Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2016 | Apr. 26, 2016 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q1 | |
Trading Symbol | NES | |
Entity Registrant Name | Nuverra Environmental Solutions, Inc. | |
Entity Central Index Key | 1,403,853 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 31,052,076 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 | |
Assets | |||
Cash and cash equivalents | $ 30 | $ 39,309 | |
Restricted cash | 4,450 | 4,250 | |
Accounts receivable, net of allowance for doubtful accounts of $3.5 and $3.5 million at March 31, 2016 and December 31, 2015, respectively | 30,857 | 42,188 | |
Inventories | 2,715 | 2,985 | |
Prepaid expenses and other receivables | 4,011 | 3,377 | |
Other current assets | 5,744 | 2,372 | |
Total current assets | 47,807 | 94,481 | |
Property, plant and equipment, net of accumulated depreciation of $219.2 and $209.1 million at March 31, 2016 and December 31, 2015, respectively | 391,775 | 406,188 | |
Equity investments | 3,745 | 3,750 | |
Intangibles, net | 16,214 | 16,867 | |
Other assets | 572 | 1,333 | |
Total assets | [1] | 460,113 | 522,619 |
Liabilities and Shareholders' Deficit | |||
Accounts payable | 7,269 | 6,907 | |
Accrued liabilities | 34,252 | 29,843 | |
Current portion of contingent consideration | 8,500 | 8,628 | |
Current portion of long-term debt | [2] | 463,164 | 499,709 |
Total current liabilities | 513,185 | 545,087 | |
Deferred income taxes | 295 | 270 | |
Long-term portion of debt | 8,015 | 11,758 | |
Other long-term liabilities | 3,735 | 3,775 | |
Total liabilities | $ 525,230 | $ 560,890 | |
Commitments and contingencies | |||
Shareholders' deficit: | |||
Common stock | $ 30 | $ 30 | |
Additional paid-in capital | 1,370,298 | 1,369,921 | |
Treasury stock | (19,807) | (19,800) | |
Accumulated deficit | (1,415,638) | (1,388,422) | |
Total shareholders' deficit | (65,117) | (38,271) | |
Total liabilities and shareholders' deficit | $ 460,113 | $ 522,619 | |
[1] | Total assets exclude intercompany receivables eliminated in consolidation. | ||
[2] | As a result of the probability of breaching one of the financial covenants if we are not successful at restructuring our debt (see "Restructuring Support Agreement" later in this section), the carrying value of the ABL Facility and the 2018 Notes was reclassified to current liabilities in the consolidated balance sheet as of March 31, 2016 and December 31, 2015. |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Mar. 31, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowance for doubtful accounts | $ 3.5 | $ 3.5 |
Property, plant and equipment, accumulated depreciation | $ 219.2 | $ 209.1 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Revenue: | ||
Non-rental revenue | $ 44,026 | $ 107,010 |
Rental revenue | 2,949 | 12,102 |
Total revenue | 46,975 | 119,112 |
Costs and expenses: | ||
Direct operating expenses | 38,617 | 87,999 |
General and administrative expenses | 7,452 | 12,700 |
Depreciation and amortization | 15,845 | 17,482 |
Other, net | 0 | 683 |
Total costs and expenses | 61,914 | 118,864 |
Operating (loss) income | (14,939) | 248 |
Interest expense, net | (12,045) | (12,588) |
Other income, net | 158 | 321 |
Loss on extinguishment of debt | (390) | 0 |
Loss from continuing operations before income taxes | (27,216) | (12,019) |
Income tax (expense) benefit | (55) | 24 |
Loss from continuing operations | (27,271) | (11,995) |
Income from discontinued operations, net of income taxes | 55 | 921 |
Net loss attributable to common shareholders | $ (27,216) | $ (11,074) |
Net loss per common share attributable to common shareholders: | ||
Basic and diluted loss from continuing operations (usd per share) | $ (0.98) | $ (0.44) |
Basic and diluted income from discontinued operations (usd per share) | 0 | 0.03 |
Net loss per basic and diluted common share (usd per share) | $ (0.98) | $ (0.41) |
Weighted average shares outstanding used in computing net loss per basic and diluted common share (in shares) | 27,907 | 27,412 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Cash flows from operating activities: | ||
Net loss | $ (27,216) | $ (11,074) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Income from discontinued operations, net of income taxes | 0 | (921) |
Gain on the sale of TFI | (55) | 0 |
Depreciation and amortization of intangible assets | 15,845 | 17,482 |
Amortization of deferred financing costs and debt discounts, net | 1,157 | 1,247 |
Stock-based compensation | 368 | 789 |
Gain on disposal of property, plant and equipment | (1,057) | (654) |
Bad debt expense | 217 | 732 |
Loss on extinguishment of debt | (390) | 0 |
Deferred income taxes | 25 | 1 |
Other, net | (88) | (418) |
Changes in operating assets and liabilities: | ||
Accounts receivable | 11,114 | 21,688 |
Prepaid expenses and other receivables | (634) | (1,273) |
Accounts payable and accrued liabilities | 4,924 | 6,949 |
Other assets and liabilities, net | (2,425) | 202 |
Net cash provided by operating activities from continuing operations | 2,565 | 34,750 |
Net cash provided by operating activities from discontinued operations | 0 | 867 |
Net cash provided by operating activities | 2,565 | 35,617 |
Cash flows from investing activities: | ||
Proceeds from the sale of property, plant and equipment | 1,449 | 1,968 |
Purchases of property, plant and equipment | (1,421) | (6,163) |
Increase in restricted cash | (200) | 0 |
Net cash used in investing activities from continuing operations | (172) | (4,195) |
Net cash used in investing activities from discontinued operations | 0 | (161) |
Net cash used in investing activities | (172) | (4,356) |
Cash flows from financing activities: | ||
Proceeds from revolving credit facility | 12,409 | 0 |
Payments on revolving credit facility | (51,968) | (7,000) |
Payments for deferred financing costs | (426) | 0 |
Payments on vehicle financing and other financing activities | (1,687) | (1,436) |
Net cash used in financing activities from continuing operations | (41,672) | (8,436) |
Net cash provided by financing activities from discontinued operations | 0 | 38 |
Net cash used in financing activities | (41,672) | (8,398) |
Net (decrease) increase in cash and cash equivalents | (39,279) | 22,863 |
Cash and cash equivalents - beginning of period | 39,309 | 15,416 |
Cash and cash equivalents - end of period | 30 | 38,279 |
Less: cash and cash equivalents of discontinued operations - end of period | 0 | 2,793 |
Cash and cash equivalents of continuing operations - end of period | 30 | 35,486 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest | 928 | 949 |
Cash paid for taxes, net | $ 2 | $ 94 |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying condensed consolidated financial statements of Nuverra Environmental Solutions, Inc. and its subsidiaries (collectively, “Nuverra,” the “Company,” “we,” “us,” or “our”) are unaudited, pursuant to the rules and regulations of the United States Securities and Exchange Commission ("SEC"). Our condensed consolidated balance sheet as of December 31, 2015 , included herein, has been derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America (or "GAAP"). Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. In our opinion, the condensed consolidated financial statements include the normal, recurring adjustments necessary for the fair statement of the results for the interim periods. These financial statements should be read in conjunction with the audited consolidated financial statements, including the notes thereto, contained in our Annual Report on Form 10-K for the year ended December 31, 2015, filed with the SEC on March 11, 2016. All dollar and share amounts in the footnote tabular presentations are in thousands, except per share amounts and unless otherwise noted. Unless stated otherwise, any reference to statement of operations items in these accompanying condensed consolidated financial statements refers to results from continuing operations. Reclassifications Certain reclassifications and adjustments have been made to prior period amounts in the accompanying condensed consolidated statements of operations and cash flows and notes thereto in order to conform to the current year’s presentation including: • Certain similar line items in the condensed consolidated statement of cash flows for the three months ended March 31, 2015 have been combined to conform to the current year presentation. • In June 2015, we purchased the remaining interest in Appalachian Water Services, LLC (“AWS”), previously a 51% owned non-guarantor subsidiary, and have recast the tables in Note 16 to reflect AWS as a part of the Guarantor Subsidiaries for the three months ended March 31, 2015 . • As of January 1, 2016, and further discussed below under "Significant Accounting Policies," we retrospectively adopted, for all comparative periods presented, ASU 2015-03, Simplifying the Presentation of Debt Issuance Costs , and ASU 2015-15, Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements . As a result, $7.9 million and $8.7 million of unamortized debt issuance costs related to our 2018 Notes have been reclassified from “Other assets” to “Current portion of long-term debt” on the condensed consolidated balance sheets as of March 31, 2016 and December 31, 2015, respectively. Additionally, as the debt associated with our asset-based revolving credit facility is presented as short-term, the related debt issuance costs of $2.1 million and $2.2 million as of March 31, 2016 and December 31, 2015, respectively, have been reclassified from "Other assets" to "Other current assets" on the condensed consolidated balance sheets. Further, the total assets for the Corporate segment reported in Note 14 have been adjusted for this reclass. Going Concern Our consolidated financial statements have been prepared assuming that we will continue as a going concern, which contemplates continuity of operations, realization of assets, and liquidation of liabilities in the normal course of business. As reflected in the condensed consolidated financial statements, we had an accumulated deficit at March 31, 2016 , and a net loss for the three months ended March 31, 2016 and 2015 . These factors, coupled with our large outstanding debt balance, raise substantial doubt about our ability to continue as a going concern. We are attempting to restructure our debt, generate sufficient revenues and reduce costs; however, our cash position may not be sufficient to support our daily operations if we are not successful. While we are currently executing a comprehensive strategy to restructure our indebtedness, improve liquidity and reduce costs, including cash interest expense, to sustain operations through the prolonged depression in oil and natural gas prices and the corresponding impact on our business operations, there can be no assurances to that effect. Our ability to continue as a going concern is dependent upon our ability to complete the transactions associated with our comprehensive strategy to restructure our indebtedness and to generate sufficient liquidity to meet our obligations and operating needs. While we were, and remain, in compliance with our existing debt arrangements, we recognize that absent an improvement in oil prices or a reduction in our indebtedness and cash interest expense, we do not have enough liquidity, including cash on hand, to service our debt, operations, and pay-down debt to avoid covenant violations. See the "Restructuring Support Agreement" discussion in Note 8 and the "Subsequent Events Related to Restructuring" discussion in Note 17 for details on management's financing strategy to restructure our debt in 2016. The consolidated financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should we be unable to continue as a going concern. Significant Accounting Policies As of January 1, 2016, we retrospectively adopted, for all comparative periods presented, ASU 2015-03, Simplifying the Presentation of Debt Issuance Costs , and ASU 2015-15, Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements . The amendments in ASU 2015-03 require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. In order to conform to the current financial statement presentation, $7.9 million and $8.7 million of unamortized debt issuance costs related to our 2018 Notes have been reclassified from “Other assets” to “Current portion of long-term debt” on the condensed consolidated balance sheets as of March 31, 2016 and December 31, 2015, respectively. The guidance in ASU 2015-15 prescribes that deferred initial up-front commitment fees paid by a borrower to a lender represent the benefit of being able to access capital over the contractual term, and therefore, meet the definition of an asset, while debt issuance costs in the scope of ASU 2015-03 do not. As such, we will continue to present the costs associated with our asset-based revolving credit facility as an asset. Deferred issuance costs associated with our asset-based revolving credit facility of $2.1 million and $2.2 million as of March 31, 2016 and December 31, 2015, respectively, are included in “Other current assets” on the condensed consolidated balance sheets as this debt is considered short-term. On March 10, 2016, we entered into an amendment to our guaranty and security agreement related to our asset-based revolving credit facility ("ABL Facility"), which is described in further detail in Note 8 under "ABL Facility Amendments." This amendment implemented a daily cash sweep of our collection lockbox and depository accounts, the proceeds of which are required to be applied against the outstanding balance of the ABL Facility. As a result of the sweep occurring one day in arrears, we had an ending balance of $0.2 million in our collection lockbox and depository accounts on March 31, 2016, which we have classified as "Restricted cash" on the condensed consolidated balance sheet as this cash is not available for operations and was subsequently swept by the lender on April 1, 2016. There have been no other material changes or developments in our significant accounting policies or evaluation of accounting estimates and underlying assumptions or methodologies from those disclosed in our Annual Report on Form 10-K for the year ended December 31, 2015. |
Recently Issued Accounting Pron
Recently Issued Accounting Pronouncements | 3 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”). The amendments in this update will be added to the ASC as Topic 606, Revenue from Contracts with Customers, and replaces the guidance in Topic 605. The underlying principle of the guidance in this update is that a business or other organization will recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects what it expects to receive in exchange for the goods or services. This new revenue standard also calls for more detailed disclosures and provides guidance for transactions that weren’t addressed completely, such as service revenue and contract modifications which may be applied retrospectively or modified retrospectively. In August 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date ("ASU 2015-14"). The guidance in ASU 2015-14 delays the effective date for the new revenue recognition guidance outlined in ASU 2014-09 to reporting periods beginning after December 15, 2017, which for us is the reporting period starting January 1, 2018. We are reviewing the guidance in ASU 2014-09 and have not yet assessed the impact, if any, on our consolidated financial statements and have not determined our method of adoption. In August 2014, the FASB issued ASU No. 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern (“ASU 2014-15”). ASU 2014-15 requires management to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures. In doing so, companies will have reduced diversity in the timing and content of footnote disclosures than under today’s guidance. ASU 2014-15 is effective for reporting periods beginning after December 15, 2016, which for us is the reporting period starting January 1, 2017, with early adoption permitted. We are reviewing the guidance in ASU 2014-15 and evaluating the impact this new guidance may have on our consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) ("ASU 2016-02"), which requires an entity that is a lessee to recognize the assets and liabilities arising from leases on the balance sheet. This guidance also requires disclosures about the amount, timing and uncertainty of cash flows arising from leases. This guidance is effective for annual reporting periods beginning after December 15, 2018, and interim periods within those annual periods, using a modified retrospective approach. Early adoption of ASU 2016-09 is permitted. We are evaluating the effect that ASU 2016-02 will have on our consolidated financial statements and related disclosures . Based upon the current effective date, the new guidance would first apply to our reporting period starting January 1, 2019. In March 2016, the FASB issued ASU No. 2016-09, Compensation-Stock Compensation- Improvements to Employee Share-Based Payment Accounting ("ASU 2016-09"), which involves several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. Under the new standard, income tax benefits and deficiencies are to be recognized as income tax expense or benefit in the income statement and the tax effects of exercised or vested awards should be treated as discrete items in the reporting period in which they occur. An entity should also recognize excess tax benefits regardless of whether the benefit reduces taxes payable in the current period. Excess tax benefits should be classified along with other income tax cash flows as an operating activity. In regards to forfeitures, the entity may make an entity-wide accounting policy election to either estimate the number of awards that are expected to vest or account for forfeitures when they occur. ASU 2016-09 is effective for fiscal years beginning after December 15, 2016, including interim periods within that reporting period, however early adoption is permitted. We are currently evaluating the guidance in ASU 2016-09 to determine our adoption method and the effect it will have on our consolidated financial statements. |
Earnings Per Common Share
Earnings Per Common Share | 3 Months Ended |
Mar. 31, 2016 | |
Earnings Per Share [Abstract] | |
Earnings Per Common Share | Earnings Per Common Share Basic and diluted loss per common share from continuing operations, basic and diluted loss per common share from discontinued operations and net loss per basic and diluted common share have been computed using the weighted average number of shares of common stock outstanding during the period. For the three months ended March 31, 2016 and 2015 , no shares of common stock underlying stock options, restricted stock, or other common stock equivalents were included in the computation of diluted earnings per common share ("EPS") from continuing operations because the inclusion of such shares would be antidilutive based on the net losses from continuing operations reported for those periods. Accordingly, for the three month periods ended March 31, 2016 and 2015 , no shares of common stock underlying stock options, restricted stock, or other common stock equivalents were included in the computations of diluted EPS from income from discontinued operations or diluted EPS from net loss per common share, because such shares were excluded from the computation of diluted EPS from continuing operations for those periods. The following table presents the calculation of basic and diluted net loss per common share: Three Months Ended March 31, 2016 2015 Numerator: Loss from continuing operations $ (27,271 ) $ (11,995 ) Income from discontinued operations 55 921 Net loss attributable to common shareholders $ (27,216 ) $ (11,074 ) Denominator: Weighted average shares—basic 27,907 27,412 Common stock equivalents — — Weighted average shares—diluted 27,907 27,412 Basic and diluted loss per common share from continuing operations $ (0.98 ) $ (0.44 ) Basic and diluted income per common share from discontinued operations — 0.03 Net loss per basic and diluted common share $ (0.98 ) $ (0.41 ) Anti-dilutive stock-based awards excluded 706 879 See Note 17 on "Subsequent Events Related to Restructuring" for a discussion on the number of shares of common stock we expect to be outstanding after completing the debt restructuring plan. |
Intangible Assets
Intangible Assets | 3 Months Ended |
Mar. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | Intangible Assets Intangible assets consist of the following: March 31, 2016 December 31, 2015 Gross Carrying Amount Accumulated Amortization Net Remaining Useful Life (Years) Gross Carrying Amount Accumulated Amortization Net Remaining Useful Life (Years) Customer relationships $ 11,731 $ (7,219 ) $ 4,512 5.5 $ 11,731 $ (6,865 ) $ 4,866 6.0 Disposal permits 1,269 (492 ) 777 4.9 1,269 (451 ) 818 5.2 Customer contracts 17,352 (6,427 ) 10,925 10.5 17,352 (6,169 ) 11,183 11.0 $ 30,352 $ (14,138 ) $ 16,214 8.9 $ 30,352 $ (13,485 ) $ 16,867 9.3 The remaining weighted average useful lives shown are calculated based on the net book value and remaining amortization period of each respective intangible asset. |
Impairment of Long-Lived Assets
Impairment of Long-Lived Assets | 3 Months Ended |
Mar. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets Long-lived assets, such as property, plant and equipment and purchased intangibles subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. There were no indicators of potential impairment for the three months ended March 31, 2016 and 2015. If reduced customer activity levels decrease demand for our services for a prolonged period of time, or if we make downward adjustments to our projections, our actual cash flows could be less than our estimated cash flows, which could result in future impairment charges for long-lived assets. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Measurements Fair value represents an exit price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. GAAP establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: • Level 1 — Observable inputs such as quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities; • Level 2 — Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and • Level 3 — Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions. Assets and liabilities measured at fair value on a recurring basis and the fair value hierarchy of the valuation techniques we utilized to determine such fair value included significant unobservable inputs (Level 3) and were as follows: Fair Value As of March 31, 2016 Assets - Cost method investment $ 3,169 Liabilities - Contingent consideration 8,500 As of December 31, 2015 Assets - Cost method investment $ 3,169 Liabilities - Contingent consideration 8,628 Contingent Consideration We are liable for certain contingent consideration payments in connection with the performance of various acquisitions. The fair values of the contingent consideration obligations were determined using a probability-weighted income approach at the acquisition date and are revalued at each reporting date or more frequently if circumstances dictate based on changes in the discount periods and rates, changes in the timing and amount of the revenue estimates and changes in probability assumptions with respect to the likelihood of achieving the performance measurements upon which the obligations are based. Contingent consideration is reported as "Current portion of contingent consideration" in the condensed consolidated balance sheets as we expect to make all remaining payments within one year. Changes to the fair value of contingent consideration are recorded as "Other income, net" in the condensed consolidated statements of operations. The fair value measurement is based on significant inputs not observable in the market, which are referred to as Level 3 inputs. Changes to contingent consideration obligations during the three months ended March 31, 2016 and the year ended December 31, 2015 were as follows: March 31, 2016 December 31, 2015 Balance at beginning of period $ 8,628 $ 9,824 Cash payments — (909 ) Changes in fair value of contingent consideration, net (128 ) (287 ) Current portion of contingent consideration $ 8,500 $ 8,628 Other In addition to our assets and liabilities that are measured at fair value on a recurring basis, we are required by GAAP to measure certain assets and liabilities at fair value on a nonrecurring basis after initial recognition. Generally, assets, liabilities and reporting units are measured at fair value on a nonrecurring basis as a result of impairment reviews and any resulting impairment charge. In connection with our impairment review of long-lived assets, we measure the fair value of our asset groups for those asset groups deemed not recoverable, based on Level 3 inputs consisting of the discounted future cash flows associated with the use and eventual disposition of the asset group. Cost method investments are measured at fair value on a nonrecurring basis when deemed necessary, using observable inputs such as trading prices of the stock, as well as using discounted cash flows, incorporating adjusted available market discount rate information and our estimates for liquidity risk. |
Accrued Liabilities
Accrued Liabilities | 3 Months Ended |
Mar. 31, 2016 | |
Payables and Accruals [Abstract] | |
Accrued Liabilities | Accrued Liabilities Accrued liabilities consisted of the following at March 31, 2016 and December 31, 2015 : March 31, 2016 December 31, 2015 Accrued payroll and employee benefits $ 2,392 $ 5,839 Accrued insurance 6,000 5,896 Accrued legal and environmental costs 1,714 1,531 Accrued taxes 1,200 1,514 Accrued interest 18,365 8,516 Accrued operating costs 2,192 4,233 Accrued other 2,389 2,314 Total accrued liabilities $ 34,252 $ 29,843 |
Debt
Debt | 3 Months Ended |
Mar. 31, 2016 | |
Debt Disclosure [Abstract] | |
Debt | Debt Debt consisted of the following at March 31, 2016 and December 31, 2015 : March 31, 2016 December 31, 2015 Interest Rate Maturity Date Unamortized Deferred Financing Costs (g) Fair Value of Debt (f) Carrying Value of Debt Carrying Value of Debt ABL Facility (a) 2.94% Jan. 2018 $ 2,109 $ 62,273 $ 62,273 $ 101,832 2018 Notes (b) 9.875% Apr. 2018 7,862 96,000 400,000 400,000 Vehicle financings (c) 1.52% Various — 11,114 11,114 12,303 Note payable (d) 4.25% Apr. 2019 — 6,063 6,063 6,492 Total debt $ 9,971 $ 175,450 479,450 520,627 Original issue discount (e) (578 ) (639 ) Original issue premium (e) 169 187 Deferred financing costs presented with debt (g) (7,862 ) (8,708 ) Total debt, net 471,179 511,467 Less: current portion (h) (463,164 ) (499,709 ) Long-term portion of debt $ 8,015 $ 11,758 _____________________ (a) The interest rate presented represents the interest rate on the $100.0 million ABL Facility at March 31, 2016 . (b) The interest rate presented represents the coupon rate on our outstanding $400.0 million aggregate principal amounts of 9.875% Senior Notes due 2018 (the “2018 Notes”), excluding the effects of deferred financing costs, original issue discounts and original issue premiums. Including the impact of these items, the effective interest rate on the 2018 Notes is approximately 11.0% . Interest payments are due semi-annually on April 15 and October 15 of each year. (c) Vehicle financings consist of capital lease arrangements related to fleet purchases with a weighted-average annual interest rate of approximately 1.52% and which mature in varying installments between 2016 and 2020 . Capital lease obligations were $11.1 million and $12.3 million , respectively, at March 31, 2016 and December 31, 2015 , respectively. (d) During the three months ended June 30, 2015, we settled our $11.0 million financing obligation to acquire the remaining 49% interest in AWS from the non-controlling interest holder with a $4.0 million cash payment and a $7.4 million note payable with principal and interest due in equal quarterly installments through April 2019. (e) The issuance discount represents the unamortized difference between the $250.0 million aggregate principal amount of the 2018 Notes issued in April 2012 and the proceeds received upon issuance (excluding interest and fees). The issuance premium represents the unamortized difference between the proceeds received in connection with the November 2012 issuance of the 2018 Notes (excluding interest and fees) and the $150.0 million aggregate principal amount thereunder. (f) The estimated fair value of our 2018 Notes is based on quoted market prices as of March 31, 2016 . Our ABL Facility and vehicle financings bear interest at rates commensurate with market rates and therefore their respective carrying values approximate fair value. (g) As discussed previously in Note 1, upon retrospective adoption of ASU 2015-03, we have reclassified the deferred financing costs associated with the 2018 Notes to be presented in the balance sheet as a direct deduction from the carrying amount of the debt liability as of March 31, 2016 and December 31, 2015 . In accordance with ASU 2015-15, the deferred financing costs related to the ABL Facility continue to be presented as an asset, and are included in "Other current assets" on the condensed consolidated balance sheets as of March 31, 2016 and December 31, 2015 . (h) As a result of the probability of breaching one of the financial covenants if we are not successful at restructuring our debt (see "Restructuring Support Agreement" later in this section), the carrying value of the ABL Facility and the 2018 Notes was reclassified to current liabilities in the consolidated balance sheet as of March 31, 2016 and December 31, 2015. For a discussion of material changes and developments in our debt and its principal terms, see our discussion below regarding the "ABL Facility Amendments" and "Restructuring Support Agreement," in addition to the discussion in Note 17 on "Subsequent Events Related to Restructuring." Indebtedness We are highly leveraged and a substantial portion of our liquidity needs result from debt service requirements and from funding our costs of operations and capital expenditures, including acquisitions. ABL Facility Amendments On March 10, 2016, we entered into a Consent and Fifth Amendment to Amended and Restated Credit Agreement (the “Fifth ABL Facility Amendment”) and a Third Amendment to Amended and Restated Guaranty and Security Agreement (the "Third GSA Amendment") by and among Wells Fargo Bank, National Association as agent ("Agent"), the Lenders named therein (the “Lenders”), and the Company. Under the Fifth ABL Facility Amendment, the Lenders consented to the inclusion of a “going concern” qualification in the opinion from our registered public accounting firm, which is included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2015. Under the Third GSA Amendment, we consented to and implemented a daily cash sweep of our collection lockbox and depository accounts, the proceeds of which are required to be applied against the outstanding balance of the ABL Facility. The Third GSA Amendment also requires the segregation of all receipts and disbursements in separate bank accounts and limits the end of day balance in our operating bank account to an amount not to exceed $1.0 million . On March 24, 2016, in connection with the previously announced Restructuring Support Agreement to implement a proposed debt restructuring and recapitalization plan (the “Restructuring”), we entered into a Sixth Amendment to Amended and Restated Credit Agreement (the “Sixth ABL Facility Amendment”) by and among the Agent, the Lenders and the Company. Among other terms and conditions, the Sixth ABL Facility Amendment amends the ABL Facility as follows: • Reduces the maximum revolver commitments from $125.0 million to $100.0 million ; • Replaces the leverage ratio financial maintenance covenant with a new minimum EBITDA financial maintenance covenant that will be tested monthly; • Amends the definition of “EBITDA” for purposes of the financial maintenance covenant to provide allowances for certain unusual or non-recurring fees, costs and expenses, with testing monthly beginning in April 2016; • Amends the definition of “Borrowing Base” (i) to set the eligible equipment advance rates based on net book value at 60% and on Net Orderly Liquidation Value (as defined in the ABL Facility) at 80% and (ii) to cap Borrowing Base availability attributable to eligible equipment at 75% ; • Increases the default rate upon the occurrence and continuation of an event of default from 2% to 4% ; • Increases the applicable margin on LIBOR Rate and Base Rate Loans (each as defined in the ABL Facility) and the unused line fee; • Eliminates our ability to voluntarily reduce the commitments without termination of the ABL Facility; • Requires us to apply proceeds from the Restructuring transactions and related agreements to pay down the ABL Facility; • Amends the definition of “Permitted Disposition” to permit the sale of our equity investment in Underground Solutions, Inc., discussed further in Note 13, and to expand the permitted disposition general basket (which excludes the sale of machinery and equipment in the ordinary course of business) from $5.0 million to $7.5 million ; • Applies a Permitted Disposition Reserve of 50% against our availability for net cash proceeds in excess of $7.5 million made on or after March 10, 2016 for sales specifically related to the Permitted Disposition general basket; and • Amends certain definitions in connection with the Restructuring transactions, including “Change of Control”, “Permitted Indebtedness”, and “Permitted Liens”. In addition, we agreed to certain make-whole fees that would be payable to the Lenders upon early termination of the ABL Facility as a result of acceleration, bankruptcy or otherwise, unless amounts outstanding under the ABL Facility are paid in full. In connection with the Sixth ABL Facility Amendment we incurred amendment fees of approximately $0.6 million which were capitalized as deferred financing costs during the three months ended March 31, 2016. Further, we wrote off a portion of the unamortized deferred financing costs associated with our ABL Facility of approximately $0.4 million during the three months ended March 31, 2016. See the "ABL Facility Amendments" discussion in Note 17 on "Subsequent Events Related to Restructuring" for details on the Seventh Amendment to Amended and Restated Credit Agreement (the "Seventh ABL Facility Amendment"). Financial Covenants and Borrowing Limitations The ABL Facility, as amended, requires, and any future credit facilities will likely require, us to comply with specified financial ratios that may limit the amount we can borrow under our ABL Facility. A breach of any of the covenants under the indenture governing the 2018 Notes (the “Indenture”) or the ABL Facility, as applicable, could result in a default. Our ability to satisfy those covenants depends principally upon our ability to meet or exceed certain positive operating performance metrics including, but not limited to, earnings before interest, taxes, depreciation and amortization, or EBITDA, and ratios thereof, as well as certain balance sheet ratios. Any debt agreements we enter into in the future may further limit our ability to enter into certain types of transactions. The ABL Facility contains certain financial covenants, including a fixed charge coverage ratio and a minimum EBITDA covenant. The fixed charge coverage ratio, which only applies if excess availability under the ABL Facility falls below 12.5% of the maximum revolver amount, requires the ratio of adjusted EBITDA (as defined by the ABL Facility) less capital expenditures to fixed charges (as defined) to be at least 1.1 to 1.0. The fixed charge coverage ratio covenant could have the effect of limiting our availability under the ABL Facility, as additional borrowings would be prohibited if, after giving pro forma effect thereto, we would be in violation of such covenant. The minimum EBITDA covenant requires us to meet a stated year-to-date EBITDA target (as defined by the ABL Facility) beginning April 30, 2016 and continuing each month thereafter through December 31, 2016 at which time the target is reset. As of March 31, 2016 , we remained in compliance with our debt covenants and availability was $26.3 million ; however, our ratio of adjusted EBITDA to fixed charges was less than 1.1 to 1.0 (as calculated pursuant to the ABL Facility). As such, our net availability was reduced by 12.5% of the maximum revolver amount, or $12.5 million , resulting in approximately $13.8 million of net availability as of March 31, 2016 . As of March 31, 2016 we were not required to meet a minimum EBITDA target. For the four months ending April 30, 2016 we are required to have minimum EBITDA of approximately $2.1 million . During the three months ended March 31, 2016 , the Agent for the ABL Facility commenced a borrowing base redetermination involving a valuation of the net orderly liquidation value of our eligible machinery and equipment by a third party specialist. As a result, the lenders applied an $18.0 million reserve against our availability based on the estimated decline to our borrowing base. Due to the application of this reserve against our availability and due to the implementation of the daily sweep of our lockbox and depository bank accounts, we made cumulative payments of $52.0 million during the three months ended March 31, 2016 , offset by borrowings of $12.4 million , thus reducing the amount outstanding under the ABL Facility to $62.3 million as of March 31, 2016 . The ABL Facility's borrowing base limitations are based upon eligible accounts receivable and equipment. If the value of our eligible accounts receivable or equipment decreases for any reason, or if some portion of our accounts receivable or equipment is deemed ineligible under the terms of our ABL Facility, the amount we can borrow under the ABL Facility could be reduced. These limitations could have a material adverse impact on our liquidity and financial condition. In addition, the administrative agent for our ABL Facility has the periodic right to commission appraisals of the assets comprising our borrowing base, and we are obligated to reimburse the cost of up to four appraisals including one field examination, during any 12 consecutive months. If an appraisal results in a reduction of the borrowing base, we may be required to repay a portion of the amount outstanding under the ABL Facility in order to remain in compliance with applicable borrowing limitations. At March 31, 2016 we had $13.8 million of net availability under the ABL Facility. During the remainder of 2016, we expect further deterioration to our ABL borrowing base due to declining accounts receivable and downward pressure on the orderly liquidation values of our machinery and equipment. During the three months ended March 31, 2016 , we made payments of $52.0 million against the outstanding balance of the ABL Facility a portion of which was made to cover the borrowing base deterioration. There can be no assurance that we will have sufficient cash on hand or other sources of liquidity to make any such future repayments if necessary. The Indenture governing the 2018 Notes contains restrictive covenants on the incurrence of senior secured indebtedness. To the extent that the fixed charge coverage ratio (as defined in the Indenture) is below 2.0 to 1.0, the Indenture prohibits our incurrence of new senior secured indebtedness under the ABL Facility or any other secured credit facility, at that point in time, to the greater of $150.0 million and the amount of debt as restricted by the secured leverage ratio, which is the ratio of secured debt to EBITDA, of 2.0 to 1.0, as determined pursuant to the Indenture. The 2.0 to 1.0 fixed charge coverage ratio and secured leverage ratio are incurrence covenants, not maintenance covenants. The covenants do not require repayment of existing borrowings incurred previously in accordance with the covenants, but rather limits new borrowings during any such period. As a result of the Sixth ABL Facility Amendment, our ability to incur new borrowings under the ABL Facility is limited to a maximum of $100.0 million irrespective of the permitted availability of up to $150.0 million under the 2018 Notes. See the "Exchange Offer" and "Term Loan" discussions in Note 17 on "Subsequent Events Related to Restructuring" for details on the exchange offer for the 2018 Notes, the consent related thereto, the 2021 Notes and the new term loan. The covenants described above are subject to important exceptions and qualifications. The continued effect of low oil and natural gas prices will negatively impact our compliance with our covenants, and we cannot guarantee that we will satisfy those requirements. If we do not obtain a long term waiver for any breached covenants, such breach would result in a default under the Indenture, ABL Facility or other debt obligations, or any future credit facilities we may enter into, which could allow all amounts outstanding thereunder to be declared immediately due and payable, subject to the terms and conditions of the documents governing such indebtedness. If we were unable to repay the accelerated amounts, our secured lenders could proceed against the collateral granted to them to secure such indebtedness. This would likely in turn trigger cross acceleration and cross-default rights under any other credit facilities and indentures. If the amounts outstanding under the 2018 Notes or any other indebtedness outstanding at such time were to be accelerated or were the subject of foreclosure actions, we cannot guarantee that our assets would be sufficient to repay in full the money owed to the lenders or to our other debt holders. We cannot guarantee that we will be granted waivers or amendments to the Indenture governing the 2018 Notes, the ABL Facility or such other debt obligations if for any reason we are unable to comply with our obligations thereunder. Any such limitations on borrowing under our ABL Facility could have a material adverse impact on our liquidity. Restructuring Support Agreement On March 11, 2016, we entered into a Restructuring Support Agreement with holders of more than 80% of the 2018 Notes relating to a restructuring transaction (the “Restructuring”), subject to the satisfaction of certain closing conditions including shareholder approval and minimum noteholder participation, pursuant to which, among other terms and conditions: (i) the exchange up to $368.6 million aggregate principal amount of the 2018 Notes for new second lien secured notes due 2021 (the “2021 Notes”), (ii) the exchange of approximately $31.4 million aggregate principal amount of the 2018 Notes for our common stock at a volume-weighted, market-average conversion price per share which were purchased on the open market during the year ended December 31, 2015 by an entity controlled by Mr. Mark D. Johnsrud, our Chief Executive Officer and Chairman of the board of directors, (iii) a new $24.0 million principal amount “last out” first lien term loan due 2018 (the “Term Loan”) which was funded by certain holders of the 2018 Notes with annual interest at 13% to be paid in-kind by increasing the principal amount payable thereunder and due at maturity, and (iv) the issuance of warrants to purchase up to 15% of our outstanding common stock, at an exercise price of $0.01 per share, to the lenders under the Term Loan and certain holders of the 2018 Notes that participated in the exchange offer. In addition, as part of the Restructuring, Mr. Johnsrud agreed to backstop a $5.0 million equity rights offering (the “Rights Offering”) that is expected to be completed in the second quarter of 2016. The net proceeds of the Term Loan and the Rights Offering are to be used to pay down a portion of the outstanding balance on the ABL Facility, which will be available for re-borrowing subject to any borrowing base limitations and compliance with other applicable terms and conditions under the ABL Facility. Interest on the 2021 Notes will be payable semiannually on April 15 and October 15 of each year beginning on October 15, 2016, and will be paid in-kind by increasing the principal amount payable thereunder and due at maturity and/or in cash as follows: (i) interest payable on October 15, 2016 will be paid in-kind at a rate of 12.5% per annum, (ii) interest payable in 2017 will be paid 50% in-kind and 50% in cash at a rate of 10% per annum, (iii) interest payable on April 15, 2018 and thereafter will be paid in cash at a rate of 10% per annum until maturity. The liens securing the 2021 Notes will be contractually subordinated to the liens on such assets securing the ABL Facility and the Term Loan. Both the conversion of Mr. Johnsrud’s 2018 Notes to equity and the Rights Offering are subject to shareholder approval of amendments to our Amended and Restated Certificate of Incorporation, as amended ("Certificate of Incorporation"), to provide for the issuance of sufficient additional shares of common stock. As described previously under "ABL Facility Amendments," on March 24, 2016 in connection with the Restructuring we entered into the Sixth ABL Facility Amendment. See Note 17 on "Subsequent Events Related to Restructuring" for a discussion of material changes and developments after March 31, 2016 with respect to the Restructuring. The Restructuring and the transactions contemplated thereby are subject to additional terms and conditions. We provide no assurances that we will be able to successfully consummate the Restructuring or other alternatives to restructure our existing indebtedness, in which case we may need to restructure under the Bankruptcy Code. |
Restructuring and Exit Costs
Restructuring and Exit Costs | 3 Months Ended |
Mar. 31, 2016 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Exit Costs | Restructuring and Exit Costs In March 2015, we initiated a plan to restructure our business in certain shale basins and reduce costs, including an exit from the Mississippian ("MidCon") shale area and the Tuscaloosa Marine Shale logistics business. Additionally, we closed certain yards within the Northeast and Southern divisions and transferred many of the related assets to our other operating locations, primarily in the Eagle Ford shale basin. The total costs of the restructuring recognized in 2015 were approximately $7.1 million . There were no costs incurred during the three months ended March 31, 2016 . We recorded $0.7 million during the three months ended March 31, 2015 . The charges are characterized as "Other, net" in the accompanying condensed consolidated statements of operations. Such costs consisted of the following: Three Months Ended Three Months Ended March 31, 2016 March 31, 2015 Severance and termination benefits $ — $ 240 Asset impairment charge — — Contract termination costs and exit costs — 443 Total restructuring and exit costs $ — $ 683 For the three months ended March 31, 2015 , approximately $0.6 million and $0.1 million of the total charge was recorded in the Southern and Northeast operating segments, respectively. The liability totaled approximately $0.2 million as of March 31, 2016 and is included as "Accrued liabilities" in the condensed consolidated balance sheets. A rollforward of the restructuring and exit cost accruals from December 31, 2015 through March 31, 2016 is as follows: Employee Termination Costs (a) Lease Exit Costs (b) Other Exit Costs (c) Total Restructuring and exit costs accrued at December 31, 2015 $ — $ 180 $ — $ 180 Restructuring and exit-related costs — — — — Cash payments — (12 ) — (12 ) Restructuring and exit costs accrued at March 31, 2016 $ — $ 168 $ — $ 168 _____________________ (a) Employee termination costs consist primarily of severance and related costs. (b) Lease exit costs consist primarily of costs that will continue to be incurred under non-cancellable operating leases for their remaining term without benefit to us. (c) Other exit costs include costs related to the movement of vehicles and rental fleet in connection with the exit from certain shale areas. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The following table shows the components of the income tax benefit for the periods indicated: Three Months Ended March 31, 2016 2015 Current income tax (expense) benefit $ (30 ) $ 25 Deferred income tax expense (25 ) (1 ) Total income tax (expense) benefit $ (55 ) $ 24 The effective income tax expense rate for the three months ended March 31, 2016 was 0.2% , which differs from the federal statutory benefit rate of 35.0% primarily due to the increase in the valuation allowance on deferred tax assets resulting from current year losses. The effective income tax benefit rate for the three months ended March 31, 2015 was 0.2% , which differs from the federal statutory rate of 35.0% primarily due to the increase in the valuation allowance on deferred tax assets resulting from current year losses. We have significant deferred tax assets, consisting primarily of net operating losses (“NOLs”), which have a limited life, generally expiring between the years 2029 and 2036 and capital losses, which have a five year carryforward expiring in 2020. We regularly assess the available positive and negative evidence to estimate if sufficient future taxable income will be generated to use the existing deferred tax assets. A significant piece of objective negative evidence evaluated was the cumulative losses incurred this year and in recent years. Such objective evidence limits the ability to consider other subjective evidence such as our projections for future taxable income. In light of our continued losses, at March 31, 2016 we determined that our deferred tax liabilities were not sufficient to fully realize our deferred tax assets. Accordingly, a valuation allowance continues to be required against the portion of our deferred tax assets that is not offset by deferred tax liabilities. Accordingly, we expect our effective income tax rate to be near zero for 2016. |
Share-based Compensation
Share-based Compensation | 3 Months Ended |
Mar. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-based Compensation | Share-based Compensation We may grant stock options, stock appreciation rights, restricted common stock and restricted stock units, performance shares and units, other stock-based awards and cash-based awards to our employees, directors, consultants and advisors pursuant to the Nuverra Environmental Solutions, Inc. 2009 Equity Incentive Plan (as amended, the “2009 Plan”). The total grants awarded during the three months ended March 31, 2016 and March 31, 2015 are presented in the table below: Three Months Ended March 31, 2016 2015 Stock option grants — 703 Restricted stock grants — — Restricted stock unit grants 1 151 Total grants under the 2009 Plan 1 854 The total stock-based compensation cost included in "General and administrative expenses" in the accompanying condensed consolidated statements of operations was as follows: Three Months Ended March 31, 2016 2015 Stock options $ 84 $ 148 Restricted stock 85 101 Restricted stock units 199 540 Total stock-based compensation expense $ 368 $ 789 |
Legal Matters
Legal Matters | 3 Months Ended |
Mar. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Legal Matters | Legal Matters Environmental Liabilities We are subject to the environmental protection and health and safety laws and related rules and regulations of the United States and of the individual states, municipalities and other local jurisdictions where we operate. Our continuing operations are subject to rules and regulations promulgated by the Texas Railroad Commission, the Texas Commission on Environmental Quality, the Louisiana Department of Natural Resources, the Louisiana Department of Environmental Quality, the Ohio Department of Natural Resources, the Pennsylvania Department of Environmental Protection, the North Dakota Department of Health, the North Dakota Industrial Commission, Oil and Gas Division, the North Dakota State Water Commission, the Montana Department of Environmental Quality and the Montana Board of Oil and Gas, among others. These laws, rules and regulations address environmental, health and safety and related concerns, including water quality and employee safety. We have installed safety, monitoring and environmental protection equipment such as pressure sensors and relief valves, and have established reporting and responsibility protocols for environmental protection and reporting to such relevant local environmental protection departments as required by law. We believe we are in material compliance with all applicable environmental protection laws and regulations in the United States and the states in which we operate. We believe that there are no unrecorded liabilities as of the periods reported herein in connection with our compliance with applicable environmental laws and regulations. The condensed consolidated balance sheets at March 31, 2016 and December 31, 2015 included accruals totaling $0.5 million and $0.3 million , respectively, for various environmental matters. Litigation There are various lawsuits, claims, investigations and proceedings that have been brought or asserted against us, which arise in the ordinary course of business, including actions with respect to securities and shareholder class actions, personal injury, vehicular and industrial accidents, commercial contracts, legal and regulatory compliance, securities disclosure, labor and employment, and employee benefits and environmental matters, the more significant of which are summarized below. We record a provision for these matters when it is both probable that a liability has been incurred and the amount of the loss can be reasonably estimated. Any provisions are reviewed at least quarterly and are adjusted to reflect the impact and status of settlements, rulings, advice of counsel and other information and events pertinent to a particular matter. We believe that we have valid defenses with respect to legal matters pending against us. Based on our experience, we also believe that the damage amounts claimed in the lawsuits disclosed below are not necessarily a meaningful indicator of our potential liability. Litigation is inherently unpredictable, and it is possible that our results of operations or cash flow could be materially affected in any particular period by the resolution of one or more of the legal matters pending against us. We do not expect that the outcome of other current claims and legal actions not discussed below will have a material adverse effect on our consolidated financial position, results of operations or cash flows. Shareholder Litigation 2013 Class Action In September 2013, two separate but substantially similar putative class action lawsuits were commenced in Federal court against us and certain of our current and former officers and directors alleging that we, along with the individual defendants, made certain material misstatements and/or omissions relating to our operations and financial condition which caused the price of our shares to fall. By order dated October 29, 2013, the two putative class actions were consolidated and a consolidated complaint was filed. Defendants filed a motion to dismiss these claims in May 2014, and such motion was granted by the Court on November 17, 2014, whereby the forgoing class action was dismissed without prejudice. Plaintiffs were permitted by the Court to file a motion to amend the complaint and did so on December 8, 2014. Defendants filed their opposition to plaintiffs' motion to amend the complaint on December 22, 2014. On March 12, 2015, the Court issued an order denying plaintiffs' motion to amend the complaint as to certain claims, but granting plaintiffs' motion as to other claims. Plaintiffs filed an amended complaint on March 19, 2015, and on March 23, 2015, we filed a motion to dismiss the amended complaint for failure to comply with the Court’s March 12, 2015 order. Both parties filed subsequent pleadings. On June 24, 2015, the Court granted our motion to dismiss plaintiffs' amended consolidated class action complaint and dismissed the case with prejudice. On July 24, 2015, plaintiffs filed a notice of appeal to the Ninth Circuit Court of Appeals. The appeal was voluntarily dismissed by plaintiffs on November 5, 2015, thereby concluding this litigation. 2013 Derivative Cases In September and October 2013, three separate but substantially similar shareholder derivative lawsuits were commenced in Federal court against us and certain of our current and former officers and directors alleging that members of our board of directors failed to prevent the issuance of certain misstatements and omissions and asserting claims for breach of fiduciary duty, waste of corporate assets and unjust enrichment. Defendants filed a motion to dismiss these claims in February 2014. On September 15, 2014, the Court dismissed the consolidated cases following its dismissal of the consolidated complaint and plaintiffs' failure to amend. Also in October 2013, two identical shareholder derivative lawsuits were commenced in Arizona state court against us and certain of our current officers and directors alleging breach of fiduciary duty, waste of corporate assets and unjust enrichment. By order dated January 28, 2014, these two actions were consolidated, and defendants filed a motion to dismiss these claims in June 2014. On July 22, 2014, the parties filed a joint stipulation to dismiss these cases with prejudice, which was granted by the Court on August 1, 2014, and no settlement payment was made. In the first quarter of 2015, we received a written demand from one of the plaintiffs in the derivative lawsuits requesting that the board of directors commence an independent investigation of certain matters and take appropriate action to recover for us any damages to which we may be entitled as a result of alleged breaches of fiduciary duties by certain of our current and former officers and directors. The board appointed a special committee to conduct such an investigation, which it did with the assistance of independent professionals. The investigation concluded with a finding that there had been no actionable wrongdoing and a recommendation that the Company not act further with respect to the shareholder demand. AWS Arbitration Demand On April 28, 2015, the holder of the non-controlling interest in AWS issued to us a Demand for Arbitration pursuant to the terms of the AWS operating agreement, relating to alleged breaches by us of certain of our obligations under the operating agreement. We entered into a settlement of this matter with the non-controlling interest holder in June 2015 whereby we purchased the remaining interest in AWS for $4.0 million in cash and a $7.4 million note payable with principal and interest due in equal quarterly installments through April 2019. If we fail to meet the payment terms of this obligation, or if we become insolvent or declare bankruptcy, all remaining outstanding balances on the note payable would become immediately due and payable. If such an acceleration were to occur, we would request a waiver from the non-controlling interest holder, but there can be no assurance that such waiver would be forthcoming or that we would have sufficient available liquidity to make any required repayment. |
Related Party and Affiliated Co
Related Party and Affiliated Company Transactions | 3 Months Ended |
Mar. 31, 2016 | |
Related Party Transactions [Abstract] | |
Related Party and Affiliated Company Transactions | Related Party and Affiliated Company Transactions Termination of Aircraft Lease Agreement During the three months ended March 31, 2016, the aircraft lease agreement with an entity owned and controlled by Mark D. Johnsrud, our Chief Executive Officer and Chairman of our board of directors, was terminated. During the three months ended March 31, 2016, reimbursements payable to the entity in exchange for use of the aircraft, in the aggregate amount of $45 thousand , were paid in full. There were no remaining reimbursements payable to the entity as of March 31, 2016. There have been no significant changes to the other related party transactions with Mr. Johnsrud for apartment rentals, purchases of fresh water for resale and use of land where certain of our saltwater disposal wells are situated as described in Note 19 to the consolidated financial statements in our 2015 Annual Report on Form 10-K. Cost Method Investment - Underground Solutions, Inc. On February 18, 2016, Aegion Corporation (or "Aegion") announced the completion of the acquisition of Underground Solutions, Inc. (or "UGSI"), an entity in which we held an approximate 7% equity interest, whereby Aegion paid approximately $85.0 million to acquire UGSI. Our total proceeds will be approximately $5.2 million . In April of 2016, we received proceeds of $5.0 million , with the remaining $0.2 million of proceeds held back and deposited in an escrow account. We will be entitled to these additional proceeds, subject to certain working capital adjustments and indemnity claims, over the course of the next 18 months. The net proceeds of $5.2 million exceeded our cost basis of approximately $3.2 million . As such, we will recognize a net gain on the sale of approximately $1.9 million , which includes approximately $0.1 million in costs incurred by us in the closing, during the three months ended June 30, 2016. |
Segments
Segments | 3 Months Ended |
Mar. 31, 2016 | |
Segment Reporting [Abstract] | |
Segments | Segments We evaluate business segment performance based on income (loss) before income taxes exclusive of corporate general and administrative costs and interest expense, which are not allocated to the segments. Our shale solutions business is comprised of three operating divisions, which we consider to be operating and reportable segments of our continuing operations: (1) the Northeast division comprising the Marcellus and Utica Shale areas, (2) the Southern division comprising the Haynesville, Eagle Ford, and Permian Basin Shale areas and (3) the Rocky Mountain division comprising the Bakken Shale area. Corporate/Other includes certain corporate costs and certain other corporate assets. As discussed in Note 9, in March 2015, we initiated a plan to restructure our business in certain shale basins and reduce costs, including an exit from the Mississippian (or "MidCon") shale area. As a result, revenues for the MidCon shale area were included in the Southern division and costs associated with revenue generating activities of the MidCon shale area were included in the Southern division for the three months ended March 31, 2015. As a result of our restructuring in the MidCon, some remaining operating expenses for shut-down activities, as well as depreciation and amortization, were included in the Southern division during the three months March 31, 2016. Financial information for our reportable segments related to continuing operations is presented below. Rocky Mountain Northeast Southern Corporate/ Other Total Three months ended March 31, 2016 Revenue $ 24,905 $ 12,777 $ 9,293 $ — $ 46,975 Direct operating expenses 19,558 11,568 7,491 — 38,617 General and administrative expenses 1,852 1,190 920 3,490 7,452 Depreciation and amortization 8,079 3,883 3,814 69 15,845 Operating loss (4,584 ) (3,864 ) (2,932 ) (3,559 ) (14,939 ) Loss from continuing operations before income taxes (4,652 ) (3,931 ) (2,926 ) (15,707 ) (27,216 ) As of March 31, 2016 Total assets (a) 246,530 72,916 123,028 17,639 460,113 Three months ended March 31, 2015 Revenue 69,410 27,313 22,389 — 119,112 Direct operating expenses 48,425 21,496 18,078 — 87,999 General and administrative expenses 2,056 1,904 2,078 6,662 12,700 Depreciation and amortization 8,737 3,927 4,648 170 17,482 Operating income (loss) 10,192 (98 ) (3,014 ) (6,832 ) 248 Income (loss) from continuing operations before income taxes 10,097 13 (2,935 ) (19,194 ) (12,019 ) As of December 31, 2015 Total assets (a) 263,871 76,472 128,482 53,794 522,619 _____________________ (a) Total assets exclude intercompany receivables eliminated in consolidation. |
Discontinued Operations
Discontinued Operations | 3 Months Ended |
Mar. 31, 2016 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | Discontinued Operations Our former industrial solutions operating and reportable segment, Thermo Fluids, Inc. ("TFI"), has been classified as discontinued operations since the sale process with various prospective acquirers began in fourth quarter of 2013. In February, 2015, we entered into a definitive agreement with Safety-Kleen, Inc. ("Safety-Kleen"), a subsidiary of Clean Harbors, Inc., whereby Safety-Kleen agreed to acquire TFI for $85.0 million in an all-cash transaction, subject to working capital adjustments. On April 11, 2015, we completed the TFI disposition with Safety-Kleen as contemplated by the previously disclosed purchase agreement. Pursuant to the purchase agreement, $4.3 million of the purchase price was deposited into an escrow account to satisfy our indemnification obligations under the purchase agreement and is captured as "Restricted cash" in our condensed consolidating balance sheet. Any remaining balance in the escrow account will be released to us 18 months following the closing date, unless both parties mutually agree to release the remaining balance prior to such date. Pursuant to the purchase agreement, the purchase price paid at closing was adjusted based upon an estimated working capital adjustment, which is subject to post-closing reconciliation, to reflect TFI’s actual working capital (calculated in accordance with the purchase agreement) on the closing date. After giving effect to the indemnity escrow, the estimated working capital adjustment and the payment of transaction fees and other expenses, the amount of net cash proceeds used to reduce the outstanding balance under the ABL Facility on the closing date was approximately $74.6 million . The post-closing working capital reconciliation is still in process and may result in an increase or decrease in our final net cash proceeds and the final loss on the sale of TFI. We classified TFI as discontinued operations in our condensed consolidated statements of operations for the three months ended March 31, 2016 and 2015 . We recorded income related to the sale of TFI of $0.1 million and $0.9 million as a component of "Income from discontinued operations, net of income taxes" in our consolidated statements of operations for the three months ended March 31, 2016 and 2015 , respectively. The following table provides selected financial information of discontinued operations related to TFI (and includes TFI's results through the sale on April 11, 2015): Three Months Ended March 31, 2016 2015 Revenue $ — $ 17,497 Income from discontinued operations before income taxes $ — $ 1,186 Income tax expense — (265 ) Income from discontinued operations - before sale $ — $ 921 Income on sale of TFI 55 — Income from discontinued operations $ 55 $ 921 |
Subsidiary Guarantors
Subsidiary Guarantors | 3 Months Ended |
Mar. 31, 2016 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Subsidiary Guarantors | Subsidiary Guarantors Our obligations under the 2018 Notes are jointly and severally, fully and unconditionally guaranteed by certain of our subsidiaries. Pursuant to the terms of the Indenture, the guarantees are full and unconditional, but are subject to release under the following circumstances: • in connection with any sale, disposition or transfer of all or substantially all of the assets to a person that is not the Company or a subsidiary guarantor; • in connection with any sale, disposition or transfer of all of the capital stock of that subsidiary guarantor to a person that is not the Company or a subsidiary guarantor; • if we designate any restricted subsidiary that is a subsidiary guarantor to be an unrestricted subsidiary; or • upon legal defeasance or the discharge of our obligations under the Indenture. Although the guarantees are subject to release under the above described circumstances, we have concluded they are still deemed full and unconditional for purposes of Rule 3-10 of Regulation S-X because these circumstances are customary, and accordingly, we concluded that we may rely on Rule 3-10 of Regulation S-X, as the other requirements of Rule 3-10 have been met. See "Subsequent Events Related to Restructuring" in Note 17 for details on additional guaranty obligations for our subsidiaries. The following tables present consolidating financial information for Nuverra Environmental Solutions, Inc. (“Parent”) and its 100% wholly-owned subsidiaries (the “Guarantor Subsidiaries”) as of March 31, 2016 and December 31, 2015 and for the three months ended March 31, 2016 and 2015 . In June 2015, we purchased the remaining interest in AWS, previously a 51% owned non-guarantor subsidiary, and have recast the tables to reflect AWS as a part of the Guarantor Subsidiaries for the three months ended March 31, 2015 . During the three months ended December 31, 2015, Nuverra Rocky Mountain Pipeline, LLC (or "RMP") was released from all obligations including as guarantor. However, because RMP's individual results are not material as there are no active contracts for new pipelines, we have not separately presented RMP as a Non-Guarantor, but rather continued to include RMP in the Guarantor Subsidiaries column. These condensed consolidating financial statements have been prepared from our financial information on the same basis of accounting as our condensed consolidated financial statements. The principal elimination entries relate to investments in subsidiaries and intercompany balances and transactions. CONDENSED CONSOLIDATING BALANCE SHEET MARCH 31, 2016 (Unaudited) Parent Guarantor Subsidiaries Eliminations Consolidated ASSETS Cash and cash equivalents $ 808 $ (778 ) $ — $ 30 Restricted cash 4,250 200 — 4,450 Accounts receivable, net — 30,857 — 30,857 Deferred income taxes — — — — Other current assets 7,275 5,195 — 12,470 Total current assets 12,333 35,474 — 47,807 Property, plant and equipment, net 2,546 389,229 391,775 Equity investments 32,033 576 (28,864 ) 3,745 Intangible assets, net — 16,214 — 16,214 Other 405,619 80,677 (485,724 ) 572 Total assets $ 452,531 $ 522,170 $ (514,588 ) $ 460,113 LIABILITIES AND SHAREHOLDERS' DEFICIT Accounts payable $ 1,610 $ 5,659 $ — $ 7,269 Accrued liabilities 23,048 11,204 — 34,252 Current portion of contingent consideration — 8,500 — 8,500 Current portion of long-term debt 454,003 9,161 — 463,164 Total current liabilities 478,661 34,524 — 513,185 Deferred income taxes (32,473 ) 32,768 — 295 Long-term portion of debt — 8,015 — 8,015 Other long-term liabilities 71,460 417,999 (485,724 ) 3,735 Total shareholders' deficit (65,117 ) 28,864 (28,864 ) (65,117 ) Total liabilities and shareholders' deficit $ 452,531 $ 522,170 $ (514,588 ) $ 460,113 CONDENSED CONSOLIDATING BALANCE SHEET DECEMBER 31, 2015 Parent Guarantor Subsidiaries Eliminations Consolidated ASSETS Cash and cash equivalents $ 40,660 $ (1,351 ) $ — $ 39,309 Restricted cash 4,250 — — 4,250 Accounts receivable, net — 42,188 — 42,188 Other current assets 2,654 6,080 — 8,734 Total current assets 47,564 46,917 — 94,481 Property, plant and equipment, net 2,609 403,579 — 406,188 Equity investments 43,542 581 (40,373 ) 3,750 Intangible assets, net — 16,867 — 16,867 Other 404,620 72,137 (475,424 ) 1,333 Total assets $ 498,335 $ 540,081 $ (515,797 ) $ 522,619 LIABILITIES AND SHAREHOLDERS' DEFICIT Accounts payable $ 172 $ 6,735 $ — $ 6,907 Accrued liabilities 13,824 16,019 — 29,843 Current portion of contingent consideration — 8,628 — 8,628 Current portion of long-term debt 492,671 7,038 — 499,709 Total current liabilities 506,667 38,420 — 545,087 Deferred income taxes (32,488 ) 32,758 — 270 Long-term portion of debt — 11,758 — 11,758 Other long-term liabilities 62,427 416,772 (475,424 ) 3,775 Total shareholders' deficit (38,271 ) 40,373 (40,373 ) (38,271 ) Total liabilities and shareholders' deficit $ 498,335 $ 540,081 $ (515,797 ) $ 522,619 CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS THREE MONTHS ENDED MARCH 31, 2016 (Unaudited) Parent Guarantor Subsidiaries Eliminations Consolidated Revenue $ — $ 46,975 $ — $ 46,975 Costs and expenses: Direct operating expenses — 38,617 — 38,617 General and administrative expenses 3,490 3,962 — 7,452 Depreciation and amortization 69 15,776 — 15,845 Total costs and expenses 3,559 58,355 — 61,914 Operating loss (3,559 ) (11,380 ) — (14,939 ) Interest expense, net (11,758 ) (287 ) — (12,045 ) Other income, net — 163 — 163 Loss from equity investments (11,532 ) (5 ) 11,532 (5 ) Loss on extinguishment of debt (390 ) — — (390 ) Loss from continuing operations before income taxes (27,239 ) (11,509 ) 11,532 (27,216 ) Income tax expense (32 ) (23 ) — (55 ) Loss from continuing operations (27,271 ) (11,532 ) 11,532 (27,271 ) Income from discontinued operations, net of income taxes 55 — — 55 Net loss attributable to common shareholders $ (27,216 ) $ (11,532 ) $ 11,532 $ (27,216 ) CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS THREE MONTHS ENDED MARCH 31, 2015 (Unaudited) Parent Guarantor Subsidiaries Eliminations Consolidated Revenue $ — $ 119,112 $ — $ 119,112 Costs and expenses: Direct operating expenses — 87,999 — 87,999 General and administrative expenses 6,662 6,038 — 12,700 Depreciation and amortization 170 17,312 — 17,482 Other, net — 683 — 683 Total costs and expenses 6,832 112,032 — 118,864 Operating (loss) income (6,832 ) 7,080 — 248 Interest expense, net (12,362 ) (226 ) — (12,588 ) Other income, net — 342 — 342 Income (loss) from equity investments 8,083 (21 ) (8,083 ) (21 ) (Loss) income from continuing operations before income taxes (11,111 ) 7,175 (8,083 ) (12,019 ) Income tax benefit (expense) 37 (13 ) — 24 (Loss) income from continuing operations (11,074 ) 7,162 (8,083 ) (11,995 ) Income from discontinued operations, net of income taxes — 921 — 921 Net (loss) income attributable to common shareholders $ (11,074 ) $ 8,083 $ (8,083 ) $ (11,074 ) CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS THREE MONTHS ENDED MARCH 31, 2016 (Unaudited) Parent Guarantor Subsidiaries Consolidated Cash flows from operating activities: Net cash provided by operating activities from continuing operations $ 115 $ 2,450 $ 2,565 Net cash used in operating activities from discontinued operations — — — Net cash provided by operating activities 115 2,450 2,565 Cash flows from investing activities: Proceeds from the sale of property and equipment 25 1,424 1,449 Purchase of property, plant and equipment — (1,421 ) (1,421 ) Increase in restricted cash — (200 ) (200 ) Net cash provided by (used in) investing activities from continuing operations 25 (197 ) (172 ) Net cash used in investing activities from discontinued operations — — — Net cash provided by (used in) investing activities 25 (197 ) (172 ) Cash flows from financing activities: Proceeds from revolving credit facility 12,409 — 12,409 Payments on revolving credit facility (51,968 ) — (51,968 ) Payments for deferred financing costs (426 ) — (426 ) Payments on vehicle financing and other financing activities (7 ) (1,680 ) (1,687 ) Net cash used in financing activities from continuing operations (39,992 ) (1,680 ) (41,672 ) Net cash used in financing activities from discontinued operations — — — Net cash used in financing activities (39,992 ) (1,680 ) (41,672 ) Net (decrease) increase in cash (39,852 ) 573 (39,279 ) Cash and cash equivalents - beginning of period 40,660 (1,351 ) 39,309 Cash and cash equivalents - end of period 808 (778 ) 30 Less: cash and cash equivalents of discontinued operations - end of period — — — Cash and cash equivalents of continuing operations - end of period $ 808 $ (778 ) $ 30 CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS THREE MONTHS ENDED MARCH 31, 2015 (Unaudited) Parent Guarantor Subsidiaries Consolidated Cash flows from operating activities: Net cash provided by operating activities from continuing operations $ 27,658 $ 7,092 $ 34,750 Net cash provided by operating activities from discontinued operations — 867 867 Net cash provided by operating activities 27,658 7,959 35,617 Cash flows from investing activities: Proceeds from the sale of property and equipment 255 1,713 1,968 Purchase of property, plant and equipment — (6,163 ) (6,163 ) Net cash provided by (used in) investing activities from continuing operations 255 (4,450 ) (4,195 ) Net cash used in investing activities from discontinued operations — (161 ) (161 ) Net cash provided by (used in) investing activities 255 (4,611 ) (4,356 ) Cash flows from financing activities: Payments on revolving credit facility (7,000 ) — (7,000 ) Payments on vehicle financing and other financing activities (75 ) (1,361 ) (1,436 ) Net cash used in financing activities from continuing operations (7,075 ) (1,361 ) (8,436 ) Net cash provided by financing activities from discontinued operations — 38 38 Net cash used in financing activities (7,075 ) (1,323 ) (8,398 ) Net increase in cash 20,838 2,025 22,863 Cash and cash equivalents - beginning of period 13,801 1,615 15,416 Cash and cash equivalents - end of period 34,639 3,640 38,279 Less: cash and cash equivalents of discontinued operations - end of period (2,793 ) (2,793 ) Cash and cash equivalents of continuing operations - end of period $ 34,639 $ 847 $ 35,486 |
Subsequent Events Related to Re
Subsequent Events Related to Restructuring | 3 Months Ended |
Mar. 31, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events Related to Restructuring | Subsequent Events Related to Restructuring On April 15, 2016, we closed (i) our exchange offer (the “Exchange Offer”) relating to our 2018 Notes, (ii) a new $24.0 million principal amount first-lien term loan due 2018 (the “Term Loan”) and (iii) related transactions as part of a comprehensive restructuring of our outstanding indebtedness pursuant to the Restructuring Support Agreement. Exchange Offer Pursuant to the Exchange Offer, we offered to exchange our new Second-Lien Notes Due 2021 (the “2021 Notes”) and shares of our common stock at a conversion price per share of $0.32 (the “Conversion Price”) for any and all of our 2018 Notes validly tendered and not properly withdrawn at or prior to the expiration date, with the exception of approximately $31.4 million in principal 2018 Notes owned by an entity controlled by Mark D. Johnsrud, our Chairman of the Board and Chief Executive Officer. We settled the Exchange Offer on April 15, 2016 by delivering to tendering holders of the 2018 Notes (i) $327.2 million in aggregate principal amount of the new 2021 Notes to those tendering holders electing to exchange for 2021 Notes and $0.9 million in shares of common stock converted at the Conversion Price to those tendering holders electing to exchange for common stock and (ii) a pro rata share (based on the aggregate principal amount of the 2018 Notes validly tendered) of penny warrants sufficient to purchase 10% of shares of our common stock (the "Exchange Warrants"). In addition, the 2018 Notes held by an entity controlled by Mr. Johnsrud were cancelled and will be converted to shares of our common stock at the Conversion Price upon shareholder approval of an increase in the number of shares of our common stock authorized to be issued by the Company (the "Johnsrud Note Conversion"). In connection with the issuance of the new 2021 Notes, we entered into a new Indenture that governs the terms of the new 2021 Notes, dated as of April 15, 2016, between the Company, Wilmington Savings Fund Society, FSB, as Trustee, and the Guarantors party thereto. Pursuant to the new Indenture, the 2021 Notes will mature on April 15, 2021. Interest will be paid in kind semi-annually by increasing the principal amount payable and due at maturity and/or in cash as follows: interest payable on October 15, 2016 will be paid in kind at an annual rate of 12.5% ; interest payable after October 15, 2016 but on or before April 15, 2018 will be paid at a rate of 10% with 50% in kind and 50% in cash; interest payable after April 15, 2018 will be paid in cash at a rate of 10% until maturity. As a result, our annual cash interest payment obligations have been reduced by approximately $17.8 million for the remainder of 2016, $17.9 million for 2017 and $8.6 million through April 15, 2018. The 2021 Notes are secured by junior liens on the same collateral as our ABL Facility and rank equal in right of payment to all senior indebtedness and senior to all subordinated indebtedness of the Company. The 2021 Notes are guaranteed by our subsidiaries. Upon settlement of the Exchange Offer, there remained outstanding approximately $40.4 million aggregate principal amount of 2018 Notes. Ongoing semi-annual interest expense with respect to the remaining 2018 Notes is approximately $2.0 million . In addition, based on the completion of the Exchange Offer, consents from each exchanging holder of the 2018 Notes for the waiver of certain provisions of the 2018 Notes Indenture became effective. The consents, among other things, waive substantially all of the restrictive covenants in the 2018 Notes Indenture and potential defaults arising from non-compliance with such waived covenants. Term Loan Concurrent to the Exchange Offer we entered into the Term Loan funded by certain holders of the 2018 Notes that were also parties to the Restructuring Support Agreement. The Term Loan accrues interest at a rate of 13% per annum to be paid in kind by increasing the principal amount payable thereunder. Principal including the paid in kind interest is due April 15, 2018. The Term Loan is subject to a minimum EBITDA covenant that is identical in all respects to the minimum EBITDA covenant applicable to the ABL Facility. To the extent actual EBITDA (as defined by the Term Loan) falls short of the minimum EBITDA targets, the Term Loan accrues interest at rate of 17% . The Term Loan is secured by junior liens on the same collateral as our ABL Facility and guaranteed by our subsidiaries. In connection with the Term Loan, we entered into a warrant agreement with the lenders under the Term Loan, pursuant to which, as a commitment fee for entering into the Term Loan, the lenders received warrants to purchase up to 5% of our then-outstanding stock at an exercise price of $0.01 per share (the "Term Loan Warrants"). The Exchange Warrants and the Term Loan Warrants (collectively, the "Warrants") contain anti-dilution provisions which adjust the number of shares issuable upon exercise thereof in certain circumstances, including adjustments intended to preserve the proportion of outstanding common stock into which such Warrants are exercisable after giving effect to the Johnsrud Note Conversion and the Rights Offering described below. Proceeds from the Term Loan were applied to pay down a portion of the outstanding balance of the ABL Facility and were reborrowed by the Company to fund the scheduled interest payment on the 2018 Notes and pay related transaction fees and expenses. ABL Facility Amendments On April 15, 2016, we also entered into a Seventh Amendment to Amended and Restated Credit Agreement, dated April 15, 2016 (the “Seventh ABL Facility Amendment”), by and among the Agent, the Lenders and the Company to make conforming amendments in connection with the restructuring transactions. Among other terms and conditions, the Seventh Amendment amends the ABL Facility to: (i) require that the we apply excess proceeds from asset sales to pay down the ABL Facility; (ii) prohibit us from optionally prepaying or acquiring other indebtedness, making any payment on subordinated indebtedness, or amending certain agreements and documents; and (iii) amend certain definitions in the ABL Facility. Rights Offering As part of the debt restructuring plan, we will also pursue an equity rights offering (the “Rights Offering”), in which all holders of our common stock will be granted the right to participate. Each shareholder who participates in the Rights Offering will have the right to subscribe for a pro rata share of $5.0 million of common stock exercisable at a 20% discount to the Conversion Price. We expect to complete the Rights Offering in the second quarter of 2016, subject to shareholder approval of an amendment to our Certificate of Incorporation to provide for the issuance of sufficient additional shares of common stock. We expect to hold a Special Meeting of Shareholders in the second quarter of 2016 to approve the amendment to our Certificate of Incorporation. Additionally, Mr. Johnsrud has agreed to backstop the proposed Rights Offering by committing to purchase rights that are not exercised by other shareholders in order to ensure that the Company receives the additional liquidity. On April 15, 2016, the Company and Mr. Johnsrud entered into an Escrow Agreement, pursuant to which Mr. Johnsrud deposited $5.0 million for the purpose of securing Mr. Johnsrud’s backstop obligations under the Rights Offering. Upon consummation of the Johnsrud Note Conversion and the Rights Offering and after giving effect to the other components of the debt restructuring plan (including adjustment to the number of shares issuable upon exercise of the Warrants), we expect to have approximately 176 million shares of outstanding common stock on a fully-diluted basis, excluding shares issuable in connection with the management incentive plan contemplated by the Restructuring Support Agreement. Net proceeds from the Rights Offering will be used to pay down the ABL Facility, which will then be available for further drawdowns, subject to any borrowing base limitations and compliance with other applicable terms and conditions under the ABL Facility. The Restructuring and the transactions contemplated thereby are subject to additional terms and conditions. We provide no assurances that we will be able to successfully consummate the Restructuring or other alternatives to restructure our existing indebtedness, in which case we may need to restructure under the Bankruptcy Code. |
Basis of Presentation Basis of
Basis of Presentation Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying condensed consolidated financial statements of Nuverra Environmental Solutions, Inc. and its subsidiaries (collectively, “Nuverra,” the “Company,” “we,” “us,” or “our”) are unaudited, pursuant to the rules and regulations of the United States Securities and Exchange Commission ("SEC"). Our condensed consolidated balance sheet as of December 31, 2015 , included herein, has been derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America (or "GAAP"). Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. In our opinion, the condensed consolidated financial statements include the normal, recurring adjustments necessary for the fair statement of the results for the interim periods. These financial statements should be read in conjunction with the audited consolidated financial statements, including the notes thereto, contained in our Annual Report on Form 10-K for the year ended December 31, 2015, filed with the SEC on March 11, 2016. All dollar and share amounts in the footnote tabular presentations are in thousands, except per share amounts and unless otherwise noted. Unless stated otherwise, any reference to statement of operations items in these accompanying condensed consolidated financial statements refers to results from continuing operations. |
Reclassifications | Reclassifications Certain reclassifications and adjustments have been made to prior period amounts in the accompanying condensed consolidated statements of operations and cash flows and notes thereto in order to conform to the current year’s presentation including: • Certain similar line items in the condensed consolidated statement of cash flows for the three months ended March 31, 2015 have been combined to conform to the current year presentation. • In June 2015, we purchased the remaining interest in Appalachian Water Services, LLC (“AWS”), previously a 51% owned non-guarantor subsidiary, and have recast the tables in Note 16 to reflect AWS as a part of the Guarantor Subsidiaries for the three months ended March 31, 2015 . • As of January 1, 2016, and further discussed below under "Significant Accounting Policies," we retrospectively adopted, for all comparative periods presented, ASU 2015-03, Simplifying the Presentation of Debt Issuance Costs , and ASU 2015-15, Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements . As a result, $7.9 million and $8.7 million of unamortized debt issuance costs related to our 2018 Notes have been reclassified from “Other assets” to “Current portion of long-term debt” on the condensed consolidated balance sheets as of March 31, 2016 and December 31, 2015, respectively. Additionally, as the debt associated with our asset-based revolving credit facility is presented as short-term, the related debt issuance costs of $2.1 million and $2.2 million as of March 31, 2016 and December 31, 2015, respectively, have been reclassified from "Other assets" to "Other current assets" on the condensed consolidated balance sheets. Further, the total assets for the Corporate segment reported in Note 14 have been adjusted for this reclass. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”). The amendments in this update will be added to the ASC as Topic 606, Revenue from Contracts with Customers, and replaces the guidance in Topic 605. The underlying principle of the guidance in this update is that a business or other organization will recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects what it expects to receive in exchange for the goods or services. This new revenue standard also calls for more detailed disclosures and provides guidance for transactions that weren’t addressed completely, such as service revenue and contract modifications which may be applied retrospectively or modified retrospectively. In August 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date ("ASU 2015-14"). The guidance in ASU 2015-14 delays the effective date for the new revenue recognition guidance outlined in ASU 2014-09 to reporting periods beginning after December 15, 2017, which for us is the reporting period starting January 1, 2018. We are reviewing the guidance in ASU 2014-09 and have not yet assessed the impact, if any, on our consolidated financial statements and have not determined our method of adoption. In August 2014, the FASB issued ASU No. 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern (“ASU 2014-15”). ASU 2014-15 requires management to evaluate whether there is substantial doubt about an entity’s ability to continue as a going concern and to provide related footnote disclosures. In doing so, companies will have reduced diversity in the timing and content of footnote disclosures than under today’s guidance. ASU 2014-15 is effective for reporting periods beginning after December 15, 2016, which for us is the reporting period starting January 1, 2017, with early adoption permitted. We are reviewing the guidance in ASU 2014-15 and evaluating the impact this new guidance may have on our consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) ("ASU 2016-02"), which requires an entity that is a lessee to recognize the assets and liabilities arising from leases on the balance sheet. This guidance also requires disclosures about the amount, timing and uncertainty of cash flows arising from leases. This guidance is effective for annual reporting periods beginning after December 15, 2018, and interim periods within those annual periods, using a modified retrospective approach. Early adoption of ASU 2016-09 is permitted. We are evaluating the effect that ASU 2016-02 will have on our consolidated financial statements and related disclosures . Based upon the current effective date, the new guidance would first apply to our reporting period starting January 1, 2019. In March 2016, the FASB issued ASU No. 2016-09, Compensation-Stock Compensation- Improvements to Employee Share-Based Payment Accounting ("ASU 2016-09"), which involves several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. Under the new standard, income tax benefits and deficiencies are to be recognized as income tax expense or benefit in the income statement and the tax effects of exercised or vested awards should be treated as discrete items in the reporting period in which they occur. An entity should also recognize excess tax benefits regardless of whether the benefit reduces taxes payable in the current period. Excess tax benefits should be classified along with other income tax cash flows as an operating activity. In regards to forfeitures, the entity may make an entity-wide accounting policy election to either estimate the number of awards that are expected to vest or account for forfeitures when they occur. ASU 2016-09 is effective for fiscal years beginning after December 15, 2016, including interim periods within that reporting period, however early adoption is permitted. We are currently evaluating the guidance in ASU 2016-09 to determine our adoption method and the effect it will have on our consolidated financial statements. |
Earnings Per Common Share (Tabl
Earnings Per Common Share (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table presents the calculation of basic and diluted net loss per common share: Three Months Ended March 31, 2016 2015 Numerator: Loss from continuing operations $ (27,271 ) $ (11,995 ) Income from discontinued operations 55 921 Net loss attributable to common shareholders $ (27,216 ) $ (11,074 ) Denominator: Weighted average shares—basic 27,907 27,412 Common stock equivalents — — Weighted average shares—diluted 27,907 27,412 Basic and diluted loss per common share from continuing operations $ (0.98 ) $ (0.44 ) Basic and diluted income per common share from discontinued operations — 0.03 Net loss per basic and diluted common share $ (0.98 ) $ (0.41 ) Anti-dilutive stock-based awards excluded 706 879 |
Intangible Assets (Tables)
Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets | Intangible assets consist of the following: March 31, 2016 December 31, 2015 Gross Carrying Amount Accumulated Amortization Net Remaining Useful Life (Years) Gross Carrying Amount Accumulated Amortization Net Remaining Useful Life (Years) Customer relationships $ 11,731 $ (7,219 ) $ 4,512 5.5 $ 11,731 $ (6,865 ) $ 4,866 6.0 Disposal permits 1,269 (492 ) 777 4.9 1,269 (451 ) 818 5.2 Customer contracts 17,352 (6,427 ) 10,925 10.5 17,352 (6,169 ) 11,183 11.0 $ 30,352 $ (14,138 ) $ 16,214 8.9 $ 30,352 $ (13,485 ) $ 16,867 9.3 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Assets and Liabilities Measured at Fair Value on a Recurring Basis and Fair Value Hierarchy of the Valuation Techniques | Assets and liabilities measured at fair value on a recurring basis and the fair value hierarchy of the valuation techniques we utilized to determine such fair value included significant unobservable inputs (Level 3) and were as follows: Fair Value As of March 31, 2016 Assets - Cost method investment $ 3,169 Liabilities - Contingent consideration 8,500 As of December 31, 2015 Assets - Cost method investment $ 3,169 Liabilities - Contingent consideration 8,628 |
Changes to Contingent Consideration | Changes to contingent consideration obligations during the three months ended March 31, 2016 and the year ended December 31, 2015 were as follows: March 31, 2016 December 31, 2015 Balance at beginning of period $ 8,628 $ 9,824 Cash payments — (909 ) Changes in fair value of contingent consideration, net (128 ) (287 ) Current portion of contingent consideration $ 8,500 $ 8,628 |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Payables and Accruals [Abstract] | |
Accrued Liabilities | Accrued liabilities consisted of the following at March 31, 2016 and December 31, 2015 : March 31, 2016 December 31, 2015 Accrued payroll and employee benefits $ 2,392 $ 5,839 Accrued insurance 6,000 5,896 Accrued legal and environmental costs 1,714 1,531 Accrued taxes 1,200 1,514 Accrued interest 18,365 8,516 Accrued operating costs 2,192 4,233 Accrued other 2,389 2,314 Total accrued liabilities $ 34,252 $ 29,843 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Debt Disclosure [Abstract] | |
Debt | Debt consisted of the following at March 31, 2016 and December 31, 2015 : March 31, 2016 December 31, 2015 Interest Rate Maturity Date Unamortized Deferred Financing Costs (g) Fair Value of Debt (f) Carrying Value of Debt Carrying Value of Debt ABL Facility (a) 2.94% Jan. 2018 $ 2,109 $ 62,273 $ 62,273 $ 101,832 2018 Notes (b) 9.875% Apr. 2018 7,862 96,000 400,000 400,000 Vehicle financings (c) 1.52% Various — 11,114 11,114 12,303 Note payable (d) 4.25% Apr. 2019 — 6,063 6,063 6,492 Total debt $ 9,971 $ 175,450 479,450 520,627 Original issue discount (e) (578 ) (639 ) Original issue premium (e) 169 187 Deferred financing costs presented with debt (g) (7,862 ) (8,708 ) Total debt, net 471,179 511,467 Less: current portion (h) (463,164 ) (499,709 ) Long-term portion of debt $ 8,015 $ 11,758 _____________________ (a) The interest rate presented represents the interest rate on the $100.0 million ABL Facility at March 31, 2016 . (b) The interest rate presented represents the coupon rate on our outstanding $400.0 million aggregate principal amounts of 9.875% Senior Notes due 2018 (the “2018 Notes”), excluding the effects of deferred financing costs, original issue discounts and original issue premiums. Including the impact of these items, the effective interest rate on the 2018 Notes is approximately 11.0% . Interest payments are due semi-annually on April 15 and October 15 of each year. (c) Vehicle financings consist of capital lease arrangements related to fleet purchases with a weighted-average annual interest rate of approximately 1.52% and which mature in varying installments between 2016 and 2020 . Capital lease obligations were $11.1 million and $12.3 million , respectively, at March 31, 2016 and December 31, 2015 , respectively. (d) During the three months ended June 30, 2015, we settled our $11.0 million financing obligation to acquire the remaining 49% interest in AWS from the non-controlling interest holder with a $4.0 million cash payment and a $7.4 million note payable with principal and interest due in equal quarterly installments through April 2019. (e) The issuance discount represents the unamortized difference between the $250.0 million aggregate principal amount of the 2018 Notes issued in April 2012 and the proceeds received upon issuance (excluding interest and fees). The issuance premium represents the unamortized difference between the proceeds received in connection with the November 2012 issuance of the 2018 Notes (excluding interest and fees) and the $150.0 million aggregate principal amount thereunder. (f) The estimated fair value of our 2018 Notes is based on quoted market prices as of March 31, 2016 . Our ABL Facility and vehicle financings bear interest at rates commensurate with market rates and therefore their respective carrying values approximate fair value. (g) As discussed previously in Note 1, upon retrospective adoption of ASU 2015-03, we have reclassified the deferred financing costs associated with the 2018 Notes to be presented in the balance sheet as a direct deduction from the carrying amount of the debt liability as of March 31, 2016 and December 31, 2015 . In accordance with ASU 2015-15, the deferred financing costs related to the ABL Facility continue to be presented as an asset, and are included in "Other current assets" on the condensed consolidated balance sheets as of March 31, 2016 and December 31, 2015 . (h) As a result of the probability of breaching one of the financial covenants if we are not successful at restructuring our debt (see "Restructuring Support Agreement" later in this section), the carrying value of the ABL Facility and the 2018 Notes was reclassified to current liabilities in the consolidated balance sheet as of March 31, 2016 and December 31, 2015. |
Restructuring and Exit Costs (T
Restructuring and Exit Costs (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Costs | A rollforward of the restructuring and exit cost accruals from December 31, 2015 through March 31, 2016 is as follows: Employee Termination Costs (a) Lease Exit Costs (b) Other Exit Costs (c) Total Restructuring and exit costs accrued at December 31, 2015 $ — $ 180 $ — $ 180 Restructuring and exit-related costs — — — — Cash payments — (12 ) — (12 ) Restructuring and exit costs accrued at March 31, 2016 $ — $ 168 $ — $ 168 _____________________ (a) Employee termination costs consist primarily of severance and related costs. (b) Lease exit costs consist primarily of costs that will continue to be incurred under non-cancellable operating leases for their remaining term without benefit to us. (c) Other exit costs include costs related to the movement of vehicles and rental fleet in connection with the exit from certain shale areas. Such costs consisted of the following: Three Months Ended Three Months Ended March 31, 2016 March 31, 2015 Severance and termination benefits $ — $ 240 Asset impairment charge — — Contract termination costs and exit costs — 443 Total restructuring and exit costs $ — $ 683 |
Income Taxes (Tables)
Income Taxes (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Components of (Expense) Benefit for Income Taxes | The following table shows the components of the income tax benefit for the periods indicated: Three Months Ended March 31, 2016 2015 Current income tax (expense) benefit $ (30 ) $ 25 Deferred income tax expense (25 ) (1 ) Total income tax (expense) benefit $ (55 ) $ 24 |
Share-based Compensation (Table
Share-based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Disclosure of Share-based Compensation Arrangements by Share-based Payment Award | The total grants awarded during the three months ended March 31, 2016 and March 31, 2015 are presented in the table below: Three Months Ended March 31, 2016 2015 Stock option grants — 703 Restricted stock grants — — Restricted stock unit grants 1 151 Total grants under the 2009 Plan 1 854 The total stock-based compensation cost included in "General and administrative expenses" in the accompanying condensed consolidated statements of operations was as follows: Three Months Ended March 31, 2016 2015 Stock options $ 84 $ 148 Restricted stock 85 101 Restricted stock units 199 540 Total stock-based compensation expense $ 368 $ 789 |
Segments (Tables)
Segments (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Segment Reporting [Abstract] | |
Financial Information for Reportable Segments | Financial information for our reportable segments related to continuing operations is presented below. Rocky Mountain Northeast Southern Corporate/ Other Total Three months ended March 31, 2016 Revenue $ 24,905 $ 12,777 $ 9,293 $ — $ 46,975 Direct operating expenses 19,558 11,568 7,491 — 38,617 General and administrative expenses 1,852 1,190 920 3,490 7,452 Depreciation and amortization 8,079 3,883 3,814 69 15,845 Operating loss (4,584 ) (3,864 ) (2,932 ) (3,559 ) (14,939 ) Loss from continuing operations before income taxes (4,652 ) (3,931 ) (2,926 ) (15,707 ) (27,216 ) As of March 31, 2016 Total assets (a) 246,530 72,916 123,028 17,639 460,113 Three months ended March 31, 2015 Revenue 69,410 27,313 22,389 — 119,112 Direct operating expenses 48,425 21,496 18,078 — 87,999 General and administrative expenses 2,056 1,904 2,078 6,662 12,700 Depreciation and amortization 8,737 3,927 4,648 170 17,482 Operating income (loss) 10,192 (98 ) (3,014 ) (6,832 ) 248 Income (loss) from continuing operations before income taxes 10,097 13 (2,935 ) (19,194 ) (12,019 ) As of December 31, 2015 Total assets (a) 263,871 76,472 128,482 53,794 522,619 _____________________ (a) Total assets exclude intercompany receivables eliminated in consolidation. |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of Disposal Groups, Including Discontinued Operations, Income Statement, Balance Sheet and Additional Disclosures | The following table provides selected financial information of discontinued operations related to TFI (and includes TFI's results through the sale on April 11, 2015): Three Months Ended March 31, 2016 2015 Revenue $ — $ 17,497 Income from discontinued operations before income taxes $ — $ 1,186 Income tax expense — (265 ) Income from discontinued operations - before sale $ — $ 921 Income on sale of TFI 55 — Income from discontinued operations $ 55 $ 921 |
Subsidiary Guarantors (Tables)
Subsidiary Guarantors (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Condensed Consolidating Balance Sheet | CONDENSED CONSOLIDATING BALANCE SHEET MARCH 31, 2016 (Unaudited) Parent Guarantor Subsidiaries Eliminations Consolidated ASSETS Cash and cash equivalents $ 808 $ (778 ) $ — $ 30 Restricted cash 4,250 200 — 4,450 Accounts receivable, net — 30,857 — 30,857 Deferred income taxes — — — — Other current assets 7,275 5,195 — 12,470 Total current assets 12,333 35,474 — 47,807 Property, plant and equipment, net 2,546 389,229 391,775 Equity investments 32,033 576 (28,864 ) 3,745 Intangible assets, net — 16,214 — 16,214 Other 405,619 80,677 (485,724 ) 572 Total assets $ 452,531 $ 522,170 $ (514,588 ) $ 460,113 LIABILITIES AND SHAREHOLDERS' DEFICIT Accounts payable $ 1,610 $ 5,659 $ — $ 7,269 Accrued liabilities 23,048 11,204 — 34,252 Current portion of contingent consideration — 8,500 — 8,500 Current portion of long-term debt 454,003 9,161 — 463,164 Total current liabilities 478,661 34,524 — 513,185 Deferred income taxes (32,473 ) 32,768 — 295 Long-term portion of debt — 8,015 — 8,015 Other long-term liabilities 71,460 417,999 (485,724 ) 3,735 Total shareholders' deficit (65,117 ) 28,864 (28,864 ) (65,117 ) Total liabilities and shareholders' deficit $ 452,531 $ 522,170 $ (514,588 ) $ 460,113 CONDENSED CONSOLIDATING BALANCE SHEET DECEMBER 31, 2015 Parent Guarantor Subsidiaries Eliminations Consolidated ASSETS Cash and cash equivalents $ 40,660 $ (1,351 ) $ — $ 39,309 Restricted cash 4,250 — — 4,250 Accounts receivable, net — 42,188 — 42,188 Other current assets 2,654 6,080 — 8,734 Total current assets 47,564 46,917 — 94,481 Property, plant and equipment, net 2,609 403,579 — 406,188 Equity investments 43,542 581 (40,373 ) 3,750 Intangible assets, net — 16,867 — 16,867 Other 404,620 72,137 (475,424 ) 1,333 Total assets $ 498,335 $ 540,081 $ (515,797 ) $ 522,619 LIABILITIES AND SHAREHOLDERS' DEFICIT Accounts payable $ 172 $ 6,735 $ — $ 6,907 Accrued liabilities 13,824 16,019 — 29,843 Current portion of contingent consideration — 8,628 — 8,628 Current portion of long-term debt 492,671 7,038 — 499,709 Total current liabilities 506,667 38,420 — 545,087 Deferred income taxes (32,488 ) 32,758 — 270 Long-term portion of debt — 11,758 — 11,758 Other long-term liabilities 62,427 416,772 (475,424 ) 3,775 Total shareholders' deficit (38,271 ) 40,373 (40,373 ) (38,271 ) Total liabilities and shareholders' deficit $ 498,335 $ 540,081 $ (515,797 ) $ 522,619 |
Condensed Consolidating Statement of Operations | CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS THREE MONTHS ENDED MARCH 31, 2016 (Unaudited) Parent Guarantor Subsidiaries Eliminations Consolidated Revenue $ — $ 46,975 $ — $ 46,975 Costs and expenses: Direct operating expenses — 38,617 — 38,617 General and administrative expenses 3,490 3,962 — 7,452 Depreciation and amortization 69 15,776 — 15,845 Total costs and expenses 3,559 58,355 — 61,914 Operating loss (3,559 ) (11,380 ) — (14,939 ) Interest expense, net (11,758 ) (287 ) — (12,045 ) Other income, net — 163 — 163 Loss from equity investments (11,532 ) (5 ) 11,532 (5 ) Loss on extinguishment of debt (390 ) — — (390 ) Loss from continuing operations before income taxes (27,239 ) (11,509 ) 11,532 (27,216 ) Income tax expense (32 ) (23 ) — (55 ) Loss from continuing operations (27,271 ) (11,532 ) 11,532 (27,271 ) Income from discontinued operations, net of income taxes 55 — — 55 Net loss attributable to common shareholders $ (27,216 ) $ (11,532 ) $ 11,532 $ (27,216 ) CONDENSED CONSOLIDATING STATEMENTS OF OPERATIONS THREE MONTHS ENDED MARCH 31, 2015 (Unaudited) Parent Guarantor Subsidiaries Eliminations Consolidated Revenue $ — $ 119,112 $ — $ 119,112 Costs and expenses: Direct operating expenses — 87,999 — 87,999 General and administrative expenses 6,662 6,038 — 12,700 Depreciation and amortization 170 17,312 — 17,482 Other, net — 683 — 683 Total costs and expenses 6,832 112,032 — 118,864 Operating (loss) income (6,832 ) 7,080 — 248 Interest expense, net (12,362 ) (226 ) — (12,588 ) Other income, net — 342 — 342 Income (loss) from equity investments 8,083 (21 ) (8,083 ) (21 ) (Loss) income from continuing operations before income taxes (11,111 ) 7,175 (8,083 ) (12,019 ) Income tax benefit (expense) 37 (13 ) — 24 (Loss) income from continuing operations (11,074 ) 7,162 (8,083 ) (11,995 ) Income from discontinued operations, net of income taxes — 921 — 921 Net (loss) income attributable to common shareholders $ (11,074 ) $ 8,083 $ (8,083 ) $ (11,074 ) |
Condensed Consolidating Statement of Cash Flows | CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS THREE MONTHS ENDED MARCH 31, 2016 (Unaudited) Parent Guarantor Subsidiaries Consolidated Cash flows from operating activities: Net cash provided by operating activities from continuing operations $ 115 $ 2,450 $ 2,565 Net cash used in operating activities from discontinued operations — — — Net cash provided by operating activities 115 2,450 2,565 Cash flows from investing activities: Proceeds from the sale of property and equipment 25 1,424 1,449 Purchase of property, plant and equipment — (1,421 ) (1,421 ) Increase in restricted cash — (200 ) (200 ) Net cash provided by (used in) investing activities from continuing operations 25 (197 ) (172 ) Net cash used in investing activities from discontinued operations — — — Net cash provided by (used in) investing activities 25 (197 ) (172 ) Cash flows from financing activities: Proceeds from revolving credit facility 12,409 — 12,409 Payments on revolving credit facility (51,968 ) — (51,968 ) Payments for deferred financing costs (426 ) — (426 ) Payments on vehicle financing and other financing activities (7 ) (1,680 ) (1,687 ) Net cash used in financing activities from continuing operations (39,992 ) (1,680 ) (41,672 ) Net cash used in financing activities from discontinued operations — — — Net cash used in financing activities (39,992 ) (1,680 ) (41,672 ) Net (decrease) increase in cash (39,852 ) 573 (39,279 ) Cash and cash equivalents - beginning of period 40,660 (1,351 ) 39,309 Cash and cash equivalents - end of period 808 (778 ) 30 Less: cash and cash equivalents of discontinued operations - end of period — — — Cash and cash equivalents of continuing operations - end of period $ 808 $ (778 ) $ 30 CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS THREE MONTHS ENDED MARCH 31, 2015 (Unaudited) Parent Guarantor Subsidiaries Consolidated Cash flows from operating activities: Net cash provided by operating activities from continuing operations $ 27,658 $ 7,092 $ 34,750 Net cash provided by operating activities from discontinued operations — 867 867 Net cash provided by operating activities 27,658 7,959 35,617 Cash flows from investing activities: Proceeds from the sale of property and equipment 255 1,713 1,968 Purchase of property, plant and equipment — (6,163 ) (6,163 ) Net cash provided by (used in) investing activities from continuing operations 255 (4,450 ) (4,195 ) Net cash used in investing activities from discontinued operations — (161 ) (161 ) Net cash provided by (used in) investing activities 255 (4,611 ) (4,356 ) Cash flows from financing activities: Payments on revolving credit facility (7,000 ) — (7,000 ) Payments on vehicle financing and other financing activities (75 ) (1,361 ) (1,436 ) Net cash used in financing activities from continuing operations (7,075 ) (1,361 ) (8,436 ) Net cash provided by financing activities from discontinued operations — 38 38 Net cash used in financing activities (7,075 ) (1,323 ) (8,398 ) Net increase in cash 20,838 2,025 22,863 Cash and cash equivalents - beginning of period 13,801 1,615 15,416 Cash and cash equivalents - end of period 34,639 3,640 38,279 Less: cash and cash equivalents of discontinued operations - end of period (2,793 ) (2,793 ) Cash and cash equivalents of continuing operations - end of period $ 34,639 $ 847 $ 35,486 |
Basis of Presentation (Detail)
Basis of Presentation (Detail) - USD ($) $ in Millions | 5 Months Ended | ||
May. 31, 2015 | Mar. 31, 2016 | Dec. 31, 2015 | |
Non-Guarantor Subsidiaries | |||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||
Subsidiary ownership percentage | 51.00% | ||
Asset Based Revolving Credit Facility | |||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||
Restricted Cash and Cash Equivalents | $ 0 | ||
Accounting Standards Update 2015-03 | 2018 Notes | Other Assets | |||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||
Deferred Finance Costs, Net | (7.9) | $ (8.7) | |
Accounting Standards Update 2015-03 | 2018 Notes | Long-term Debt | |||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||
Deferred Finance Costs, Net | 7.9 | 8.7 | |
Accounting Standards Update 2015-03 | Revolving Credit Facility | Other Assets | |||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||
Deferred Finance Costs, Net | (2.1) | (2.2) | |
Accounting Standards Update 2015-03 | Revolving Credit Facility | Other Assets | |||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||
Deferred Finance Costs, Net | $ 2.1 | $ 2.2 |
Earnings Per Common Share (Deta
Earnings Per Common Share (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Net Income (Loss) Attributable to Parent [Abstract] | ||
Loss from continuing operations | $ (27,271) | $ (11,995) |
Income from discontinued operations, net of income taxes | 55 | 921 |
Net loss attributable to common shareholders | $ (27,216) | $ (11,074) |
Weighted Average Number of Shares Outstanding Reconciliation [Abstract] | ||
Weighted average shares—basic (in shares) | 27,907,000 | 27,412,000 |
Common stock equivalents (in shares) | 0 | 0 |
Weighted average shares—diluted (in shares) | 27,907,000 | 27,412,000 |
Basic and diluted loss per common share from continuing operations (usd per share) | $ (0.98) | $ (0.44) |
Basic and diluted income per common share from discontinued operations (usd per share) | 0 | 0.03 |
Net loss per basic and diluted common share (usd per share) | $ (0.98) | $ (0.41) |
Antidilutive stock-based awards excluded (in shares) | 706,000 | 879,000 |
Continuing Operations | ||
Weighted Average Number of Shares Outstanding Reconciliation [Abstract] | ||
Weighted average shares—diluted (in shares) | 0 | 0 |
Discontinued Operations | ||
Weighted Average Number of Shares Outstanding Reconciliation [Abstract] | ||
Weighted average shares—diluted (in shares) | 0 | 0 |
Intangible Assets (Detail)
Intangible Assets (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2016 | Dec. 31, 2015 | |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 30,352 | $ 30,352 |
Accumulated Amortization | (14,138) | (13,485) |
Net | $ 16,214 | $ 16,867 |
Remaining Useful Life (Years) | 8 years 11 months | 9 years 3 months |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 11,731 | $ 11,731 |
Accumulated Amortization | (7,219) | (6,865) |
Net | $ 4,512 | $ 4,866 |
Remaining Useful Life (Years) | 5 years 6 months | 6 years |
Disposal permits | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 1,269 | $ 1,269 |
Accumulated Amortization | (492) | (451) |
Net | $ 777 | $ 818 |
Remaining Useful Life (Years) | 4 years 11 months | 5 years 2 months |
Customer contracts | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 17,352 | $ 17,352 |
Accumulated Amortization | (6,427) | (6,169) |
Net | $ 10,925 | $ 11,183 |
Remaining Useful Life (Years) | 10 years 6 months | 11 years |
Impairment of Ling-Lived Assets
Impairment of Ling-Lived Assets (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Impairment of long-lived assets held-for-use | $ 0 | $ 0 |
Fair Value Measurements - Meas
Fair Value Measurements - Measured on a Recurring Basis (Detail) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Fair Value Disclosures [Abstract] | ||
Assets - Cost method investment | $ 3,169 | $ 3,169 |
Liabilities - Contingent consideration | $ 8,500 | $ 8,628 |
Fair Value Measurements - Chan
Fair Value Measurements - Changes to Contingent Consideration (Detail) - Contingent consideration - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2016 | Dec. 31, 2015 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Balance at beginning of period | $ 8,628 | $ 9,824 |
Changes in fair value of contingent consideration, net | (128) | (287) |
Current portion of contingent consideration | 8,500 | 8,628 |
Cash | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Contingent consideration liability settlement | $ 0 | $ (909) |
Accrued Liabilities (Detail)
Accrued Liabilities (Detail) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 |
Payables and Accruals [Abstract] | ||
Accrued payroll and employee benefits | $ 2,392 | $ 5,839 |
Accrued insurance | 6,000 | 5,896 |
Accrued legal and environmental costs | 1,714 | 1,531 |
Accrued taxes | 1,200 | 1,514 |
Accrued interest | 18,365 | 8,516 |
Accrued operating costs | 2,192 | 4,233 |
Accrued other | 2,389 | 2,314 |
Total accrued liabilities | $ 34,252 | $ 29,843 |
Debt - Schedule of Debt (Detai
Debt - Schedule of Debt (Detail) - USD ($) | 1 Months Ended | 3 Months Ended | ||||||
Jun. 30, 2015 | Mar. 31, 2016 | Jun. 30, 2015 | Dec. 31, 2015 | Nov. 30, 2012 | Apr. 30, 2012 | |||
Debt Instrument [Line Items] | ||||||||
Interest Rate | 1.52% | |||||||
Unamortized Deferred Financing Costs (g) | [1] | $ (9,971,000) | ||||||
Fair Value of Debt | [2] | 175,450,000 | ||||||
Long term debt | 479,450,000 | $ 520,627,000 | ||||||
Original issue discount | [3] | (578,000) | (639,000) | |||||
Original issue premium | [3] | 169,000 | 187,000 | |||||
Total debt, net | 471,179,000 | 511,467,000 | ||||||
Less: current portion | [4] | (463,164,000) | (499,709,000) | |||||
Long-term portion of debt | 8,015,000 | 11,758,000 | ||||||
Capital lease obligations, noncurrent | $ 11,100,000 | $ 12,300,000 | ||||||
Appalachian Water Services | ||||||||
Debt Instrument [Line Items] | ||||||||
Business acquisition equity interest issuable, value | $ 11,000,000 | $ 11,000,000 | ||||||
Percentage of ownership interest to be acquired | 49.00% | |||||||
Payments to acquire businesses, gross | 4,000,000 | |||||||
Notes payable, fair value disclosure | $ 7,400,000 | $ 7,400,000 | ||||||
Asset Based Revolving Credit Facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest Rate | [5] | 2.94% | 2.45% | |||||
Maturity Date | [5] | 2018-01 | ||||||
Maturity Date | [5] | Jan. 2018 | ||||||
Unamortized Deferred Financing Costs (g) | [1],[5] | $ (2,109,000) | ||||||
Fair Value of Debt | [2],[5] | 62,273,000 | ||||||
Long term debt | [5] | 62,273,000 | $ 101,832,000 | |||||
Line of credit facility, maximum borrowing capacity | $ 100,000,000 | |||||||
2018 Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest Rate | [6] | 9.875% | 9.875% | |||||
Maturity Date | [6] | 2018-04 | ||||||
Maturity Date | [6] | Apr. 2018 | ||||||
Unamortized Deferred Financing Costs (g) | [1] | $ (7,862,000) | [6] | $ (8,708,000) | ||||
Fair Value of Debt | [2],[6] | 96,000,000 | ||||||
Long term debt | [6] | 400,000,000 | $ 400,000,000 | |||||
Face amount | $ 400,000,000 | $ 150,000,000 | $ 250,000,000 | |||||
Interest rate, effective percentage | 11.00% | |||||||
Vehicle Financings | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest Rate | [7] | 1.52% | 3.86% | |||||
Maturity Date | [7] | Various | ||||||
Unamortized Deferred Financing Costs (g) | [1],[7] | $ 0 | ||||||
Fair Value of Debt | [2],[7] | 11,114,000 | ||||||
Long term debt | [7] | $ 11,114,000 | $ 12,303,000 | |||||
Notes Payable, Other Payables | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest Rate | [8] | 4.25% | 4.25% | |||||
Maturity Date | [8] | 2019-04 | ||||||
Maturity Date | [8] | Apr. 2019 | ||||||
Unamortized Deferred Financing Costs (g) | [1],[8] | $ 0 | ||||||
Fair Value of Debt | [2],[8] | 6,063,000 | ||||||
Long term debt | [8] | $ 6,063,000 | $ 6,492,000 | |||||
[1] | As discussed previously in Note 1, upon retrospective adoption of ASU 2015-03, we have reclassified the deferred financing costs associated with the 2018 Notes to be presented in the balance sheet as a direct deduction from the carrying amount of the debt liability as of March 31, 2016 and December 31, 2015. In accordance with ASU 2015-15, the deferred financing costs related to the ABL Facility continue to be presented as an asset, and are included in "Other current assets" on the condensed consolidated balance sheets as of March 31, 2016 and December 31, 2015. | |||||||
[2] | The estimated fair value of our 2018 Notes is based on quoted market prices as of March 31, 2016. Our ABL Facility and vehicle financings bear interest at rates commensurate with market rates and therefore their respective carrying values approximate fair value. | |||||||
[3] | The issuance discount represents the unamortized difference between the $250.0 million aggregate principal amount of the 2018 Notes issued in April 2012 and the proceeds received upon issuance (excluding interest and fees). The issuance premium represents the unamortized difference between the proceeds received in connection with the November 2012 issuance of the 2018 Notes (excluding interest and fees) and the $150.0 million aggregate principal amount thereunder. | |||||||
[4] | As a result of the probability of breaching one of the financial covenants if we are not successful at restructuring our debt (see "Restructuring Support Agreement" later in this section), the carrying value of the ABL Facility and the 2018 Notes was reclassified to current liabilities in the consolidated balance sheet as of March 31, 2016 and December 31, 2015. | |||||||
[5] | The interest rate presented represents the interest rate on the $100.0 million ABL Facility at March 31, 2016. | |||||||
[6] | The interest rate presented represents the coupon rate on our outstanding $400.0 million aggregate principal amounts of 9.875% Senior Notes due 2018 (the “2018 Notes”), excluding the effects of deferred financing costs, original issue discounts and original issue premiums. Including the impact of these items, the effective interest rate on the 2018 Notes is approximately 11.0%. Interest payments are due semi-annually on April 15 and October 15 of each year. | |||||||
[7] | Vehicle financings consist of capital lease arrangements related to fleet purchases with a weighted-average annual interest rate of approximately 1.52% and which mature in varying installments between 2016 and 2020. Capital lease obligations were $11.1 million and $12.3 million, respectively, at March 31, 2016 and December 31, 2015, respectively. | |||||||
[8] | During the three months ended June 30, 2015, we settled our $11.0 million financing obligation to acquire the remaining 49% interest in AWS from the non-controlling interest holder with a $4.0 million cash payment and a $7.4 million note payable with principal and interest due in equal quarterly installments through April 2019. |
Debt - Additional Information
Debt - Additional Information (Detail) | 3 Months Ended | |||||||
Mar. 31, 2016USD ($) | Apr. 30, 2016USD ($) | Apr. 15, 2016USD ($) | Feb. 01, 2016USD ($) | Dec. 31, 2015USD ($) | Nov. 30, 2012USD ($) | Apr. 30, 2012USD ($) | ||
Debt Instrument [Line Items] | ||||||||
Long term debt | $ 479,450,000 | $ 520,627,000 | ||||||
Debt instrument fixed charge coverage ratio minimum | 1.1 | |||||||
Senior Loans | ||||||||
Debt Instrument [Line Items] | ||||||||
Line of credit facility, maximum borrowing capacity | $ 150,000,000 | |||||||
Credit Agreement | Asset Based Loan Facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Line of credit facility, excess availability threshold for fixed charge coverage ratio to take effect, percent | 12.50% | |||||||
Line of credit facility, maximum borrowing capacity | $ 26,300,000 | |||||||
Line of credit facility, remaining borrowing capacity | 12,500,000 | |||||||
Line of credit borrowing (less than $5 million) | 13,760,000 | |||||||
Asset Based Revolving Credit Facility Amendment Four | ||||||||
Debt Instrument [Line Items] | ||||||||
Line of credit facility, maximum borrowing capacity | 100,000,000 | |||||||
2018 Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Long term debt | [1] | $ 400,000,000 | $ 400,000,000 | |||||
Debt instrument fixed charge coverage ratio minimum | 2 | |||||||
Face amount | $ 400,000,000 | $ 150,000,000 | $ 250,000,000 | |||||
2018 Notes | Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 24,000,000 | |||||||
Subsequent Event | Credit Agreement | Asset Based Loan Facility | ||||||||
Debt Instrument [Line Items] | ||||||||
Minimum EBITDA requirement | $ 2,100,000 | |||||||
Subsequent Event | 2018 Notes | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 40,400,000 | |||||||
[1] | The interest rate presented represents the coupon rate on our outstanding $400.0 million aggregate principal amounts of 9.875% Senior Notes due 2018 (the “2018 Notes”), excluding the effects of deferred financing costs, original issue discounts and original issue premiums. Including the impact of these items, the effective interest rate on the 2018 Notes is approximately 11.0%. Interest payments are due semi-annually on April 15 and October 15 of each year. |
Debt - Events Related to Restru
Debt - Events Related to Restructuring (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Mar. 31, 2016 | Dec. 31, 2015 | Apr. 15, 2018 | Dec. 31, 2017 | Oct. 15, 2016 | Apr. 15, 2016 | Mar. 10, 2016 | Feb. 01, 2016 | Nov. 30, 2012 | Apr. 30, 2012 | ||
Debt Instrument [Line Items] | |||||||||||
Interest Rate | 1.52% | ||||||||||
Exercise price of warrants or rights | $ 0.01 | ||||||||||
Back stop amount | $ 5,000,000 | ||||||||||
2018 Notes | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Troubled debt restructuring, debtor, percent of debt subject to restructuring (more than) | 80.00% | ||||||||||
Face amount | $ 400,000,000 | $ 150,000,000 | $ 250,000,000 | ||||||||
Interest Rate | [1] | 9.875% | 9.875% | ||||||||
Notes 2,021 | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Interest Rate | 13.00% | 13.00% | 17.00% | ||||||||
Interest paid in-kind, paid in year two | 50.00% | 50.00% | |||||||||
Interest paid in cash, paid in year two | 50.00% | 50.00% | |||||||||
Subsequent Event | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Back stop amount | $ 5,000,000 | ||||||||||
Subsequent Event | 2018 Notes | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Troubled debt restructuring, debtor, current period, aggregate principal amount | 327,200,000 | ||||||||||
Face amount | 40,400,000 | ||||||||||
Subsequent Event | Notes 2021 | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Face amount | $ 24,000,000 | ||||||||||
Maximum | 2018 Notes | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Troubled debt restructuring, debtor, current period, aggregate principal amount | $ 368,600,000 | ||||||||||
Face amount | $ 24,000,000 | ||||||||||
Chief Executive Officer | 2018 Notes | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Notes payable, related parties, noncurrent | $ 31,400,000 | $ 31,400,000 | |||||||||
Common Class A | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Percent of securities called by warrants or rights, percent | 15.00% | ||||||||||
Common Class A | Subsequent Event | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Percent of securities called by warrants or rights, percent | 10.00% | ||||||||||
Common Class A | Subsequent Event | 2018 Notes | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Troubled debt restructuring, debtor, current period, aggregate principal amount | $ 900,000 | ||||||||||
Common Class A | Subsequent Event | Notes 2021 | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Percent of securities called by warrants or rights, percent | 5.00% | ||||||||||
Scenario, Forecast | Notes 2021 | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Interest Rate | 10.00% | 10.00% | 12.50% | ||||||||
[1] | The interest rate presented represents the coupon rate on our outstanding $400.0 million aggregate principal amounts of 9.875% Senior Notes due 2018 (the “2018 Notes”), excluding the effects of deferred financing costs, original issue discounts and original issue premiums. Including the impact of these items, the effective interest rate on the 2018 Notes is approximately 11.0%. Interest payments are due semi-annually on April 15 and October 15 of each year. |
Debt - ABL Facility Amendments
Debt - ABL Facility Amendments (Details) - USD ($) | 1 Months Ended | 2 Months Ended | 3 Months Ended | ||
Nov. 30, 2015 | Mar. 10, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Mar. 24, 2016 | |
Wells Fargo Bank | Asset Based Loan Facility | |||||
Line of Credit Facility [Line Items] | |||||
Permitted disposition | $ 5,000,000 | ||||
Third GSA Amendment [Member] | Wells Fargo Bank | |||||
Line of Credit Facility [Line Items] | |||||
Line of Credit Facility, Maximum Daily Bank Cash Balance | $ 1,000,000 | ||||
Credit Agreement | Asset Based Loan Facility | |||||
Line of Credit Facility [Line Items] | |||||
Line of credit facility, maximum borrowing capacity | $ 26,300,000 | ||||
Increase (decrease) in borrowing capacity | 18,000,000 | ||||
Credit Agreement | Wells Fargo Bank | Asset Based Loan Facility | |||||
Line of Credit Facility [Line Items] | |||||
Proceeds from lines of credit | 12,400,000 | ||||
Repayments of lines of credit | $ 52,000,000 | 52,000,000 | |||
Asset Based Revolving Credit Facility | |||||
Line of Credit Facility [Line Items] | |||||
Line of credit facility, maximum borrowing capacity | $ 100,000,000 | ||||
Fourth ABL Facility Amendment | Wells Fargo Bank | Asset Based Loan Facility | |||||
Line of Credit Facility [Line Items] | |||||
Line of credit facility, maximum borrowing capacity | $ 125,000,000 | ||||
Debt Instrument, default fee, percent | 2.00% | ||||
Sixth ABL Facility Amendment | |||||
Line of Credit Facility [Line Items] | |||||
Ultimate orderly liquidation value advance rate | 60.00% | ||||
Eligible equipment NOVL advance rate | 80.00% | ||||
Borrowing based availability attributable to eligible equipment | 75.00% | ||||
Debt instrument, fee amount | $ 600,000 | ||||
Write off of deferred debt issuance cost | $ 400,000 | ||||
Sixth ABL Facility Amendment | Wells Fargo Bank | Asset Based Loan Facility | |||||
Line of Credit Facility [Line Items] | |||||
Line of credit facility, maximum borrowing capacity | $ 100,000,000 | ||||
Debt Instrument, default fee, percent | 4.00% | ||||
Permitted disposition | $ 7,500,000 | ||||
Permitted disposition reserve | 50.00% |
Restructuring and Exit Costs -
Restructuring and Exit Costs - Additional Information (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | |
Restructuring Cost and Reserve [Line Items] | |||
Restructuring, expected cost | $ 7,100,000 | ||
Other, net | 0 | $ 683,000 | |
Restructuring reserve | $ 180,000 | ||
Accrued Liabilities | |||
Restructuring Cost and Reserve [Line Items] | |||
Restructuring reserve | $ 168,000 | ||
Southern | |||
Restructuring Cost and Reserve [Line Items] | |||
Other, net | 600,000 | ||
Northeast | |||
Restructuring Cost and Reserve [Line Items] | |||
Other, net | $ 100,000 |
Restructuring and Exit Costs 47
Restructuring and Exit Costs - Schedule of Restructuring and Exit Costs (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Restructuring and Related Activities [Abstract] | ||
Severance and termination benefits | $ 0 | $ 240,000 |
Contract termination costs and exit costs | 0 | 443,000 |
Asset impairment charge | 0 | 0 |
Total restructuring and exit costs | $ 0 | $ 683,000 |
Restructuring and Exit Costs 48
Restructuring and Exit Costs - Restructuring Reserve (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | ||
Restructuring Reserve [Roll Forward] | |||
Restructuring and exit costs accrued at December 31, 2015 | $ 180,000 | ||
Restructuring and exit-related costs | 0 | $ 683,000 | |
Cash payments | (12,000) | ||
Employee Severance | |||
Restructuring Reserve [Roll Forward] | |||
Restructuring and exit costs accrued at December 31, 2015 | [1] | 0 | |
Restructuring and exit-related costs | [1] | 0 | |
Cash payments | [1] | 0 | |
Restructuring and exit costs accrued at March 31, 2016 | [1] | 0 | |
Facility Closing | |||
Restructuring Reserve [Roll Forward] | |||
Restructuring and exit costs accrued at December 31, 2015 | [2] | 180,000 | |
Restructuring and exit-related costs | [2] | 0 | |
Cash payments | [2] | (12,000) | |
Restructuring and exit costs accrued at March 31, 2016 | [2] | 168,000 | |
Other Restructuring | |||
Restructuring Reserve [Roll Forward] | |||
Restructuring and exit costs accrued at December 31, 2015 | [3] | 0 | |
Restructuring and exit-related costs | [3] | 0 | |
Cash payments | [3] | 0 | |
Restructuring and exit costs accrued at March 31, 2016 | [3] | $ 0 | |
[1] | Employee termination costs consist primarily of severance and related costs. | ||
[2] | Lease exit costs consist primarily of costs that will continue to be incurred under non-cancellable operating leases for their remaining term without benefit to us. | ||
[3] | Other exit costs include costs related to the movement of vehicles and rental fleet in connection with the exit from certain shale areas. |
Income Taxes - Components of (
Income Taxes - Components of (Expense) Benefit for Income Taxes (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Current Income Tax Expense (Benefit), Continuing Operations [Abstract] | ||
Current income tax (expense) benefit | $ (30) | $ 25 |
Deferred income tax expense | (25) | (1) |
Total income tax (expense) benefit | $ (55) | $ 24 |
Income Taxes - Additional Info
Income Taxes - Additional Information (Detail) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Income Tax Disclosure [Abstract] | ||
Effective income tax benefit rate (near zero for 2015) | 0.20% | 0.20% |
Federal statutory rate | 35.00% | 35.00% |
Share-based Compensation (Detai
Share-based Compensation (Detail) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock option grants (in shares) | 0 | 703 |
Total grants under the 2009 Plan (in shares) | 1 | 854 |
Stock-based compensation | $ 368 | $ 789 |
Stock options | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Stock-based compensation | $ 84 | $ 148 |
Restricted stock | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Grants in period (in shares) | 0 | 0 |
Stock-based compensation | $ 85 | $ 101 |
Restricted stock units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Grants in period (in shares) | 1 | 151 |
Restricted stock units | $ 199 | $ 540 |
Legal Matters (Detail)
Legal Matters (Detail) shares in Thousands, $ in Millions | Mar. 04, 2014shares | Mar. 04, 2013USD ($) | Jun. 30, 2015USD ($) | Oct. 31, 2013lawsuit | Sep. 30, 2013lawsuit | Oct. 31, 2013lawsuit | Mar. 31, 2015plaintiff | Mar. 31, 2016USD ($) | Dec. 31, 2015USD ($) |
Loss Contingencies [Line Items] | |||||||||
Environmental accrual | $ 0.5 | $ 0.3 | |||||||
Legal settlement, attorney fees, shares | shares | 267 | ||||||||
Payments for legal settlements, attorney fees | $ 4.5 | ||||||||
Legal settlement, escrow | shares | 533 | ||||||||
Appalachian Water Services | |||||||||
Loss Contingencies [Line Items] | |||||||||
Payments to acquire businesses, gross | $ 4 | ||||||||
Notes payable, fair value disclosure | $ 7.4 | ||||||||
Twenty Thirteen Shareholder Derivative Actions | |||||||||
Loss Contingencies [Line Items] | |||||||||
Number of lawsuits | lawsuit | 2 | 2 | 3 | ||||||
Number of plaintiffs | plaintiff | 1 |
Related Party and Affiliated 53
Related Party and Affiliated Company Transactions (Details) - USD ($) | Feb. 18, 2016 | Apr. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2009 |
Underground Solutions Inc | |||||
Business Acquisition [Line Items] | |||||
Business acquisition, percentage of voting interests acquired | 7.00% | ||||
Subsequent Event | Underground Solutions Inc | |||||
Business Acquisition [Line Items] | |||||
Proceeds from sale of business | $ 5,000,000 | ||||
Escrow Deposits Related to Property Sales | 200,000 | ||||
Expected Noncash Proceeds from Divestiture of Interest in Consolidated Subsidiaries | 5,200,000 | ||||
Cost method investment cost basis | $ 3,200,000 | ||||
Aegion Corporation | Underground Solutions Inc | |||||
Business Acquisition [Line Items] | |||||
Proceeds from sale of business | $ 85,000,000 | ||||
Scenario, Forecast | Underground Solutions Inc | |||||
Business Acquisition [Line Items] | |||||
Gain (Loss) on disposition of business | $ 1,900,000 | ||||
Cost-method Investments, Closing Costs Incurred | $ 100,000 | ||||
3721 Aircraft | Chief Executive Officer | |||||
Business Acquisition [Line Items] | |||||
Related Party Costs | $ 45,000 | ||||
Related Party Transaction, Purchases from Related Party | $ 0 |
Segments - Additional Informat
Segments - Additional Information (Detail) | Mar. 31, 2016operating_division |
Segment Reporting [Abstract] | |
Number of operating divisions | 3 |
Segments - Financial Informati
Segments - Financial Information for Reportable Segments (Detail) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | ||
Segment Reporting Information [Line Items] | ||||
Revenue | $ 46,975 | $ 119,112 | ||
Direct operating expenses | 38,617 | 87,999 | ||
General and administrative expenses | 7,452 | 12,700 | ||
Depreciation and amortization | 15,845 | 17,482 | ||
Operating loss | (14,939) | 248 | ||
Loss from continuing operations before income taxes | (27,216) | (12,019) | ||
Total assets (a) | [1] | 460,113 | $ 522,619 | |
Operating Segments | Rocky Mountain | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 24,905 | 69,410 | ||
Direct operating expenses | 19,558 | 48,425 | ||
General and administrative expenses | 1,852 | 2,056 | ||
Depreciation and amortization | 8,079 | 8,737 | ||
Operating loss | (4,584) | 10,192 | ||
Loss from continuing operations before income taxes | (4,652) | 10,097 | ||
Total assets (a) | [1] | 246,530 | 263,871 | |
Operating Segments | Northeast | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 12,777 | 27,313 | ||
Direct operating expenses | 11,568 | 21,496 | ||
General and administrative expenses | 1,190 | 1,904 | ||
Depreciation and amortization | 3,883 | 3,927 | ||
Operating loss | (3,864) | (98) | ||
Loss from continuing operations before income taxes | (3,931) | 13 | ||
Total assets (a) | [1] | 72,916 | 76,472 | |
Operating Segments | Southern | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 9,293 | 22,389 | ||
Direct operating expenses | 7,491 | 18,078 | ||
General and administrative expenses | 920 | 2,078 | ||
Depreciation and amortization | 3,814 | 4,648 | ||
Operating loss | (2,932) | (3,014) | ||
Loss from continuing operations before income taxes | (2,926) | (2,935) | ||
Total assets (a) | [1] | 123,028 | 128,482 | |
Corporate, Non-Segment | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 0 | 0 | ||
Direct operating expenses | 0 | 0 | ||
General and administrative expenses | 3,490 | 6,662 | ||
Depreciation and amortization | 69 | 170 | ||
Operating loss | (3,559) | (6,832) | ||
Loss from continuing operations before income taxes | (15,707) | $ (19,194) | ||
Total assets (a) | [1] | $ 17,639 | $ 53,794 | |
[1] | Total assets exclude intercompany receivables eliminated in consolidation. |
Discontinued Operations - Addi
Discontinued Operations - Additional Information (Detail) - USD ($) $ in Thousands | Apr. 11, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | Feb. 28, 2015 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Cash and cash equivalents | $ 0 | $ 2,793 | ||
Disposal Group, Not Discontinued Operation, Gain (Loss) on Disposal | 55 | 0 | ||
Income (loss) from discontinued operations | $ 55 | $ 921 | ||
TFI | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Consideration | $ 85,000 | |||
Escrow deposit | $ 4,300 | |||
Period after closing date escrow will be released | 18 months | |||
Cash and cash equivalents | $ 74,600 |
Discontinued Operations - Fina
Discontinued Operations - Financial Information of Discontinued Operations (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Income from discontinued operations - before sale | $ 0 | $ 921 |
Income from discontinued operations | 55 | 921 |
TFI | ||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||
Revenue | 0 | 17,497 |
Income from discontinued operations before income taxes | 0 | 1,186 |
Income tax expense | 0 | (265) |
Income from discontinued operations - before sale | 0 | 921 |
Income on sale of TFI | 55 | 0 |
Income from discontinued operations | $ 55 | $ 921 |
Subsidiary Guarantors - Additi
Subsidiary Guarantors - Additional Information (Detail) | 3 Months Ended | 5 Months Ended | 12 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | May. 31, 2015 | Dec. 31, 2015 | |
Guarantor Subsidiaries | ||||
Condensed Financial Statements, Captions [Line Items] | ||||
Subsidiary ownership percentage | 100.00% | 100.00% | 100.00% | |
Non-Guarantor Subsidiaries | ||||
Condensed Financial Statements, Captions [Line Items] | ||||
Subsidiary ownership percentage | 51.00% |
Subsidiary Guarantors - Conden
Subsidiary Guarantors - Condensed Consolidating Balance Sheet (Detail) - USD ($) $ in Thousands | Mar. 31, 2016 | Dec. 31, 2015 | Mar. 31, 2015 | |
Assets | ||||
Cash and cash equivalents | $ 30 | $ 39,309 | $ 35,486 | |
Restricted cash | 4,450 | 4,250 | ||
Accounts receivable, net | 30,857 | 42,188 | ||
Deferred income taxes | 0 | |||
Other current assets | 12,470 | 8,734 | ||
Total current assets | 47,807 | 94,481 | ||
Property, plant and equipment, net | 391,775 | 406,188 | ||
Equity investments | 3,745 | 3,750 | ||
Intangibles, net | 16,214 | 16,867 | ||
Other assets | 572 | 1,333 | ||
Total assets | [1] | 460,113 | 522,619 | |
Liabilities and Shareholders' Deficit | ||||
Accounts payable | 7,269 | 6,907 | ||
Accrued liabilities | 34,252 | 29,843 | ||
Current portion of contingent consideration | 8,500 | 8,628 | ||
Current portion of long-term debt | [2] | 463,164 | 499,709 | |
Total current liabilities | 513,185 | 545,087 | ||
Deferred income taxes | 295 | 270 | ||
Long-term portion of debt | 8,015 | 11,758 | ||
Other long-term liabilities | 3,735 | 3,775 | ||
Total shareholders' deficit | (65,117) | (38,271) | ||
Total liabilities and shareholders' deficit | 460,113 | 522,619 | ||
Reportable Legal Entities | Nuverra Environmental Solutions Inc. (Parent) | ||||
Assets | ||||
Cash and cash equivalents | 808 | 40,660 | 34,639 | |
Restricted cash | 4,250 | 4,250 | ||
Accounts receivable, net | 0 | 0 | ||
Deferred income taxes | 0 | |||
Other current assets | 7,275 | 2,654 | ||
Total current assets | 12,333 | 47,564 | ||
Property, plant and equipment, net | 2,546 | 2,609 | ||
Equity investments | 32,033 | 43,542 | ||
Intangibles, net | 0 | 0 | ||
Other assets | 405,619 | 404,620 | ||
Total assets | 452,531 | 498,335 | ||
Liabilities and Shareholders' Deficit | ||||
Accounts payable | 1,610 | 172 | ||
Accrued liabilities | 23,048 | 13,824 | ||
Current portion of contingent consideration | 0 | 0 | ||
Current portion of long-term debt | 454,003 | 492,671 | ||
Total current liabilities | 478,661 | 506,667 | ||
Deferred income taxes | (32,473) | (32,488) | ||
Long-term portion of debt | 0 | 0 | ||
Other long-term liabilities | 71,460 | 62,427 | ||
Total shareholders' deficit | (65,117) | (38,271) | ||
Total liabilities and shareholders' deficit | 452,531 | 498,335 | ||
Reportable Legal Entities | Guarantor Subsidiaries | ||||
Assets | ||||
Cash and cash equivalents | (778) | (1,351) | $ 847 | |
Restricted cash | 200 | 0 | ||
Accounts receivable, net | 30,857 | 42,188 | ||
Deferred income taxes | 0 | |||
Other current assets | 5,195 | 6,080 | ||
Total current assets | 35,474 | 46,917 | ||
Property, plant and equipment, net | 389,229 | 403,579 | ||
Equity investments | 576 | 581 | ||
Intangibles, net | 16,214 | 16,867 | ||
Other assets | 80,677 | 72,137 | ||
Total assets | 522,170 | 540,081 | ||
Liabilities and Shareholders' Deficit | ||||
Accounts payable | 5,659 | 6,735 | ||
Accrued liabilities | 11,204 | 16,019 | ||
Current portion of contingent consideration | 8,500 | 8,628 | ||
Current portion of long-term debt | 9,161 | 7,038 | ||
Total current liabilities | 34,524 | 38,420 | ||
Deferred income taxes | 32,768 | 32,758 | ||
Long-term portion of debt | 8,015 | 11,758 | ||
Other long-term liabilities | 417,999 | 416,772 | ||
Total shareholders' deficit | 28,864 | 40,373 | ||
Total liabilities and shareholders' deficit | 522,170 | 540,081 | ||
Consolidation, Eliminations | ||||
Assets | ||||
Cash and cash equivalents | 0 | 0 | ||
Restricted cash | 0 | 0 | ||
Accounts receivable, net | 0 | 0 | ||
Deferred income taxes | 0 | |||
Other current assets | 0 | 0 | ||
Total current assets | $ 0 | 0 | ||
Property, plant and equipment, net | 0 | |||
Equity investments | $ (28,864) | (40,373) | ||
Intangibles, net | 0 | 0 | ||
Other assets | (485,724) | (475,424) | ||
Total assets | (514,588) | (515,797) | ||
Liabilities and Shareholders' Deficit | ||||
Accounts payable | 0 | 0 | ||
Accrued liabilities | 0 | 0 | ||
Current portion of contingent consideration | 0 | 0 | ||
Current portion of long-term debt | 0 | 0 | ||
Total current liabilities | 0 | 0 | ||
Deferred income taxes | 0 | 0 | ||
Long-term portion of debt | 0 | 0 | ||
Other long-term liabilities | (485,724) | (475,424) | ||
Total shareholders' deficit | (28,864) | (40,373) | ||
Total liabilities and shareholders' deficit | $ (514,588) | $ (515,797) | ||
[1] | Total assets exclude intercompany receivables eliminated in consolidation. | |||
[2] | As a result of the probability of breaching one of the financial covenants if we are not successful at restructuring our debt (see "Restructuring Support Agreement" later in this section), the carrying value of the ABL Facility and the 2018 Notes was reclassified to current liabilities in the consolidated balance sheet as of March 31, 2016 and December 31, 2015. |
Subsidiary Guarantors - Cond60
Subsidiary Guarantors - Condensed Consolidating Statement of Operations (Detail) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Condensed Income Statements, Captions [Line Items] | ||
Revenue | $ 46,975 | $ 119,112 |
Costs and expenses: | ||
Direct operating expenses | 38,617 | 87,999 |
General and administrative expenses | 7,452 | 12,700 |
Depreciation and amortization | 15,845 | 17,482 |
Other, net | 0 | 683 |
Total costs and expenses | 61,914 | 118,864 |
Operating (loss) income | (14,939) | 248 |
Interest expense, net | (12,045) | (12,588) |
Other income, net | 163 | 342 |
Loss from equity investments | (5) | (21) |
Loss on extinguishment of debt | (390) | 0 |
Loss from continuing operations before income taxes | (27,216) | (12,019) |
Income tax (expense) benefit | (55) | 24 |
Loss from continuing operations | (27,271) | (11,995) |
Income from discontinued operations, net of income taxes | 55 | 921 |
Net loss attributable to common shareholders | (27,216) | (11,074) |
Reportable Legal Entities | Nuverra Environmental Solutions Inc. (Parent) | ||
Condensed Income Statements, Captions [Line Items] | ||
Revenue | 0 | 0 |
Costs and expenses: | ||
Direct operating expenses | 0 | 0 |
General and administrative expenses | 3,490 | 6,662 |
Depreciation and amortization | 69 | 170 |
Other, net | 0 | |
Total costs and expenses | 3,559 | 6,832 |
Operating (loss) income | (3,559) | (6,832) |
Interest expense, net | (11,758) | (12,362) |
Other income, net | 0 | 0 |
Loss from equity investments | (11,532) | 8,083 |
Loss on extinguishment of debt | (390) | |
Loss from continuing operations before income taxes | (27,239) | (11,111) |
Income tax (expense) benefit | (32) | 37 |
Loss from continuing operations | (27,271) | (11,074) |
Income from discontinued operations, net of income taxes | 55 | 0 |
Net loss attributable to common shareholders | (27,216) | (11,074) |
Reportable Legal Entities | Guarantor Subsidiaries | ||
Condensed Income Statements, Captions [Line Items] | ||
Revenue | 46,975 | 119,112 |
Costs and expenses: | ||
Direct operating expenses | 38,617 | 87,999 |
General and administrative expenses | 3,962 | 6,038 |
Depreciation and amortization | 15,776 | 17,312 |
Other, net | 683 | |
Total costs and expenses | 58,355 | 112,032 |
Operating (loss) income | (11,380) | 7,080 |
Interest expense, net | (287) | (226) |
Other income, net | 163 | 342 |
Loss from equity investments | (5) | (21) |
Loss on extinguishment of debt | 0 | |
Loss from continuing operations before income taxes | (11,509) | 7,175 |
Income tax (expense) benefit | (23) | (13) |
Loss from continuing operations | (11,532) | 7,162 |
Income from discontinued operations, net of income taxes | 0 | 921 |
Net loss attributable to common shareholders | (11,532) | 8,083 |
Consolidation, Eliminations | ||
Condensed Income Statements, Captions [Line Items] | ||
Revenue | 0 | 0 |
Costs and expenses: | ||
Direct operating expenses | 0 | 0 |
General and administrative expenses | 0 | 0 |
Depreciation and amortization | 0 | 0 |
Other, net | 0 | |
Total costs and expenses | 0 | 0 |
Operating (loss) income | 0 | 0 |
Interest expense, net | 0 | 0 |
Other income, net | 0 | 0 |
Loss from equity investments | 11,532 | (8,083) |
Loss on extinguishment of debt | 0 | |
Loss from continuing operations before income taxes | 11,532 | (8,083) |
Income tax (expense) benefit | 0 | 0 |
Loss from continuing operations | 11,532 | (8,083) |
Income from discontinued operations, net of income taxes | 0 | 0 |
Net loss attributable to common shareholders | $ 11,532 | $ (8,083) |
Subsidiary Guarantors - Cond61
Subsidiary Guarantors - Condensed Consolidating Statement of Cash Flows (Detail) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | |
Cash flows from operating activities: | |||
Net cash provided by operating activities from continuing operations | $ 2,565 | $ 34,750 | |
Net cash provided by operating activities from discontinued operations | 0 | 867 | |
Net cash provided by operating activities | 2,565 | 35,617 | |
Cash flows from investing activities: | |||
Proceeds from the sale of property and equipment | 1,449 | 1,968 | |
Purchase of property, plant and equipment | (1,421) | (6,163) | |
Increase in restricted cash | (200) | 0 | |
Net cash used in investing activities from continuing operations | (172) | (4,195) | |
Net cash used in investing activities from discontinued operations | 0 | (161) | |
Net cash used in investing activities | (172) | (4,356) | |
Cash flows from financing activities: | |||
Proceeds from revolving credit facility | 12,409 | 0 | |
Payments on revolving credit facility | (51,968) | (7,000) | |
Payments for deferred financing costs | (426) | 0 | |
Payments on vehicle financing and other financing activities | (1,687) | (1,436) | |
Net cash used in financing activities from continuing operations | (41,672) | (8,436) | |
Net cash provided by financing activities from discontinued operations | 0 | 38 | |
Net cash used in financing activities | (41,672) | (8,398) | |
Net (decrease) increase in cash and cash equivalents | (39,279) | 22,863 | |
Cash and cash equivalents - beginning of period | 39,309 | 15,416 | |
Cash and cash equivalents - end of period | 30 | 38,279 | |
Less: cash and cash equivalents of discontinued operations - end of period | 0 | (2,793) | |
Cash and cash equivalents of continuing operations - end of period | 30 | 35,486 | $ 39,309 |
Reportable Legal Entities | Nuverra Environmental Solutions Inc. (Parent) | |||
Cash flows from operating activities: | |||
Net cash provided by operating activities from continuing operations | 115 | 27,658 | |
Net cash provided by operating activities from discontinued operations | 0 | 0 | |
Net cash provided by operating activities | 115 | 27,658 | |
Cash flows from investing activities: | |||
Proceeds from the sale of property and equipment | 25 | 255 | |
Purchase of property, plant and equipment | 0 | 0 | |
Increase in restricted cash | 0 | ||
Net cash used in investing activities from continuing operations | 25 | 255 | |
Net cash used in investing activities from discontinued operations | 0 | 0 | |
Net cash used in investing activities | 25 | 255 | |
Cash flows from financing activities: | |||
Proceeds from revolving credit facility | 12,409 | ||
Payments on revolving credit facility | (51,968) | (7,000) | |
Payments for deferred financing costs | (426) | ||
Payments on vehicle financing and other financing activities | (7) | (75) | |
Net cash used in financing activities from continuing operations | (39,992) | (7,075) | |
Net cash provided by financing activities from discontinued operations | 0 | 0 | |
Net cash used in financing activities | (39,992) | (7,075) | |
Net (decrease) increase in cash and cash equivalents | (39,852) | 20,838 | |
Cash and cash equivalents - beginning of period | 40,660 | 13,801 | |
Cash and cash equivalents - end of period | 808 | $ 34,639 | |
Less: cash and cash equivalents of discontinued operations - end of period | 0 | ||
Cash and cash equivalents of continuing operations - end of period | 808 | $ 34,639 | 40,660 |
Reportable Legal Entities | Guarantor Subsidiaries | |||
Cash flows from operating activities: | |||
Net cash provided by operating activities from continuing operations | 2,450 | 7,092 | |
Net cash provided by operating activities from discontinued operations | 0 | 867 | |
Net cash provided by operating activities | 2,450 | 7,959 | |
Cash flows from investing activities: | |||
Proceeds from the sale of property and equipment | 1,424 | 1,713 | |
Purchase of property, plant and equipment | (1,421) | (6,163) | |
Increase in restricted cash | (200) | ||
Net cash used in investing activities from continuing operations | (197) | (4,450) | |
Net cash used in investing activities from discontinued operations | 0 | (161) | |
Net cash used in investing activities | (197) | (4,611) | |
Cash flows from financing activities: | |||
Proceeds from revolving credit facility | 0 | ||
Payments on revolving credit facility | 0 | 0 | |
Payments for deferred financing costs | 0 | ||
Payments on vehicle financing and other financing activities | (1,680) | (1,361) | |
Net cash used in financing activities from continuing operations | (1,680) | (1,361) | |
Net cash provided by financing activities from discontinued operations | 0 | 38 | |
Net cash used in financing activities | (1,680) | (1,323) | |
Net (decrease) increase in cash and cash equivalents | 573 | 2,025 | |
Cash and cash equivalents - beginning of period | (1,351) | 1,615 | |
Cash and cash equivalents - end of period | (778) | 3,640 | |
Less: cash and cash equivalents of discontinued operations - end of period | 0 | (2,793) | |
Cash and cash equivalents of continuing operations - end of period | $ (778) | $ 847 | $ (1,351) |
Subsequent Events Related to 62
Subsequent Events Related to Restructuring (Details) - USD ($) | Apr. 15, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Jun. 30, 2016 | Dec. 31, 2015 | Apr. 15, 2018 | Dec. 31, 2017 | Oct. 15, 2016 | Mar. 10, 2016 | Feb. 01, 2016 | Nov. 30, 2012 | Apr. 30, 2012 | |
Restructuring Cost and Reserve [Line Items] | |||||||||||||
Interest Rate | 1.52% | ||||||||||||
Back stop amount | $ 5,000,000 | ||||||||||||
Scenario, Forecast | |||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||
Common stock potentially issuable, aggregate amount | $ 5,000,000 | ||||||||||||
Discount to the conversion price, percent | 20.00% | ||||||||||||
Common stock, value, outstanding, fully diluted basis, excluding shares issuable in connection with management incentive plan | $ 176,000,000 | $ 176,000,000 | |||||||||||
Notes 2,021 | |||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||
Interest Rate | 13.00% | 13.00% | 17.00% | ||||||||||
Interest paid in-kind, paid in year two | 50.00% | 50.00% | |||||||||||
Interest paid in cash, paid in year two | 50.00% | 50.00% | |||||||||||
Notes 2021 | Scenario, Forecast | |||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||
Interest Rate | 10.00% | 10.00% | 12.50% | ||||||||||
2018 Notes | |||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||
Interest Rate | [1] | 9.875% | 9.875% | ||||||||||
Face amount | $ 400,000,000 | $ 150,000,000 | $ 250,000,000 | ||||||||||
Chief Executive Officer | 2018 Notes | |||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||
Notes payable, related parties, noncurrent | $ 31,400,000 | $ 31,400,000 | |||||||||||
Subsequent Event | |||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||
Back stop amount | $ 5,000,000 | ||||||||||||
Subsequent Event | Notes 2021 | |||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||
Debt instrument, convertible, conversion price | $ 0.32 | ||||||||||||
Increase (decrease) in interest payment obligation, remainder of the year | $ 17,800,000 | ||||||||||||
Increase (decrease) in interest payment obligation, payable in year two | 17,900,000 | ||||||||||||
Increase (decrease) in interest payment obligation, payable in year three | 8,600,000 | ||||||||||||
Face amount | 24,000,000 | ||||||||||||
Subsequent Event | 2018 Notes | |||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||
Troubled debt restructuring, debtor, current period, aggregate principal amount | 327,200,000 | ||||||||||||
Face amount | 40,400,000 | ||||||||||||
Interest expense | $ 2,000,000 | ||||||||||||
Common Class A | |||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||
Percent of securities called by warrants or rights, percent | 15.00% | ||||||||||||
Common Class A | Subsequent Event | |||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||
Percent of securities called by warrants or rights, percent | 10.00% | ||||||||||||
Common Class A | Subsequent Event | Notes 2021 | |||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||
Debt instrument, convertible, conversion price | $ 0.01 | ||||||||||||
Percent of securities called by warrants or rights, percent | 5.00% | ||||||||||||
Common Class A | Subsequent Event | 2018 Notes | |||||||||||||
Restructuring Cost and Reserve [Line Items] | |||||||||||||
Troubled debt restructuring, debtor, current period, aggregate principal amount | $ 900,000 | ||||||||||||
[1] | The interest rate presented represents the coupon rate on our outstanding $400.0 million aggregate principal amounts of 9.875% Senior Notes due 2018 (the “2018 Notes”), excluding the effects of deferred financing costs, original issue discounts and original issue premiums. Including the impact of these items, the effective interest rate on the 2018 Notes is approximately 11.0%. Interest payments are due semi-annually on April 15 and October 15 of each year. |