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Note 20 - Subsequent Events | 12 Months Ended
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Dec. 31, 2019
Notes to Financial Statements |
Subsequent Events [Text Block] |
20. | SUBSEQUENT EVENTS:
Business Combination On January 31, 2020, the Company completed the acquisition of 100% of Geneva Pipe Company, Inc. (“Geneva”) for a purchase price of approximately $49.4 million, subject to a post-closing adjustment based on changes in net working capital. Geneva is a concrete pipe and precast concrete products manufacturer based in Utah. This acquisition expands the Company’s water infrastructure product capabilities by adding additional reinforced concrete pipe capacity and a full line of precast concrete products including storm drains and manholes, catch basins, vaults, and curb inlets as well as innovative products that extend the life of concrete pipe and manholes for sewer applications. Operations will continue with Geneva's current management and workforce at the three Utah manufacturing facilities located in Salt Lake City, Orem, and St. George. The Company incurred costs associated with this acquisition of $0.6 million during the year ended December 31, 2019. These costs are included in Selling, general, and administrative expense in the Consolidated Statements of Operations. The initial accounting for the business combination is incomplete at the time of this filing due to the limited amount of time since the acquisition date and the ongoing status of the valuation. Therefore, it is impracticable for the Company to provide the major classes of assets acquired and liabilities assumed and the pro forma results of operations related to this acquisition. F- 32 Table of Contents Amendment to the Credit Agreement On January 31, 2020, the Company entered into the Consent and Amendment No. 1 to Credit Agreement with Wells Fargo Bank, N.A. (the “Amendment”) (together with the Credit Agreement, the “Amended Credit Agreement”). Among other modifications, the Amendment increases the aggregate amount available for revolving loans and letters of credit to an aggregate amount of up to $74 million, subject to a borrowing base, and extends the maturity date to October 25, 2024. As of January 31, 2020, the Company had approximately $19 million of outstanding borrowings under the Amended Credit Agreement and additional borrowing capacity of approximately $39 million. The Amendment also provides the right to request, at any time prior to March 30, 2020, a Delayed Draw Term Loan (as defined in the Amendment) (“Term Loan”) of up to approximately $16 million bearing interest at the daily three month LIBOR plus 2.0% to 2.5%. If drawn, the Term Loan would be subject to monthly principal payments in the amount of 1/60th of the original principal amount of the Term Loan, with the remaining outstanding unpaid principal and accrued interest due on the maturity date. The Company will be obligated to prepay the Term Loan to the extent that the outstanding principal balance at any time exceeds 60% of the fair market value of specified real property securing the loan. There is also a provision that would require prepayment of the Obligations (as defined in the Credit Agreement) in an amount equal to 20% of Excess Cash Flow (as defined in the Amendment). Subject to certain limitations, the Company may also voluntarily prepay the balance upon ten business days’ written notice. In addition to events of default and remedies as provided in the Credit Agreement, under the terms of the Amendment, mandatory prepayments may be required to the extent the revolving loans exceed the borrowing base or the Maximum Revolver Amount (as defined in the Credit Agreement), or in the event the Company or its named affiliates receive cash proceeds from the sale or disposition of assets (including proceeds of insurance or arising from casualty losses), subject to certain limitations and exceptions, including sales of assets in the ordinary course of business. The Amendment imposes a new financial covenant requiring the Company to maintain a Senior Leverage Ratio (as defined in the Amendment) not greater than 3.00. Additionally, the Amendment modifies an existing financial covenant, requiring the Company to maintain a Fixed Charge Coverage Ratio (as defined in the Credit Agreement) of at least 1.10 to 1.00. The Amendment also provides a mechanism for determining an alternative benchmark rate to the LIBOR. Pursuant to the Amended Credit Agreement, the Company’s Obligations under the Amended Credit Agreement are secured by a security interest in certain of the real property owned by the Company and its subsidiaries and substantially all of the Company’s and its subsidiaries’ other assets. F- 33 Table of Contents

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- Definition The entire disclosure for significant events or transactions that occurred after the balance sheet date through the date the financial statements were issued or the date the financial statements were available to be issued. Examples include: the sale of a capital stock issue, purchase of a business, settlement of litigation, catastrophic loss, significant foreign exchange rate changes, loans to insiders or affiliates, and transactions not in the ordinary course of business. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 855 -URI http://asc.fasb.org/topic&trid=2122774 + Details
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