Delaware
State
of Incorporation
|
26-0097459
IRS
Employer Identification Number
|
12000
Aerospace Suite 300
Houston,
Texas 77034
Address
of Principal Executive Office
|
(713)
852-6500
Telephone
number (including area code)
|
Title
of Each Class
|
Name
of Each Exchange on Which Registered
|
|
Common
stock, $0.01 par value per share
|
The
New York Stock Exchange
|
|
|
·
|
In
September 2006, we acquired substantially all of the operations of F.
Miller and Sons, LLC, a construction company based in Lake Charles,
Louisiana, and which expanded our marine construction
footprint.
|
·
|
In
February 2008, we expanded our dredging capabilities along the eastern
Atlantic Seaboard, through the purchase of marine construction equipment,
including several dredges.
|
·
|
In
January 2010, we purchased T.W. LaQuay Dredging, LLC, a dredging company
based in Texas which owns and operates marine construction equipment,
including several large dredges.
|
·
|
In
February 2010, we purchased marine construction assets and expanded our
area of operations into the Pacific
Northwest.
|
|
•
|
Barges — Spud
barges, material barges, deck barges, anchor barges and fuel barges are
used to provide work platforms for cranes and other equipment, to
transport materials to the project site and to provide support for the
project at the project site.
|
|
•
|
Dayboats — Small
pushboats, dredge tenders and skiffs are used to shift barges at the
project site, to move personnel and to provide general support to the
project site.
|
|
•
|
Tugs — Larger
pushboats and tug boats are used to transport barges and other support
equipment to and from project site.
|
|
•
|
Dredges — 24”
cutter head suction dredge (diesel), 20” cutter head suction dredge
(diesel/electric), 20” cutter head suction dredges (diesel), 16” cutter
head suction dredges, and 12” portable cutter head suction dredges are
used to provide dredging services at project
sites.
|
|
•
|
Cranes — Crawler
lattice boom cranes with lift capability from 50 tons to 400 tons and
hydraulic rough terrain cranes with lift capability from 15 tons to 60
tons are used to provide lifting and pile driving capabilities on project
sites, and to provide bucket work, including mechanical dredging and
dragline work, to project sites.
|
|
•
|
regulations
concerning workplace safety, labor relations and disadvantaged
businesses;
|
|
•
|
licensing
requirements applicable to shipping and
dredging; and
|
|
•
|
permitting
and inspection requirements applicable to marine construction
projects.
|
|
•
|
failure
to properly estimate costs of engineering, design, material, equipment or
labor;
|
|
•
|
unanticipated
technical problems with the structures or services being supplied by us,
which may require that we spend our own money to remedy the
problem;
|
|
•
|
project
modifications creating unanticipated
costs;
|
|
•
|
changes
in the costs of equipment, materials, labor or
subcontractors;
|
|
•
|
our
suppliers’ or subcontractors’ failure to
perform;
|
|
•
|
difficulties
in our customers obtaining required governmental permits or
approvals;
|
|
•
|
changes
in local laws and regulations;
|
|
•
|
delays
caused by local weather
conditions; and
|
|
•
|
exacerbation
of any one or more of these factors as projects grow in size and
complexity.
|
|
•
|
difficulties
in the integration of operations, systems, policies and
procedures;
|
|
•
|
enhancements
in our controls and procedures including those necessary for a public
company may make it more difficult to integrate operations and
systems;
|
|
•
|
failure
to implement proper overall business controls, including those required to
support our growth, resulting in inconsistent operating and financial
practices at companies we acquire or have
acquired;
|
|
•
|
termination
of relationships with the key personnel and customers of an acquired
company;
|
|
•
|
additional
financial and accounting challenges and complexities in areas such as tax
planning, treasury management, financial reporting and internal
controls;
|
|
•
|
the
incurrence of environmental and other liabilities, including liabilities
arising from the operation of an acquired business or asset prior to our
acquisition for which we are not indemnified or for which the indemnity is
inadequate;
|
|
•
|
disruption
of or receipt of insufficient management attention to our ongoing
business; and
|
|
•
|
inability
to realize the cost savings or other financial benefits that we
anticipate.
|
|
•
|
evacuation
of personnel and curtailment of
services;
|
|
•
|
weather-related
damage to our equipment, facilities and project work sites resulting in
suspension of operations;
|
|
•
|
inability
to deliver materials to jobsites in accordance with contract
schedules; and
|
|
•
|
loss
of productivity.
|
|
•
|
uncertainties
concerning import and export license requirements, tariffs and other trade
barriers;
|
|
•
|
restrictions
on repatriating foreign profits back to the
U.S.;
|
|
•
|
changes
in foreign policies and regulatory
requirements;
|
|
•
|
difficulties
in staffing and managing international
operations;
|
|
•
|
taxation
issues;
|
|
•
|
currency
fluctuations; and
|
|
•
|
political,
cultural and economic
uncertainties.
|
Location
|
Type of Facility
|
Size
|
Leased or Owned
|
159
Highway 316
Port
Lavaca, TX
|
Waterfront
maintenance and dock facilities, equipment yard and dry dock; regional
office
|
17.5
acres
|
Owned
|
17140
Market Street
Channelview,
TX
|
Waterfront
maintenance and dock facilities and equipment yard
|
23.7
acres
|
Owned
|
5600
West Commerce Street
Tampa,
FL
|
Waterfront
maintenance and dock facilities; equipment yard and dry
dock
|
9.1
acres
|
Owned
|
12550
Fuqua
Houston,
TX
|
Regional
office
|
16,440
square feet
|
Leased
|
1500
Main Street
Ingleside,
TX
|
Regional
office
|
4
acres
|
Leased
|
City
of Port Lavaca Port Commission
Port
Lavaca, Texas
|
Safe
harbor
|
6.6
acres
|
Leased
|
825
Ryan Street
Lake
Charles, LA
|
Regional
office
|
6,500
square feet
|
Leased
|
Dock
Board Road
Sulphur,
LA
|
Waterfront
maintenance and dock facilities; equipment yard
|
4.37
acres
|
Leased
|
2400
Veterans Boulevard
Kenner,
LA
|
Regional
office
|
1,255
square feet
|
Leased
|
321
Great Bridge Blvd., Chesapeake, VA
|
Regional
office
|
1,500
square feet
|
Leased
|
5440
W. Tyson Avenue
Tampa,
Florida
|
Regional
office
|
6,160
square feet
|
Leased
|
1901
Hill Street
Jacksonville,
Florida
|
Waterfront
maintenance and dock facilities and equipment yard
|
Estimated
less than 5 acres
|
Leased
|
Item
5.
|
MARKET
FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER
PURCHASES OF EQUITY SECURITIES
|
|
Market
Information
|
Low
|
High
|
|||||||
2009
|
||||||||
Fourth
quarter – December 31
|
$ | 17.57 | $ | 24.38 | ||||
Third
quarter – September 30
|
$ | 16.58 | $ | 24.98 | ||||
Second
quarter – June 30
|
$ | 11.65 | $ | 22.84 | ||||
First
quarter – March 31
|
$ | 7.93 | $ | 13.48 | ||||
2008
|
||||||||
Fourth
quarter – December 31
|
$ | 3.55 | $ | 10.40 | ||||
Third
quarter – September 30
|
$ | 9.01 | $ | 14.50 | ||||
Second
quarter – June 30
|
$ | 11.89 | $ | 15.41 | ||||
First
quarter – March 31
|
$ | 10.01 | $ | 15.00 |
Plan
category
|
Column A
Number
of securities to be issued upon exercise of outstanding options, warrants
and rights
|
Column B
Weighted
average exercise price of outstanding options, warrants and
rights
|
Column C
Number
of securities remaining available for future issuance under equity
compensation plans (excluding securities reflected in Column
A)
|
|||||||||
Equity
compensation plans approved by shareholders
|
2,606,629 | $ | 6.75 | 337,317 | ||||||||
Equity
compensation plans not approved by shareholders
|
-- | -- | -- | |||||||||
Total
|
2,606,629 | $ | 6.75 | 337,317 |
2007
|
2007
|
2008
|
2009
|
|||||||||||||
Orion
Marine Group, Inc.
|
100.00 | 94.94 | 61.14 | 133.29 | ||||||||||||
S&P
500
|
100.00 | 99.31 | 62.56 | 79.12 | ||||||||||||
Dow
Jones US Heavy Civil Construction
|
100.00 | 103.61 | 46.50 | 53.15 |
Dollar
amounts in thousands, except share and per share information
|
||||||||||||||||||||
2009
|
2008
|
2007
|
2006
|
2005
|
||||||||||||||||
Contract
revenues
|
$ | 293,494 | $ | 261,802 | $ | 210,360 | $ | 183,278 | $ | 167,315 | ||||||||||
Gross
profit
|
62,697 | 50,451 | 50,433 | 38,537 | 21,575 | |||||||||||||||
Selling,
general and administrative expenses
|
30,947 | 27,978 | 22,946 | 17,425 | 10,685 | |||||||||||||||
Net
income
|
20,030 | 14,475 | 17,399 | 12,403 | 5,311 | |||||||||||||||
Preferred
dividends
|
-- | -- | 782 | 2,100 | 2,100 | |||||||||||||||
Income
available to common shareholders
|
$ | 20,030 | $ | 14,475 | $ | 16,617 | $ | 10,303 | $ | 3,211 | ||||||||||
Net
income per share available to common shareholders:
|
||||||||||||||||||||
Basic
|
$ | 0.85 | $ | 0.67 | $ | 0.86 | $ | 0.65 | $ | 0.20 | ||||||||||
Diluted
|
$ | 0.84 | $ | 0.66 | $ | 0.83 | $ | 0.63 | $ | 0.20 | ||||||||||
Weighted
average shares outstanding;
|
||||||||||||||||||||
Basic
|
23,577,854 | 21,561,201 | 19,657,436 | 16,630,045 | 16,730,942 | |||||||||||||||
Diluted
|
23,979,943 | 21,979,535 | 19,976,683 | 16,958,453 | 16,730,942 | |||||||||||||||
Other
Financial Data
|
||||||||||||||||||||
EBITDA
|
$ | 50,538 | $ | 41,321 | $ | 40,079 | $ | 33,003 | $ | 22,331 | ||||||||||
Capital
expenditures
|
22,693 | 14,485 | 11,433 | 11,931 | 9,149 | |||||||||||||||
Cash
interest expense
|
553 | 1,234 | 927 | 2,848 | 2,146 | |||||||||||||||
Depreciation
and amortization*
|
18,788 | 18,848 | 12,592 | 11,805 | 11,036 | |||||||||||||||
Net
cash provided by (used in):
Operating
activities
|
40,336 | 26,471 | 10,092 | 32,475 | 11,618 | |||||||||||||||
Investing
activities
|
(21,598 | ) | (47,337 | ) | (9,463 | ) | (11,987 | ) | (5,431 | ) | ||||||||||
Financing
activities
|
60,286 | 33,994 | (6,606 | ) | (9,572 | ) | (6,244 | ) |
2009
|
2008
|
2007
|
2006
|
2005
|
||||||||||||||||
(in
thousands)
|
||||||||||||||||||||
Balance
Sheet Data:
|
||||||||||||||||||||
Cash
and cash equivalents
|
$ | 104,736 | $ | 25,712 | $ | 12,584 | $ | 18,561 | $ | 7,645 | ||||||||||
Working
capital
|
130,760 | 47,021 | 32,452 | 12,970 | 14,729 | |||||||||||||||
Total
assets
|
273,157 | 186,322 | 133,534 | 125,072 | 114,626 | |||||||||||||||
Total
debt
|
-- | 34,125 | -- | 25,000 | 34,548 | |||||||||||||||
Total
stockholders’ equity
|
221,666 | 105,611 | 90,084 | 53,239 | 40,730 |
|
•
|
the
financial performance of our assets without regard to financing methods,
capital structure or historical cost
basis;
|
|
•
|
the
ability of our assets to generate cash sufficient to pay interest costs
and support our indebtedness;
|
|
•
|
our
operating performance and return on capital as compared to those of other
companies in our industry, without regard to financing or capital
structure; and
|
|
•
|
the
viability of acquisitions and capital expenditure projects and the overall
rates of return on alternative investment
opportunities.
|
2009
|
2008
|
2007
|
2006
|
2005
|
||||||||||||||||
Net
income
|
$ | 20,030 | $ | 14,475 | $ | 17,399 | $ | 12,403 | $ | 5,311 | ||||||||||
Income
tax expense
|
11,534 | 7,282 | 10,178 | 7,040 | 3,805 | |||||||||||||||
Interest
expense(income), net
|
186 | 716 | (90 | ) | 1,755 | 2,179 | ||||||||||||||
Depreciation
and amortization*
|
18,788 | 18,848 | 12,592 | 11,805 | 11,036 | |||||||||||||||
EBITDA
|
$ | 50,538 | $ | 41,321 | $ | 40,079 | $ | 33,003 | $ | 22,331 | ||||||||||
First
Quarter
|
Second
Quarter
|
Third
Quarter
|
Fourth
Quarter
|
Total
Year
|
||||||||||||||||
2009
|
||||||||||||||||||||
Revenues
|
$ | 70,040 | $ | 70,753 | $ | 81,466 | $ | 71,235 | $ | 293,494 | ||||||||||
Operating
profit(a)
|
7,074 | 10,136 | 8,300 | 6,241 | 31,750 | |||||||||||||||
Income
before income taxes
|
6,971 | 10,000 | 8,289 | 6,304 | 31,564 | |||||||||||||||
Net
income
|
4,341 | 6,286 | 5,397 | 4,006 | 20,030 | |||||||||||||||
Earnings
per share:
|
||||||||||||||||||||
Basic
|
$ | 0.20 | $ | 0.29 | $ | 0.22 | $ | 0.15 | $ | 0.85 | ||||||||||
Diluted
|
$ | 0.20 | $ | 0.28 | $ | 0.22 | $ | 0.15 | $ | 0.84 |
First
Quarter
|
Second
Quarter
|
Third
Quarter
|
Fourth
Quarter
|
Total
Year
|
||||||||||||||||
(in
thousands, except per share data)
|
||||||||||||||||||||
2008
|
||||||||||||||||||||
Revenues
|
$ | 52,591 | $ | 67,070 | $ | 62,897 | $ | 79,244 | $ | 261,802 | ||||||||||
Operating
profit(a)
|
4,245 | 4,135 | 5,243 | 8,851 | 22,474 | |||||||||||||||
Income
before tax
|
4,268 | 3,890 | 4,985 | 8,614 | 21,757 | |||||||||||||||
Net
income
|
2,846 | 2,401 | 3,764 | 5,464 | 14,475 | |||||||||||||||
Earnings
per share:
|
||||||||||||||||||||
Basic
|
$ | 0.13 | $ | 0.11 | $ | 0.18 | $ | 0.25 | $ | 0.67 | ||||||||||
Diluted
|
$ | 0.13 | $ | 0.11 | $ | 0.17 | $ | 0.25 | $ | 0.66 |
Item
7.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
|
|
•
|
port
and channel expansion and
maintenance;
|
|
•
|
deteriorating
condition of intracoastal waterways and
bridges;
|
|
•
|
continued
demand in the cruise industry;
|
|
•
|
infrastructure
spending by the United States Navy and Coast
Guard;
|
|
•
|
near-shore
oil and gas capital expenditures
|
|
•
|
ongoing
U.S. coastal wetlands restoration and
reclamation;
|
|
•
|
recurring
hurricane restoration and
repair.
|
·
|
Gulf
Coast and Southeast Atlantic ports, which are expected to continue with
expansion plans, with supplemental funding available from the American
Recovery and Reinvestment Act (the “Stimulus
package”).
|
·
|
Bridge
maintenance, alterations, and construction, which should be a priority for
states, with funding from highway transportation programs and through the
Stimulus package.
|
·
|
Funds
available from the civil works budget and Stimulus package of the US Army
Corps of Engineers.
|
·
|
The
continuation of the highway transportation program for highway
construction, including bridges over
water.
|
Twelve
months ended December 31,
|
||||||||||||||||
2009
|
2008
|
|||||||||||||||
Amount
|
Percent
|
Amount
|
Percent
|
|||||||||||||
Contract
revenues
|
$ | 293,494 | 100.0 | % | $ | 261,802 | 100.0 | % | ||||||||
Cost
of contract revenues
|
230,797 | 78.6 | % | 211,351 | 80.7 | % | ||||||||||
Gross
profit
|
62,697 | 21.4 | % | 50,451 | 19.3 | % | ||||||||||
Selling,
general and administrative expenses
|
30,947 | 10.5 | % | 27,978 | 10.7 | % | ||||||||||
Operating
income
|
31,750 | 10.9 | % | 22,473 | 8.6 | % | ||||||||||
Interest
(income) expense
|
||||||||||||||||
Interest
(income)
|
(352 | ) | -0.1 | % | (530 | ) | -0.2 | % | ||||||||
Interest
expense
|
538 | 0.2 | % | 1,246 | 0.5 | % | ||||||||||
Interest
(income) expense, net
|
186 | 0.1 | % | 716 | 0.3 | % | ||||||||||
Income
before income taxes
|
31,564 | 10.8 | % | 21,757 | 8.3 | % | ||||||||||
Income
tax expense
|
11,534 | 3.9 | % | 7,282 | 2.8 | % | ||||||||||
Net
income
|
$ | 20,030 | 6.9 | % | $ | 14,475 | 5.5 | % | ||||||||
Twelve
months ended December 31,
|
||||||||||||||||
2008
|
2007
|
|||||||||||||||
Amount
|
Percent
|
Amount
|
Percent
|
|||||||||||||
Contract
revenues
|
$ | 261,802 | 100.0 | % | $ | 210,360 | 100.0 | % | ||||||||
Cost
of contract revenues
|
211,351 | 80.7 | % | 159,927 | 76.0 | % | ||||||||||
Gross
profit
|
50,451 | 19.3 | % | 50,433 | 24.0 | % | ||||||||||
Selling,
general and administrative expenses
|
27,978 | 10.7 | % | 22,946 | 10.9 | % | ||||||||||
Operating
income
|
22,473 | 8.6 | % | 27,487 | 13.1 | % | ||||||||||
Interest
(income) expense
|
||||||||||||||||
Interest
(income)
|
(530 | ) | -0.2 | % | (1,000 | ) | -0.5 | % | ||||||||
Interest
expense
|
1,246 | 0.5 | % | 910 | 0.5 | % | ||||||||||
Interest
(income) expense, net
|
716 | 0.3 | % | (90 | ) | 0.0 | % | |||||||||
Income
before income taxes
|
21,757 | 8.3 | % | 27,577 | 13.1 | % | ||||||||||
Income
tax expense
|
7,282 | 2.8 | % | 10,178 | 4.8 | % | ||||||||||
Net
income
|
$ | 14,475 | 5.5 | % | $ | 17,399 | 8.3 | % | ||||||||
Year
ended December 31,
|
||||||||||||
2009
|
2008
|
2007
|
||||||||||
(in
thousands)
|
||||||||||||
Cash
provided by (used in):
|
||||||||||||
Operating
activities………………………………………….............
|
$ | 40,336 | $ | 26,471 | $ | 10,092 | ||||||
Investing
activities………………………………………………...
|
(21,598 | ) | (47,337 | ) | (9,463 | ) | ||||||
Financing
activities………………………………………….............
|
60,286 | 33,994 | (6,606 | ) | ||||||||
Capital
expenditures (included in investing activities above)………
|
22,693 | 14,485 | 11,433 |
·
|
An
increase of $5.6 million in net
income;
|
·
|
A
reduction in our deferred income taxes of $1.0 million ;
and
|
·
|
An
increase of $7.3 million in working capital components, as described
below.
|
·
|
A
minimum net worth in the amount of not less than the sum of $40.0 million
plus 50% of consolidated net income earned in each fiscal quarter ended
after December 31, 2006 plus adjustments for certain equity
transactions;
|
·
|
A
minimum fixed charge coverage ratio of not less than 1.30 to 1.0 as of
each fiscal quarter end; and
|
·
|
A
total leverage ratio not greater than 3.0 to 1.0 as of each
fiscal quarter end.
|
Payment
Due by Period
|
||||||||||||||||||||
Total
|
< 1 year
|
1-3 years
|
3-5 years
|
> 5 years
|
||||||||||||||||
(in
thousands)
|
||||||||||||||||||||
Long-term
debt obligations………..
|
$ | -- | $ | -- | $ | -- | $ | --- | $ | --- | ||||||||||
Operating
lease obligations…………..
|
8,153 | 2,981 | 3,477 | 1,181 | 514 | |||||||||||||||
Purchase
obligations (1)…………….
|
-- | -- | --- | --- | --- | |||||||||||||||
Total…………………………………...
|
$ | 8,153 | $ | 2,981 | $ | 3,477 | $ | 1,181 | $ | 514 |
(1)
|
Commitments
pursuant to other purchase orders and subcontracts related to construction
contracts are not included since such amounts are expected to be funded
under contract billings.
|
·
|
Cash
consideration of $55.5 million, paid to the Seller for the membership
interests of T.W. LaQuay Dredging;
|
·
|
Cash
consideration of $4.5 million, paid to the Principal Shareholders for the
Channel and Dock Companies and the above mentioned parcels of land;
and
|
·
|
Up
to an additional $4.0 million (to be held in escrow) payable to Seller as
a result of an increase in the purchase price of the membership interests
by the amount of any additional taxes incurred by the Seller arising from
the allocation of the membership interests purchase price, as further
described in Section 1060 of the U.S. Internal Revenue Code, as
amended.
|
|
Item
9.
|
CHANGES
IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE
|
|
None
|
|
Item
9A.
|
CONTROLS
AND PROCEDURES
|
Item
9B.
|
OTHER
INFORMATION
|
|
None
|
|
PART
III
|
Name
|
Age
|
Position with the Company
|
Year Joined the Registrant
|
||||||
Richard
L. Daerr, Jr.
|
65 |
Chairman
of the Board
|
2007 | ||||||
J.
Michael Pearson
|
62 |
President,
Chief Executive Officer and Director
|
2006 | ||||||
Thomas
N. Amonett
|
66 |
Director
|
2007 | ||||||
Austin
J. Shanfelter
|
52 |
Director
|
2007 | ||||||
Gene
Stoever
|
71 |
Director
|
2007 | ||||||
Mark
R. Stauffer
|
47 |
Executive
Vice President and Chief Financial Officer
|
1999 | ||||||
Elliott
J. Kennedy
|
55 |
Executive
Vice President
|
1994 | ||||||
James
L. Rose
|
45 |
Executive
Vice President
|
2005 | ||||||
Peter
R. Buchler
|
63 |
Executive
Vice President, General Counsel and Secretary
|
2009 | ||||||
Item
12.
|
SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
STOCKHOLDER MATTERS
|
Exhibit
|
||||
Number
|
Description
|
|||
1
|
.01
|
Form
of Indemnity Agreement for Directors and Certain Officers dated November
24, 2008 (filed as Exhibit 1.01 to Form 8-K filed on November 25,
2008)
|
||
2
|
.1
|
Asset
Purchase Agreement dated February 28, 2008, by and between OMGI Sub, LLC
and Orion Marine Group, Inc. and Subaqueous Services, Inc. and Lance Young
(filed as an exhibit to the Company’s Current Report on Form 8-K on March
4, 2008)
|
||
2
|
.2
|
Purchase
Agreement dated January 28, 2010 by and among LaQuay Holdings., Inc and
Seagull Services Inc. (filed as Exhibit 2.1 to the Company’s Current
Report on Form 8-K on February 2, 2010)
|
||
3
|
.1
|
Amended
and Restated Certificate of Incorporation of Orion Marine Group,
Inc.
|
||
3
|
.2
|
Amended
and Restated Bylaws of Orion Marine Group, Inc.
|
||
4
|
.1
|
Registration
Rights Agreement between Friedman, Billings, Ramsey & Co., Inc.
and Orion Marine Group, Inc. dated May 17, 2007
|
||
10
|
.1
|
Loan
Agreement, dated as of July 10, 2007, between Orion Marine Group,
Inc. and Amegy Bank National Association
|
||
**
|
10
|
.1.1
|
First
Amendment to Loan Agreement dated February 29, 2008, among Orion Marine
Group, Inc., and Amegy Bank National Association, a national banking
association, as agent
|
|
10 | .2 | Purchase/Placement Agreement dated May 9, 2007 between Orion Marine Group, Inc. and Friedman, Billings, Ramsey & Co., Inc. | ||
10
|
.3
|
Amended &
Restated Redemption Agreement dated May 7,
2007
|
||
+
|
10
|
.8
|
2005
Stock Incentive Plan
|
|
+
|
10
|
.9
|
Form
of Stock Option Agreement Under the 2005 Stock Incentive Plan &
Notice of Grant of Stock Option
|
|
+
|
10
|
.10
|
Form
of Restricted Stock Agreement Under the 2005 Stock Incentive
Plan & Notice of Grant of Restricted Stock
|
|
+
|
10
|
.11
|
Orion
Marine Group, Inc. Long Term Incentive Plan
|
|
+
|
10
|
.12
|
Form
of Stock Option Agreement Under the 2007 Long Term Incentive
Plan
|
|
+
|
10
|
.13
|
Form
of Restricted Stock Agreement and Notice of Grant of Restricted
Stock
|
|
+
|
10
|
.14
|
Executive
Incentive Plan (filed as an exhibit to the Quarterly Report on Form 10-Q
for the quarterly period ended September 30, 2008)
|
|
+
|
10
|
.15
|
Subsidiary
Incentive Plan (filed as an exhibit to the Quarterly Report on Form 10-Q
for the quarterly period ended September 30, 2008)
|
|
+
|
10
|
.16
|
Employment
Agreement, dated as of December 4, 2009, by and between Orion Marine
Group, Inc. and J. Michael Pearson
|
|
+
|
10
|
.17
|
Employment
Agreement, dated as of December 4, 2009, by and between Orion Marine
Group, Inc. and Mark Stauffer
|
|
+
|
10
|
.18
|
Employment
Agreement , dated as of December 11, 2009, by and between Orion Marine
Group, Inc. and Elliott Kennedy
|
|
+
|
10
|
.19
|
Employment
Agreement, dated as of December 11, 2009, by and between Orion Marine
Group, Inc. and Jim Rose
|
|
+
|
10
|
.20
|
Employment
Agreement, dated as of December 11, 2009, by and between Orion Marine
Group, Inc. and Peter R. Buchler
|
|
+
|
10
|
.23
|
Schedule
of Changes to Compensation of Non-employee Directors, effective for 2008
(filed as an exhibit to the Quarterly Report on Form 1-Q for the quarterly
period ended June 30, 2008)
|
|
*
|
21
|
.1
|
List
of Subsidiaries
|
|
* |
23
|
.1
|
Consent
of Independent Registered Public Accounting Firm
|
|
*
|
23
|
.2
|
Consent
of Garland Sandhop, CPA
|
|
24
|
.1
|
Power
of Attorney (included on signature page of this filing)
|
||
*
|
31
|
.1
|
Certification
of CEO pursuant to Section 302
|
|
*
|
31
|
.2
|
Certification
of CFO pursuant to Section 302
|
|
*
|
32
|
.1
|
Certification
of CEO and CFO pursuant to Section 906
|
|
*
|
99
|
.1
|
Audited
financial statements of T.W. LaQuay Dredging, LLC as of December 31,
2008
|
|
*
|
99
|
.2
|
Unaudited
financial statements of T.W. LaQuay Dredging, LLC as of September 30,
2009
|
|
*
|
99
|
.3
|
Unaudited
pro forma condensed combined balance sheet as of September 30, 2009 and
statements of income for the year ended December 31, 2008 and nine months
ended September 30, 2009 of Orion Marine Group, Inc. and T.W. LaQuay
Dredging, LLC
|
*
|
Filed
herewith
|
|
**
|
Incorporated
by reference to the Company’s report on Form 8K filed with the SEC on
March 4, 2008
|
|
+
|
Management
contract or compensatory plan or arrangement
|
|
(b)
|
Financial
Statement Schedules
|
ORION
MARINE GROUP, INC.
|
||
Date: March
9, 2010
|
By:
|
/s/
J. Michael Pearson
|
J.
Michael Pearson
President
and Chief Executive Officer and
Director
|
Signature
|
Title
|
Date
|
President
and Chief
|
||
/s/
J. Michael Pearson
|
Executive
Officer and
|
March
9, 2010
|
J.
Michael Pearson
|
Director
|
|
/s/
Mark R. Stauffer
|
Chief
Financial Officer
|
March
9, 2010
|
Mark
R. Stauffer
|
Chief
Accounting Officer
|
|
/s/ Richard
L. Daerr, Jr.
|
Chairman
of the Board
|
March
9, 2010
|
Richard
L. Daerr, Jr.
|
||
/s/ Thomas
N. Amonett
|
Director
|
March
9, 2010
|
Thomas
N. Amonett
|
||
/s/ Austin
J. Shanfelter
|
Director
|
March
9, 2010
|
Austin
J. Shanfelter
|
||
/s/ Gene
Stoever
|
Director
|
March
9, 2010
|
Gene
Stoever
|
Report
of Independent Registered Public Accounting Firm
|
F3
|
Consolidated
Balance Sheets at December 31, 2009 and 2008
|
F5
|
Consolidated
Statements of Income for the Years Ended December 31, 2009, 2008 and
2007
|
F6
|
Consolidated
Statement of Stockholders’ Equity for the Year Ended December 31,
2009
|
F7
|
Consolidated
Statements of Cash Flows for the Years Ended December 31, 2009, 2008 and
2007
|
F8
|
Notes
to Consolidated Financial Statements
|
F9
|
December
31,
|
||||||||
2009
|
2008
|
|||||||
ASSETS
|
||||||||
Current
assets:
|
||||||||
Cash
and cash equivalents
|
$ | 104,736 | $ | 25,712 | ||||
Accounts
receivable:
|
||||||||
Trade,
net of allowance of $1,202 and $800, respectively
|
32,819 | 37,806 | ||||||
Retainage
|
12,028 | 5,719 | ||||||
Other
|
922 | 691 | ||||||
Income
taxes receivable
|
3,040 | 4,017 | ||||||
Note
receivable
|
961 | -- | ||||||
Inventory
|
1,472 | 738 | ||||||
Deferred
tax asset
|
1,499 | 1,319 | ||||||
Costs
and estimated earnings in excess of billings on uncompleted
contracts
|
10,868 | 7,228 | ||||||
Prepaid
expenses and other
|
1,624 | 3,207 | ||||||
Total
current assets
|
169,969 | 86,437 | ||||||
Property
and equipment, net
|
90,790 | 84,154 | ||||||
Goodwill
|
12,096 | 12,096 | ||||||
Intangible
assets, net of accumulated amortization
|
38 | 3,556 | ||||||
Other
assets
|
264 | 79 | ||||||
Total
assets
|
$ | 273,157 | $ | 186,322 | ||||
LIABILITIES
AND STOCKHOLDERS’ EQUITY
|
||||||||
Current
liabilities:
|
||||||||
Current
portion of long-term debt
|
$ | -- | $ | 5,909 | ||||
Accounts
payable:
|
||||||||
Trade
|
23,680 | 13,276 | ||||||
Retainage
|
1,227 | 389 | ||||||
Accrued
liabilities
|
8,354 | 8,176 | ||||||
Taxes
payable
|
312 | -- | ||||||
Billings
in excess of costs and estimated earnings on uncompleted
contracts
|
5,636 | 11,666 | ||||||
Total
current liabilities
|
39,209 | 39,416 | ||||||
Long-term
debt, less current portion
|
-- | 28,216 | ||||||
Other
long-term liabilities
|
514 | 422 | ||||||
Deferred
income taxes
|
11,453 | 12,286 | ||||||
Deferred
revenue
|
315 | 371 | ||||||
Total
liabilities
|
51,491 | 80,711 | ||||||
Commitments
and contingencies
|
||||||||
Stockholders’
equity:
|
||||||||
Common
stock -- $0.01 par value, 50,000,000 authorized,
26,852,407
|
||||||||
and
21,577,366 issued; 26,840,761 and 21,565,720 outstanding at December 31,
2009 and 2008, respectively
|
268 | 216 | ||||||
Treasury
stock, 11,646, at cost
|
-- | -- | ||||||
Additional
paid-in capital
|
151,361 | 55,388 | ||||||
Retained
earnings
|
70,037 | 50,007 | ||||||
Total
stockholders’ equity
|
221,666 | 105,611 | ||||||
Total
liabilities and stockholders’ equity
|
$ | 273,157 | $ | 186,322 |
Year
ended December 31,
|
||||||||||||
2009
|
2008
|
2007
|
||||||||||
Contract
revenues
|
$ | 293,494 | $ | 261,802 | $ | 210,360 | ||||||
Costs
of contract revenues
|
230,797 | 211,351 | 159,927 | |||||||||
Gross
profit
|
62,697 | 50,451 | 50,433 | |||||||||
Selling,
general and administrative expenses
|
30,947 | 27,978 | 22,946 | |||||||||
31,750 | 22,473 | 27,487 | ||||||||||
Interest
(income) expense
|
||||||||||||
Interest
(income)
|
(352 | ) | (530 | ) | (1,000 | ) | ||||||
Interest
expense
|
538 | 1,246 | 910 | |||||||||
Interest
(income) expense, net
|
186 | 716 | (90 | ) | ||||||||
Income
before income taxes
|
31,564 | 21,757 | 27,577 | |||||||||
Income
tax expense
|
11,534 | 7,282 | 10,178 | |||||||||
Net
income
|
$ | 20,030 | $ | 14,475 | $ | 17,399 | ||||||
Net
income
|
$ | 20,030 | $ | 14,475 | $ | 17,399 | ||||||
Preferred
dividends
|
-- | -- | 782 | |||||||||
Earnings
available to common stockholders
|
$ | 20,030 | $ | 14,475 | $ | 16,617 | ||||||
Earnings
per share available to common stockholders:
|
||||||||||||
Basic
|
$ | 0.85 | $ | 0.67 | $ | 0.85 | ||||||
Diluted
|
$ | 0.84 | $ | 0.66 | $ | 0.83 | ||||||
Shares
used to compute earnings per share
|
||||||||||||
Basic
|
23,577,854 | 21,561,201 | 19,657,436 | |||||||||
Diluted
|
23,979,943 | 21,979,535 | 19,976,683 | |||||||||
Additional
|
||||||||||||||||||||||||||||||||||||
Preferred
stock
Shares Amount
|
Common
stock
Shares Amount
|
Treasury
stock
Shares Amount
|
Paid-in
capital
|
Retained
earnings
|
Total
|
|||||||||||||||||||||||||||||||
Balance,
December 31, 2006
|
35,000 | -- | 16,730,942 | $ | 167 | (100,897 | ) | $ | (24 | ) | $ | 34,963 | $ | 18,133 | $ | 53,239 | ||||||||||||||||||||
Forfeit
unvested restricted stock
|
(8,969 | ) | -- | -- | ||||||||||||||||||||||||||||||||
Stock-based
compensation
|
501 | 501 | ||||||||||||||||||||||||||||||||||
Liquidation
of preferred stock
|
(35,000 | ) | -- | (40,431 | ) | (40,431 | ) | |||||||||||||||||||||||||||||
Exercise
of stock options
|
22,422 | -- | 48 | 48 | ||||||||||||||||||||||||||||||||
Proceeds
from sale of common stock, net of expenses
|
20,839,350 | 210 | 109,866 | 24 | 260,292 | 260,526 | ||||||||||||||||||||||||||||||
Redemption
and cancellation of common shares
|
(16,053,816 | ) | (161 | ) | (201,394 | ) | (201,555 | ) | ||||||||||||||||||||||||||||
Issuance
of common stock
|
26,426 | -- | 357 | 357 | ||||||||||||||||||||||||||||||||
Net
income
|
-- | - | -- | -- | -- | -- | -- | 17,399 | 17,399 | |||||||||||||||||||||||||||
Balance,
December 31, 2007
|
-- | $ | - | 21,565,324 | $ | 216 | -- | $ | -- | $ | 54,336 | $ | 35,532 | $ | 90,084 | |||||||||||||||||||||
Forfeit
unvested restricted stock
|
-- | (11,646 | ) | -- | -- | |||||||||||||||||||||||||||||||
Stock-based
compensation
|
1,103 | 1,103 | ||||||||||||||||||||||||||||||||||
Expenses
related to the sale of common stock
|
(51 | ) | (51 | ) | ||||||||||||||||||||||||||||||||
Issuance
of restricted stock
|
12,042 | -- | -- | -- | ||||||||||||||||||||||||||||||||
Net
income
|
-- | - | -- | -- | -- | -- | -- | 14,475 | 14,475 | |||||||||||||||||||||||||||
Balance,
December 31, 2008
|
-- | $ | - | 21,577,366 | $ | 216 | (11,646 | ) | $ | -- | $ | 55,388 | $ | 50,007 | $ | 105,611 | ||||||||||||||||||||
Stock-based
compensation
|
1,614 | 1,614 | ||||||||||||||||||||||||||||||||||
Exercise
of stock options
|
-- | 382,852 | $ | 4 | 1,934 | 1,938 | ||||||||||||||||||||||||||||||
Excess
tax benefits from exercise of stock options
|
1,476 | 1,476 | ||||||||||||||||||||||||||||||||||
Proceeds
from sale of common stock, net of expenses
|
4,830,000 | $ | 48 | 90,949 | 90,997 | |||||||||||||||||||||||||||||||
Issuance
of restricted stock
|
62,189 | |||||||||||||||||||||||||||||||||||
Net
income
|
-- | - | -- | -- | -- | -- | -- | 20,030 | 20,030 | |||||||||||||||||||||||||||
Balance,
December 31, 2009
|
-- | - | 26,852,407 | $ | 268 | (11,646 | ) | $ | -- | $ | 151,361 | $ | 70,037 | $ | 221,666 |
Year
ended December 31,
|
||||||||||||
2009
|
2008
|
2007
|
||||||||||
Cash
flows from operating activities
|
||||||||||||
Net
income
|
$ | 20,030 | $ | 14,475 | $ | 17,399 | ||||||
Adjustments
to reconcile net income to net cash provided
|
||||||||||||
by
operating activities:
|
||||||||||||
Depreciation
and amortization
|
18,536 | 18,599 | 12,384 | |||||||||
Deferred
financing cost amortization
|
252 | 249 | 208 | |||||||||
Non-cash
interest expense
|
-- | 22 | 86 | |||||||||
Bad
debt expense
|
442 | 300 | -- | |||||||||
Deferred
income taxes
|
(1,013 | ) | (2,410 | ) | (1,998 | ) | ||||||
Stock-based
compensation
|
1,614 | 1,103 | 858 | |||||||||
Gain
on sale of property and equipment
|
(518 | ) | (1,075 | ) | (333 | ) | ||||||
Excess
tax benefit from stock option exercise
|
(1,476 | ) | -- | -- | ||||||||
Change
in operating assets and liabilities:
|
||||||||||||
Accounts
receivable
|
(1,996 | ) | (4,550 | ) | (11,292 | ) | ||||||
Income
tax receivable
|
2,453 | (4,017 | ) | -- | ||||||||
Note
receivable
|
(961 | ) | -- | -- | ||||||||
Inventory
|
(734 | ) | (92 | ) | (120 | ) | ||||||
Prepaid
expenses and other
|
1,608 | (2,380 | ) | (183 | ) | |||||||
Costs
and estimated earnings in excess of billings
|
||||||||||||
on
uncompleted contracts
|
(3,640 | ) | 1,678 | (5,540 | ) | |||||||
Accounts
payable
|
11,241 | 1,848 | 4,559 | |||||||||
Accrued
liabilities
|
270 | 661 | (3,086 | ) | ||||||||
Income
tax payable
|
314 | (1,960 | ) | 1,994 | ||||||||
Billings
in excess of costs and estimated earnings
|
||||||||||||
on
uncompleted contracts
|
(6,030 | ) | 4,076 | (4,790 | ) | |||||||
Deferred
revenue
|
(56 | ) | (56 | ) | (54 | ) | ||||||
Net
cash provided by operating activities
|
40,336 | 26,471 | 10,092 | |||||||||
Cash
flows from investing activities:
|
||||||||||||
Proceeds
from sale of property and equipment
|
1,095 | 3,861 | 1,970 | |||||||||
Purchase
of property and equipment
|
(22,693 | ) | (14,485 | ) | (11,433 | ) | ||||||
Acquisition
of business (net of cash acquired)
|
-- | (36,713 | ) | -- | ||||||||
Net
cash used in investing activities
|
(21,598 | ) | (47,337 | ) | (9,463 | ) | ||||||
Cash
flows from financing activities:
|
||||||||||||
Increase
in loan costs
|
-- | (80 | ) | (194 | ) | |||||||
Borrowings
on long-term debt
|
-- | 35,000 | -- | |||||||||
Payments
on long-term debt
|
(34,125 | ) | (875 | ) | (25,000 | ) | ||||||
Purchase
of treasury stock
|
-- | -- | -- | |||||||||
Exercise
of stock options
|
1,938 | -- | 48 | |||||||||
Excess
tax benefit from stock option exercise
|
1,476 | -- | -- | |||||||||
Payment
of accumulated preferred dividends and liquidation of preferred
stock
|
-- | -- | (40,431 | ) | ||||||||
Proceeds
from the sale of common stock, net of offering costs
|
90,997 | (51 | ) | 260,526 | ||||||||
Redemption
of common stock
|
-- | -- | (201,555 | ) | ||||||||
Net
cash provided by (used in) financing activities
|
60,286 | 33,994 | (6,606 | ) | ||||||||
Net
change in cash and cash equivalents
|
79,024 | 13,128 | (5,977 | ) | ||||||||
Cash
and cash equivalents at beginning of period
|
25,712 | 12,584 | 18,561 | |||||||||
Cash
and cash equivalents at end of period
|
$ | 104,736 | $ | 25,712 | $ | 12,584 | ||||||
Supplemental
disclosures of cash flow information:
|
||||||||||||
Cash
paid during the period for:
|
||||||||||||
Interest
|
$ | 553 | $ | 1,234 | $ | 927 | ||||||
Taxes,
net of refunds
|
$ | 9,781 | $ | 14,476 | $ | 9,835 |
·
|
Revenue
recognition from construction
contracts;
|
·
|
Allowance
for doubtful accounts;
|
·
|
Testing
of goodwill and other long-lived assets for possible
impairment;
|
·
|
Income
taxes;
|
·
|
Self-insurance;
and
|
·
|
Stock-based
compensation
|
December 31, 2009
|
December 31, 2008
|
|||||||||||||||
A/R |
%
|
A/R |
%
|
|||||||||||||
Federal
Government………………….
|
$ | 5,262 | 12 | % | $ | 1,593 | 4 | % | ||||||||
State
Governments……………………
|
1,124 | 3 | % | 3,866 | 9 | % | ||||||||||
Local
Municipalities………………….
|
11,431 | 25 | % | 7,750 | 18 | % | ||||||||||
Private
Companies……………………
|
27,030 | 60 | % | 30,316 | 69 | % | ||||||||||
$ | 44,847 | 100 | % | $ | 43,525 | 100 | % | |||||||||
Automobiles
and trucks
|
3
to 5 years
|
Buildings
and improvements
|
5
to 30 years
|
Construction
equipment
|
3
to 15 years
|
Vessels
and dredges
|
1
to 15 years
|
Office
equipment
|
1
to 5 years
|
Proceeds
received from the sale of securities
|
$ | 95,151 | ||
Less:
|
||||
Underwriters’
commission
|
(3,806 | ) | ||
91,345 | ||||
Offering
related expenses
|
(548 | ) | ||
Expense
credit received from underwriters
|
200 | |||
Total
proceeds, net of expenses
|
$ | 90,997 | ||
Use
of proceeds:
|
||||
Purchase
of specialized equipment
|
5,778 | |||
Repayment
of outstanding debt
|
29,966 | |||
Balance
retained in working capital, December 31, 2009
|
$ | 55,253 |
2009
|
2008
|
|||||||
Costs
incurred on uncompleted contracts…………………………….............
|
$ | 235,175 | $ | 196,363 | ||||
Estimated
earnings……………………………………………………………
|
61,486 | 54,711 | ||||||
296,661 | 251,074 | |||||||
Less: Billings
to date………………………………………………………...
|
(291,429 | ) | (255,512 | ) | ||||
$ | 5,232 | $ | (4,438 | ) | ||||
Included
in the accompanying consolidated balance sheet under the following
captions:
|
||||||||
Costs
and estimated earnings in excess of billings on uncompleted
contracts.
|
$ | 10,868 | $ | 7,228 | ||||
Billings
in excess of costs and estimated earnings on uncompleted
contracts.
|
(5,636 | ) | (11,666 | ) | ||||
$ | 5,232 | $ | (4,438 | ) |
2009
|
2008
|
|||||||
Automobiles
and trucks…………………….
|
$ | 1,409 | $ | 1,472 | ||||
Building
and improvements………………..
|
12,832 | 12,015 | ||||||
Construction
equipment……………………
|
92,230 | 88,070 | ||||||
Dredges
and dredging equipment………….
|
44,912 | 42,458 | ||||||
Office
equipment…………………………...
|
2,460 | 1,123 | ||||||
153,843 | 145,138 | |||||||
Less: accumulated
depreciation…………...
|
(82,671 | ) | (69,092 | ) | ||||
Net
book value of depreciable assets………
|
71,172 | 76,046 | ||||||
Construction
in progress…………………...
|
14,389 | 2,886 | ||||||
Land………………………………………..
|
5,229 | 5,222 | ||||||
$ | 90,790 | $ | 84,154 |
2009
|
2008
|
|||||||
Beginning
balance, January 1……………...
|
$ | 12,096 | $ | 2,481 | ||||
Additions…………………………………...
|
-- | 9,615 | ||||||
Impairment…………………………………
|
-- | -- | ||||||
Ending
balance, December 31……………..
|
$ | 12,096 | $ | 12,096 |
2009
|
||||
Intangible
assets, January 1, 2009………
|
$ | 6,900 | ||
Additions………………………………….
|
-- | |||
Total
intangible assets……………………
|
6,900 | |||
Accumulated
amortization………………..
|
$ | (3,806 | ) | |
Current
year amortization…………………
|
(3,056 | ) | ||
Total
accumulated amortization…………..
|
(6,862 | ) | ||
Net
intangible assets, end of year………...
|
$ | 38 |
Year Ended December 31,
|
||||
2010
|
$ | 33 | ||
2011
|
$ | 5 |
2009
|
2008
|
|||||||
Accrued
salaries, wages and benefits………
|
$ | 5,195 | $ | 3,856 | ||||
Accrual
for self-insurance liabilities……….
|
2,114 | 2,143 | ||||||
Other
accrued expenses…………………….
|
1,045 | 2,177 | ||||||
$ | 8,354 | $ | 8,176 |
·
|
A
minimum net worth in the amount of not less than the sum of $40.0 million
plus 50% of consolidated net income earned in each fiscal quarter ended
after December 31, 2006 plus adjustments for certain equity
transactions;
|
·
|
A
minimum fixed charge coverage ratio of not less than 1.30 to 1.0 as of
each fiscal quarter end; and
|
·
|
A
total leverage ratio not greater than 3.0 to 1.0 as of each fiscal quarter
end.
|
Number
of
Shares
|
Weighted
Average
Fair
Value
Per Share
|
|||||||
Nonvested
at December 31, 2006…………………
|
604,708 | $ | 0.02 | |||||
Granted……………………………………………..
|
26,426 | $ | 13.50 | |||||
Vested………………………………………………
|
(520,142 | ) | $ | 0.71 | ||||
Forfeited/repurchased
shares………………………..
|
(8,969 | ) | $ | 0.02 | ||||
Nonvested
at December 31, 2007…………………..
|
102,023 | $ | 0.02 | |||||
Granted……………………………………………...
|
12,042 | $ | 8.72 | |||||
Vested……………………………………………….
|
(38,132 | ) | $ | 0.02 | ||||
Forfeited/repurchased
shares………………………..
|
(11,646 | ) | $ | 0.02 | ||||
Nonvested
at December 31, 2008…………………..
|
64,287 | $ | 1.65 | |||||
Granted……………………………………………...
|
62,189 | $ | 19.01 | |||||
Vested……………………………………………….
|
(36,771 | ) | $ | 0.02 | ||||
Forfeited/repurchased
shares………………………..
|
-- | -- | ||||||
Nonvested
at December 31, 2009
|
89,705 | $ | 14.36 | |||||
Number
of
Shares
|
Weighted
Average
Exercise
Price
Per Share
|
Weighted
Average
Contractual
Life
(Years)
|
Aggregate
Intrinsic
Value
|
|||||||
Outstanding
at December 31, 2006………………….
|
443,959 | $ | 1.96 | |||||||
Granted……………………………………………....
|
579,261 | $ | 13.79 | |||||||
Exercised…………………………………………….
|
(22,422 | ) | $ | 1.96 | ||||||
Forfeited……………………………………………...
|
(98,654 | ) | $ | 3.00 | ||||||
Outstanding
at December 31, 2007………………….
|
902,144 | |||||||||
Granted……………………………………………....
|
451,749 | $ | 6.48 | |||||||
Exercised…………………………………………….
|
-- | -- | ||||||||
Forfeited…………………………………………...
|
(25,553 | ) | $ | 13.65 | ||||||
Outstanding
at December 31, 2008………………….
|
1,328,340 | $ | 8.35 | |||||||
Granted……………………………………………....
|
262,934 | $ | 19.19 | |||||||
Exercised…………………………………………….
|
(382,852 | ) | $ | 5.06 | ||||||
Forfeited…………………………………………...
|
(22,102 | ) | $ | 11.27 | ||||||
Outstanding
at December 31, 2009………………….
|
1,186,320 | $ | 11.76 | |||||||
Vested
at December 31, 2009 and expected to vest....
|
1,130,085 | $ | 11.76 |
8.47
|
$10,508
|
|||||
Exercisable
at December 31, 2009…………………..
|
521,279 | $ | 10.91 |
7.88
|
$5,292
|
2009
|
2008
|
2007
|
||||||||||
Weighted
average grant-date fair value of options granted
|
$ | 8.57 | $ | 2.52 | $ | 5.35 | ||||||
Risk-free
interest rate
|
1.3 | % | 2.9 | % | 4.3 | % | ||||||
Expected
volatility
|
66.5 | % | 37 | % | 31 | % | ||||||
Expected
term of options (in years)
|
3.0 | 6.0 | 6.0 | |||||||||
Dividend
yield
|
0 | % | 0 | % | 0 | % |
2009
|
2008
|
2007
|
||||||||||
Total
intrinsic value of options exercised
|
$ | 5,042 | $ | ---- | $ | 258 | ||||||
Total
fair value of shares vested
|
$ | 6,367 | $ | 1,282 | $ | 4,007 |
|
Current
|
Deferred
|
Total
|
|||||||||
2009
|
||||||||||||
U.S. Federal
|
$ | 11,484 | $ | (392 | ) | $ | 11,092 | |||||
State
and local
|
1,063 | (621 | ) | 442 | ||||||||
$ | 12,547 | $ | (1,013 | ) | $ | 11,534 | ||||||
2008
|
||||||||||||
U.S. Federal
|
$ | 9,090 | $ | (2,403 | ) | $ | 6,687 | |||||
State
and local
|
602 | (7 | ) | 595 | ||||||||
$ | 9,692 | $ | (2,410 | ) | $ | 7,282 | ||||||
2007
|
||||||||||||
U.S. Federal
|
$ | 11,577 | $ | (1,392 | ) | $ | 10,185 | |||||
State
and local
|
599 | (606 | ) | (7 | ) | |||||||
$ | 12,176 | $ | (1,998 | ) | $ | 10,178 |
2009
|
2008
|
2007
|
||||||||||
Statutory
amount (computed at 35%)………..
|
$ | 11,048 | $ | 7,615 | $ | 9,652 | ||||||
State
income tax, net of federal benefit……...
|
290 | 385 | (5 | ) | ||||||||
Permanent
differences……………………….
|
5 | (86 | ) | (101 | ) | |||||||
Other
(net)…………………………………...
|
191 | (632 | ) | 632 | ||||||||
Consolidated
income tax provision………….
|
$ | 11,534 | $ | 7,282 | $ | 10,178 | ||||||
Consolidated
effective tax rate………………
|
36.5 | % | 33.5 | % | 36.9 | % |
December
31, 2009
|
December
31, 2008
|
|||||||||||||||
Current
|
Long-term
|
Current
|
Long-term
|
|||||||||||||
Assets
related to:
|
||||||||||||||||
Accrued
liabilities………………………………………
|
$ | 837 | $ | -- | $ | 738 | $ | -- | ||||||||
Intangible
assets…………………………………………
|
2,814 | 1,771 | ||||||||||||||
Allowance
for bad debt………………………………….
|
421 | 280 | ||||||||||||||
Non-qualified
stock options…………………………….
|
72 | 32 | ||||||||||||||
Other…………………………………………………….
|
241 | 731 | 301 | 21 | ||||||||||||
Total
assets………………………………………………
|
1,499 | 3,617 | 1,319 | 1,824 | ||||||||||||
Liabilities
related to:
|
||||||||||||||||
Depreciation
and amortization…………………………..
|
(15,003 | ) | (14,098 | ) | ||||||||||||
Other…………………………………………………….
|
-- | (67 | ) | -- | (12 | ) | ||||||||||
Total
liabilities…………………………………………..
|
-- | (15,070 | ) | -- | (14,110 | ) | ||||||||||
Net
deferred assets (liabilities)…………………………..
|
$ | 1,499 | $ | (11,453 | ) | $ | 1,319 | $ | (12,286 | ) |
|
December
31, 2009
|
December 31,
2008
|
||||||
As
reported in the balance sheet:
|
||||||||
Net
current deferred tax assets
|
1,499 | 1,319 | ||||||
Net
non-current deferred tax liabilities
|
(11,453 | ) | (12,286 | ) | ||||
Total
net deferred tax liabilities:
|
$ | (9,554 | ) | $ | (10,967 | ) | ||
2009
|
2008
|
2007
|
|||||||||||
Basic
EPS computation:
|
|||||||||||||
Numerator:
|
|||||||||||||
Net
income…………………………………………...
|
$ | 20,030 | $ | 14,475 | $ | 17,399 | |||||||
Preferred
dividends…………………………………..
|
-- | -- | 782 | ||||||||||
Earnings
available to common stockholders………
|
$ | 20,030 | $ | 14,475 | $ | 16,617 | |||||||
Denominator:
|
|||||||||||||
Basic
weighted average shares outstanding,…………
|
23,577,854 | 21,561,201 | 19,657,436 | ||||||||||
Basic
earnings per share…………………………...........
|
$ | 0.85 | $ | 0.67 | $ | 0.85 | |||||||
Diluted
EPS computation:
|
|||||||||||||
Total
basic weighted average shares outstanding……
|
23,577,854 | 21,561,201 | 19,657,436 | ||||||||||
Effect
of dilutive securities:
|
|||||||||||||
Common
stock options……………………………
|
402,088 | 418,334 | 319,247 | ||||||||||
Total
weighted average shares outstanding assuming dilution
|
23,979,943 | 21,979,535 | 19,976,683 | ||||||||||
Diluted
earnings per share……………………………...
|
$ | 0.84 | $ | 0.83 | $ | 0.83 | |||||||
(1)
|
Upon
any liquidation of the Company, holders of preferred shares would have
received a liquidation preference of $1,000 per share, plus 6% cumulative
dividends per year. Holders were not entitled to additional payment or
distribution of the earnings, assets or surplus funds of the Company upon
liquidation. The shares were converted into preferred stock, redeemed
and retired in May 2007. See Note 19.
|
2009
|
%
|
2008
|
%
|
2007
|
%
|
|||||||||||||||||||
Federal……..
|
$ | 54,173 | 19 | % | $ | 29,134 | 11 | % | $ | 37,528 | 18 | % | ||||||||||||
State………..
|
24,835 | 8 | % | 37,340 | 14 | % | 13,489 | 6 | % | |||||||||||||||
Local……….
|
82,933 | 28 | % | 64,713 | 25 | % | 69,235 | 33 | % | |||||||||||||||
Private………
|
131,553 | 45 | % | 130,615 | 50 | % | 90,108 | 43 | % | |||||||||||||||
$ | 293,494 | 100 | % | $ | 261,802 | 100 | % | $ | 210,360 | 100 | % |
2009
|
2008
|
2007
|
||||||||||
Customer
A
|
N/A | N/A | 13 | % | ||||||||
Customer
B
|
16 | % | N/A | 12 | % | |||||||
Customer
C
|
N/A | 10 | % | N/A |
Amount
|
||||||
Year ended December 31,
|
||||||
2010………………………………………… | $ | 2,981 | ||||
2011………………………………………… | 2,229 | |||||
2012………………………………………… | 1,248 | |||||
2013………………………………………… | 669 | |||||
2014………………………………………… | 512 | |||||
Thereafter…………………………………...
|
514 | |||||
$ | 8,153 |
·
|
Cash
consideration of $55.5 million, paid to the Seller for the membership
interests of T.W. LaQuay Dredging;
|
·
|
Cash
consideration of $4.5 million, paid to the Principal Shareholders for the
Channel and Dock Companies and the above mentioned parcels of land;
and
|
·
|
Up
to an additional $4.0 million (to be held in escrow) payable to Seller as
a result of an increase in the purchase price of the membership interests
by the amount of any additional taxes incurred by the Seller arising from
the allocation of the membership interests purchase price, as further
described in Section 1060 of the U.S. Internal Revenue Code, as
amended.
|
2009
|
2008
|
|||||||
Revenues
|
$ | 334,271 | $ | 284,190 | ||||
Income
before taxes
|
39,206 | 22,851 | ||||||
Net
income
|
$ | 24,879 | $ | 15,203 | ||||
Diluted
net income per share available to common stockholders
|
$ | 1.04 | $ | 0.69 | ||||
Exhibit
|
||||||
Number
|
Description
|
|||||
1 | .01 |
Form
of Indemnity Agreement for Directors and Certain Officers dated November
24, 2008 (filed as Exhibit 1.01 to Form 8-K filed on November 25,
2008)
|
||||
2 | .1 |
Asset
Purchase Agreement dated February 28, 2008, by and between OMGI Sub, LLC
and Orion Marine Group, Inc. and Subaqueous Services, Inc. and Lance Young
(filed as an exhibit to the Company’s Current Report on Form 8-K on March
4, 2008)
|
||||
2 | .2 |
Purchase
Agreement dated January 28, 2010 by and among LaQuay Holdings., Inc and
Seagull Services Inc. (filed as Exhibit 2.1 to the Company’s Current
Report on Form 8-K on February 2, 2010)
|
||||
3 | .1 |
Amended
and Restated Certificate of Incorporation of Orion Marine Group,
Inc.
|
||||
3 | .2 |
Amended
and Restated Bylaws of Orion Marine Group, Inc.
|
||||
4 | .1 |
Registration
Rights Agreement between Friedman, Billings, Ramsey & Co., Inc. and
Orion Marine Group, Inc. dated May 17, 2007
|
||||
10 | .1 |
Loan
Agreement, dated as of July 10, 2007, between Orion Marine Group, Inc. and
Amegy Bank National Association
|
||||
** | 10 | .1.1 |
First
Amendment to Loan Agreement dated February 29, 2008, among Orion Marine
Group, Inc., and Amegy Bank National Association, a national banking
association, as agent
|
|||
10 | .2 |
Purchase/Placement
Agreement dated May 9, 2007 between Orion Marine Group, Inc. and Friedman,
Billings, Ramsey & Co., Inc.
|
||||
10 | .3 |
Amended
& Restated Redemption Agreement dated May 7, 2007
|
||||
+ | 10 | .8 |
2005
Stock Incentive Plan
|
|||
+ | 10 | .9 |
Form
of Stock Option Agreement Under the 2005 Stock Incentive Plan & Notice
of Grant of Stock Option
|
|||
+ | 10 | .10 |
Form
of Restricted Stock Agreement Under the 2005 Stock Incentive Plan &
Notice of Grant of Restricted Stock
|
|||
+ | 10 | .11 |
Orion
Marine Group, Inc. Long Term Incentive Plan
|
|||
+ | 10 | .12 |
Form
of Stock Option Agreement Under the 2007 Long Term Incentive
Plan
|
|||
+ | 10 | .13 |
Form
of Restricted Stock Agreement and Notice of Grant of Restricted
Stock
|
|||
+ | 10 | .14 |
Executive
Incentive Plan (filed as an exhibit to the Quarterly Report on Form 10-Q
for the quarterly period ended September 30, 2008)
|
|||
+ | 10 | .15 |
Subsidiary
Incentive Plan (filed as an exhibit to the Quarterly Report on Form 10-Q
for the quarterly period ended September 30, 2008)
|
|||
+ | 10 | .16 |
Employment
Agreement, dated as of December 4, 2009, by and between Orion Marine
Group, Inc. and J. Michael Pearson
|
|||
+ | 10 | .17 |
Employment
Agreement, dated as of December 4, 2009, by and between Orion Marine
Group, Inc. and Mark Stauffer
|
|||
+ | 10 | .18 |
Employment
Agreement , dated as of December 11, 2009, by and between Orion Marine
Group, Inc. and Elliott Kennedy
|
|||
+ | 10 | .19 |
Employment
Agreement, dated as of December 11, 2009, by and between Orion Marine
Group, Inc. and Jim Rose
|
|||
+ | 10 | .20 |
Employment
Agreement, dated as of December 11, 2009, by and between Orion Marine
Group, Inc. and Peter R. Buchler
|
|||
+ | 10 | .23 |
Schedule
of Changes to Compensation of Non-employee Directors, effective for 2008
(filed as an exhibit to the Quarterly Report on Form 1-Q for the quarterly
period ended June 30, 2008)
|
|||
* | 21 | .1 |
List
of Subsidiaries
|
|||
* | 23 | .1 |
Consent
of Independent RegisteredPublic Accounting Firm
|
|||
* | 23 | .2 |
Consent
of Garland Sandhop, CPA
|
|||
24 | .1 |
Power
of Attorney (included on signature page of this filing)
|
||||
* | 31 | .1 |
Certification
of CEO pursuant to Section 302
|
|||
* | 31 | .2 |
Certification
of CFO pursuant to Section 302
|
|||
* | 32 | .1 |
Certification
of CEO and CFO pursuant to Section 906
|
|||
* | 99 | .1 |
Audited
financial statements of T.W. LaQuay Dredging, LLC as of December 31,
2008
|
|||
* | 99 | .2 |
Unaudited
financial statements of T.W. LaQuay Dredging, LLC as of September 30,
2009
|
|||
* | 99 | .3 |
Unaudited
pro forma condensed combined balance sheet as of September 30, 2009 and
statements of income for the year ended December 31, 2008 and nine months
ended September 30, 2009 of Orion Marine Group, Inc. and T.W. LaQuay
Dredging, LLC
|
*
|
Filed
herewith
|
|
**
|
Incorporated
by reference to the Company’s report on Form 8K filed with the SEC on
March 4, 2008
|
|
+
|
Management
contract or compensatory plan or arrangement
|
|
(b)
|
Financial
Statement Schedules
|
Description
|
Balance
at the
Beginning
of
the Period
|
Charged
to
Revenue,
Cost
or Expense
|
Deduction
|
Balance
at the
End
of
the Period
|
||||||||||||
Year
ended December 31, 2007:
|
||||||||||||||||
Provision
for Doubtful Accounts
|
$ | 500 | $ | -- | $ | -- | $ | 500 | ||||||||
Year
ended December 31, 2008:
|
||||||||||||||||
Provision
for Doubtful Accounts
|
$ | 500 | $ | 800 | $ | (500 | ) | $ | 800 | |||||||
Year
ended December 31, 2009:
|
||||||||||||||||
Provision
for Doubtful Accounts
|
$ | 800 | $ | 442 | $ | -- | $ | 1,202 |
Name of subsidiary
|
Jurisdiction of Formation
|
Effective Ownership
|
|
Orion
Administrative Services, Inc.
|
Texas
|
Orion
Marine Group, Inc.
|
100%
|
OCLP,
LLC
|
Nevada
|
Orion
Marine Group, Inc.
|
100%
|
OCGP,
LLC
|
Texas
|
OCLP,
LLC
|
100%
|
Orion
Construction, LP
|
Texas
|
OCLP,
LLC
|
99%
|
OCGP,
LLC
|
1%
|
||
Misener
Marine Construction, Inc.
|
Florida
|
Orion
Construction, LP
|
100%
|
KFMSLP,
LLC
|
Nevada
|
Orion
Construction, LP
|
100%
|
KFMSGP,
LLC
|
Texas
|
KFMSLP,
LLC
|
100%
|
King
Fisher Marine Service LP
|
Texas
|
KFMSLP,
LLC
|
99%
|
KFMSGP,
LLC
|
1%
|
||
F.
Miller Construction, LLC
|
Louisiana
|
Orion
Marine Group, Inc.
|
100%
|
Orion
Dredging Services, LLC
|
Florida
|
Orion
Marine Group, Inc.
|
100%
|
Northwest Marine Construction, Inc. | Delaware | Orion Marine Group, Inc. | 100% |
(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
|
(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.
|
By:
|
/s/
J. Michael Pearson
|
March
9, 2010
|
J.
Michael Pearson
|
President
and Chief Executive Officer
|
(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
|
(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.
|
|
|
By:
|
/s/
Mark R. Stauffer
|
March 9,
2010
|
Mark
R. Stauffer
|
Executive
Vice President and Chief Financial
Officer
|
1)
|
T he 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 result of operations of the
Company.
|
By:
|
/s/
J. Michael Pearson
|
March
9, 2010
|
J.
Michael Pearson
|
President
and Chief Executive Officer
|
|
By:
|
/s/
Mark R. Stauffer
|
March
9, 2010
|
Mark
R. Stauffer
|
Executive
Vice President and Chief Financial
Officer
|
|
FINANCIAL
STATEMENTS
|
Balance
Sheet
|
2-3
|
Statement of
Income
|
4
|
Statement of Cash
Flows
|
5-6
|
Notes
to Financial Statements
|
7-12
|
Cash
on hand and in banks
|
1,938,365.47 | |||||||
Certificates
of deposit
|
28,690.47 | |||||||
Contract
receivables
|
1,073,121.77 | |||||||
Costs
and earnings in excess of billings
|
869,620.74 | |||||||
Prepaid
expenses
|
2,650,396.46 | |||||||
Advances
|
11,833.24 | |||||||
Total
current assets
|
6,572,028.15 | |||||||
PROPERTY,
EQUIPMENT AND VEHICLES
|
||||||||
Land
|
882,172.88 | |||||||
Equipment
|
25,687,336.26 | |||||||
Leasehold
improvements
|
1,128,529.33 | |||||||
Office
furniture, fixtures and equipment
|
219,246.12 | |||||||
Vehicles
|
825,295.91 | |||||||
Accumulated
depreciation
|
(6,199,930.68 | ) | ||||||
Total
propery, equipment and vehicles
|
22,542,649.82 | |||||||
OTHER
ASSETS
|
||||||||
Prepaid
loan costs
|
35,000.00 | |||||||
Amortization
of prepaid loan costs
|
(18,750.00 | ) | ||||||
Total
other assets
|
16,250.00 | |||||||
TOTAL
ASSETS
|
29,130,927.97 | |||||||
Accounts
payable
|
1,102,898.21 | |||||||
Billings
in excess of costs and earnings
|
1,532,793.04 | |||||||
Insurance
payable
|
2,259,025.42 | |||||||
Payroll
liabilities
|
404,914.87 | |||||||
Sales
tax payable
|
0.00 | |||||||
Interest
payable
|
41,471.22 | |||||||
Notes payable
– current portion
|
3,053,545.06 | |||||||
Total
current liabilities
|
8,394,647.82 | |||||||
LONG-TERM
LIABILITIES
|
||||||||
Notes
payable – long-term portion
|
9,183,461.05 | |||||||
Rent
payable – shareholders
|
120,000.00 | |||||||
Total
long-term liabilities
|
9,303,461.05 | |||||||
TOTAL
LIABILITIES
|
17,698,108.87 | |||||||
SHAREHOLDERS’
EQUITY
|
||||||||
Capital
stock, $0.01 par value, 500,000 shares authorized, 1,950 issued and
outstanding
|
19.50 | |||||||
Paid
in surplus
|
1,848,454.48 | |||||||
Retained
earnings
|
9,584,345.12 | |||||||
Total
shareholders’ equity
|
11,432,819.10 | |||||||
TOTAL
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
29,130,927.97 |
Completed
contracts
|
||||||||
Revenues
|
9,566,054.07 | |||||||
Costs
|
(4,470,959.99 | |||||||
Total
|
5,095,094.08 | |||||||
Contracts
in progress
|
||||||||
Revenues
|
12,713,419.73 | |||||||
Costs
|
(7,583,315.16 | ) | ||||||
Total
|
5,130,104.57 | |||||||
GROSS
PROFIT
|
10,225,198.65 | |||||||
OPERATING
EXPENSES (Schedule)
|
(9,613,632.47 | ) | ||||||
NET
INCOME BEFORE OTHER INCOME
|
611,566.18 | |||||||
OTHER
INCOME
|
||||||||
Grant
income – TCEQ
|
1,192,255.64 | |||||||
Gain
(Loss) on sale of assets
|
(17,132.80 | ) | ||||||
Interest
income
|
1,228.43 | |||||||
Other
income
|
500,990.55 | |||||||
Other
job income
|
109,054.26 | |||||||
Total
|
1,786,396.08 | |||||||
NET
INCOME (LOSS)
|
2,397,962.26 | |||||||
RETAINED
EARNINGS, JANUARY 1, 2008
|
7,636,220.18 | |||||||
Distributions
to shareholders
|
(449,837.32 | ) | ||||||
RETAINED
EARNINGS, DECEMBER 31, 2008
|
9,584,345.12 | |||||||
CASH
FLOWS FROM OPERATING ACTIVITIES
|
||||||||
Cash
received from customers
|
22,647,100.49 | |||||||
Cash
paid to suppliers and employees
|
(20,508,735.15 | ) | ||||||
Interest
paid
|
(638,101.12 | ) | ||||||
Interest
income
|
1,228.43 | |||||||
Miscellaneous
income
|
610,044.81 | |||||||
Sale
of assets
|
(17,132,80 | ) | ||||||
Grant
income – TCEQ
|
1,192,255.64 | |||||||
Net
cash provided (used) by operating activities
|
3,286,660.30 | |||||||
CASH
FLOWS FROM INVESTING ACTIVITIES
|
||||||||
Sale
of assets
|
37,132.80 | |||||||
Purchase
of capital assets
|
(8,663,648.66 | ) | ||||||
Investments
|
(1,228.43 | ) | ||||||
Net
cash provided (used) by investing activities
|
(8,627,744.29 | ) | ||||||
CASH
FLOWS FROM FINANCING ACTIVITIES
|
||||||||
Borrowings
|
9,026,574.29 | |||||||
Debt
Reduction
|
(4,936,515.42 | ) | ||||||
Distributions
to shareholders
|
(449,837.32 | ) | ||||||
Net
cash provided (used) by financing activities
|
3,640,221.55 | |||||||
NET
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
|
(1,700,862.44 | ) | ||||||
CASH
AND CASH EQUIVALENTS AT BEGINNING OF PERIOD
|
3,639,227.91 | |||||||
CASH
AND CASH EQUIVALENTS AT END OF PERIOD
|
1,938,365.47 | |||||||
|
RECONCILIATION
OF NET INCOME TO NET CASH PROVIDED
|
|
BY
OPERATING ACTIVITIES
|
Net
income (loss)
|
2,397,962.26 | |||||||
Adjustments
to reconcile net income to net cash provided by operating
activities
|
||||||||
Depreciation
|
1,240,478.26 | |||||||
Amortization
of prepaid loan costs
|
2,500.00 | |||||||
(Increase)
Decrease in contract receivables
|
367,626.69 | |||||||
(Increase)
Decrease in costs and earnings in excess of billings
|
(311,689.82 | ) | ||||||
(Increase)
Decrease in prepaid expenses
|
(299,669.57 | ) | ||||||
(Increase)
Decrease in advances
|
(1,833.24 | ) | ||||||
Increase
(Decrease) in accounts payable
|
(1,764,976.96 | ) | ||||||
Increase
(Decrease) in billings in excess of costs and earnings
|
1,458,624.07 | |||||||
Increase
(Decrease) in insurance payable
|
(119,083.22 | ) | ||||||
Increase
(Decrease) in payroll liabilities
|
187,002.69 | |||||||
Increase
(Decrease) in accrued interest payable
|
9,719.17 | |||||||
Increase
(Decrease) in rent payable
|
120,000.00 | |||||||
Total
adjustments
|
888,698.04 | |||||||
NET
CASH PROVIDED BY OPERATING ACTIVITIES
|
3,286,660.30 | |||||||
Notes
payable at December 31, 2008 consist of the following:
|
||||
Note
payable to NewFirst National Bank, secured by equipment, payable in
monthly installments of $95,750.00 through July 9, 2014, with interest of
7.75%.
|
5,190,976.16 | |||
Note
payable to NewFirst National Bank, secured by equipment, advancing line of
credit in the amount of $1,081,295.85 payable in monthly installments of
interest only through July 9, 2009, with adjustable interest at the prime
rate currently 3.25%.
|
1,081,295.85 | |||
Note
payable to NewFirst National Bank, secured by real estate, with adjustable
interest at the prime rate, currently 3.25% revolving credit up to
$1,000,000.00.
|
1,000,000.00 | |||
Note
payable to First National Bank, secured by certificates of deposit held by
shareholders, payable in full on April 3, 2009, with stated interest of
4.75%.
|
100,000.00 | |||
Note
payable to Seaport Bank, secured by certificates of deposit held by
shareholders, payable in full on March 15, 2009, with stated interest of
3.74%.
|
100,000.00 | |||
Note
payable to NewFirst National Bank, secured by real estate, Baytown, Texas
with stated interest of 7.75%. Monthly payments are
$7,000.74.
|
714,184.10 | |||
Note
payable dated November 5, 2008 to NewFirst National Bank secured by Dredge
linda LaQuay, advancing line of credit up to $7,500,000.00. Current
balance is $4,050,550.00. Payable interest only for first 12 months at
variable rate with a 6% fioor and 7.5% ceiling. Payments $89,000.00
beginning December 5, 2009.
|
4,050,550.00 | |||
Total
notes payable
|
12,237,006.11 | |||
Less
current portion
|
3,053,545.06 | |||
Long-term
debt
|
9,183,461.05 |
|
The
maturity of the notes payable is as
follows:
|
|
December
31,
|
|
9.
TAX DISCLOSURE -PASS THROUGH
ENTITIES
|
Deductible
Network
Non-network
|
$500
$1,000
|
In-Network
Benefit
Out
of Network Benefit
|
70%
50%
|
Maximum
Out of Pocket
Network
Non-network
|
$3,000
individual
$6,000
individual
|
Doctor
Co-pay
Rx
Co-pay
|
$25
$5
-generic I $9
brand name
|
December
31, 2008
|
||||
Backlog
balance at January 1
|
6,284,565.18 | |||
New
contracts during the period
|
37,573,757.20 | |||
Total
|
43,858,322.38 | |||
Less
contract revenue earned during the period
|
22,225,408.13 | |||
Backlog
balance at December 31
|
21,632,914.25 |
|
17.
TCEQ -EMISSIONS REDUCTION INCENTIVE
GRANT
|
Current
Assets
|
||||||
Cash
on hand and in banks
|
2,640,976.29 | |||||
Certificates
of deposit
|
29,373.61 | |||||
Contracts
receivables
|
4,268,449.48 | |||||
Costs
and earnings in excess of billings
|
2,291,304.98 | |||||
Prepaid
expenses
|
891,886.63 | |||||
Advances
|
11,833.24 | |||||
Total
Current Assets
|
10,133,824.23
|
Property,
Equipment & Vehicles
|
|||
Land
|
882,172.88
|
||
Equipment
|
33,826,990.75
|
||
Leasehold
improvements
|
1,128,529.33
|
||
Office
furniture, fixtures & equipment
|
238,680.14
|
||
Vehicles
|
900,342.88
|
||
Accumulated
depreciation
|
(7,581,661.25)
|
||
Total
property, equipment & vehicles
|
29,395,054.73
|
Other
Assets
|
|||
Prepaid
loan costs
|
35,000.00
|
||
Amortization
of
Prepaid
loan costs
|
(20,625.00)
|
||
Total
other assets
|
14,375.00
|
||
TOTAL
ASSETS
|
39,543,253.96
|
Current
Liabilities
|
|||
Accounts
Payable
|
1,068,880.70
|
||
Billings
in excess of costs and earnings
|
1,084,228.09
|
||
Insurance
Payable
|
557,107.22
|
||
Payroll
liabilities
|
559,761.56
|
||
Sales
tax payable
|
0.00
|
||
Interest
payable
|
71,179.84
|
||
Notes
payable-current portion
|
2,713,149.59
|
||
Total
current liabilities
|
6,064,307.00
|
Long-term
Liabilities
|
|||
Notes
payable-long term portion
|
11,989,278.85
|
||
Recent
payable – shareholders
|
210,000.00
|
||
Total
long-term liabilities
|
12,199,278.85
|
||
Total
Liabilities
|
18,263,585.85
|
Shareholders’
Equity
|
|||
Capital
stock, $0.01 par value,
500,000 shares
Authorized
1,950 issued and
outstanding
|
19.50
|
||
Paid
surplus
|
1,848,454.48
|
||
Retained
earnings
|
19,431,194.13
|
||
Total
shareholders’ equity
|
21,279,668.11
|
||
Total
Liabilities and Shareholders’ Equity
|
39,543,253.96
|
INCOME
|
|||
Completed
contracts
|
|||
Revenues
|
11,002.118.08
|
||
Costs
|
(3,734,840.40)
|
||
7,267,277.68
|
Contracts
in progress
|
|||
Revenues
|
18,057,571.33
|
||
Costs
|
(8,963,690.90)
|
||
9,093,880.4
|
|
|||
GROSS
PROFIT
|
16,361,158.10
|
||
OPERATING
EXPENSES(Schedule)
|
(8,843,531.76)
|
||
NET
INCOME BEFORE OTHER INCOME
|
7,517,626.35
|
||
OTHER
INCOME
|
|||
Grant
income –TCEQ
|
1,540,610.36
|
||
Gain
(Loss) on sale assets
|
0.00
|
||
Interest
income
|
683.14
|
||
Other
income
|
355,821.08
|
||
Other
job income
|
432,108.08
|
||
TOTAL
|
2,329,222.66
|
||
NET
INCOME (LOSS)
|
9,846,849.01
|
||
RETAINED
EARNINGS, JANUARY 1,2009
|
9,584,345.12
|
||
Distributions
toShareholders
|
0.00
|
||
RETAINED
EARNINGS, SEPTEMBER 30, 2009
|
19,431,194.13
|
CASH
FLOWS FROM OPERATING ACTIVITIES
|
|||
Cash
received from customers
|
25,864,361.70
|
||
Cash
paid to suppliers and employees
|
(21,024,764.00)
|
||
Interest
paid
|
696,813.25
|
||
Interest
income
|
683.14
|
||
Miscellaneous
income
|
355,821.08
|
||
Other
jobs income
|
432,108.08
|
||
Sale
of assets
|
0.00
|
||
Grant
income – TCEQ
|
1,540,610.36
|
||
Net
cash provided (used) by operating activities
|
6,472,007.11
|
CASH
FLOWS FROM INVESTING ACTIVITIES
|
|||||
Sale
of assets
|
0.00
|
||||
Purchase
of capital assets
|
8,234,135.48
|
||||
Investments
|
(683.14)
|
||||
Net
cash provided (used) by investing activities
|
(8,234,818.62)
|
||||
CASH
FLOWS FROM FINANCING ACTIVITIES
|
|||||
Borrowings
|
4,600,932.73
|
||||
Debt
reduction
|
(2,135,510.40)
|
||||
Distributions
to shareholders
|
0.00
|
||||
Net
cash provided (used) by financing activities
|
2,465,422.33
|
||||
NET
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
|
702,610.82
|
||||
CASH
AND CASH EQUIVALENTS AT BEGINNING OF PERIOD
|
1,938,365.4
|
||||
CASH
AND CASH EQUIVALENTS AT END OF PERIOD
|
2,640,976.29
|
|
T.W.
LAQUAY DREDGING, INC
|
|
STATEMENT
OF CASH FLOWS
|
|
FOR
THE NINE MONTHS ENDED SEPTEMBER
30,2009
|
|
RECONCILIATION
OF NET INCOME TO NET CASH PROVIDED
|
|
BY
OPERATING ACTIVITIES
|
Net
income (loss)
|
9,846,849.01
|
||||
Adjustments
to reconcile net income to net cash provided by operating
activities
|
|||||
Depreciation
|
1,381,730.57
|
||||
Amortization
of prepaid loan costs
|
1,875.00
|
||||
(Increase)
Decrease in contract receivables
|
3,195,327.71)
|
||||
Increase)
Decrease in costs and earnings in excess of billings
|
(1,421,684.24)
|
||||
(Increase)
Decrease in prepaid expenses
|
1,758,509.83
|
||||
(Increase)
Decrease in advances
|
0.00
|
||||
Increase
(Decrease) in accounts payable
|
(34,017.51)
|
||||
Increase
(Decrease) in billings in excess of costs and earnings
|
(448,564.95)
|
||||
Increase
(Decrease) in insurance payable
|
(1,701,918.20)
|
||||
Increase
(Decrease) in payroll liabilities
|
164,846.69
|
||||
Increase
(Decrease) in accrued interest payable
|
29,708.62
|
||||
Increase
(Decrease) in rent payable
|
90,000.00
|
||||
TOTAL
ADJUSTMENTS
|
(3,374,841.90)
|
||||
NET
CASH PROVIDED BY OPERATING ACTIVITIES
|
6,472,007.11
|
NOTES
TO FINANCIAL STATEMENTS
|
1.
|
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES
|
Completed contracts
|
1,784,784.83
|
|
As
of September 30, 2009, the company had liabilities relating to payroll for
accrued payroll and taxes for
$569,761.56.
|
|
6. NOTES
PAYABLE
|
|
Notes
payable at September 30, 2009 consist of the
following:
|
|
Note
to payable to NewFirst National Bank, secured by equipment, payable
in
|
|
4,616,511.45
|
|
Note
payable to NewFirst National Bank, secured by Dredges Tulsa and
Linda
|
Orion
|
TWLD
|
Pro
Forma
Adjustments
|
Pro
Forma
Balance
Sheet
|
|||||||||||||||||
Assets
|
||||||||||||||||||||
Current
assets
|
||||||||||||||||||||
Cash
and cash equivalents
|
$ | 108,984 | $ | 2,641 | $ | (64,000 | ) | b | $ | 47,625 | ||||||||||
Short-term
investments
|
29 | (29 | ) | a | -- | |||||||||||||||
Accounts
receivable, including retainage
|
48,730 | 4,268 | (12 | ) | a | 52,986 | ||||||||||||||
Taxes
receivable
|
2,197 | 2,197 | ||||||||||||||||||
Note
receivable
|
765 | 765 | ||||||||||||||||||
Inventories
|
1,744 | 1,744 | ||||||||||||||||||
Deferred
tax asset
|
1,642 | 1,642 | ||||||||||||||||||
Costs
and estimated earnings in excess of billings
|
9,094 | 2,291 | 11,385 | |||||||||||||||||
Prepaid
expenses
|
1,834 | 904 | 2,738 | |||||||||||||||||
Total
current assets
|
174,989 | 10,134 | (64,041 | ) | 121,082 | |||||||||||||||
Property
and equipment, net of accumulated
|
80,451 | 29,395 | 19,199 | c | 129,045 | |||||||||||||||
Goodwill
|
12,096 | 8,664 | c | 20,761 | ||||||||||||||||
Intangible
assets, net of amortization
|
320 | 14 | (14 | ) | a | 320 | ||||||||||||||
Investment
in subsidiary
|
b,c | -- | ||||||||||||||||||
Other
assets
|
66 | 66 | ||||||||||||||||||
Total
assets
|
$ | 267,922 | $ | 39,543 | $ | (36,192 | ) | $ | 271,273 | |||||||||||
Liabilities
and Stockholders’ Equity
|
||||||||||||||||||||
Current
liabilities
|
||||||||||||||||||||
Current
portion of long-term debt
|
$ | -- | $ | 2,713 | $ | (2,713 | ) | a | $ | -- | ||||||||||
Accounts
payable
|
21,259 | 1,069 | 21,549 | |||||||||||||||||
Accrued
liabilities
|
11,739 | 1,198 | 12,937 | |||||||||||||||||
Taxes
payable
|
353 | 353 | ||||||||||||||||||
Billings
in excess of costs and estimated earnings
|
5,402 | 1,084 | 6,486 | |||||||||||||||||
Total
current liabilities
|
38,753 | 6,064 | (2,713 | ) | 42,105 | |||||||||||||||
Long-term
debt, less current portion
|
-- | 11,989 | (11,989 | ) | a | -- | ||||||||||||||
Other
long-term liabilities
|
409 | 210 | (210 | ) | a | 409 | ||||||||||||||
Deferred
income taxes
|
11,383 | 11,383 | ||||||||||||||||||
Deferred
revenue
|
330 | 330 | ||||||||||||||||||
Total
liabilities
|
50,875 | 18,264 | (14,912 | ) | 54,226 | |||||||||||||||
Stockholders’
equity
|
||||||||||||||||||||
Common
stock
|
268 | 268 | ||||||||||||||||||
Treasury
stock
|
-- | -- | ||||||||||||||||||
Additional
paid in capital
|
150,748 | 1,848 | 150,748 | |||||||||||||||||
Retained
earnings
|
66,031 | 19,431 | (21,279 | ) | a,c | 66,031 | ||||||||||||||
Total
stockholders’ equity
|
217,047 | 21,280 | (21,279 | ) | 217,047 | |||||||||||||||
Total
liabilities and stockholders’ equity
|
$ | 267,922 | 39,543 | (36,192 | ) | $ | 271,273 |
Pro Forma Adjustments
|
|||||||||||
(a)
|
Current
portion of long-term debt
|
$ | 2,713 | ||||||||
Long
term debt, net of current portion
|
11,989 | ||||||||||
Other
long-term liabilities
|
210 |
|
|||||||||
Short
term investments
|
(29 | ) | |||||||||
Employee
receivables
|
(12 | ) | |||||||||
Loan
costs, net of amortization
|
(14 | ) | |||||||||
Retained
earnings
|
(14,857 | ) | |||||||||
Record
TWLD assets and liabilities not assumed
|
|||||||||||
(b)
|
Investment
in TWLD
|
$ | 64,000 | ||||||||
Cash
and cash equivalents
|
(64,000 | ) | |||||||||
Record
investment in TWLD
|
|||||||||||
(c)
|
Goodwill
|
$ | 8,664 | ||||||||
Property
and equipment
|
19,199 | ||||||||||
Retained
earnings
|
36,137 | ||||||||||
Investment
in TWLD
|
(64,000 | ) | |||||||||
Entries
in consolidation to reflect goodwill and step-up in basis of property and
equipment
|
|||||||||||
Explanatory Notes
|
|||||||||||
(1 | ) |
Summary
of purchase price
|
|||||||||
Cash
and cash equivalents
|
$ | 64,000 | |||||||||
$ | 64,000 | * | |||||||||
Pro
Forma Preliminary Allocation of Purchase Price
|
|||||||||||
Working
capital
|
$ | 6,742 | |||||||||
Property
and equipment
|
48,594 | ||||||||||
Goodwill
|
8,664 | ||||||||||
Total
preliminary purchase price allocation
|
$ | 64,000 |
Year
ended December 31, 2008
|
||||||||||||||||||||
Orion
|
TWLD
|
Pro
Forma Adjustments
|
Pro
Forma Combined
|
|||||||||||||||||
Contract
revenues
|
$ | 261,802 | $ | 22,279 | $ | 109 | b | $ | 284,190 | |||||||||||
Cost
of contract revenues
|
211,351 | 12,054 | 7,408 | a,b,d | 230,813 | |||||||||||||||
Gross
profit
|
50,451 | 10,225 | (7,299 | ) | 53,377 | |||||||||||||||
Selling,
general and administrative
|
27,978 | 9,614 | (7,279 | ) | a | 30,313 | ||||||||||||||
Operating
income
|
22,473 | 612 | (20 | ) | 23,065 | |||||||||||||||
Other
(income) expense
|
||||||||||||||||||||
Other
income
|
-- | (1,785 | ) | 1,284 | b,c | (501 | ) | |||||||||||||
Interest
(income)
|
(530 | ) | (1 | ) | (531 | ) | ||||||||||||||
Interest
expense
|
1,246 | -- | -- | a | 1,246 | |||||||||||||||
Other
(income) expense, net
|
716 | (1,786 | ) | 1,304 | 715 | |||||||||||||||
Income
before income taxes
|
21,757 | 2,398 | (1,304 | ) | 22,851 | |||||||||||||||
Income
tax expense
|
7,282 | -- | 366 | e | 7,648 | |||||||||||||||
Net
income
|
$ | 14,475 | $ | 2,398 | $ | 1,670 | $ | 15,203 | ||||||||||||
Basic
earnings per share
|
$ | 0.67 | $ | 0.71 | ||||||||||||||||
Diluted
earnings per share
|
$ | 0.66 | $ | 0.69 | ||||||||||||||||
Shares
used to compute earnings per share:
|
21,561,201 | 21,561,201 | ||||||||||||||||||
Basic
|
21,979,535 | 21,979,535 | ||||||||||||||||||
Diluted
|
Pro
forma adjustments and explanatory notes:
|
|||||
(a)
|
Cost
of contract revenues
|
$ |
6,641
|
||
Interest
expense
|
638
|
||||
Selling,
general and administrative expenses
|
(7,279)
|
||||
Reclassification
of project related expenses to cost of contract revenues to conform to
Orion presentation
|
|||||
(b)
|
Cost
of contract revenues
|
$ |
17
|
||
Other
income
|
92
|
||||
Contract
revenues
|
(109)
|
||||
Reclassification
of other income/expense to conform to Orion
presentation
|
|||||
(c)
|
Other
income
|
$ |
1,192
|
||
Fixed
assets
|
(1,192)
|
||||
Reclassification
of Texas equipment grant to reduce fixed asset cost to conform to Orion
presentation
|
|||||
(d)
|
Depreciation
|
$ |
750
|
||
Accumulated
depreciation
|
(750)
|
||||
Record
additional depreciation related to step-up of assets
|
|||||
(e)
|
Tax
expense
|
$ |
366
|
||
Taxes
payable
|
(366)
|
||||
Record
additional taxes at Orion’s effective tax rate at 33.5%
|
Nine
months ended September 30, 2009
|
||||||||||||||||||||
Orion
|
TWLD
|
Pro
Forma Adjustments
|
Pro
Forma Combined
|
|||||||||||||||||
Contract
revenues
|
$ | 222,259 | $ | 29,060 | $ | 432 | b | $ | 251,751 | |||||||||||
Cost
of contract revenues
|
173,112 | 12,699 | 6,876 | a,b,d | 192,686 | |||||||||||||||
Gross
profit
|
49,147 | 16,361 | (6,444 | ) | 59,064 | |||||||||||||||
Selling,
general and administrative
|
23,638 | 8,844 | (7,010 | ) | a | 25,472 | ||||||||||||||
Operating
income
|
25,509 | 7,518 | 566 | 33,593 | ||||||||||||||||
Other
(income) expense
|
||||||||||||||||||||
Other
income
|
-- | (2,329 | ) | 1,973 | b,c | (356 | ) | |||||||||||||
Interest
(income)
|
(274 | ) | -- | (274 | ) | |||||||||||||||
Interest
expense
|
523 | -- | -- | a | 523 | |||||||||||||||
Other
(income) expense, net
|
249 | (2,329 | ) | (1,973 | ) | (107 | ) | |||||||||||||
Income
before income taxes
|
25,260 | 9,847 | (1,407 | ) | 33,700 | |||||||||||||||
Income
tax expense
|
9,236 | -- | 3,086 | e | 12,322 | |||||||||||||||
Net
income
|
$ | 16,024 | $ | 9,847 | $ | (4,493 | ) | $ | 21,378 | |||||||||||
Basic
earnings per share
|
$ | 0.71 | $ | 1.00 | ||||||||||||||||
Diluted
earnings per share
|
$ | 0.70 | $ | 0.97 | ||||||||||||||||
Shares
used to compute earnings per share:
|
22,485,770 | 22,485,770 | ||||||||||||||||||
Basic
|
22,896,150 | 22,896,150 | ||||||||||||||||||
Diluted
|
Pro
forma adjustments and explanatory notes:
|
|||||
(a)
|
Cost
of contract revenues
|
$ |
6,313
|
||
Interest
expense
|
697
|
||||
Selling,
general and administrative expenses
|
(7,010)
|
||||
Reclassification
of project related expenses to cost of contract revenues to conform to
Orion presentation
|
|||||
(b)
|
Other
income
|
$ |
432
|
||
Contract
revenues
|
(432)
|
||||
Reclassification
of other income/expense to conform to Orion
presentation
|
|||||
(c)
|
Other
income
|
$ |
1,541
|
||
Fixed
assets
|
(1,541)
|
||||
Reclassification
of Texas equipment grant to reduce fixed asset cost to conform to Orion
presentation
|
|||||
(d)
|
Depreciation
|
$ |
563
|
||
Accumulated
depreciation
|
(563)
|
||||
Record
additional depreciation related to step-up of assets
|
|||||
(e)
|
Tax
expense
|
$ |
3,086
|
||
Taxes
payable
|
(3,086)
|
||||
Record
additional taxes at Orion’s effective tax rate at 36.6%
|