.3 million upon the closing of this transaction which is anticipated to occur in the third quarter of 2015. The Company continues to hold this long-term contract receivable in “Other assets, net” on the balance sheet as it was not ready for immediate sale as of June 30, 2015.

The Company also plans to sell a parcel of land located in Harris County, Texas to Joseph P. Harper, Sr., a former President and Chief Operating Officer of the Company. The contract price is approximately $2.4 million, subject to closing adjustments and is at or above the property’s appraised value. The sale is anticipated to close in the third quarter of 2015. The Company continues to hold this property in “Property and equipment, net” on the balance sheet as it was not ready for immediate sale as of June 30, 2015.