Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2020 | Nov. 11, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2020 | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | MEG | |
Entity Registrant Name | Montrose Environmental Group, Inc. | |
Entity Central Index Key | 0001643615 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Common Stock, Shares Outstanding | 24,961,680 | |
Entity Interactive Data Current | Yes | |
Entity Current Reporting Status | Yes | |
Entity Shell Company | false | |
Entity File Number | 001-39394 | |
Entity Tax Identification Number | 46-4195044 | |
Entity Incorporation State Country Code | DE | |
Entity Address Address Line1 | 1 Park Plaza | |
Entity Address, Address Line Two | Suite 1000 | |
Entity Address City Or Town | Irvine | |
Entity Address State Or Province | CA | |
Entity Address Postal Zip Code | 92614 | |
City Area Code | 949 | |
Local Phone Number | 988-3500 | |
Security12b Title | Common Stock, par value $0.000004 per share | |
Security Exchange Name | NYSE |
UNAUDITED CONDENSED CONSOLIDATE
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
CURRENT ASSETS: | ||
Cash and restricted cash | $ 38,377 | $ 6,884 |
Accounts receivable—net | 44,785 | 45,927 |
Contract assets | 35,441 | 13,605 |
Prepaid and other current assets | 8,585 | 6,823 |
Total current assets | 127,188 | 73,239 |
NON-CURRENT ASSETS: | ||
Property and equipment—net | 34,559 | 27,036 |
Goodwill | 274,309 | 127,058 |
Other intangible assets—net | 162,201 | 102,549 |
Other assets | 4,081 | 1,956 |
TOTAL ASSETS | 602,338 | 331,838 |
CURRENT LIABILITIES: | ||
Accounts payable and other accrued liabilities | 33,897 | 29,585 |
Accrued payroll and benefits | 17,957 | 11,032 |
Warrant option | 16,878 | |
Business acquisitions contingent consideration, current | 49,170 | 8,614 |
Current portion of long-term debt | 5,034 | 7,143 |
Total current liabilities | 106,058 | 73,252 |
NON-CURRENT LIABILITIES: | ||
Business acquisitions contingent consideration, long-term | 9,742 | 379 |
Other non-current liabilities | 3,431 | |
Deferred tax liabilities—net | 1,936 | 3,530 |
Long-term debt—net of deferred financing fees | 171,417 | 145,046 |
Total liabilities | 310,643 | 229,307 |
COMMITMENTS AND CONTINGENCIES | ||
STOCKHOLDERS’ EQUITY (DEFICIT): | ||
Additional paid-in-capital | 261,945 | 38,153 |
Accumulated deficit | (123,165) | (64,404) |
Accumulated other comprehensive loss | (13) | (40) |
Total stockholders’ equity (deficit) | 138,767 | (26,291) |
TOTAL LIABILITIES, REDEEMABLE SERIES A-1 PREFERRED STOCK, CONVERTIBLE AND REDEEMABLE SERIES A-2 PREFERRED STOCK AND STOCKHOLDERS’ EQUITY (DEFICIT) | 602,338 | 331,838 |
Conversion Option | ||
NON-CURRENT LIABILITIES: | ||
Embedded derivative | 18,059 | |
Contingent Put Option | ||
NON-CURRENT LIABILITIES: | ||
Embedded derivative | 7,100 | |
Redeemable Series A-1 Preferred Stock | ||
NON-CURRENT LIABILITIES: | ||
REDEEMABLE SERIES PREFERRED STOCK | $ 128,822 | |
Convertible And Redeemable Series A-2 Preferred Stock | ||
NON-CURRENT LIABILITIES: | ||
REDEEMABLE SERIES PREFERRED STOCK | $ 152,928 |
UNAUDITED CONDENSED CONSOLIDA_2
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Common stock, par value | $ 0.000004 | $ 0.000004 |
Common stock, shares authorized | 190,000,000 | 25,000,000 |
Common stock, shares issued | 24,893,122 | 8,370,107 |
Common stock, shares outstanding | 24,893,122 | 8,370,107 |
Redeemable Series A-1 Preferred Stock | ||
Temporary equity, par value | $ 0.0001 | $ 0.0001 |
Temporary equity, shares authorized | 0 | 12,000 |
Temporary equity, shares issued | 0 | 12,000 |
Temporary equity, shares outstanding | 0 | 12,000 |
Temporary equity, aggregate liquidation preference | $ 0 | $ 141,898 |
Convertible And Redeemable Series A-2 Preferred Stock | ||
Temporary equity, par value | $ 0.0001 | $ 0.0001 |
Temporary equity, shares authorized | 17,500 | 0 |
Temporary equity, shares issued | 17,500 | 0 |
Temporary equity, shares outstanding | 17,500 | 0 |
Temporary equity, aggregate liquidation preference | $ 182,200 | $ 0 |
UNAUDITED CONDENSED CONSOLIDA_3
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Income Statement [Abstract] | ||||
REVENUES | $ 84,705 | $ 57,623 | $ 219,502 | $ 165,978 |
COST OF REVENUES (exclusive of depreciation and amortization shown below) | 51,828 | 39,804 | 142,115 | 116,248 |
SELLING, GENERAL AND ADMINISTRATIVE EXPENSE | 24,442 | 12,656 | 64,810 | 35,464 |
FAIR VALUE CHANGES IN BUSINESS ACQUISITIONS CONTINGENT CONSIDERATION | 13,404 | 256 | 17,387 | (670) |
DEPRECIATION AND AMORTIZATION | 9,740 | 7,412 | 27,084 | 20,262 |
LOSS FROM OPERATIONS | (14,709) | (2,505) | (31,894) | (5,326) |
OTHER EXPENSE | ||||
Other expense | (9,637) | (2,460) | (17,534) | (3,639) |
Interest expense—net | (3,043) | (2,130) | (10,896) | (4,590) |
Total other expenses—net | (12,680) | (4,590) | (28,430) | (8,229) |
LOSS BEFORE EXPENSE (BENEFIT) FROM INCOME TAXES | (27,389) | (7,095) | (60,324) | (13,555) |
INCOME TAXES EXPENSE (BENEFIT) | 3,348 | (412) | (1,563) | (1,308) |
NET LOSS | (30,737) | (6,683) | (58,761) | (12,247) |
EQUITY ADJUSTMENT FROM FOREIGN CURRENCY TRANSLATION | 80 | (20) | 27 | 3 |
COMPREHENSIVE LOSS | (30,657) | (6,703) | (58,734) | (12,244) |
ACCRETION OF REDEEMABLE SERIES A-1 PREFERRED STOCK | (6,542) | (5,030) | (17,601) | (14,341) |
REDEEMABLE SERIES A-1 PREFERRED STOCK DEEMED DIVIDEND | (24,341) | (24,341) | ||
CONVERTIBLE AND REDEEMABLE SERIES A-2 PREFERRED STOCK DIVIDEND | (2,870) | (2,870) | ||
NET LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS | $ (64,490) | $ (11,713) | $ (103,573) | $ (26,588) |
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING— BASIC AND DILUTED | 21,554 | 8,718 | 13,669 | 8,640 |
NET LOSS PER SHARE ATTRIBUTABLE TO COMMON STOCKHOLDERS— BASIC AND DILUTED | $ (2.99) | $ (1.34) | $ (7.58) | $ (3.08) |
UNAUDITED CONDENSED CONSOLIDA_4
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF REDEEMABLE SERIES A-1 PREFERRED STOCK, CONVERTIBLE AND REDEEMABLE SERIES A-2 PREFERRED STOCK AND STOCKHOLDERS' EQUITY (DEFICIT) - USD ($) $ in Thousands | Total | Redeemable Series A-1 Preferred Stock | Convertible And Redeemable Series A-2 Preferred Stock | Common Stock | Additional Paid-In Capital | Accumulated Deficit | Notes Receivable from Stockholders | Accumulated Other Comprehensive Income (Loss) |
Beginning balance at Dec. 31, 2018 | $ 6,900 | $ 47,869 | $ (40,847) | $ (122) | ||||
Beginning balance, shares at Dec. 31, 2018 | 8,137,771 | |||||||
Beginning balance at Dec. 31, 2018 | $ 109,206 | |||||||
Beginning balance, shares at Dec. 31, 2018 | 12,000 | |||||||
Net income (loss) | (5,242) | (5,242) | ||||||
Accretion of the redeemable series A-1 preferred stock to redeemable value | (4,534) | (4,534) | ||||||
Accretion of the redeemable series A-1 preferred stock to redeemable shares | $ 4,534 | |||||||
Stock-based compensation | 1,228 | 1,228 | ||||||
Common stock issued | 6 | 6 | ||||||
Common stock issued, shares | 1,775 | |||||||
Ending balance at Mar. 31, 2019 | (1,642) | 44,569 | (46,089) | (122) | ||||
Ending balance, shares at Mar. 31, 2019 | 8,139,546 | |||||||
Ending balance at Mar. 31, 2019 | $ 113,740 | |||||||
Ending balance, shares at Mar. 31, 2019 | 12,000 | |||||||
Beginning balance at Dec. 31, 2018 | 6,900 | 47,869 | (40,847) | (122) | ||||
Beginning balance, shares at Dec. 31, 2018 | 8,137,771 | |||||||
Beginning balance at Dec. 31, 2018 | $ 109,206 | |||||||
Beginning balance, shares at Dec. 31, 2018 | 12,000 | |||||||
Net income (loss) | (12,247) | |||||||
Accumulated other comprehensive income (loss) | 3 | |||||||
Ending balance at Sep. 30, 2019 | (11,922) | 41,291 | (53,094) | (122) | $ 3 | |||
Ending balance, shares at Sep. 30, 2019 | 8,310,885 | |||||||
Ending balance at Sep. 30, 2019 | $ 123,547 | |||||||
Ending balance, shares at Sep. 30, 2019 | 12,000 | |||||||
Beginning balance at Mar. 31, 2019 | (1,642) | 44,569 | (46,089) | (122) | ||||
Beginning balance, shares at Mar. 31, 2019 | 8,139,546 | |||||||
Beginning balance at Mar. 31, 2019 | $ 113,740 | |||||||
Beginning balance, shares at Mar. 31, 2019 | 12,000 | |||||||
Net income (loss) | (322) | (322) | ||||||
Accretion of the redeemable series A-1 preferred stock to redeemable value | (4,777) | (4,777) | ||||||
Accretion of the redeemable series A-1 preferred stock to redeemable shares | $ 4,777 | |||||||
Stock-based compensation | 1,294 | 1,294 | ||||||
Common stock issued | 3,452 | 3,452 | ||||||
Common stock issued, shares | 138,781 | |||||||
Accumulated other comprehensive income (loss) | 23 | 23 | ||||||
Ending balance at Jun. 30, 2019 | (1,972) | 44,538 | (46,411) | (122) | 23 | |||
Ending balance, shares at Jun. 30, 2019 | 8,278,327 | |||||||
Ending balance at Jun. 30, 2019 | $ 118,517 | |||||||
Ending balance, shares at Jun. 30, 2019 | 12,000 | |||||||
Net income (loss) | (6,683) | (6,683) | ||||||
Accretion of the redeemable series A-1 preferred stock to redeemable value | (5,030) | (5,030) | ||||||
Accretion of the redeemable series A-1 preferred stock to redeemable shares | $ 5,030 | |||||||
Stock-based compensation | 1,055 | 1,055 | ||||||
Common stock issued | 728 | 728 | ||||||
Common stock issued, shares | 32,558 | |||||||
Accumulated other comprehensive income (loss) | (20) | (20) | ||||||
Ending balance at Sep. 30, 2019 | (11,922) | 41,291 | (53,094) | $ (122) | 3 | |||
Ending balance, shares at Sep. 30, 2019 | 8,310,885 | |||||||
Ending balance at Sep. 30, 2019 | $ 123,547 | |||||||
Ending balance, shares at Sep. 30, 2019 | 12,000 | |||||||
Beginning balance at Dec. 31, 2019 | (26,291) | 38,153 | (64,404) | (40) | ||||
Beginning balance, shares at Dec. 31, 2019 | 8,370,107 | |||||||
Beginning balance at Dec. 31, 2019 | $ 128,822 | |||||||
Beginning balance, shares at Dec. 31, 2019 | 12,000 | 0 | ||||||
Net income (loss) | (41,248) | (41,248) | ||||||
Accretion of the redeemable series A-1 preferred stock to redeemable value | (5,415) | (5,415) | ||||||
Accretion of the redeemable series A-1 preferred stock to redeemable shares | $ 5,415 | |||||||
Stock-based compensation | 1,150 | 1,150 | ||||||
Accumulated other comprehensive income (loss) | 37 | 37 | ||||||
Ending balance at Mar. 31, 2020 | (71,767) | 33,888 | (105,652) | (3) | ||||
Ending balance, shares at Mar. 31, 2020 | 8,370,107 | |||||||
Ending balance at Mar. 31, 2020 | $ 134,237 | |||||||
Ending balance, shares at Mar. 31, 2020 | 12,000 | |||||||
Beginning balance at Dec. 31, 2019 | (26,291) | 38,153 | (64,404) | (40) | ||||
Beginning balance, shares at Dec. 31, 2019 | 8,370,107 | |||||||
Beginning balance at Dec. 31, 2019 | $ 128,822 | |||||||
Beginning balance, shares at Dec. 31, 2019 | 12,000 | 0 | ||||||
Net income (loss) | $ (58,761) | |||||||
Redemption of the series A-1, shares | 1,786,739 | |||||||
Dividend payment to the series A-2 preferred shareholders | $ (2,900) | |||||||
Cancellation of shares | (117,785) | |||||||
Accumulated other comprehensive income (loss) | $ 27 | |||||||
Ending balance at Sep. 30, 2020 | 138,767 | 261,945 | (123,165) | (13) | ||||
Ending balance, shares at Sep. 30, 2020 | 24,893,122 | |||||||
Ending balance at Sep. 30, 2020 | $ 152,928 | |||||||
Ending balance, shares at Sep. 30, 2020 | 0 | 17,500 | ||||||
Beginning balance at Mar. 31, 2020 | (71,767) | 33,888 | (105,652) | (3) | ||||
Beginning balance, shares at Mar. 31, 2020 | 8,370,107 | |||||||
Beginning balance at Mar. 31, 2020 | $ 134,237 | |||||||
Beginning balance, shares at Mar. 31, 2020 | 12,000 | |||||||
Net income (loss) | 13,224 | 13,224 | ||||||
Accretion of the redeemable series A-1 preferred stock to redeemable value | (5,644) | (5,644) | ||||||
Accretion of the redeemable series A-1 preferred stock to redeemable shares | $ 5,644 | |||||||
Issuance of the convertible and redeemable series A-2 preferred stock | $ 152,928 | |||||||
Issuance of the convertible and redeemable series A-2 preferred stock, shares | 17,500 | |||||||
Stock-based compensation | 1,140 | 1,140 | ||||||
Common stock issued | 25,021 | 25,021 | ||||||
Common stock issued, shares | 794,639 | |||||||
Accumulated other comprehensive income (loss) | (90) | (90) | ||||||
Ending balance at Jun. 30, 2020 | (38,116) | 54,405 | (92,428) | (93) | ||||
Ending balance, shares at Jun. 30, 2020 | 9,164,746 | |||||||
Ending balance at Jun. 30, 2020 | $ 139,881 | $ 152,928 | ||||||
Ending balance, shares at Jun. 30, 2020 | 12,000 | 17,500 | ||||||
Net income (loss) | (30,737) | (30,737) | ||||||
Accretion of the redeemable series A-1 preferred stock to redeemable value | 6,542 | (6,542) | ||||||
Accretion of the redeemable series A-1 preferred stock to redeemable shares | $ 6,542 | |||||||
Series A-1 preferred stock deemed dividend | (24,341) | (24,341) | ||||||
Series A-1 preferred stock deemed dividend | $ 24,341 | |||||||
Redemption of the series A-1 | $ 26,801 | 26,801 | ||||||
Temporary equity redemption of the series A-1, shares | (12,000) | |||||||
Temporary equity redemption of the series A-1, value | $ (170,764) | |||||||
Redemption of the series A-1, shares | 1,786,739 | 1,786,739 | ||||||
Dividend payment to the series A-2 preferred shareholders | $ (2,870) | $ (2,900) | (2,870) | |||||
Exercise of the series A-1 preferred stock warrant | 11,871 | 11,871 | ||||||
Exercise of the series A-1 preferred stock warrant, shares | 534,240 | |||||||
Exercise of the series A-2 preferred stock warrant | 44,441 | 44,441 | ||||||
Exercise of the series A-2 preferred stock warrant,shares | 1,999,999 | |||||||
Stock-based compensation | 1,149 | 1,149 | ||||||
Common stock issued | 150 | 150 | ||||||
Common stock issued, shares | 26,850 | |||||||
Issuance of common stock in connection with initial public offering, net of issuance costs of $15.6 million | $ 156,881 | 156,881 | ||||||
Issuance of common stock in connection with initial public offering, net of issuance costs of $15.6 million, shares | 11,500,000 | |||||||
Cancellation of shares | (117,785) | (119,452) | ||||||
Accumulated other comprehensive income (loss) | $ 80 | 80 | ||||||
Ending balance at Sep. 30, 2020 | $ 138,767 | $ 261,945 | $ (123,165) | $ (13) | ||||
Ending balance, shares at Sep. 30, 2020 | 24,893,122 | |||||||
Ending balance at Sep. 30, 2020 | $ 152,928 | |||||||
Ending balance, shares at Sep. 30, 2020 | 0 | 17,500 |
UNAUDITED CONDENSED CONSOLIDA_5
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF REDEEMABLE SERIES A-1 PREFERRED STOCK, CONVERTIBLE AND REDEEMABLE SERIES A-2 PREFERRED STOCK AND STOCKHOLDERS' EQUITY (DEFICIT) (Parenthetical) $ in Millions | 3 Months Ended |
Sep. 30, 2020USD ($) | |
Statement Of Stockholders Equity [Abstract] | |
Issuance of common stock in connection with initial public offering, issuance costs | $ 15.6 |
UNAUDITED CONDENSED CONSOLIDA_6
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
OPERATING ACTIVITIES: | ||||||
Net loss | $ (30,737) | $ (6,683) | $ (58,761) | $ (12,247) | ||
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: | ||||||
Provision for bad debt | $ 6,300 | 6,445 | 590 | $ 1,246 | ||
Depreciation and amortization | 9,740 | 7,412 | 27,084 | 20,262 | ||
Stock-based compensation expense | 1,149 | 1,055 | 3,439 | 3,577 | ||
Fair value changes in the contingent put option | (26,265) | (19,240) | ||||
Fair value changes in the compound embedded option | 26,664 | 27,420 | ||||
Fair value changes in business acquisitions contingent consideration | 13,404 | 256 | 17,387 | (670) | ||
Fair value changes in the warrant options | 9,311 | 2,510 | 9,312 | 4,059 | ||
Deferred income taxes | (1,563) | (1,308) | ||||
Cloud computing costs | (2,350) | (247) | ||||
Other | 1,170 | 97 | ||||
Changes in operating assets and liabilities—net of acquisitions: | ||||||
Accounts receivable and contract assets | (7,736) | (2,732) | ||||
Prepaid expenses and other current assets | (1,349) | (179) | ||||
Accounts payable and other accrued liabilities | (4,829) | (95) | ||||
Accrued payroll and benefits | 6,084 | 1,440 | ||||
Payment of contingent consideration and other assumed purchase price obligations | (6,390) | |||||
Net cash (used in) provided by operating activities | (3,877) | 12,547 | ||||
INVESTING ACTIVITIES: | ||||||
Purchases of property and equipment | (5,366) | (2,765) | ||||
Proprietary software development | (370) | (6) | ||||
Proceeds from net working capital adjustment related to acquisitions | 2,819 | |||||
Cash paid for acquisitions—net of cash acquired | (173,923) | (81,370) | ||||
Net cash used in investing activities | (176,840) | (84,141) | ||||
FINANCING ACTIVITIES: | ||||||
Proceeds from line of credit | 104,390 | 149,744 | ||||
Payments on line of credit | (201,980) | (69,744) | ||||
Proceeds from term loans | 175,000 | |||||
Repayment of term loan | (49,297) | |||||
Payment of contingent consideration and other purchase price obligations | (6,004) | (1,136) | ||||
Repayment of capital leases | (2,257) | (1,304) | ||||
Proceeds from issuance of common stock in connection with initial public offering, net of issuance costs | 161,288 | |||||
Payments of deferred offering costs | (2,925) | (29) | ||||
Debt issuance costs | (4,866) | (417) | ||||
Debt extinguishment costs | (351) | |||||
Proceeds from issuance of common stock | 171 | 139 | ||||
Issuance of convertible and redeemable Series A-2 preferred stock and warrant | 173,664 | |||||
Redemption of the Series A-1 Preferred Stock | (131,821) | |||||
Dividend payment to the Series A-2 shareholders | (2,870) | |||||
Exercise of warrant options | 25 | |||||
Net cash provided by financing activities | 212,167 | 77,253 | ||||
CHANGE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH | 31,450 | 5,659 | ||||
Foreign exchange impact on cash balance | 43 | (5) | ||||
Beginning of year | $ 6,884 | 6,884 | 2,489 | 2,489 | ||
End of period | $ 38,377 | $ 8,143 | 38,377 | 8,143 | $ 6,884 | |
SUPPLEMENTAL DISCLOSURES OF CASH FLOWS INFORMATION: | ||||||
Cash paid for interest | 9,368 | 2,689 | ||||
Cash paid for income tax | 171 | 878 | ||||
SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||||||
Series A-1 preferred stock deemed dividend—net of return from holders | 24,341 | |||||
Series A-1 preferred stock dividend paid in common shares | 26,801 | |||||
Accrued purchases of property and equipment | 486 | 932 | ||||
Property and equipment acquired under capital leases | 1,753 | 2,757 | ||||
Accretion of the redeemable series A-1 preferred stock to redeemable value | 17,601 | 14,341 | ||||
Common stock issued to acquire new businesses | 25,000 | 4,047 | ||||
Acquisitions unpaid contingent consideration | 58,912 | $ 5,401 | ||||
Offering costs included in accounts payable and other accrued liabilities | $ 1,237 |
Description of the Business and
Description of the Business and Basis of Presentation | 9 Months Ended |
Sep. 30, 2020 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Description of the Business and Basis of Presentation | 1. DESCRIPTION OF THE BUSINESS AND BASIS OF PRESENTATION Description of the Business —Montrose Environmental Group, Inc. (“Montrose” or the “Company”) is a corporation formed on November 2013, under the laws of the State of Delaware. The Company has approximately 70 offices across the United States, Canada and Australia and over 1,700 employees. Montrose is highly acquisitive and, as of September 30, 2020, had completed 56 acquisitions since its inception. Montrose is an environmental services company serving the recurring environmental needs of a diverse client base, including Fortune 500 companies and federal, state and local governments through the following three segments: Assessment, Permitting and Response —Through its Assessment, Permitting and Response segment, Montrose provides scientific advisory and consulting services to support environmental assessments, environmental emergency response, and environmental audits and permits for current operations, facility upgrades, new projects, decommissioning projects and development projects. Montrose’s technical advisory and consulting offerings include regulatory compliance support and planning, environmental, ecosystem and toxicological assessments and support during responses to environmental disruption. Montrose helps clients navigate regulations at the local, state, provincial and federal levels. Measurement and Analysis —Through its Measurement and Analysis segment, Montrose’s teams test and analyze air, water and soil to determine concentrations of contaminants as well as the toxicological impact of contaminants on flora, fauna and human health. Montrose’s offerings include source and ambient air testing and monitoring, leak detection and repair (“LDAR”) and advanced analytical laboratory services such as air, storm water, wastewater and drinking water analysis. Remediation and Reuse —Through its Remediation and Reuse segment, Montrose provides clients with engineering, design, implementation and operations and maintenance (“O&M”) services, primarily to treat contaminated water, remove contaminants from soil or create biogas from waste. The Company does not own the properties or facilities at which it implements these projects or the underlying liabilities, nor does it own material amounts of the equipment used in projects; instead, the Company assists clients in designing solutions, managing projects and mitigating their environmental risks and liabilities at their locations. Initial Public Offering —On July 27, 2020, the Company completed its initial public offering (“IPO”) of common stock, in which it sold 11,500,000 shares, including 1,500,000 shares issued pursuant to the underwriters full exercise on July 24, 2020 of the underwriters’ option to purchase additional shares, at a price to the public of $15.00 per share, resulting in net proceeds to the Company of approximately $161.3 million after deducting underwriting discounts of $11.2 million. Additionally, the Company offset $4.4 million of deferred IPO costs against IPO proceeds recorded to additional paid in capital. These deferred IPO costs were directly attributable to the IPO offering in accordance with Staff Accounting Bulletin Topic 5: Miscellaneous Accounting. The Company’s common stock began trading on the New York Stock Exchange on July 23, 2020. Basis of Presentation —The unaudited condensed consolidated financial statements include the operations of the Company and its wholly-owned subsidiaries. These unaudited condensed consolidated financial statements are presented in conformity with accounting principles generally accepted in the United States (“U.S. GAAP”) and have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) that permit reduced disclosure for interim periods. The unaudited condensed consolidated financial statements include all accounts of the Company and, in the opinion of management, include all recurring adjustments and normal accruals necessary for a fair statement of the Company’s financial position, results of operations and cash flows for the dates and periods presented. These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited financial statements as of and for the year ended December 31, 2019. Results for interim periods are not necessarily indicative of the results to be expected during the remainder of the current year or for any future period. All intercompany transactions, accounts and profits, have been eliminated in the condensed consolidated financial statements. |
Summary of New Accounting Prono
Summary of New Accounting Pronouncements | 9 Months Ended |
Sep. 30, 2020 | |
New Accounting Pronouncements And Changes In Accounting Principles [Abstract] | |
Summary of New Accounting Pronouncements | 2. SUMMARY OF NEW ACCOUNTING PRONOUNCEMENTS Recently Adopted Accounting Pronouncements — The Company qualifies as an emerging growth company as defined in the Jumpstart Our Business Startups Act of 2012 (“JOBS Act”) and therefore intends to take advantage of certain exemptions from various public company reporting requirements, including delaying adoption of new or revised accounting standards until those standards apply to private companies. The Company has elected to use this extended transition period under the JOBS Act. The effective dates shown below reflect the election to use the extended transition period. In June 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2018-07, Compensation—Stock Compensation: Improvements to Nonemployee Share-Based Payment Accounting. Under the revised guidance, the accounting for awards issued to non-employees will be similar to the accounting for employee awards. The new guidance is effective for fiscal years beginning after December 15, 2019. The standard was adopted as of January 1, 2020 and did not have a material impact on the Company’s condensed consolidated financial statements. In January 2017, the FASB issued ASU 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Accounting for Goodwill Impairment. The revised guidance eliminates Step 2 of the current goodwill impairment analysis test, which requires hypothetical purchase price allocation to measure goodwill impairment. A goodwill impairment loss will instead be measured at the amount by which a reporting unit’s carrying amount exceeds its fair value, not to exceed the carrying amount of goodwill. The revised guidance was adopted as of January 1, 2020 and did not have a material impact on the Company’s condensed consolidated financial statements. Recently Issued Accounting Pronouncements Not Yet Adopted — In August 2020, the FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40)—Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. The ASU simplifies accounting for convertible instruments by removing major separation models required under current GAAP. Consequently, more convertible debt instruments will be reported as a single liability instrument with no separate accounting for embedded conversion features. The ASU removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception, which will permit more equity contracts to qualify for the exception. The ASU also simplifies the diluted net income per share calculation in certain areas. The new guidance is effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years, and early adoption is permitted. The Company is currently evaluating the impact of the adoption of the standard on the condensed consolidated financial statements. In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. ASU 2020-04 provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions affected by the expected transition away from reference rates that are expected to be discontinued, such as LIBOR. ASU 2020-04 was effective upon issuance. The Company may elect to apply the guidance prospectively through December 31, 2022. The Company is currently evaluating the impact of the adoption of the standard on the condensed consolidated financial statements. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. ASU 2019-12 removes certain exceptions to the general principles in ASC 740 and clarifies and amends certain guidance to promote consistent application. ASU 2019-12 is effective for the Company’s annual and interim periods beginning on January 1, 2021, with early adoption permitted. Depending on the amendment, adoption may be applied on a retrospective, modified retrospective or prospective basis. The Company is currently evaluating the impact of the adoption of the standard on the condensed consolidated financial statements and does not anticipate the standard to have a significant impact. In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326). The standard introduces a new model for recognizing credit losses on financial instruments based on an estimate of current expected credit losses and will apply to trade receivables. The new guidance will be effective for the Company’s annual and interim periods beginning after December 15, 2022. The Company is currently evaluating the impact of the adoption of the standard on the condensed consolidated financial statements and does not anticipate the standard to have a significant impact. In February 2016, the FASB issued ASU 2016-2, Leases (Topic 842), to improve financial reporting regarding leasing transactions. The ASU primarily affects the accounting by the lessee in that it requires a lessee to recognize lease assets and liabilities, initially measured at the present value of the lease payments, on the balance sheets for those leases classified as operating leases under previous guidance. The new leasing standard is effective for the Company’s annual and interim periods beginning after December 15, 2021. The new leasing standard requires modified retrospective transition. The Company is evaluating the on the statements, but anticipates a material increase in assets and liabilities due to the recognition of the required right-of-use asset and corresponding liability for all significant lease obligations that are currently classified as operating leases. |
Revenues and Accounts Receivabl
Revenues and Accounts Receivable | 9 Months Ended |
Sep. 30, 2020 | |
Revenues And Accounts Receivable [Abstract] | |
Revenues and Accounts Receivable | 3. REVENUES AND ACCOUNTS RECEIVABLE The Company’s main revenue sources derive from the following revenue streams: Assessment, Permitting and Response Revenues —Assessment, Permitting and Response revenues are generated from multidisciplinary environmental consulting services. The majority of the contracts are fixed-price or time and material based. Measurement and Analysis Revenues —Measurement and Analysis revenues are generated from emissions sampling, testing and reporting services, leak detection services, ambient air monitoring services and laboratory testing services. The majority of the contracts are fixed-price or time-and-materials based. Remediation and Reuse Revenues —Remediation and Reuse revenues are generated from O&M services (on biogas and water treatment facilities), as well as remediation, monitoring and environmental compliance services. Services on the majority of O&M contracts are provided under long-term fixed-fee contracts. The majority of the remediation, monitoring and environmental compliance contracts are fixed price or time-and-materials based. Disaggregation of Revenue —The Company disaggregates revenue by its operating segments The Company believes disaggregating revenue into these categories achieves the disclosure objectives to depict how the nature, amount, and uncertainty of revenue and cash flows are affected by economic factors. Disaggregated revenue disclosures are provided in Note 19. Contract Balances —The Company presents contract balances for unbilled receivables (contract assets), as well as customer advances, deposits and deferred revenue (contract liabilities) within contract assets and accounts payable and accrued expenses, respectively, on the condensed consolidated statements of financial position. Amounts are generally billed at periodic intervals (e.g., weekly, bi-weekly or monthly) as work progresses in accordance with agreed-upon contractual terms. The Company utilizes the practical expedient to not adjust the promised amount of consideration for the effects of a significant financing component as the period between when the Company transfers services to a customer and when the customer pays for those services is one year or less. Amounts recorded as unbilled receivables are generally for services the Company is not entitled to bill based on the passage of time. Under certain contracts, billing occurs subsequent to revenue recognition, resulting in contract assets. The Company sometimes receives advances or deposits from customers before revenue is recognized, resulting in contract liabilities. The following table presents the Company’s contract balances: September 30, December 31, 2020 2019 Contract assets $ 35,441 $ 13,605 Contract liabilities 9,335 3,314 Contracts assets acquired through business acquisitions completed in the nine months ended September 30, 2020 and the twelve months ended December 31, 2019, amounted to $6.5 million and $0.7 million, respectively. Contract liabilities acquired through business acquisitions completed in the nine months ended September 30, 2020 and twelve months ended December 31, 2019, amounted to zero and $2.2 million. Revenue recognized during the three and nine months ended September 30, 2020, included in the contract liabilities balance at December 31, 2019 was $0.5 million and $2.1 million, respectively. The revenue recognized from the contract liabilities consisted of the Company satisfying performance obligations during the normal course of business. The amount of revenue recognized from changes in the transaction price associated with performance obligations satisfied in prior periods during the three and nine months ended September 30, 2020 was not material. Remaining Unsatisfied Performance Obligations —Remaining unsatisfied performance obligations represent the total dollar value of work to be performed on contracts awarded and in progress. The amount of remaining unsatisfied performance obligations increases with new contracts or additions to existing contracts and decreases as revenue is recognized on existing contracts. Contracts are included in the amount of remaining unsatisfied performance obligations when an enforceable agreement has been reached. As of September 30, 2020 and December 31, 2019, the estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied was approximately $25.2 million and $13.0 million, respectively. As of September 30, 2020, the Company expected to recognize approximately $24.0 million of this amount as revenue within the next year and $1.2 million the year after. Accounts Receivable, Net —Accounts receivable, net as of September 30, 2020 and December 31, 2019 consisted of the following: September 30, December 31, 2020 2019 Accounts receivable, invoiced $ 52,372 $ 46,643 Accounts receivable, other 929 611 Allowance for doubtful accounts (8,516 ) (1,327 ) Accounts receivable—net $ 44,785 $ 45,927 The Company extends non-interest-bearing trade credit to its customers in the ordinary course of business. Accounts receivable are shown on the face of the condensed consolidated statements of financial position, net of an allowance for doubtful accounts. In determining the allowance for doubtful accounts, the Company analyzes the aging of accounts receivable, historical bad debts, customer creditworthiness and current economic trends. Subsequent to December 31, 2019, there was a global outbreak of a new strain of coronavirus, COVID-19. The COVID-19 pandemic has added uncertainty to the collectability of certain receivables, particularly in industries hard hit by the pandemic. As a result, the Company recorded a $6.3 million bad debt reserve during the first quarter of 2020. The bad debt adjustment included a $5.5 million reserve for one customer in the Company’s Remediation and Reuse segment in which management concluded to discontinue select service lines as of March 31, 2020 (Note 19). For all periods presented, no customer accounted for more than 10.0% of revenue or accounts receivable, net. The allowance for doubtful accounts as of September 30, 2020 and December 31, 2019 consisted of the following: Beginning Balance Bad Debt Expense Charged to Allowance Other ( 1) Ending Balance Nine months ended September 30, 2020 $ 1,327 $ 6,445 $ (294 ) $ 1,038 $ 8,516 Year ended December 31, 2019 453 1,246 (556 ) 184 1,327 (1) This amount consists of additions to the allowance due to business acquisitions. |
Prepaid and Other Current Asset
Prepaid and Other Current Assets | 9 Months Ended |
Sep. 30, 2020 | |
Deferred Costs Capitalized Prepaid And Other Assets Disclosure [Abstract] | |
Prepaid and Other Current Assets | 4. PREPAID AND OTHER CURRENT ASSETS Prepaid and other current assets as of September 30, 2020 and December 31, 2019 consisted of the following: September 30, December 31, 2020 2019 Deposits $ 733 $ 605 Prepaid expenses 1,665 1,235 Prepaid insurance 2,577 170 Supplies 2,428 2,368 Offering costs — 1,240 Income tax receivable 1,182 1,205 Prepaid and other current assets $ 8,585 $ 6,823 |
Property and Equipment
Property and Equipment | 9 Months Ended |
Sep. 30, 2020 | |
Property Plant And Equipment [Abstract] | |
Property and Equipment | 5. PROPERTY AND EQUIPMENT Property and equipment are stated at cost or estimated fair value for assets acquired through business combinations. Depreciation and amortization is provided using the straight-line method over the estimated useful lives of the assets. Leasehold improvements are amortized using the straight-line method over the shorter of the remaining lease term, including options that are deemed to be reasonably assured, or the estimated useful life of the improvement. Property and equipment, net, as of September 30, 2020 and December 31, 2019 consisted of the following: Estimated September 30, December 31, Useful Life 2020 2019 Lab and test equipment 7 years $ 17,755 $ 14,810 Vehicles 5 years 12,869 11,073 Equipment 3–7 years 31,539 29,922 Furniture and fixtures 7 years 2,854 1,119 Leasehold improvements 7 years 6,758 5,954 Aircraft 10 years 834 — Building 39 years 2,975 — 75,584 62,878 Land 725 — Construction in progress 156 796 Less accumulated depreciation (41,906 ) (36,638 ) Total property and equipment—net $ 34,559 $ 27,036 Total depreciation expense included on the condensed consolidated statements of operations was $2.1 million and $6.1 million for the three and nine months ended September 30, 2020, respectively. Total depreciation expense included on the condensed consolidated statements of operations was $2.1 million and $5.9 million for the three and nine months ended September 30, 2019, respectively. |
Business Acquisitions
Business Acquisitions | 9 Months Ended |
Sep. 30, 2020 | |
Business Combinations [Abstract] | |
Business Acquisitions | 6. BUSINESS ACQUISITIONS In line with the Company’s strategic growth initiatives, the Company acquired several businesses during the nine months ended September 30, 2020 and September 30, 2019. The results of each of those acquired businesses are included in the condensed consolidated financial statements beginning on the respective acquisition dates. Each transaction qualified as an acquisition of a business and was accounted for as a business combination. All acquisitions resulted in the recognition of goodwill. The Company paid these premiums resulting in such goodwill for a number of reasons, including expected synergies from combining operations of the acquiree and the Company while also growing the Company’s customer base, acquiring assembled workforces, expanding its presence in certain markets and expanding and advancing its product and service offerings. The Company recorded the assets acquired and liabilities assumed at their acquisition date fair value, with the difference between the fair value of the net assets acquired and the acquisition consideration reflected as goodwill. The identifiable intangible assets for acquisitions are valued using the excess earnings method discounted cash flow approach for customer relationships, the relief from royalty method for trade names, the patent and external proprietary software, the “with and without” method for covenants not to compete and the replacement cost method for the internal proprietary software by incorporating Level 3 inputs as described under the fair value hierarchy of ASC 820. These unobservable inputs reflect the Company’s own assumptions about which assumptions market participants would use in pricing an asset on a non-recurring basis. These assets will be amortized over their respective estimated useful lives. Other purchase price obligations (primarily deferred purchase price liabilities and target working capital liabilities or receivables) are included on the condensed consolidated statements of financial position in accounts payable and other accrued liabilities, other non-current liabilities or accounts receivable-net in the case of working capital deficits. Contingent consideration outstanding from acquisitions are included on the condensed consolidated statements of financial position in business acquisition contingent consideration, current or in business acquisitions contingent consideration, long-term. These obligations are scheduled to be settled if certain performance thresholds are met. The Company considers several factors when determining whether or not contingent consideration liabilities are part of the purchase price, including the following: (i) the valuation of its acquisitions is not supported solely by the initial consideration paid, (ii) the former stockholders of acquired companies that remain as key employees receive compensation other than contingent consideration payments at a reasonable level compared with the compensation of the Company’s other key employees and (iii) contingent consideration payments are not affected by employment termination. The Company reviews and assesses the estimated fair value of contingent consideration at each reporting period. Transaction costs related to business combinations totaled $3.8 million and $2.4 million for the nine months ended September 30, 2020 and September 30, 2019, respectively, and zero and $1.3 million for the three months ended September 30, 2020 and September 30, 2019, respectively. These costs are expensed within the selling, general and administrative expense in the accompanying condensed consolidated statements of operations. The cash payment made to acquire The Center for Toxicology and Environmental Health, L.L.C. (“CTEH”) was funded through the issuance of the Convertible and Redeemable Series A-2 Preferred Stock (Note 16) and the common stock portion of the purchase price was funded through the issuance of 791,139 shares of common stock. Cash payments made to acquire businesses during the nine months ended September 30, 2019 were funded through the Company’s prior senior secured credit facility (Note 12). Acquisitions completed during the nine months ended September 30, 2020 The Center for Toxicology and Environmental Health, L.L.C. —In April 2020, the Company completed the acquisition of CTEH by acquiring 100% of its membership interests. CTEH is an environmental consulting company headquartered in Arkansas that specializes in environmental response and toxicology. The transaction qualified as an acquisition of a business and is accounted for as a business combination. Leed Environmental Inc. — In September 2020, the Company acquired certain testing assets, and operations from Leed Environmental Inc. (“LEED”). LEED provides environmental project management and coordination services. LEED expands the Company’s remediation capabilities in the Northeast region of the United States. American Environmental Testing Co. — In September 2020, the Company acquired certain assets and operations of American Environmental Testing Co. (“AETC”), a stack testing company in Utah. AETC expands the Company’s air measurement and analysis capabilities in the West Coast region. The following table summarizes the elements of purchase price of the acquisitions completed during the nine months ended September 30, 2020: Cash Common Stock Other Purchase Price Component Current Other Purchase Price Component Long Term Contingent Consideration Current Contingent Consideration Long Term Total Purchase Price CTEH $ 175,000 $ 25,000 $ (2,297 ) $ — $ 34,451 $ 10,543 $ 242,697 All other acquisitions 450 — 50 100 210 — 810 $ 175,450 $ 25,000 $ (2,247 ) $ 100 $ 34,661 $ 10,543 $ 243,507 The contingent consideration elements of the purchase price of the acquisitions is related to earn-outs which are based on the expected achievement of revenue or earnings thresholds as of the date of the acquisition and for which the maximum potential amount is limited. CTEH first year earnout is to be calculated at twelve times CTEH’s 2020 EBITDA (as defined in the purchase agreement) in excess of $18.3 million, with a maximum first year earn-out payment of $50.0 million. The second year earn-out is to be calculated at ten times CTEH’s 2021 EBITDA in excess of actual 2020 EBITDA (with actual 2020 EBITDA subject to a minimum of $18.3 million and a maximum of $22.5 million), with a maximum second year earn-out payment of $30.0 million. The 2020 earn out was initially payable 100% in common stock, but as a result of the completion of the Company’s IPO (Note 1), 50% of any 2020 earnout payment will be payable in cash and 50% will be payable, at the Company’s election, in cash or shares of common stock. The 2021 earn out, if any, is payable 100% in cash. The preliminary purchase price attributable to the acquisitions was allocated as follows: CTEH All Other Acquisitions Total Cash $ 1,527 $ — $ 1,527 Accounts receivable 17,059 — 17,059 Other current assets 1,265 — 1,265 Current assets 19,851 — 19,851 Property and equipment 7,042 75 7,117 Customer relationships 56,000 — 56,000 Trade names 4,200 — 4,200 Covenants not to compete 4,000 109 4,109 Proprietary software 14,700 — 14,700 Goodwill 146,625 626 147,251 Total assets 252,418 810 253,228 Current liabilities 9,721 — 9,721 Total liabilities 9,721 — 9,721 Purchase price $ 242,697 $ 810 $ 243,507 For the acquisitions completed during the nine months ended September 30, 2020, the results of operations have been combined with those of the Company. The Company’s condensed consolidated statement of operations for the three and nine months ended September 30, 2020 includes revenue and pre-tax income of $37.2 million and $5.7 million, respectively, related mainly to the CTEH acquisition. CTEH, LEED and AETC are included in the Company’s Assessment, Permitting and Response, Remediation and Reuse and Measurement and Analysis segments, respectively. The weighted average useful lives for the acquired customer relationships and internal proprietary software for the CTEH acquisition are 15 years and 3 years, respectively. The weighted average useful lives for the acquired tradenames, covenants not to compete and external proprietary software for the CTEH acquisition is 5 years. The weighted average useful lives for the acquired covenants not to compete for the other acquisitions is 4 years. Goodwill associated with the CTEH, LEED and AETC acquisitions is deductible for income tax purposes. Acquisitions completed during the nine months ended September 30, 2019 Golden Specialty, Inc. — In March 2019, the Company acquired 100% of the issued and outstanding capital stock of Golden Specialty, Inc. (“Golden”), an air testing laboratory in Texas. Golden expands the Company’s air measurement and analysis capabilities in the Gulf Coast region. Target Emission Services Inc. —In April 2019, the Company acquired 100% of the issued and outstanding capital stock of Target Emission Services, Inc. (“TES”), an emission detection company in Canada. TES expands the Company’s LDAR business, increasing the geographic footprint in Canada and initiating growth into international markets. Target Emission Services USA LP —In April 2019, the Company acquired 100% of the issued and outstanding capital stock of Target Emission Services USA LP (now Target Emission Services USA LLC) (“TESUS”), an emission detection company in the United States. TESUS expands the Company’s LDAR business throughout the United States. Air Water & Soil Laboratories, Inc. —In June 2019, the Company acquired 100% of the issued and outstanding capital stock of Air Water & Soil Laboratories, Inc. (“AWS”), a provider of air, water, and soil testing in the mid-Atlantic region. AWS expands the Company’s air, water, and soil environmental lab services in the East Coast region. Advanced Environmental Compliance LLC —In July 2019, the Company acquired certain emissions testing assets, employees and customer relationships from Advanced Environmental Compliance LLC (“AEC”). AEC is in the business of providing air quality measurement and analysis services, together with environmental laboratory services. AEC expands the Company’s emissions testing services offering in the West Coast region. LEHDER Environmental Services Ltd .—In July 2019, the Company acquired 100% of the issued and outstanding capital stock of LEHDER Environmental Services (“LEHDER”), a provider of air quality management services in Canada. LEHDER expands the Company’s international reach and air quality services capabilities in Canada. Emerging Compounds Treatments Technologies, Inc. —In August 2019, the Company acquired 100% of the issued and outstanding capital stock of Emerging Compounds Treatments Technologies, Inc. (“ECT2”), a provider of novel technologies for removing contaminants/compounds from water and air. ECT2 expands the Company’s water and air treatment capabilities throughout the United States and Australia. The following table summarizes the elements of purchase price of the acquisitions completed during the nine months ended September 30, 2019: Cash Common Stock Other Purchase Price Components Contingent Consideration Total Purchase Price Golden $ 1,500 — — $ 477 $ 1,977 TES 2,359 322 25 4,911 7,617 TESUS 18,683 3,041 1,495 — 23,219 AWS 6,020 — 150 — 6,170 AEC 808 — — — 808 LEHDER 3,878 684 — 13 4,575 ECT2 54,037 — (220 ) — 53,817 $ 87,285 $ 4,047 $ 1,450 $ 5,401 $ 98,183 Contingent consideration elements of the purchase price of these acquisitions are related to earn-outs which are based on the expected achievement of revenue or earnings thresholds by the applicable business as of the date of the acquisition and for which the maximum potential amount to be earned is generally not limited. The purchase price attributable to the acquisitions was allocated as follows: ECT2 All Other Acquisitions Total Cash $ 3,149 $ 2,137 $ 5,286 Restricted cash 629 — 629 Accounts receivable 1,707 3,751 5,458 Other current assets 498 61 559 Current assets 5,983 5,949 11,932 Property and equipment 776 3,288 4,064 Customer relationships 13,840 12,748 26,588 Trade names 1,008 659 1,667 Covenants not to compete 3,360 2,083 5,443 Proprietary software — 2,560 2,560 Patent 17,479 — 17,479 Goodwill 16,395 20,227 36,622 Total assets 58,841 47,514 106,355 Current liabilities 5,024 977 6,001 Non- current liabilities — 2,171 2,171 Total liabilities 5,024 3,148 8,172 Purchase price $ 53,817 $ 44,366 $ 98,183 The weighted average useful lives for the acquired customer relationships, trade names, covenants not to compete, proprietary software and patent for these acquisitions are 9.5 years, 1.5 years, 4 years, 3 years and 16 years, respectively. For the acquisitions completed during the nine months ended September 30, 2019, the results of operations since the acquisition dates have been combined with those of the Company. The Company’s three and nine months ended September 30, 2019 condensed consolidated statement of operations includes revenue of $7.7 million and pre-tax income of $1.5 million, respectively, related to these acquisitions. The Golden, TES, TESUS, AWS, AEC and LEHDER acquisitions are included in the Company’s Measurement and Analysis segment. The ECT2 acquisition is included in the Company’s Remediation and Reuse segment. Goodwill associated with the acquisitions of Golden, AEC and ECT2 is deductible for income tax purposes. Supplemental Unaudited Pro-Forma —The unaudited condensed consolidated financial information summarized in the following table gives effect to the 2020 and the 2019 acquisitions discussed above assuming they occurred on January 1, 2019. These unaudited consolidated pro forma operating results do not assume any impact from revenue, cost or other operating synergies that are expected or may have been realized as a result of the acquisitions. These unaudited consolidated pro forma operating results are presented for illustrative purposes only and are not indicative of the operating results that would have been achieved had the acquisitions occurred on January 1, 2019, nor does the information purport to reflect results for any future period. For the Three Months Ended September 30, 2020 2019 As reported Acquisitions Pro-Forma (Unaudited) Consolidated Pro-Forma (Unaudited) As reported Acquisitions Pro-Forma (Unaudited) Consolidated Pro-Forma (Unaudited) Revenues $ 84,705 $ — $ 84,705 $ 57,623 $ 18,551 $ 76,174 Net (loss) income (30,737 ) — (30,737 ) (6,683 ) 4,042 (2,641 ) For the Nine Months Ended September 30, 2020 2019 As reported Acquisitions Pro-Forma (Unaudited) Consolidated Pro-Forma (Unaudited) As reported Acquisitions Pro-Forma (Unaudited) Consolidated Pro-Forma (Unaudited) Revenues $ 219,502 $ 31,253 $ 250,755 $ 165,978 $ 107,459 $ 273,437 Net (loss) income (58,761 ) 10,288 (48,473 ) (12,247 ) 30,002 17,755 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 9 Months Ended |
Sep. 30, 2020 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | 7. GOODWILL AND INTANGIBLE ASSETS Amounts related to goodwill as of September 30, 2020 and December 31, 2019 are as follows: Assessment, Permitting and Response Measurement and Analysis Remediation and Reuse Total Balance as of December 31, 2019 $ 15,173 $ 68,628 $ 43,257 $ 127,058 Goodwill acquired during the period 146,625 426 200 147,251 Balance as of September 30, 2020 $ 161,798 $ 69,054 $ 43,457 $ 274,309 Amounts related to finite-lived intangible assets as of September 30, 2020 and December 31, 2019 are as follows: September 30, 2020 Estimated Useful Life Gross Balance Accumulated Amortization Total Intangible Assets—Net Finite lived intangible assets Customer relationships 7–15 years $ 164,782 $ 49,068 $ 115,714 Covenants not to compete 4–5 years 29,942 20,444 9,498 Trade names 1–5 years 16,938 12,196 4,742 Proprietary software 3-5 years 20,808 4,915 15,893 Patent 16 years 17,479 1,125 16,354 Total other intangible assets—net $ 249,949 $ 87,748 $ 162,201 December 31, 2019 Estimated Useful Life Gross Balance Accumulated Amortization Total Intangible Assets—Net Finite lived intangible assets Customer relationships 7–10 years $ 108,782 $ 36,700 $ 72,082 Covenants not to compete 4–5 years 25,832 17,572 8,260 Trade names 1–5 years 12,738 10,230 2,508 Proprietary software 3 years 3,885 1,359 2,526 Patent 16 years 17,479 306 17,173 Total other intangible assets—net $ 168,716 $ 66,167 $ 102,549 Intangible assets with finite lives are stated at cost, less accumulated amortization and impairment losses, if any. These intangible assets are amortized using the straight-line method over the estimated useful lives of the assets. Amortization expense was $7.6 million and $21.0 million for the three and nine months ended September 30, 2020, respectively and $5.3 million and $14.4 million for the three and nine months ended September 30, 2019, respectively. Future amortization expense is estimated to be as follows for each of the five following years and thereafter: December 31, 2020 (remaining) $ 7,543 2021 28,140 2022 24,053 2023 20,073 2024 16,951 Thereafter 65,441 $ 162,201 |
Accounts Payable and Other Accr
Accounts Payable and Other Accrued Liabilities | 9 Months Ended |
Sep. 30, 2020 | |
Payables And Accruals [Abstract] | |
Accounts Payable and Other Accrued Liabilities | 8. ACCOUNTS PAYABLE AND OTHER ACCRUED LIABILITIES Accounts payable and other accrued liabilities consisted of the following as of September 30, 2020 and December 31, 2019: September 30, December 31, 2020 2019 Accounts payable $ 13,360 $ 15,034 Accrued expenses 10,395 10,733 Other purchase obligations 572 — Contract liabilities 9,335 3,314 Other current liabilities 235 504 Total accounts payable and other accrued liabilities $ 33,897 $ 29,585 |
Accrued Payroll and Benefits
Accrued Payroll and Benefits | 9 Months Ended |
Sep. 30, 2020 | |
Statement Of Financial Position [Abstract] | |
Accrued Payroll and Benefits | 9. ACCRUED PAYROLL AND BENEFITS Accrued payroll and benefits consisted of the following as of September 30, 2020 and December 31, 2019: September 30, December 31, 2020 2019 Accrued bonuses $ 7,854 $ 3,449 Accrued paid time off 2,157 2,154 Accrued payroll 5,536 4,470 Accrued other 2,410 959 Total accrued payroll and benefits $ 17,957 $ 11,032 |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 10. INCOME TAXES The Company calculates its interim income tax provision in accordance with Accounting Standard Codification Topic 270, Interim Reporting (“ASC 270”), and ASC 740. The Company’s effective tax rate (“ETR”) from continuing operations was (12.2%) and 5.8% for the three months ended September 30, 2020 and September 30, 2019, respectively, and 2.6% and 9.6% for the nine months ended September 30, 2020 and September 30, 2019, respectively, and the Company recorded income tax expense/(benefit) of $3.3 million and $(0.4) million for the three months ended September 30, 2020 and September 30, 2019, respectively, and income tax benefits of $1.6 million and $1.3 million for the nine months ended September 30, 2020 and September 30, 2019, respectively. The difference between the ETR and federal statutory rate of 21.0% is primarily attributable to items recorded for GAAP but permanently disallowed for U.S. federal income tax purposes, recognition of a US federal and state valuation allowance, state and foreign income tax provisions and Global Intangible Low Taxed Income (“GILTI”). A valuation allowance is recorded when it is more-likely-than-not some of the Company’s deferred tax assets may not be realized. Significant judgment is applied when assessing the need for a valuation allowance and the Company considers future taxable income, reversals of existing deferred tax assets and liabilities and ongoing prudent and feasible tax planning strategies, in making such assessment. As of September 30, 2020, the Company determined its US federal and state net deferred tax assets are not more-likely-than-not to be realized and recorded a valuation allowance of $7.4 million against the net deferred tax assets. The Company records uncertain tax positions in accordance with ASC 740, Income Taxes, on the basis of a two-step process in which (i) the Company determines whether it is more likely than not a tax position will be sustained on the basis of the technical merits of such position and (ii) for those tax positions meeting the more-likely-than-not recognition threshold, the Company would recognize the largest amount of tax benefit that is more than 50.0% likely to be realized upon ultimate settlement with the related tax authority. The Company has determined it has no uncertain tax positions as of September 30, 2020. The Company classifies interest and penalties recognized on uncertain tax positions as a component of income tax expense. On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was enacted. The CARES Act includes several significant provisions for corporations, including those pertaining to net operating losses, interest deductions and payroll tax benefits. Under ASC 740, the effects of new legislation are recognized upon enactment. Accordingly, the effects of the CARES Act have been incorporated into the income tax provision computation for the nine months ended September 30, 2020. These provisions did not have a material impact on the income tax provision. The Company anticipates deferring the employer side social security payments for payroll paid for the remainder of 2020 as permitted by the CARES Act. |
Warrant Options
Warrant Options | 9 Months Ended |
Sep. 30, 2020 | |
Warrants And Rights Note Disclosure [Abstract] | |
Warrant Options | 11. WARRANT OPTIONS In October 2018, in connection with the issuance of the Redeemable Series A-1 Preferred Stock, the Company issued a detachable warrant to acquire 534,240 shares of common stock at a price of $0.01 per share at any given time during a period of ten years beginning on the instrument’s issuance date. On July 30, 2020, the Redeemable Series A-1 Preferred Stock warrant was In April 2020, in connection with the issuance of the Convertible and Redeemable Series A-2 Preferred Stock, the Company issued a detachable warrant to acquire 1,351,960 shares of common stock at a price of $0.01 per share at any time following the occurrence of a qualifying IPO, a sale of the Company, or a redemption in full of the Series A-2 preferred stock (each, an “Adjustment Event”), with an expiration date of ten years from the instrument’s issuance date. The number of shares underlying the warrant and issuable upon exercise was subject to adjustment based upon the price per share of common stock upon the occurrence of an Adjustment Event (Note 16) to reflect an aggregate value of $30.0 million. As a result of the $15.00 per share public offering price in the IPO, the warrant issued in connection with the issuance of the Convertible and Redeemable Series A-2 Preferred Stock was adjusted pursuant to its terms and, upon closing of the IPO, represented a warrant to purchase 1,999,999 shares of common stock (an increase of 648,039 shares). On July 30, 2020, the Convertible and Redeemable Series A-2 Preferred Stock warrant was exercised in full resulting in the issuance of 1,999,999 shares of common stock to the holder, for an exercise price of $0.01 per share. The fair value of this warrant was determined to be $44.4 million immediately before the exercise of the warrant option. Fair value loss recorded in other expense on the condensed consolidated statements of operations was $14.3 million for the three and nine months ended September 30, 2020. |
Debt
Debt | 9 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
Debt | 12. DEBT Debt as of September 30, 2020 and December 31, 2019 consisted of the following: September 30, December 31, 2020 2019 Term Loan Facility $ 174,453 $ 48,750 Revolving Line of Credit — 97,590 Capital leases 3,127 3,765 Other leases 2 12 Equipment line of credit 3,214 3,124 Less deferred debt issuance costs (4,345 ) (1,052 ) Total debt 176,451 152,189 Less current portion of long term debt (5,034 ) (7,143 ) Long-term debt, less current portion $ 171,417 $ 145,046 Deferred Financing Costs —Costs relating to debt issuance have been deferred and are presented as discounted against the underlying debt instrument. These costs are amortized to interest expense over the terms of the underlying debt instruments. Revolving Line of Credit and Term Loan Facility — On April 13, 2020, the Company entered into a Unitranche Credit Agreement (the “New Credit Facility”) providing for a new $225.0 million credit facility comprised of a $175.0 million term loan and a $50.0 million revolving credit facility and repaid all amounts outstanding under the prior senior secured credit facility. T he New Credit Facility matures in April 2025. As of September 30, 2020, the term loan and the revolver bore interest at LIBOR plus 5.0% with a 1.0% LIBOR floor or the base rate plus 4.0% and LIBOR plus 3.5% or the base rate plus 2.5% , respectively. See Note 22 regarding an amendment to the New Credit Facility reducing the interest rates on the term loan. The revolver is also subject to an unused commitment fee of 0.35%. The Term Loan has quarterly repayments starting on September 30, 2020 of $0.5 million, increasing to $1.1 million on September 30, 2021 and further increasing to $1.6 million on September 30, 2022, with the remaining outstanding principal amount due on the maturity date. The Company has the option to borrow incremental term loans up to an aggregate principal amount of $100.0 million subject to satisfaction of certain conditions, including the borrower’s pro forma compliance with the financial covenants under the New Credit Facility. Immediately after giving effect to the incurrence of any such incremental term loans, the unitranche lenders must collectively hold at least 70.0% of all pari passu debt of all lenders under the credit facility. The existing lenders are not obligated to participate in any incremental term loan facility. The New Credit Facility includes a number of covenants imposing certain restrictions on the Company’s business, including, among other things, restrictions on the Company’s ability to incur indebtedness, prepay or amend other indebtedness, create liens, make certain fundamental changes including mergers or dissolutions, pay dividends and make other payments in respect of capital stock, make certain investments, sell assets, change the Company’s lines of business, enter into transactions with affiliates and other corporate actions. The New Credit Facility also contains financial covenants requiring the Company to remain below a maximum consolidated total leverage ratio of 4.25 times, which steps down to 4.00 times beginning December 31, 2021 and then to 3.75 times beginning December 31, , and a minimum consolidated fixed charge coverage ratio of 1.25 times. The New Credit Facility contains mandatory prepayment features upon a number of events, including with the proceeds of certain asset sales, proceeds from the issuance of any debt and proceeds of the capital contribution amounts contributed to cure a financial covenant default. The New Credit Facility also includes mandatory prepayments of 50.0% of excess cash flow minus voluntary prepayments of the term loan and, solely to the extent accompanied by a permanent reduction in the revolving commitment, the revolver, if the Company’s consolidated total leverage ratio for the year ending December 31, 2020 is greater than or equal to 3.25 times and, for any year thereafter, the amount of any such mandatory prepayment shall be reduced to 25.0% of excess cash flow if the leverage ratio is less than 3.00 times. The weighted average interest rate on the New Credit Facility as of September 30, 2020 was 6.0%. The New Credit Facility contains a number of customary events of default related to, among other things, the non-payment of principal, interest or fees, violations of covenants, inaccuracy of representations or warranties, certain bankruptcy events, default in payment under or the acceleration of other indebtedness and certain change of control events. In the event of a default, subject to varying cure periods and rights for certain events of default, the required lenders may, at their option, declare the commitments to fund the credit facility to be terminated. The Company’s obligations under the credit facility are guaranteed by certain of the Company’s existing and future direct and indirect subsidiaries, and such obligations are secured by substantially all of the Company’s assets, including the capital stock or other equity interests in those subsidiaries. Prior Senior Secured Credit Facility —As of December 31, 2019, the Company’s Prior Senior Secured Credit Facility (the “Prior Senior Credit Facility”) consisted of a $50.0 million term loan and a $130.0 million revolving credit facility. Borrowings under the Credit Facility bore interest at either (i) LIBOR plus the applicable margin or (ii) a base rate (equal to the highest of (a) the federal funds rate plus 0.5%, (b) Lender A’s prime rate and (c) Eurodollar Rate, which is based on LIBOR, (using a one-month period plus 1.0%), plus the applicable margin, as the Company elects. The applicable margin means a percentage per annum determined in accordance with the following table as of December 31, 2019: Pricing Tier Consolidated Leverage Ratio Commitment Fee Eurodollar Rate Loans and LIBOR Letter of Credit Fee Daily Floating Rate Loans Rate Loans 1 > 3.75 to 1.0 0.50 % 4.00 % 4.00 % 3.00 % 2 ≤ 3.75 to 1.0 but > 3.00 to 1.0 0.50 3.50 3.50 2.50 3 ≤ 3.00 to 1.0 but > 2.25 to 1.0 0.40 3.00 3.00 2.00 4 < 2.25 to 1.0 0.30 2.50 2.50 1.50 As of December 31, 2019, the Company fell within Pricing Tier 2 and the Company was subject to a fixed charge coverage ratio of greater than 1.25 and a consolidated total leverage ratio of lower than 4.00. The Prior Senior Secured Credit Facility was repaid in full on April 13, 2020 via proceeds from the issuance of the New Credit Facility. The resulting loss on extinguishment amounted to $1.4 million, of which $0.4 million was related to fees paid and $1.0 million related to unamortized debt issuance costs. Total loss on extinguishment is recorded in interest expense-net within the condensed consolidated statement of operations for the nine months ended September 30, 2020. Equipment Line of Credit —On March 12, 2019, the Company increased its equipment line of credit facility for the purchase of equipment and related freight, installation costs and taxes paid for an additional amount not to exceed $2.0 million. On May 16, 2019, the Company entered into a Canadian equipment line of credit facility for an amount not to exceed $1.0 million Canadian dollars. Interest on the line of credit is determined based on a three-year swap rate at the time of funding. Capital Lease Obligations —The assets and liabilities under capital lease agreements are recorded at the lower of the present value of the minimum lease payments or the fair value of the asset. The assets are being amortized over the shorter of their related lease terms or their estimated useful lives ranging from four to six years. The gross amount of assets under capital leases as of September 30, 2020 and December 31, 2019 was $6.3 million and $6.9 million, respectively. The amortization of assets under capital leases was $0.6 million and $1.6 million for the three and nine months ended September 30, 2020, respectively and $0.4 million and $1.0 million for the three and nine months ended September 30, 2019, respectively and was included in depreciation and amortization on the condensed consolidated statements of operations. All capital leases (including those purchased through the Company’s equipment line of credit) mature by 2025 as follows: September 30, Payments Interest Principal 2021 $ 2,670 $ 368 $ 2,302 2022 2,178 265 1,913 2023 1,582 139 1,443 2024 667 32 635 2025 49 1 48 $ 7,146 $ 805 $ 6,341 The following is a schedule of the aggregate annual maturities of long-term debt presented on the condensed consolidated statement of financial position, based on the terms of the credit facility, capital lease obligations and equipment line of credit as of September 30, 2020: September 30, 2021 $ 5,034 2022 6,839 2023 8,006 2024 7,198 2025 153,719 Total $ 180,796 |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | 13. FAIR VALUE OF FINANCIAL INSTRUMENTS As of September 30, 2020 and December 31, 2019, the following financial liabilities are measured at fair value on a recurring basis using significant unobservable inputs (Level 3). September 30, December 31, 2020 2019 Business acquisitions contingent consideration, current $ 49,170 $ 8,614 Business acquisitions contingent consideration, long-term 9,742 379 Contingent put option — 7,100 Warrant option — 16,878 Conversion option 18,059 — Total $ 76,971 $ 32,971 The estimated fair value amounts shown above are not necessarily indicative of the amounts that the Company would realize upon disposition, nor do they indicate the Company’s intent or ability to dispose of the financial instrument. The following table sets forth the Company’s financial instruments that were measured at fair value on a recurring basis for the nine months ended September 30, 2020 and September 30, 2019: Level 3 Embedded Option Business Acquisitions Contingent Consideration, Current ( 1) Business Acquisitions Contingent Consideration, Long-term ( 2) Contingent Put Option Warrant Options Total Balance—at December 31, 2018 $ — $ 2,754 $ — $ — $ 12,818 $ 15,572 Acquisitions 31 — — — 31 Changes in fair value included in earnings — (670 ) — — 4,059 3,389 Payment of contingent consideration payable — (554 ) — — — (554 ) Balance—at September 30, 2019 $ — $ 1,561 $ — $ — $ 16,877 $ 18,438 Balance—at December 31, 2019 $ — $ 8,614 $ 379 $ 7,100 $ 16,878 $ 32,971 Foreign currency translation of contingent consideration payment — (208 ) — — — (208 ) Payment of contingent consideration payable — (12,464 ) — — — (12,464 ) Acquisitions 34,661 10,543 45,204 Series A-2 compound embedded option (9,361 ) — — — — (9,361 ) Issuance of warrant option — — — — 30,097 30,097 Reclass of long term to short term contingent liabilities — 180 (180 ) — — — Changes in fair value included in earnings 27,420 18,387 (1,000 ) (19,240 ) 9,312 34,879 Write off of the contingent put option — — — 12,140 — 12,140 Exercise of warrant options — — — — (56,287 ) (56,287 ) Balance—at September 30, 2020 $ 18,059 $ 49,170 $ 9,742 $ — $ — $ 76,971 (1) Current portion of the contingent consideration is recorded in business acquisitions contingent consideration, current. (2) Long term portion of the contingent consideration is recorded in business acquisitions contingent consideration, long-term. Quantitative Information about Assets and Liabilities Measured at Fair Value on a Recurring Basis Using Significant Unobservable Inputs (Level 3): Business Acquisitions Contingent Consideration —The fair value of the contingent consideration payable associated with the acquisition of CTEH was determined using a Monte Carlo simulation of earnings in a risk-neutral Geometric Brownian Motion framework. The fair values of the contingent consideration payables for the other acquisitions were calculated based on expected target achievement amounts, which are measured quarterly and then subsequently adjusted to actuals at the target measurement date. The method used to price these liabilities is considered level 3 due to the subjective nature of the unobservable inputs used to determine the fair value. The input is the expected achievement of earnout thresholds. Conversion Option —The fair value of the embedded derivative associated with the issuance of the Convertible and Redeemable Series A-2 Preferred Stock (Note 16) was estimated using a “with-and-without” method. The “with-and-without” methodology considers the value of the security on an as-is basis and then without the embedded conversion premium. The difference between the two scenarios is the implied fair value of the embedded derivative. The unobservable input is the required rate of return on the Series A-2. The considerable quantifiable inputs in the valuation relate to the timing of conversions or redemptions. Contingent Put Option —The fair value of the contingent put option associated with the issuance of the Redeemable Series A-1 Preferred Stock was estimated using a “with-and-without” method. The “with-and-without” methodology considers the value of the security on an as-is basis and then without the embedded contingent put option. The difference between the two scenarios is the implied fair value of the embedded derivative, recorded as the contingent put option liability. In this case the Series A-1 was redeemed on the date of value so the value of the “with” scenario is known. The unobservable input is the required rate of return on the Series A-1 through to maturity in the “without” scenario. The contingent put option was redeemed in July 2020 (Note 15). Warrant Options — The warrant options were exercised on July 30, 2020 (Note 11). The fair value of the warrant options associated with the issuance of the Redeemable Series A-1 Preferred Stock and the Convertible and Redeemable Series A-2 Preferred Stock was calculated based on the Black-Sholes pricing model using the following assumptions: July 30, September 30, Series A-1 Preferred Stock Warrant Option 2020 2019 Common stock value (per share) $ 22.22 $ 31.60 Expected volatility 44.35 % 47.63 % Risk-free interest rate 0.55 % 1.68 % Expected life (years) 10 10 July 30, September 30, Series A-2 Preferred Stock Warrant Option 2020 2019 Common stock value (per share) $ 22.22 n/a Expected volatility 44.35 % n/a Risk-free interest rate 0.55 % n/a Expected life (years) 10 n/a The method used to price these liabilities is considered Level 3 due to the subjective nature of the unobservable inputs (common stock value and expected volatility) used to determine the fair value. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2020 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 14. COMMITMENTS AND CONTINGENCIES Operating Leases —The Company leases office facilities over various terms expiring through 2028. Certain of these operating leases contain rent escalation clauses. The Company also has office equipment leases that expire through 2025 September 30, Rent Office Equipment Total 2021 $ 5,863 $ 332 $ 6,195 2022 4,865 327 5,192 2023 2,961 129 3,090 2024 1,410 39 1,449 2025 and thereafter 1,385 1 1,386 $ 16,484 $ 828 $ 17,312 Total rent expense under operating leases was $2.2 and $6.4 for the three and nine months ended September 30, 2020, respectively, and $2.0 and $5.6 for the three and nine months ended September 30, 2019, respectively Other Commitments —The Company has commitments under the New Credit Facility, its equipment line of credit and its capital lease obligations (Note 12). Contingencies —The Company is subject to purchase price contingencies related to earn-outs associated with certain acquisitions (Note 6). Legal —In the normal course of business, the Company is at times subject to pending and threatened legal actions. In management’s opinion, any potential loss resulting from the resolution of these matters is not expected to have a material effect on the condensed consolidated results of operations, financial position or cash flows of the Company. |
Redeemable Series A-1 Preferred
Redeemable Series A-1 Preferred Stock | 9 Months Ended |
Sep. 30, 2020 | |
Temporary Equity Disclosure [Abstract] | |
Redeemable Series A-1 Preferred Stock | 15. REDEEMABLE SERIES A-1 PREFERRED STOCK On October 19, 2018, the Company issued 12,000 shares of Redeemable Series A-1 Preferred Stock with a par value of $0.0001 per share and a detachable warrant to purchase 534,240 shares of the Company’s common stock. Each preferred share was issued as part of a unit, which consisted of one share of the Redeemable Series A-1 Preferred Stock at $0.01 million per share. On April 13, 2020, the Company amended and restated the certificate of designation of the Company’s Redeemable Series A-1 Preferred Stock. The most significant changes in the amendment included (i) the Redeemable Series A-1 Preferred Stock became pari passu with the Convertible and Redeemable Series A-2 Preferred Stock (Note 16), (ii) the maturity was extended to October 2024; (iii) the Company could use up to $50.0 million of indebtedness or cash on hand to redeem the Redeemable Series A-1 Preferred Stock, and (iv) upon an IPO, up to 50.0% of accumulated dividends could be paid in shares of common stock and (v) the Company could elect to reduce the three year make whole penalty to a two year make whole penalty if the warrant issued in connection with the issuance of the Redeemable Series A-1 Preferred Stock was redeemed in full at a share price of no less than $31.60. Following a partial redemption of outstanding Redeemable Series A-1 Preferred Stock, the dividend rate of the remaining Redeemable Series A-1 Preferred Stock would be reduced proportionally (between 15.0% and 9.0%) in relation to the proportion of Redeemable Series A-1 Preferred Stock redeemed, with the rate increasing by an additional 1.0% for dividends that are accrued versus paid in cash. Based on a qualitative assessment performed by the Company, the Redeemable Series A-1 Preferred Stock amendments did not represent a significant long-term change to the original terms of the instrument and, therefore, there was no change in the accounting of the instrument. On July 27, 2020, the Company redeemed in full the Redeemable Series A-1 Preferred Stock, including the guaranteed minimum two-year dividend. The Company used $131.8 million of the IPO proceeds and 1,786,739 shares of common stock to redeem all outstanding shares of the Company’s Redeemable Series A-1 Preferred Stock. The total accreted value immediately prior to redemption was $40.8 million. The difference between the fair value of the consideration transferred to the holder of the Series A-1 Preferred Stock and the instrument’s carrying value immediately before the redemption of $24.3 million, was treated as a deemed dividend to the holder. The Redeemable Series A-1 Preferred Stock contained restrictive covenants. As of December 31, 2019, the Company was subject to a consolidated total leverage ratio (including the outstanding principal and accrued dividend on the Redeemable Series A-1 Preferred Stock) limit of less than 10.0 times as of the end of any fiscal quarter ending until maturity. The Company was in compliance with the covenants as of December 31, 2019. Before redemption, the Redeemable Series A-1 Preferred Stock accrued dividends quarterly at an annual rate of 15.0% with respect to dividends that were paid in cash and at an annual rate of 14.2% with respect to dividends that were accrued. Total accrued and unpaid dividends as of December 31, 2019 were $21.9 million. At issuance the Company determined that the detachable warrant (Note 11) and the contingent put option were required to be accounted for separately. As of July 27, 2020 and December 31, 2019, the contingent put option issued in connection with the Redeemable Series A-1 Preferred Stock had a fair value of $12.1 million and $7.1 million, respectively. The change in value of $26.3 million and $19.2 million for the three and nine months ended September 30, 2020 was recorded to other expense. As of September 30, 2019, the Company determined that the fair value of the contingent put option related to the Redeemable Series A-1 Preferred Stock was immaterial as the probability of the feature being exercised was considered remote. |
Convertible and Redeemable Seri
Convertible and Redeemable Series A-2 Preferred Stock | 9 Months Ended |
Sep. 30, 2020 | |
Temporary Equity Disclosure [Abstract] | |
Convertible and Redeemable Series A-2 Preferred Stock | 16. CONVERTIBLE AND REDEEMABLE SERIES A-2 PREFERRED STOCK On April 13, 2020, the Company entered into an agreement to issue 17,500 shares of the Convertible and Redeemable Series A-2 Preferred Stock with a par value of $0.0001 per share and a detachable warrant to purchase shares of the Company’s common stock with a 10-year life, in exchange for gross proceeds of $175.0 million, net of $1.3 million debt issuance costs. Before the Company’s IPO, each share of Convertible and Redeemable Series A-2 Preferred Stock accrued dividends at the rate of 15.0% per annum, with respect to dividends that were paid in cash, and 14.2% per annum, with respect to dividends that were accrued. The Company paid dividends on shares of the Convertible and Redeemable Series A-2 Preferred Stock of $2.9 million during the three and nine months ended September 30, 2020. At issuance, the Company determined that Convertible and Redeemable Series A-2 Preferred Stock and the detachable warrant (Note 11), were required to be accounted for separately. Upon the Company’s IPO, following which the Redeemable Series A-1 Preferred Stock was fully redeemed, the Convertible and Redeemable Series A-2 Preferred Stock terms automatically updated to the following: (i) no mandatory redemption, (ii) no stated value cash repayment obligation other than in the event of certain defined liquidation events, (iii) only redeemable at the Company’s option, (iv) the instrument became convertible into common stock beginning on the four year anniversary of issuance at a 15.0% discount to the common stock market price (with a limit of $60.0 million in stated value of Convertible and Redeemable Series A-2 Preferred Stock eligible to be converted in any 60-day period prior to the seventh anniversary of issuance and the amount of stated value of the Convertible and Redeemable Series A-2 Preferred Stock eligible for conversion limited to $60.0 million during year 5 and $120.0 million (which includes the aggregate amount of the stated value of the Convertible and Redeemable Series A-2 Preferred Stock and any accrued but unpaid dividends added to such stated value of any shares of Convertible and Redeemable Series A-2 Preferred Stock converted in year 5) during year 6), (v) the dividend rate stepped down to 9.0% per year with required quarterly cash payments, (vi) in an event of noncompliance, the dividend rate shall increase to 12.0% per annum for the first 90-day period from and including the date the noncompliance event occurred, and thereafter shall increase to 14.0% per annum, (vii) the debt incurrence test ratio increased to 4.5 times, (viii) the total leverage cap covenant was removed, and (ix) minimum repayment amount dropped down from $50.0 million to $25.0 million. The Company may, at its option on any one or more dates, redeem all or a minimum portion (the lesser of (i) $25.0 million in aggregate stated value of the Convertible and Redeemable Series A-2 Preferred Stock and (ii) all of the Convertible and Redeemable Series A-2 Preferred Stock then outstanding) of the outstanding Convertible and Redeemable Series A-2 Preferred Stock in cash. In the event the Company redeems all or a portion of the Convertible and Redeemable Series A-2 Preferred Stock prior to the three year anniversary of the issuance date, such redemption amount shall include stated value, accrued but unpaid dividends and a make whole payment such that the aggregate redemption amount reflects three years of dividends. With respect to any redemption of any share of the Convertible and Redeemable Series A-2 Preferred Stock prior to the third-year anniversary, the Company is subject to a make whole penalty in which the holders of the Convertible and Redeemable Series A-2 Preferred Stock are guaranteed a minimum repayment equal to outstanding redeemed stated value plus three years of dividends accrued or accruable thereon. The Convertible and Redeemable Series A-2 Preferred Stock does not meet the definition of a liability pursuant to “ASC 480- Distinguishing Liabilities from Equity.” However, as (i) the instrument is redeemable upon a change of control as defined in the certificate of designations governing the terms of the Convertible and Redeemable Series A-2 Preferred Stock, and (ii) the Company cannot assert it would have sufficient authorized and unissued shares of common stock to settle all future conversion requests due to the variable conversion terms, the instrument is redeemable upon the occurrence of events that are not solely within the control of the Company, and therefore the Company classifies the Convertible and Redeemable Series A-2 Preferred Stock as mezzanine equity. Subsequent adjustment of the carrying value of the instrument is required if the instrument is probable of becoming redeemable. As of September 30, 2020, the Company has determined that a change of control is not probable. Additionally, as of September 30, 2020, the Company has determined that it is not probable that there will be a future conversion request that the Company is unable to settle with authorized and issued shares based on the Company’s current stock price and available shares as well as the Company’s monitoring efforts to ensure there are a sufficient number of shares available to settle any conversion request. Therefore, as of September 30, 2020, the Company has determined that the instrument is not probable of becoming redeemable, and does not believe subsequent adjustment of the carrying value of the instrument will be necessary. The Convertible and Redeemable Series A-2 Preferred Stock had an aggregate liquidation preference of $182.2 million as of September 30, 2020. The Convertible and Redeemable Series A-2 Preferred Stock contains embedded features that are required to be bifurcated and are subject to separate accounting treatment from the instrument itself. At issuance, these embedded features consisted of (i) a contingent dividend feature associated with the decrease in the dividend rate upon an IPO and (ii) a conversion option of the preferred shares to shares of common stock beginning on the fourth-year anniversary of the issuance date. Upon the Company’s IPO, the embedded derivative only consisted of the conversion option. As of September 30, 2020, this conversion embedded feature had a net fair value of $18.1 million. The change in value of $26.7 million and $27.4 million for the three and nine months ended September 30, 2020 was recorded to other expense. |
Stockholder's Equity (Deficit)
Stockholder's Equity (Deficit) | 9 Months Ended |
Sep. 30, 2020 | |
Equity [Abstract] | |
Stockholders' Deficit | 17. STOCKHOLDERS’ EQUITY (DEFICIT) Authorized Capital Stock— The Company was authorized to issue 190,000,000 and 25,000,000 shares of common stock, with a par value of $0.000004 per share as of September 30, 2020 and December 31, 2019, respectively. Warrants— In May 2015, the Company issued warrants to acquire 116,350 shares of Common Stock at a price of approximately $17.19 per share to the placement agent as consideration for backstopping the financing completed in May 2015. There were no changes related to these warrants during the three and nine months ended September 30, 2020 and September 30, 2019. Common Stock Issuances and Cancellations —During the three and nine months ended September 30, 2020 and September 30, 2019, the Company issued and cancelled the following shares of common stock: Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Shares Average Price per Share Shares Average Price per Share Shares Average Price per Share Shares Average Price per Share Common stock issued in connection with initial public offering 11,500,000 $ 15.00 — $ — 11,500,000 $ 15.00 — $ — Acquisitions — — 25,408 26.90 791,139 31.60 150,439 22.41 Redemption of series A-1 preferred stock 1,786,739 15.00 — — 1,786,739 15.00 — — Exercise of warrant options 2,534,239 0.01 — — 2,534,239 0.01 — — Exercise of options 16,850 8.92 7,150 6.03 20,350 9.27 22,675 18.01 Restricted shares, net 8,333 24.00 — — 8,333 24.00 — — Cancellation of shares (117,785 ) 17.15 — — (117,785 ) 17.15 — — 15,728,376 $ 12.82 32,558 $ 22.32 16,523,015 $ 13.72 173,114 $ 21.83 Employee Equity Incentive Plans —The Company has two plans under which stock-based awards have been issued: (i) the Montrose Amended & Restated 2017 Stock Incentive Plan (“2017 Plan”) and (ii) the Montrose Amended & Restated 2013 Stock Option Plan (“2013 Plan”) (collectively the “Plans”). As of September 30, 2020 and September 30, 2019, there was $10.4 million and $6.7 million, respectively, of total unrecognized stock compensation expense related to unvested options and restricted stock granted under the Plans. Such unrecognized expense is expected to be recognized over the next two years. The following number of shares were authorized to be issued and available for grant as of September 30, 2020 and September 30, 2019: September 30, 2020 2017 Plan 2013 Plan Shares authorized to be issued 2,945,443 2,047,269 Shares available for grant 1,233,266 — September 30, 2019 2017 Plan 2013 Plan Shares authorized to be issued 981,800 2,074,604 Shares available for grant 159,428 — Total stock compensation expense for the Plans was as follows: Three Months Ended September 30, 2020 2019 2017 plan 2013 plan 2017 plan 2013 plan Options Restricted Stock Options Total Options Restricted Stock Options Total Cost of revenue $ 276 $ — $ (5 ) $ 271 $ 278 $ — $ 97 $ 375 Selling, general and administrative expense 592 233 53 878 185 111 384 680 $ 868 $ 233 $ 48 $ 1,149 $ 463 $ 111 $ 481 $ 1,055 Nine Months Ended September 30, 2020 2019 2017 plan 2013 plan 2017 plan 2013 plan Options Restricted Stock Options Total Options Restricted Stock Options Total Cost of revenue $ 973 $ — $ 126 $ 1,099 $ 623 $ — $ 390 $ 1,013 Selling, general and administrative expense 1,178 973 189 2,340 457 323 1,784 2,564 $ 2,151 $ 973 $ 315 $ 3,439 $ 1,080 $ 323 $ 2,174 $ 3,577 Montrose Amended & Restated 2017 Stock Incentive Plan Restricted Stock —During the nine months ended September 30, 2020 and September 30, 2019, the Company issued 33,229 and 30,000 shares of restricted stock with a fair market value of $31.60 and $24.00 per share, respectively, to certain 2017 Plan participants as Director’s compensation. These shares of restricted stock granted in the nine months ended September 30, 2020 vest one year from the date of grant and the shares of restricted stock granted during the nine months ended September 30, 2019 vest over three years, or, in each case, in full upon a change in control, subject to the participant’s continued service as a Director throughout such date, or upon retirement. Members of the Board of Directors that receive stock-based compensation are treated as employees for accounting purposes. There were 10,000 shares of restricted stock that became fully vested and were released as unrestricted shares of common stock during the nine months ended September 30, 2020. No restricted shares vested and were released as unrestricted shares of common stock during the nine months ended September 30, 2019. There were 1,667 shares of restricted stock that were forfeited during the nine months ended September 30, 2020. There were no forfeitures of restricted shares during the nine months ended September 30, 2019. There were an aggregate of 267,173 and 242,025 restricted shares outstanding as of September 30, 2020 and September 30, 2019, respectively. Options —Options issued to all optionees under the 2017 Plan vest over four years from the date of issuance (or earlier vesting start date, as determined by the Board of Directors) as follows: one half on the second anniversary of date of grant and the remaining half on the fourth anniversary of the date of grant, with the exception of certain annual grants to certain executive officers, which vest annually over a 3-year period. The following summarizes the options activity of the 2017 Plan for the nine months ended September 30, 2020 and September 30, 2019: Options to Purchase Common Stock Weighted- Average Exercise Price per Share Weighted Average Grant Date Fair Value per Share Weighted Average Remaining Contract Life (in Years) Aggregate Intrinsic Value of In-The- Money Options (in Thousands) Outstanding at December 31, 2018 257,762 $ 20 $ 10 - $ 1,151 Granted 356,470 27 14 - — Forfeited/ cancelled (17,700 ) 19 — - — Outstanding at September 30, 2019 596,532 24 12 8.07 4,693 Outstanding at December 31, 2019 617,852 24 12 7.82 4,693 Granted 851,877 32 12 - — Forfeited/ cancelled (14,375 ) 22 — - — Exercised (925 ) 14 — - 7,918 Outstanding at September 30, 2020 1,454,429 21 12 7.59 7,649 Exercised at September 30, 2020 925 14 — 7.33 7,649 Options vested and expected to vest 1,454,429 21 9.04 7,649 The following weighted-average assumptions were used in the Black-Sholes option-pricing model calculation for the nine months ended September 30, 2020 and September 30, 2019: September 30, September 30, 2020 2019 Common stock value (per share) $ 16.36 $ 27.30 Expected volatility 46.14 47.94 Risk-free interest rate 0.41 2.15 Expected life (years) 7 7 Forfeiture rate None None Dividend rate None None Montrose Amended & Restated 2013 Stock Option Plan —The following summarizes the activity of the 2013 Plan for the nine months ended September 30, 2020 and September 30, 2019: Options to Purchase Common Stock Weighted- Average Exercise Price per Share Weighted Average Grant Date Fair Value per Share Weighted Average Remaining Contract Life (in Years) Aggregate Intrinsic Value of In-The- Money Options (in Thousands) Outstanding at December 31, 2018 1,900,404 $ 6 $ 1 7.30 33,290 Forfeited/ cancelled (14,500 ) 8 — - — Expired (5,400 ) 8 — - — Exercised (19,010 ) 6 — - 466 Outstanding at September 30, 2019 1,861,494 6 1 6.65 47,381 Outstanding at December 31, 2019 1,855,469 6 1 6.40 46,617 Forfeited/ cancelled (7,500 ) 10 — - — Expired (11,300 ) 6 — - — Exercised (19,175 ) 8 — - 354 Outstanding at September 30, 2020 1,817,494 6 1 5.63 33,772 Exercised at September 30, 2020 221,025 6 — 5.14 33,772 Options vested and expected to vest 1,817,494 6 — 5.17 33,772 Total shares outstanding from exercised options were 221,950 shares and 201,600 shares as of September 30, 2020 and December 31, 2019. Common Stock Reserved for Future Issuances —At September 30, 2020 and September 30, 2019, the Company has reserved certain stock of its authorized but unissued common stock for possible future issuance in connection with the following: September 30, December 31, 2020 2019 Warrants 116,350 650,590 Montrose 2013 Stock Incentive Plan 2,047,269 2,058,619 Montrose 2017 Stock Incentive Plan 2,945,443 997,785 Common stock reserved for future issuance 5,109,062 3,706,994 |
Net Loss Per Share
Net Loss Per Share | 9 Months Ended |
Sep. 30, 2020 | |
Earnings Per Share [Abstract] | |
Net Loss per Share | 18. NET LOSS PER SHARE Basic net loss per share is computed by dividing net loss attributable to common stockholders by the weighted average number of common shares outstanding during each period. The Redeemable Series A-1 Preferred Stock, which was outstanding prior to its redemption on July 27, 2020, and the Convertible and Redeemable Series A-2 Preferred Stock are considered a participating security. Net losses are not allocated to the Redeemable Series A-1 Preferred stockholders nor the Convertible and Redeemable Series A-2 stockholders, as they were not contractually obligated to share in the Company’s losses. Diluted net loss per share is computed by dividing net loss attributable to common stockholders by the weighted average number of common and dilutive common equivalent shares outstanding for the period using the treasury-stock method or the as-converted method. During the three and nine months ended September 30, 2019, up until the warrant options were exercised (Note 11), shares issuable in connection with the warrant options were considered outstanding common shares for purposes of calculating net loss per share since they do not contain any conditions that must be satisfied for the holder to exercise the warrant. Potentially dilutive shares are comprised of restricted stock and shares of common stock underlying stock options outstanding under the Plans and warrants (other than warrant options) to purchase common stock. During the three and nine months ended September 30, 2020 and September 30, 2019, there is no difference in the number of shares used to calculate basic and diluted shares outstanding due to the Company’s net loss and potentially dilutive shares being anti-dilutive. The following table summarizes the computation of basic and diluted net loss per share attributable to common stockholders of the Company for the three and nine months ended September 30, 2020 and September 30, 2019: Three Months Ended September 30, Nine Months Ended September 30, In thousands, except for net loss per share 2020 2019 2020 2019 Net loss $ (30,737 ) $ (6,683 ) $ (58,761 ) $ (12,247 ) Accretion of redeemable series A-1 preferred stock (6,542 ) (5,030 ) (17,601 ) (14,341 ) Redeemable series A-1 preferred stock deemed dividend (24,341 ) — (24,341 ) — Convertible and redeemable series A-2 preferred stock dividend (2,870 ) — (2,870 ) — Net loss attributable to common stockholders – basic and diluted (64,490 ) (11,713 ) (103,573 ) (26,588 ) Weighted-average common shares outstanding – basic and diluted 21,554 8,718 13,669 8,640 Net loss per share attributable to common stockholders – basic and diluted $ (2.99 ) $ (1.34 ) $ (7.58 ) $ (3.08 ) The following equity shares were excluded from the calculation of diluted net loss per share attributable to common stockholders because their effect would have been anti-dilutive for the three and nine months ended September 30, 2020 and September 30, 2019: September 30, 2020 2019 Stock options 2,423,900 2,062,825 Restricted stock 176,384 158,426 Warrants 116,350 116,350 |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2020 | |
Segment Reporting [Abstract] | |
Segment Information | 19. SEGMENT INFORMATION The Company has three operating and reportable segments: Assessment, Permitting and Response, Measurement and Analysis and Remediation and Reuse. These segments are monitored separately by management for performance against budget and prior year and are consistent with internal financial reporting. The Company’s operating segments are organized based upon primary services provided, the nature of the production process, their type of customers, methods used to distribute the products and the nature of the regulatory environment. Segment Adjusted EBITDA is the primary measure of operating performance for all three operating segments. Segment Adjusted EBITDA is the calculated Company’s Earnings before Interest, Tax, Depreciation and Amortization (“EBITDA”), adjusted to exclude certain transactions such as stock-based compensation, acquisition costs and fair value changes in financial instruments, amongst others. The Chief Operating Decision Maker (“CODM”) does not review segment assets as a measure of segment performance. Corporate and Other includes costs associated with general corporate overhead (including executive, legal, finance, safety, human resources, marketing and IT related costs) that are not directly related to supporting operations. Overhead costs that are directly related to supporting operations (such as insurance, software, licenses, shared services and payroll processing costs) are allocated to the operating segments on a basis that reasonably approximates an estimate of the use of these services. Segment revenues and Adjusted EBITDA for the three and nine months ended September 30, 2020 and September 30, 2019 were as follows: Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Segment Segment Segment Segment Segment Adjusted Segment Adjusted Segment Adjusted Segment Adjusted Revenues EBITDA Revenues EBITDA Revenues EBITDA Revenues EBITDA Assessment, Permitting and Response $ 26,593 $ 8,230 $ 5,413 $ 1,695 $ 49,768 $ 14,665 $ 15,017 $ 5,693 Measurement and Analysis 39,770 11,226 35,672 7,691 113,130 30,422 98,521 19,761 Remediation and Reuse 18,342 2,012 16,538 2,400 56,604 6,495 52,440 7,317 Total Operating Segments 84,705 21,468 57,623 11,786 219,502 51,582 165,978 32,771 Corporate and Other — (4,762 ) — (3,567 ) — (15,425 ) — (10,935 ) Total $ 84,705 $ 16,706 $ 57,623 $ 8,219 $ 219,502 $ 36,157 $ 165,978 $ 21,836 Presented below is a reconciliation of the Company’s segment measure to loss before benefit from income taxes for the three and nine months ended September 30, 2020 and September 30, 2019: For the Three Months Ended September 30, For the Nine Months Ended September 30, 2020 2019 2020 2019 Total $ 16,706 $ 8,219 $ 36,157 $ 21,836 Interest expense, net (3,043 ) (2,130 ) (10,896 ) (4,590 ) Income tax (expense) benefit (3,348 ) 412 1,563 1,308 Depreciation and amortization (9,740 ) (7,412 ) (27,084 ) (20,262 ) Stock-based compensation (1,149 ) (1,055 ) (3,439 ) (3,577 ) Start-up losses and investment in new services (602 ) (634 ) (1,283 ) (1,091 ) Acquisition costs (6 ) (1,278 ) (3,767 ) (2,350 ) Fair value changes in contingent put option 26,265 — 19,240 — Fair value changes in warrant options (9,311 ) (2,510 ) (9,312 ) (4,059 ) Fair value changes in compound embedded option (26,664 ) — (27,420 ) — Fair value changes in business acquisitions contingent consideration (13,404 ) (256 ) (17,387 ) 670 Short term purchase accounting fair value adjustment to deferred revenue — — (243 ) — IPO preparation costs and IPO related bonuses (6,378 ) (20 ) (6,908 ) (105 ) Discontinued services (i) (30 ) — (7,526 ) — Expenses related to financing transactions — — (277 ) — Other expenses (33 ) (19 ) (179 ) (27 ) Net loss $ (30,737 ) $ (6,683 ) $ (58,761 ) $ (12,247 ) (i) |
Related-Party Transactions
Related-Party Transactions | 9 Months Ended |
Sep. 30, 2020 | |
Related Party Transactions [Abstract] | |
Related-Party Transactions | 20. RELATED-PARTY TRANSACTIONS The Company engages a related party to provide Quality of Earnings reports on acquisition targets. The Company paid this related party approximately zero and $0.1 $0.4 million during the three and nine months ended September 30, 2019, respectively During the three months ended September 30, 2020, the holder of the Redeemable Series A-1 Preferred Stock and Convertible and Redeemable A-2 Preferred Stock became a stockholder in the Company. On the redemption date of the Redeemable Series A-1 Preferred Stock (Note 15), the Company issued 1,786,739 shares of common stock as dividend payment. Additionally, this related party exercised its warrant options (Note 11), becoming the holder of 2,534,239 additional common shares. This related party owns 17.3% of the total common shares outstanding as of September 30, 2020. |
Defined Contribution Plan
Defined Contribution Plan | 9 Months Ended |
Sep. 30, 2020 | |
Compensation And Retirement Disclosure [Abstract] | |
Defined Contribution Plan | 21. DEFINED CONTRIBUTION PLAN On January 1, 2014, the Company established the Montrose Environmental Group 401(k) Savings Plan. As of September 30, 2020 and December 31, 2019, plan participants may defer up to 85.0% of their eligible wages for the year, up to the Internal Revenue Service dollar limit and catch up contribution allowed by law. Up to May 22, 2020, the Company provided employer matching contributions equal to 100.0% of the first 3.0% of the participant’s compensation and 50.0% of the participant’s elective deferrals that exceed 3.0% but do not exceed 4.0% of the participant’s compensation. Subsequent to May 22, 2020, the Company temporarily ceased making employer contributions. Employer contributions for the three and nine months ended September 30, 2020 were zero 1.2 $0.5 million and $1.9 million for the three and nine months ended September 30, 2019, respectively, |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | 22. SUBSEQUENT EVENTS Effective October 6, 2020, the Company amended the New Credit Facility to provide for a reduction on the applicable interest rate on the term loan from LIBOR plus 5.0% with a 1.0% LIBOR floor to LIBOR plus 4.5% with a 1.0% LIBOR floor. The revolver interest rate remained unchanged. |
Description of the Business a_2
Description of the Business and Basis of Presentation (Policies) | 9 Months Ended |
Sep. 30, 2020 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation —The unaudited condensed consolidated financial statements include the operations of the Company and its wholly-owned subsidiaries. These unaudited condensed consolidated financial statements are presented in conformity with accounting principles generally accepted in the United States (“U.S. GAAP”) and have been prepared pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) that permit reduced disclosure for interim periods. The unaudited condensed consolidated financial statements include all accounts of the Company and, in the opinion of management, include all recurring adjustments and normal accruals necessary for a fair statement of the Company’s financial position, results of operations and cash flows for the dates and periods presented. These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited financial statements as of and for the year ended December 31, 2019. Results for interim periods are not necessarily indicative of the results to be expected during the remainder of the current year or for any future period. All intercompany transactions, accounts and profits, have been eliminated in the condensed consolidated financial statements. |
Recently Adopted Accounting Pronouncements /Recently Issued Accounting Pronouncements Not Yet Adopted | Recently Adopted Accounting Pronouncements — The Company qualifies as an emerging growth company as defined in the Jumpstart Our Business Startups Act of 2012 (“JOBS Act”) and therefore intends to take advantage of certain exemptions from various public company reporting requirements, including delaying adoption of new or revised accounting standards until those standards apply to private companies. The Company has elected to use this extended transition period under the JOBS Act. The effective dates shown below reflect the election to use the extended transition period. In June 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2018-07, Compensation—Stock Compensation: Improvements to Nonemployee Share-Based Payment Accounting. Under the revised guidance, the accounting for awards issued to non-employees will be similar to the accounting for employee awards. The new guidance is effective for fiscal years beginning after December 15, 2019. The standard was adopted as of January 1, 2020 and did not have a material impact on the Company’s condensed consolidated financial statements. In January 2017, the FASB issued ASU 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Accounting for Goodwill Impairment. The revised guidance eliminates Step 2 of the current goodwill impairment analysis test, which requires hypothetical purchase price allocation to measure goodwill impairment. A goodwill impairment loss will instead be measured at the amount by which a reporting unit’s carrying amount exceeds its fair value, not to exceed the carrying amount of goodwill. The revised guidance was adopted as of January 1, 2020 and did not have a material impact on the Company’s condensed consolidated financial statements. Recently Issued Accounting Pronouncements Not Yet Adopted — In August 2020, the FASB issued ASU 2020-06, Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40)—Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity. The ASU simplifies accounting for convertible instruments by removing major separation models required under current GAAP. Consequently, more convertible debt instruments will be reported as a single liability instrument with no separate accounting for embedded conversion features. The ASU removes certain settlement conditions that are required for equity contracts to qualify for the derivative scope exception, which will permit more equity contracts to qualify for the exception. The ASU also simplifies the diluted net income per share calculation in certain areas. The new guidance is effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years, and early adoption is permitted. The Company is currently evaluating the impact of the adoption of the standard on the condensed consolidated financial statements. In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. ASU 2020-04 provides optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions affected by the expected transition away from reference rates that are expected to be discontinued, such as LIBOR. ASU 2020-04 was effective upon issuance. The Company may elect to apply the guidance prospectively through December 31, 2022. The Company is currently evaluating the impact of the adoption of the standard on the condensed consolidated financial statements. In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes. ASU 2019-12 removes certain exceptions to the general principles in ASC 740 and clarifies and amends certain guidance to promote consistent application. ASU 2019-12 is effective for the Company’s annual and interim periods beginning on January 1, 2021, with early adoption permitted. Depending on the amendment, adoption may be applied on a retrospective, modified retrospective or prospective basis. The Company is currently evaluating the impact of the adoption of the standard on the condensed consolidated financial statements and does not anticipate the standard to have a significant impact. In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326). The standard introduces a new model for recognizing credit losses on financial instruments based on an estimate of current expected credit losses and will apply to trade receivables. The new guidance will be effective for the Company’s annual and interim periods beginning after December 15, 2022. The Company is currently evaluating the impact of the adoption of the standard on the condensed consolidated financial statements and does not anticipate the standard to have a significant impact. In February 2016, the FASB issued ASU 2016-2, Leases (Topic 842), to improve financial reporting regarding leasing transactions. The ASU primarily affects the accounting by the lessee in that it requires a lessee to recognize lease assets and liabilities, initially measured at the present value of the lease payments, on the balance sheets for those leases classified as operating leases under previous guidance. The new leasing standard is effective for the Company’s annual and interim periods beginning after December 15, 2021. The new leasing standard requires modified retrospective transition. The Company is evaluating the on the statements, but anticipates a material increase in assets and liabilities due to the recognition of the required right-of-use asset and corresponding liability for all significant lease obligations that are currently classified as operating leases. |
Revenues and Accounts Receiva_2
Revenues and Accounts Receivable (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Revenues And Accounts Receivable [Abstract] | |
Schedule of Contract Balances | The following table presents the Company’s contract balances: September 30, December 31, 2020 2019 Contract assets $ 35,441 $ 13,605 Contract liabilities 9,335 3,314 |
Schedule of Accounts Receivable, Net | Accounts receivable, net as of September 30, 2020 and December 31, 2019 consisted of the following: September 30, December 31, 2020 2019 Accounts receivable, invoiced $ 52,372 $ 46,643 Accounts receivable, other 929 611 Allowance for doubtful accounts (8,516 ) (1,327 ) Accounts receivable—net $ 44,785 $ 45,927 |
Schedule of Allowance for Doubtful Accounts | The allowance for doubtful accounts as of September 30, 2020 and December 31, 2019 consisted of the following: Beginning Balance Bad Debt Expense Charged to Allowance Other ( 1) Ending Balance Nine months ended September 30, 2020 $ 1,327 $ 6,445 $ (294 ) $ 1,038 $ 8,516 Year ended December 31, 2019 453 1,246 (556 ) 184 1,327 (1) This amount consists of additions to the allowance due to business acquisitions. |
Prepaid and Other Current Ass_2
Prepaid and Other Current Assets (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Deferred Costs Capitalized Prepaid And Other Assets Disclosure [Abstract] | |
Schedule of Prepaid and Other Current Assets | Prepaid and other current assets as of September 30, 2020 and December 31, 2019 consisted of the following: September 30, December 31, 2020 2019 Deposits $ 733 $ 605 Prepaid expenses 1,665 1,235 Prepaid insurance 2,577 170 Supplies 2,428 2,368 Offering costs — 1,240 Income tax receivable 1,182 1,205 Prepaid and other current assets $ 8,585 $ 6,823 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Property Plant And Equipment [Abstract] | |
Property and Equipment, Net | Property and equipment, net, as of September 30, 2020 and December 31, 2019 consisted of the following: Estimated September 30, December 31, Useful Life 2020 2019 Lab and test equipment 7 years $ 17,755 $ 14,810 Vehicles 5 years 12,869 11,073 Equipment 3–7 years 31,539 29,922 Furniture and fixtures 7 years 2,854 1,119 Leasehold improvements 7 years 6,758 5,954 Aircraft 10 years 834 — Building 39 years 2,975 — 75,584 62,878 Land 725 — Construction in progress 156 796 Less accumulated depreciation (41,906 ) (36,638 ) Total property and equipment—net $ 34,559 $ 27,036 |
Business Acquisitions (Tables)
Business Acquisitions (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Business Acquisition [Line Items] | |
Summary of Elements of Purchase Price of Acquisitions | The following table summarizes the elements of purchase price of the acquisitions completed during the nine months ended September 30, 2020: Cash Common Stock Other Purchase Price Component Current Other Purchase Price Component Long Term Contingent Consideration Current Contingent Consideration Long Term Total Purchase Price CTEH $ 175,000 $ 25,000 $ (2,297 ) $ — $ 34,451 $ 10,543 $ 242,697 All other acquisitions 450 — 50 100 210 — 810 $ 175,450 $ 25,000 $ (2,247 ) $ 100 $ 34,661 $ 10,543 $ 243,507 The following table summarizes the elements of purchase price of the acquisitions completed during the nine months ended September 30, 2019: Cash Common Stock Other Purchase Price Components Contingent Consideration Total Purchase Price Golden $ 1,500 — — $ 477 $ 1,977 TES 2,359 322 25 4,911 7,617 TESUS 18,683 3,041 1,495 — 23,219 AWS 6,020 — 150 — 6,170 AEC 808 — — — 808 LEHDER 3,878 684 — 13 4,575 ECT2 54,037 — (220 ) — 53,817 $ 87,285 $ 4,047 $ 1,450 $ 5,401 $ 98,183 |
Summary of Purchase Price Attributable to Acquisitions | The purchase price attributable to the acquisitions was allocated as follows: ECT2 All Other Acquisitions Total Cash $ 3,149 $ 2,137 $ 5,286 Restricted cash 629 — 629 Accounts receivable 1,707 3,751 5,458 Other current assets 498 61 559 Current assets 5,983 5,949 11,932 Property and equipment 776 3,288 4,064 Customer relationships 13,840 12,748 26,588 Trade names 1,008 659 1,667 Covenants not to compete 3,360 2,083 5,443 Proprietary software — 2,560 2,560 Patent 17,479 — 17,479 Goodwill 16,395 20,227 36,622 Total assets 58,841 47,514 106,355 Current liabilities 5,024 977 6,001 Non- current liabilities — 2,171 2,171 Total liabilities 5,024 3,148 8,172 Purchase price $ 53,817 $ 44,366 $ 98,183 |
Summary of Supplemental Unaudited Pro-Forma Information | The unaudited condensed consolidated financial information summarized in the following table gives effect to the 2020 and the 2019 acquisitions discussed above assuming they occurred on January 1, 2019. These unaudited consolidated pro forma operating results do not assume any impact from revenue, cost or other operating synergies that are expected or may have been realized as a result of the acquisitions. These unaudited consolidated pro forma operating results are presented for illustrative purposes only and are not indicative of the operating results that would have been achieved had the acquisitions occurred on January 1, 2019, nor does the information purport to reflect results for any future period. For the Three Months Ended September 30, 2020 2019 As reported Acquisitions Pro-Forma (Unaudited) Consolidated Pro-Forma (Unaudited) As reported Acquisitions Pro-Forma (Unaudited) Consolidated Pro-Forma (Unaudited) Revenues $ 84,705 $ — $ 84,705 $ 57,623 $ 18,551 $ 76,174 Net (loss) income (30,737 ) — (30,737 ) (6,683 ) 4,042 (2,641 ) For the Nine Months Ended September 30, 2020 2019 As reported Acquisitions Pro-Forma (Unaudited) Consolidated Pro-Forma (Unaudited) As reported Acquisitions Pro-Forma (Unaudited) Consolidated Pro-Forma (Unaudited) Revenues $ 219,502 $ 31,253 $ 250,755 $ 165,978 $ 107,459 $ 273,437 Net (loss) income (58,761 ) 10,288 (48,473 ) (12,247 ) 30,002 17,755 |
CTEH | |
Business Acquisition [Line Items] | |
Summary of Purchase Price Attributable to Acquisitions | The preliminary purchase price attributable to the acquisitions was allocated as follows: CTEH All Other Acquisitions Total Cash $ 1,527 $ — $ 1,527 Accounts receivable 17,059 — 17,059 Other current assets 1,265 — 1,265 Current assets 19,851 — 19,851 Property and equipment 7,042 75 7,117 Customer relationships 56,000 — 56,000 Trade names 4,200 — 4,200 Covenants not to compete 4,000 109 4,109 Proprietary software 14,700 — 14,700 Goodwill 146,625 626 147,251 Total assets 252,418 810 253,228 Current liabilities 9,721 — 9,721 Total liabilities 9,721 — 9,721 Purchase price $ 242,697 $ 810 $ 243,507 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Schedule of Amounts Related to Goodwill | Amounts related to goodwill as of September 30, 2020 and December 31, 2019 are as follows: Assessment, Permitting and Response Measurement and Analysis Remediation and Reuse Total Balance as of December 31, 2019 $ 15,173 $ 68,628 $ 43,257 $ 127,058 Goodwill acquired during the period 146,625 426 200 147,251 Balance as of September 30, 2020 $ 161,798 $ 69,054 $ 43,457 $ 274,309 |
Schedule of Amounts Related to Finite-Lived Intangible Assets | Amounts related to finite-lived intangible assets as of September 30, 2020 and December 31, 2019 are as follows: September 30, 2020 Estimated Useful Life Gross Balance Accumulated Amortization Total Intangible Assets—Net Finite lived intangible assets Customer relationships 7–15 years $ 164,782 $ 49,068 $ 115,714 Covenants not to compete 4–5 years 29,942 20,444 9,498 Trade names 1–5 years 16,938 12,196 4,742 Proprietary software 3-5 years 20,808 4,915 15,893 Patent 16 years 17,479 1,125 16,354 Total other intangible assets—net $ 249,949 $ 87,748 $ 162,201 December 31, 2019 Estimated Useful Life Gross Balance Accumulated Amortization Total Intangible Assets—Net Finite lived intangible assets Customer relationships 7–10 years $ 108,782 $ 36,700 $ 72,082 Covenants not to compete 4–5 years 25,832 17,572 8,260 Trade names 1–5 years 12,738 10,230 2,508 Proprietary software 3 years 3,885 1,359 2,526 Patent 16 years 17,479 306 17,173 Total other intangible assets—net $ 168,716 $ 66,167 $ 102,549 |
Schedule of Future Amortization Expense | Future amortization expense is estimated to be as follows for each of the five following years and thereafter: December 31, 2020 (remaining) $ 7,543 2021 28,140 2022 24,053 2023 20,073 2024 16,951 Thereafter 65,441 $ 162,201 |
Accounts Payable and Other Ac_2
Accounts Payable and Other Accrued Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Payables And Accruals [Abstract] | |
Summary of Accounts Payable and Other Accrued Liabilities | Accounts payable and other accrued liabilities consisted of the following as of September 30, 2020 and December 31, 2019: September 30, December 31, 2020 2019 Accounts payable $ 13,360 $ 15,034 Accrued expenses 10,395 10,733 Other purchase obligations 572 — Contract liabilities 9,335 3,314 Other current liabilities 235 504 Total accounts payable and other accrued liabilities $ 33,897 $ 29,585 |
Accrued Payroll and Benefits (T
Accrued Payroll and Benefits (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Statement Of Financial Position [Abstract] | |
Schedule of Accrued Payroll and Benefits | Accrued payroll and benefits consisted of the following as of September 30, 2020 and December 31, 2019: September 30, December 31, 2020 2019 Accrued bonuses $ 7,854 $ 3,449 Accrued paid time off 2,157 2,154 Accrued payroll 5,536 4,470 Accrued other 2,410 959 Total accrued payroll and benefits $ 17,957 $ 11,032 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | Debt as of September 30, 2020 and December 31, 2019 consisted of the following: September 30, December 31, 2020 2019 Term Loan Facility $ 174,453 $ 48,750 Revolving Line of Credit — 97,590 Capital leases 3,127 3,765 Other leases 2 12 Equipment line of credit 3,214 3,124 Less deferred debt issuance costs (4,345 ) (1,052 ) Total debt 176,451 152,189 Less current portion of long term debt (5,034 ) (7,143 ) Long-term debt, less current portion $ 171,417 $ 145,046 |
Schedule of Applicable Percentages | The applicable margin means a percentage per annum determined in accordance with the following table as of December 31, 2019: Pricing Tier Consolidated Leverage Ratio Commitment Fee Eurodollar Rate Loans and LIBOR Letter of Credit Fee Daily Floating Rate Loans Rate Loans 1 > 3.75 to 1.0 0.50 % 4.00 % 4.00 % 3.00 % 2 ≤ 3.75 to 1.0 but > 3.00 to 1.0 0.50 3.50 3.50 2.50 3 ≤ 3.00 to 1.0 but > 2.25 to 1.0 0.40 3.00 3.00 2.00 4 < 2.25 to 1.0 0.30 2.50 2.50 1.50 |
Schedule of Capital Leases Mature by 2025 | All capital leases (including those purchased through the Company’s equipment line of credit) mature by 2025 as follows: September 30, Payments Interest Principal 2021 $ 2,670 $ 368 $ 2,302 2022 2,178 265 1,913 2023 1,582 139 1,443 2024 667 32 635 2025 49 1 48 $ 7,146 $ 805 $ 6,341 |
Schedule of Aggregate Annual Maturities of Long-Term Debt | The following is a schedule of the aggregate annual maturities of long-term debt presented on the condensed consolidated statement of financial position, based on the terms of the credit facility, capital lease obligations and equipment line of credit as of September 30, 2020: September 30, 2021 $ 5,034 2022 6,839 2023 8,006 2024 7,198 2025 153,719 Total $ 180,796 |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Summary of Financial Liabilities Measured at Fair Value on Recurring Basis | As of September 30, 2020 and December 31, 2019, the following financial liabilities are measured at fair value on a recurring basis using significant unobservable inputs (Level 3). September 30, December 31, 2020 2019 Business acquisitions contingent consideration, current $ 49,170 $ 8,614 Business acquisitions contingent consideration, long-term 9,742 379 Contingent put option — 7,100 Warrant option — 16,878 Conversion option 18,059 — Total $ 76,971 $ 32,971 |
Summary of Financial Instruments Measured at Fair Value on Recurring Basis | The following table sets forth the Company’s financial instruments that were measured at fair value on a recurring basis for the nine months ended September 30, 2020 and September 30, 2019: Level 3 Embedded Option Business Acquisitions Contingent Consideration, Current ( 1) Business Acquisitions Contingent Consideration, Long-term ( 2) Contingent Put Option Warrant Options Total Balance—at December 31, 2018 $ — $ 2,754 $ — $ — $ 12,818 $ 15,572 Acquisitions 31 — — — 31 Changes in fair value included in earnings — (670 ) — — 4,059 3,389 Payment of contingent consideration payable — (554 ) — — — (554 ) Balance—at September 30, 2019 $ — $ 1,561 $ — $ — $ 16,877 $ 18,438 Balance—at December 31, 2019 $ — $ 8,614 $ 379 $ 7,100 $ 16,878 $ 32,971 Foreign currency translation of contingent consideration payment — (208 ) — — — (208 ) Payment of contingent consideration payable — (12,464 ) — — — (12,464 ) Acquisitions 34,661 10,543 45,204 Series A-2 compound embedded option (9,361 ) — — — — (9,361 ) Issuance of warrant option — — — — 30,097 30,097 Reclass of long term to short term contingent liabilities — 180 (180 ) — — — Changes in fair value included in earnings 27,420 18,387 (1,000 ) (19,240 ) 9,312 34,879 Write off of the contingent put option — — — 12,140 — 12,140 Exercise of warrant options — — — — (56,287 ) (56,287 ) Balance—at September 30, 2020 $ 18,059 $ 49,170 $ 9,742 $ — $ — $ 76,971 (1) Current portion of the contingent consideration is recorded in business acquisitions contingent consideration, current. (2) Long term portion of the contingent consideration is recorded in business acquisitions contingent consideration, long-term. |
Summary of Fair Value of Warrant Options Associated with Issuance of Redeemable Preferred Stock | The fair value of the warrant options associated with the issuance of the Redeemable Series A-1 Preferred Stock and the Convertible and Redeemable Series A-2 Preferred Stock was calculated based on the Black-Sholes pricing model using the following assumptions: July 30, September 30, Series A-1 Preferred Stock Warrant Option 2020 2019 Common stock value (per share) $ 22.22 $ 31.60 Expected volatility 44.35 % 47.63 % Risk-free interest rate 0.55 % 1.68 % Expected life (years) 10 10 July 30, September 30, Series A-2 Preferred Stock Warrant Option 2020 2019 Common stock value (per share) $ 22.22 n/a Expected volatility 44.35 % n/a Risk-free interest rate 0.55 % n/a Expected life (years) 10 n/a |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Commitments And Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Lease Payments under Leases | The following is a schedule of the future minimum lease payments by year under the leases as of September 30, 2020: September 30, Rent Office Equipment Total 2021 $ 5,863 $ 332 $ 6,195 2022 4,865 327 5,192 2023 2,961 129 3,090 2024 1,410 39 1,449 2025 and thereafter 1,385 1 1,386 $ 16,484 $ 828 $ 17,312 |
Stockholder's Equity (Deficit)
Stockholder's Equity (Deficit) (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Summary of Issued and Cancelled Shares of Common Stock | During the three and nine months ended September 30, 2020 and September 30, 2019, the Company issued and cancelled the following shares of common stock: Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Shares Average Price per Share Shares Average Price per Share Shares Average Price per Share Shares Average Price per Share Common stock issued in connection with initial public offering 11,500,000 $ 15.00 — $ — 11,500,000 $ 15.00 — $ — Acquisitions — — 25,408 26.90 791,139 31.60 150,439 22.41 Redemption of series A-1 preferred stock 1,786,739 15.00 — — 1,786,739 15.00 — — Exercise of warrant options 2,534,239 0.01 — — 2,534,239 0.01 — — Exercise of options 16,850 8.92 7,150 6.03 20,350 9.27 22,675 18.01 Restricted shares, net 8,333 24.00 — — 8,333 24.00 — — Cancellation of shares (117,785 ) 17.15 — — (117,785 ) 17.15 — — 15,728,376 $ 12.82 32,558 $ 22.32 16,523,015 $ 13.72 173,114 $ 21.83 |
Schedule of Share Authorized to be Issue and Available for Grant | The following number of shares were authorized to be issued and available for grant as of September 30, 2020 and September 30, 2019: September 30, 2020 2017 Plan 2013 Plan Shares authorized to be issued 2,945,443 2,047,269 Shares available for grant 1,233,266 — September 30, 2019 2017 Plan 2013 Plan Shares authorized to be issued 981,800 2,074,604 Shares available for grant 159,428 — |
Schedule of Stock Compensation Expense | Total stock compensation expense for the Plans was as follows: Three Months Ended September 30, 2020 2019 2017 plan 2013 plan 2017 plan 2013 plan Options Restricted Stock Options Total Options Restricted Stock Options Total Cost of revenue $ 276 $ — $ (5 ) $ 271 $ 278 $ — $ 97 $ 375 Selling, general and administrative expense 592 233 53 878 185 111 384 680 $ 868 $ 233 $ 48 $ 1,149 $ 463 $ 111 $ 481 $ 1,055 Nine Months Ended September 30, 2020 2019 2017 plan 2013 plan 2017 plan 2013 plan Options Restricted Stock Options Total Options Restricted Stock Options Total Cost of revenue $ 973 $ — $ 126 $ 1,099 $ 623 $ — $ 390 $ 1,013 Selling, general and administrative expense 1,178 973 189 2,340 457 323 1,784 2,564 $ 2,151 $ 973 $ 315 $ 3,439 $ 1,080 $ 323 $ 2,174 $ 3,577 |
Summary of Weighted Average Assumptions Used in Black-Sholes Option-pricing Model | The following weighted-average assumptions were used in the Black-Sholes option-pricing model calculation for the nine months ended September 30, 2020 and September 30, 2019: September 30, September 30, 2020 2019 Common stock value (per share) $ 16.36 $ 27.30 Expected volatility 46.14 47.94 Risk-free interest rate 0.41 2.15 Expected life (years) 7 7 Forfeiture rate None None Dividend rate None None |
Schedule of Common Stock Reserved for Future Issuance | Common Stock Reserved for Future Issuances —At September 30, 2020 and September 30, 2019, the Company has reserved certain stock of its authorized but unissued common stock for possible future issuance in connection with the following: September 30, December 31, 2020 2019 Warrants 116,350 650,590 Montrose 2013 Stock Incentive Plan 2,047,269 2,058,619 Montrose 2017 Stock Incentive Plan 2,945,443 997,785 Common stock reserved for future issuance 5,109,062 3,706,994 |
Montrose Amended & Restated 2017 Stock Incentive Plan | |
Summary of Stock Option Activity | The following summarizes the options activity of the 2017 Plan for the nine months ended September 30, 2020 and September 30, 2019: Options to Purchase Common Stock Weighted- Average Exercise Price per Share Weighted Average Grant Date Fair Value per Share Weighted Average Remaining Contract Life (in Years) Aggregate Intrinsic Value of In-The- Money Options (in Thousands) Outstanding at December 31, 2018 257,762 $ 20 $ 10 - $ 1,151 Granted 356,470 27 14 - — Forfeited/ cancelled (17,700 ) 19 — - — Outstanding at September 30, 2019 596,532 24 12 8.07 4,693 Outstanding at December 31, 2019 617,852 24 12 7.82 4,693 Granted 851,877 32 12 - — Forfeited/ cancelled (14,375 ) 22 — - — Exercised (925 ) 14 — - 7,918 Outstanding at September 30, 2020 1,454,429 21 12 7.59 7,649 Exercised at September 30, 2020 925 14 — 7.33 7,649 Options vested and expected to vest 1,454,429 21 9.04 7,649 |
Montrose Amended and Restated 2013 Stock Option Plan | |
Summary of Stock Option Activity | Montrose Amended & Restated 2013 Stock Option Plan —The following summarizes the activity of the 2013 Plan for the nine months ended September 30, 2020 and September 30, 2019: Options to Purchase Common Stock Weighted- Average Exercise Price per Share Weighted Average Grant Date Fair Value per Share Weighted Average Remaining Contract Life (in Years) Aggregate Intrinsic Value of In-The- Money Options (in Thousands) Outstanding at December 31, 2018 1,900,404 $ 6 $ 1 7.30 33,290 Forfeited/ cancelled (14,500 ) 8 — - — Expired (5,400 ) 8 — - — Exercised (19,010 ) 6 — - 466 Outstanding at September 30, 2019 1,861,494 6 1 6.65 47,381 Outstanding at December 31, 2019 1,855,469 6 1 6.40 46,617 Forfeited/ cancelled (7,500 ) 10 — - — Expired (11,300 ) 6 — - — Exercised (19,175 ) 8 — - 354 Outstanding at September 30, 2020 1,817,494 6 1 5.63 33,772 Exercised at September 30, 2020 221,025 6 — 5.14 33,772 Options vested and expected to vest 1,817,494 6 — 5.17 33,772 |
Net Loss Per Share (Tables)
Net Loss Per Share (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Net Loss Per Share Attributable to Common Stockholders | The following table summarizes the computation of basic and diluted net loss per share attributable to common stockholders of the Company for the three and nine months ended September 30, 2020 and September 30, 2019: Three Months Ended September 30, Nine Months Ended September 30, In thousands, except for net loss per share 2020 2019 2020 2019 Net loss $ (30,737 ) $ (6,683 ) $ (58,761 ) $ (12,247 ) Accretion of redeemable series A-1 preferred stock (6,542 ) (5,030 ) (17,601 ) (14,341 ) Redeemable series A-1 preferred stock deemed dividend (24,341 ) — (24,341 ) — Convertible and redeemable series A-2 preferred stock dividend (2,870 ) — (2,870 ) — Net loss attributable to common stockholders – basic and diluted (64,490 ) (11,713 ) (103,573 ) (26,588 ) Weighted-average common shares outstanding – basic and diluted 21,554 8,718 13,669 8,640 Net loss per share attributable to common stockholders – basic and diluted $ (2.99 ) $ (1.34 ) $ (7.58 ) $ (3.08 ) |
Equity Shares Excluded from Calculation of Diluted Net Loss per Share Attributable to Common Stockholders | The following equity shares were excluded from the calculation of diluted net loss per share attributable to common stockholders because their effect would have been anti-dilutive for the three and nine months ended September 30, 2020 and September 30, 2019: September 30, 2020 2019 Stock options 2,423,900 2,062,825 Restricted stock 176,384 158,426 Warrants 116,350 116,350 |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Segment Reporting [Abstract] | |
Components of Segment Revenues and Adjusted EBITDA | Segment revenues and Adjusted EBITDA for the three and nine months ended September 30, 2020 and September 30, 2019 were as follows: Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Segment Segment Segment Segment Segment Adjusted Segment Adjusted Segment Adjusted Segment Adjusted Revenues EBITDA Revenues EBITDA Revenues EBITDA Revenues EBITDA Assessment, Permitting and Response $ 26,593 $ 8,230 $ 5,413 $ 1,695 $ 49,768 $ 14,665 $ 15,017 $ 5,693 Measurement and Analysis 39,770 11,226 35,672 7,691 113,130 30,422 98,521 19,761 Remediation and Reuse 18,342 2,012 16,538 2,400 56,604 6,495 52,440 7,317 Total Operating Segments 84,705 21,468 57,623 11,786 219,502 51,582 165,978 32,771 Corporate and Other — (4,762 ) — (3,567 ) — (15,425 ) — (10,935 ) Total $ 84,705 $ 16,706 $ 57,623 $ 8,219 $ 219,502 $ 36,157 $ 165,978 $ 21,836 |
Reconciliation of Segment Measure to Loss Before Benefit from Income Taxes | Presented below is a reconciliation of the Company’s segment measure to loss before benefit from income taxes for the three and nine months ended September 30, 2020 and September 30, 2019: For the Three Months Ended September 30, For the Nine Months Ended September 30, 2020 2019 2020 2019 Total $ 16,706 $ 8,219 $ 36,157 $ 21,836 Interest expense, net (3,043 ) (2,130 ) (10,896 ) (4,590 ) Income tax (expense) benefit (3,348 ) 412 1,563 1,308 Depreciation and amortization (9,740 ) (7,412 ) (27,084 ) (20,262 ) Stock-based compensation (1,149 ) (1,055 ) (3,439 ) (3,577 ) Start-up losses and investment in new services (602 ) (634 ) (1,283 ) (1,091 ) Acquisition costs (6 ) (1,278 ) (3,767 ) (2,350 ) Fair value changes in contingent put option 26,265 — 19,240 — Fair value changes in warrant options (9,311 ) (2,510 ) (9,312 ) (4,059 ) Fair value changes in compound embedded option (26,664 ) — (27,420 ) — Fair value changes in business acquisitions contingent consideration (13,404 ) (256 ) (17,387 ) 670 Short term purchase accounting fair value adjustment to deferred revenue — — (243 ) — IPO preparation costs and IPO related bonuses (6,378 ) (20 ) (6,908 ) (105 ) Discontinued services (i) (30 ) — (7,526 ) — Expenses related to financing transactions — — (277 ) — Other expenses (33 ) (19 ) (179 ) (27 ) Net loss $ (30,737 ) $ (6,683 ) $ (58,761 ) $ (12,247 ) (i) |
Description of the Business a_3
Description of the Business and Basis of Presentation - Additional Information (Details) $ / shares in Units, $ in Thousands | Jul. 27, 2020USD ($)$ / sharesshares | Sep. 30, 2020Employee$ / sharesshares | Sep. 30, 2020USD ($)EmployeeOfficeAcquisition$ / sharesshares | Sep. 30, 2019USD ($)$ / shares |
Description Of Business And Basis Of Presentation [Line Items] | ||||
Entity formation, month and year | 2013-11 | |||
Number of offices in which entity operates | Office | 70 | |||
Entity number of employees | Employee | 1,700 | 1,700 | ||
Number of acquisitions completed | Acquisition | 56 | |||
Common stock shares sold under IPO | shares | 1,786,739 | |||
Share price | $ / shares | $ 16.36 | $ 16.36 | $ 27.30 | |
Net proceeds from sale of common stock | $ 171 | $ 139 | ||
IPO | ||||
Description Of Business And Basis Of Presentation [Line Items] | ||||
Common stock shares sold under IPO | shares | 11,500,000 | 11,500,000 | 11,500,000 | |
Share price | $ / shares | $ 15 | |||
Net proceeds from sale of common stock | $ 161,300 | |||
Underwriting discounts | 11,200 | |||
Deferred IPO costs againts additional paid in capital | $ 4,400 | |||
Underwriters | ||||
Description Of Business And Basis Of Presentation [Line Items] | ||||
Common stock shares sold under IPO | shares | 1,500,000 |
Summary of New Accounting Pro_2
Summary of New Accounting Pronouncements - Additional Information (Details) | Sep. 30, 2020 |
Accounting Standards Update 2018-07 | |
New Accounting Pronouncements Or Change In Accounting Principle [Line Items] | |
Change in accounting principle, accounting standards update, adopted | true |
Change in accounting principle, accounting standards update, adoption date | Jan. 1, 2020 |
Change in accounting principle, accounting standards update, immaterial effect | true |
Accounting Standards Update 2017-04 | |
New Accounting Pronouncements Or Change In Accounting Principle [Line Items] | |
Change in accounting principle, accounting standards update, adopted | true |
Change in accounting principle, accounting standards update, adoption date | Jan. 1, 2020 |
Change in accounting principle, accounting standards update, immaterial effect | true |
Revenues and Accounts Receiva_3
Revenues and Accounts Receivable - Schedule of Contract Balances (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Revenues And Accounts Receivable [Abstract] | ||
Contract assets | $ 35,441 | $ 13,605 |
Contract liabilities | $ 9,335 | $ 3,314 |
Revenues and Accounts Receiva_4
Revenues and Accounts Receivable - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Accounts Notes And Loans Receivable [Line Items] | |||||
Contracts assets acquired through business acquisitions | $ 6,500 | $ 700 | |||
Contract liabilities acquired through business acquisitions | 0 | 2,200 | |||
Contract with customer liabilities, revenue recognized | $ 500 | 2,100 | |||
Revenue remaining performance obligations | $ 25,200 | 25,200 | 13,000 | ||
Provision for bad debt | $ 6,300 | 6,445 | $ 590 | $ 1,246 | |
Remediation and Reuse Segment | |||||
Accounts Notes And Loans Receivable [Line Items] | |||||
Provision for bad debt | $ 5,500 | ||||
Customer Concentration Risk | Accounts Receivable | Minimum | |||||
Accounts Notes And Loans Receivable [Line Items] | |||||
Concentration Risk Percentage | 10.00% |
Revenues and Accounts Receiva_5
Revenues and Accounts Receivable - Additional Information (Details1) - USD ($) $ in Millions | Sep. 30, 2020 | Dec. 31, 2019 |
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items] | ||
Revenue remaining performance obligations | $ 25.2 | $ 13 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2020-10-01 | ||
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items] | ||
Revenue remaining performance obligations | $ 24 | |
Revenue remaining performance obligations, satisfaction period | 1 year | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date: 2021-01-01 | ||
Revenue Remaining Performance Obligation Expected Timing Of Satisfaction [Line Items] | ||
Revenue remaining performance obligations | $ 1.2 | |
Revenue remaining performance obligations, satisfaction period |
Revenues and Accounts Receiva_6
Revenues and Accounts Receivable - Schedule of Accounts Receivable, Net (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Revenues And Accounts Receivable [Abstract] | |||
Accounts receivable, invoiced | $ 52,372 | $ 46,643 | |
Accounts receivable, other | 929 | 611 | |
Allowance for doubtful accounts | (8,516) | (1,327) | $ (453) |
Accounts receivable—net | $ 44,785 | $ 45,927 |
Revenues and Accounts Receiva_7
Revenues and Accounts Receivable - Schedule of Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Mar. 31, 2020 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Revenues And Accounts Receivable [Abstract] | ||||
Beginning Balance | $ 1,327 | $ 1,327 | $ 453 | $ 453 |
Bad Debt Expense | $ 6,300 | 6,445 | $ 590 | 1,246 |
Charged to Allowance | (294) | (556) | ||
Other | 1,038 | 184 | ||
Ending Balance | $ 8,516 | $ 1,327 |
Prepaid and Other Current Ass_3
Prepaid and Other Current Assets - Schedule of Prepaid and Other Current Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Prepaid Expense and Other Assets, Current [Abstract] | ||
Deposits | $ 733 | $ 605 |
Prepaid expenses | 1,665 | 1,235 |
Prepaid insurance | 2,577 | 170 |
Supplies | 2,428 | 2,368 |
Offering costs | 1,240 | |
Income tax receivable | 1,182 | 1,205 |
Prepaid and other current assets | $ 8,585 | $ 6,823 |
Property and Equipment - Proper
Property and Equipment - Property and Equipment, Net (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Dec. 31, 2019 | |
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | $ 75,584 | $ 62,878 |
Less accumulated depreciation | (41,906) | (36,638) |
Total property and equipment—net | $ 34,559 | 27,036 |
Lab and Test Equipment | ||
Property Plant And Equipment [Line Items] | ||
Estimated Useful Life | 7 years | |
Property and equipment, gross | $ 17,755 | 14,810 |
Vehicles | ||
Property Plant And Equipment [Line Items] | ||
Estimated Useful Life | 5 years | |
Property and equipment, gross | $ 12,869 | 11,073 |
Equipment | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | $ 31,539 | 29,922 |
Equipment | Minimum | ||
Property Plant And Equipment [Line Items] | ||
Estimated Useful Life | 3 years | |
Equipment | Maximum [Member] | ||
Property Plant And Equipment [Line Items] | ||
Estimated Useful Life | 7 years | |
Furniture and Fixtures | ||
Property Plant And Equipment [Line Items] | ||
Estimated Useful Life | 7 years | |
Property and equipment, gross | $ 2,854 | 1,119 |
Leasehold Improvements | ||
Property Plant And Equipment [Line Items] | ||
Estimated Useful Life | 7 years | |
Property and equipment, gross | $ 6,758 | 5,954 |
Aircraft | ||
Property Plant And Equipment [Line Items] | ||
Estimated Useful Life | 10 years | |
Property and equipment, gross | $ 834 | |
Building | ||
Property Plant And Equipment [Line Items] | ||
Estimated Useful Life | 39 years | |
Property and equipment, gross | $ 2,975 | |
Land | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | 725 | |
Construction in Progress | ||
Property Plant And Equipment [Line Items] | ||
Property and equipment, gross | $ 156 | $ 796 |
Property and Equipment - Additi
Property and Equipment - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Property Plant And Equipment [Abstract] | ||||
Depreciation expense | $ 2.1 | $ 2.1 | $ 6.1 | $ 5.9 |
Business Acquisitions - Additio
Business Acquisitions - Additional Information (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||||||
Apr. 30, 2020 | Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Aug. 31, 2019 | Jul. 31, 2019 | Jun. 30, 2019 | Apr. 30, 2019 | Mar. 31, 2019 | |
Business Acquisition [Line Items] | ||||||||||
Transaction costs related to business combinations | $ 6,000 | $ 1,278,000 | $ 3,767,000 | $ 2,350,000 | ||||||
Number of common stock shares issued in connection with business acquisition | 25,408 | 791,139 | 150,439 | |||||||
Revenue | $ 7,700,000 | $ 7,700,000 | ||||||||
Pre-tax income (loss) | $ 1,500,000 | $ 1,500,000 | ||||||||
Customer Relationships | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Weighted average useful lives for acquired intangible assets | 9 years 6 months | |||||||||
Trade Names | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Weighted average useful lives for acquired intangible assets | 1 year 6 months | |||||||||
Covenants Not to Compete | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Weighted average useful lives for acquired intangible assets | 4 years | |||||||||
Proprietary Software | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Weighted average useful lives for acquired intangible assets | 3 years | |||||||||
Patent | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Weighted average useful lives for acquired intangible assets | 16 years | |||||||||
CTEH | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Percentage of interests acquired | 100.00% | |||||||||
Revenue | 37,200,000 | $ 37,200,000 | ||||||||
Pre-tax income (loss) | $ 5,700,000 | $ 5,700,000 | ||||||||
CTEH | External Proprietary Software | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Weighted average useful lives for acquired intangible assets | 5 years | |||||||||
CTEH | Customer Relationships | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Weighted average useful lives for acquired intangible assets | 15 years | |||||||||
CTEH | Trade Names | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Weighted average useful lives for acquired intangible assets | 5 years | |||||||||
CTEH | Covenants Not to Compete | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Weighted average useful lives for acquired intangible assets | 5 years | |||||||||
CTEH | Proprietary Software | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Weighted average useful lives for acquired intangible assets | 3 years | |||||||||
CTEH | Covenants Not to Compete Other Acquisitions | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Weighted average useful lives for acquired intangible assets | 4 years | |||||||||
CTEH | 2020 Earn Out | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Business combination, contingent consideration arrangements, basis for amount | CTEH first year earnout is to be calculated at twelve times CTEH’s 2020 EBITDA (as defined in the purchase agreement) in excess of $18.3 million, with a maximum first year earn-out payment of $50.0 million. | |||||||||
Business combination, contingent consideration arrangements, description | The 2020 earn out was initially payable 100% in common stock, but as a result of the completion of the Company’s IPO (Note 1), 50% of any 2020 earnout payment will be payable in cash and 50% will be payable, at the Company’s election, in cash or shares of common stock. | |||||||||
Business combination, minimum EBITDA for contingent consideration arrangements | $ 18,300,000 | |||||||||
Business combination, earn-out payment, maximum | $ 50,000,000 | |||||||||
Percentage of earn out payable in common stock | 100.00% | |||||||||
Percentage of earn out payable in cash, as result of completing of IPO | 50.00% | |||||||||
Percentage of earn out payable in cash or shares, as a result of completion of IPO, at company's election | 50.00% | |||||||||
CTEH | 2021 Earn Out | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Business combination, contingent consideration arrangements, basis for amount | The second year earn-out is to be calculated at ten times CTEH’s 2021 EBITDA in excess of actual 2020 EBITDA (with actual 2020 EBITDA subject to a minimum of $18.3 million and a maximum of $22.5 million), with a maximum second year earn-out payment of $30.0 million. | |||||||||
Business combination, contingent consideration arrangements, description | The 2021 earn out, if any, is payable 100% in cash. | |||||||||
Business combination, earn-out payment, maximum | $ 30,000,000 | |||||||||
Percentage of earn out payable in cash | 100.00% | |||||||||
CTEH | Minimum | 2020 Earn Out | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Business combination, actual EBITDA | $ 18,300,000 | |||||||||
CTEH | Maximum [Member] | 2020 Earn Out | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Business combination, actual EBITDA | $ 22,500,000 | |||||||||
CTEH | Convertible And Redeemable Series A-2 Preferred Stock | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Number of common stock shares issued in connection with business acquisition | 791,139 | |||||||||
Golden | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Percentage of interests acquired | 100.00% | |||||||||
TES | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Percentage of interests acquired | 100.00% | |||||||||
TESUS | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Percentage of interests acquired | 100.00% | |||||||||
AWS | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Percentage of interests acquired | 100.00% | |||||||||
LEHDER | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Percentage of interests acquired | 100.00% | |||||||||
ECT2 | ||||||||||
Business Acquisition [Line Items] | ||||||||||
Percentage of interests acquired | 100.00% |
Business Acquisitions - Summary
Business Acquisitions - Summary of Elements of Purchase Price of Acquisitions (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Business Acquisition [Line Items] | ||
Cash | $ 175,450 | $ 87,285 |
Common Stock | 25,000 | 4,047 |
Other Purchase Price Component Current | (2,247) | |
Other Purchase Price Component Long Term | 100 | |
Contingent Consideration Current | 34,661 | |
Contingent Consideration Long Term | 10,543 | |
Other Purchase Price Components | 1,450 | |
Contingent Consideration | 5,401 | |
Total Purchase Price | 243,507 | 98,183 |
CTEH | ||
Business Acquisition [Line Items] | ||
Cash | 175,000 | |
Common Stock | 25,000 | |
Other Purchase Price Component Current | (2,297) | |
Contingent Consideration Current | 34,451 | |
Contingent Consideration Long Term | 10,543 | |
Total Purchase Price | 242,697 | |
All Other Acquisitions | ||
Business Acquisition [Line Items] | ||
Cash | 450 | |
Other Purchase Price Component Current | 50 | |
Other Purchase Price Component Long Term | 100 | |
Contingent Consideration Current | 210 | |
Total Purchase Price | $ 810 | |
Golden | ||
Business Acquisition [Line Items] | ||
Cash | 1,500 | |
Contingent Consideration | 477 | |
Total Purchase Price | 1,977 | |
TES | ||
Business Acquisition [Line Items] | ||
Cash | 2,359 | |
Common Stock | 322 | |
Other Purchase Price Components | 25 | |
Contingent Consideration | 4,911 | |
Total Purchase Price | 7,617 | |
TESUS | ||
Business Acquisition [Line Items] | ||
Cash | 18,683 | |
Common Stock | 3,041 | |
Other Purchase Price Components | 1,495 | |
Total Purchase Price | 23,219 | |
AWS | ||
Business Acquisition [Line Items] | ||
Cash | 6,020 | |
Other Purchase Price Components | 150 | |
Total Purchase Price | 6,170 | |
AEC | ||
Business Acquisition [Line Items] | ||
Cash | 808 | |
Total Purchase Price | 808 | |
LEHDER | ||
Business Acquisition [Line Items] | ||
Cash | 3,878 | |
Common Stock | 684 | |
Contingent Consideration | 13 | |
Total Purchase Price | 4,575 | |
ECT2 | ||
Business Acquisition [Line Items] | ||
Cash | 54,037 | |
Other Purchase Price Components | (220) | |
Total Purchase Price | $ 53,817 |
Business Acquisitions - Summa_2
Business Acquisitions - Summary of Purchase Price Attributable to Acquisitions (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Sep. 30, 2019 |
Business Acquisition [Line Items] | ||
Cash | $ 1,527 | $ 5,286 |
Restricted cash | 629 | |
Accounts receivable | 17,059 | 5,458 |
Other current assets | 1,265 | 559 |
Current assets | 19,851 | 11,932 |
Property and equipment | 7,117 | 4,064 |
Goodwill | 147,251 | 36,622 |
Total assets | 253,228 | 106,355 |
Current liabilities | 9,721 | 6,001 |
Total liabilities | 9,721 | 8,172 |
Purchase price | 243,507 | 98,183 |
Non- current liabilities | 2,171 | |
Customer Relationships | ||
Business Acquisition [Line Items] | ||
Intangible assets | 56,000 | 26,588 |
Trade Names | ||
Business Acquisition [Line Items] | ||
Intangible assets | 4,200 | 1,667 |
Covenants Not to Compete | ||
Business Acquisition [Line Items] | ||
Intangible assets | 4,109 | 5,443 |
Proprietary Software | ||
Business Acquisition [Line Items] | ||
Intangible assets | 14,700 | 2,560 |
Patent | ||
Business Acquisition [Line Items] | ||
Intangible assets | 17,479 | |
CTEH | ||
Business Acquisition [Line Items] | ||
Cash | 1,527 | |
Accounts receivable | 17,059 | |
Other current assets | 1,265 | |
Current assets | 19,851 | |
Property and equipment | 7,042 | |
Goodwill | 146,625 | |
Total assets | 252,418 | |
Current liabilities | 9,721 | |
Total liabilities | 9,721 | |
Purchase price | 242,697 | |
CTEH | Customer Relationships | ||
Business Acquisition [Line Items] | ||
Intangible assets | 56,000 | |
CTEH | Trade Names | ||
Business Acquisition [Line Items] | ||
Intangible assets | 4,200 | |
CTEH | Covenants Not to Compete | ||
Business Acquisition [Line Items] | ||
Intangible assets | 4,000 | |
CTEH | Proprietary Software | ||
Business Acquisition [Line Items] | ||
Intangible assets | 14,700 | |
All Other Acquisitions | ||
Business Acquisition [Line Items] | ||
Property and equipment | 75 | |
Goodwill | 626 | |
Total assets | 810 | |
Purchase price | 810 | |
All Other Acquisitions | Covenants Not to Compete | ||
Business Acquisition [Line Items] | ||
Intangible assets | $ 109 | |
ECT2 | ||
Business Acquisition [Line Items] | ||
Cash | 3,149 | |
Restricted cash | 629 | |
Accounts receivable | 1,707 | |
Other current assets | 498 | |
Current assets | 5,983 | |
Property and equipment | 776 | |
Goodwill | 16,395 | |
Total assets | 58,841 | |
Current liabilities | 5,024 | |
Total liabilities | 5,024 | |
Purchase price | 53,817 | |
ECT2 | Customer Relationships | ||
Business Acquisition [Line Items] | ||
Intangible assets | 13,840 | |
ECT2 | Trade Names | ||
Business Acquisition [Line Items] | ||
Intangible assets | 1,008 | |
ECT2 | Covenants Not to Compete | ||
Business Acquisition [Line Items] | ||
Intangible assets | 3,360 | |
ECT2 | Patent | ||
Business Acquisition [Line Items] | ||
Intangible assets | 17,479 | |
All Other Acquisitions | ||
Business Acquisition [Line Items] | ||
Cash | 2,137 | |
Accounts receivable | 3,751 | |
Other current assets | 61 | |
Current assets | 5,949 | |
Property and equipment | 3,288 | |
Goodwill | 20,227 | |
Total assets | 47,514 | |
Current liabilities | 977 | |
Total liabilities | 3,148 | |
Purchase price | 44,366 | |
Non- current liabilities | 2,171 | |
All Other Acquisitions | Customer Relationships | ||
Business Acquisition [Line Items] | ||
Intangible assets | 12,748 | |
All Other Acquisitions | Trade Names | ||
Business Acquisition [Line Items] | ||
Intangible assets | 659 | |
All Other Acquisitions | Covenants Not to Compete | ||
Business Acquisition [Line Items] | ||
Intangible assets | 2,083 | |
All Other Acquisitions | Proprietary Software | ||
Business Acquisition [Line Items] | ||
Intangible assets | $ 2,560 |
Business Acquisitions - Summa_3
Business Acquisitions - Summary of Supplemental Unaudited Pro-Forma Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Business Acquisition [Line Items] | ||||
Revenues | $ 84,705 | $ 57,623 | $ 219,502 | $ 165,978 |
Net (loss) income | (30,737) | (6,683) | (58,761) | (12,247) |
Acquisition Proforma | ||||
Business Acquisition [Line Items] | ||||
Revenues | 18,551 | 31,253 | 107,459 | |
Net (loss) income | 4,042 | 10,288 | 30,002 | |
Consolidated Proforma | ||||
Business Acquisition [Line Items] | ||||
Revenues | 84,705 | 76,174 | 250,755 | 273,437 |
Net (loss) income | $ (30,737) | $ (2,641) | $ (48,473) | $ 17,755 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Schedule of Amounts Related to Goodwill (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2020USD ($) | |
Goodwill [Line Items] | |
Balance | $ 127,058 |
Goodwill acquired during the period | 147,251 |
Balance | 274,309 |
Assessment, Permitting and Response | |
Goodwill [Line Items] | |
Balance | 15,173 |
Goodwill acquired during the period | 146,625 |
Balance | 161,798 |
Measurement and Analysis | |
Goodwill [Line Items] | |
Balance | 68,628 |
Goodwill acquired during the period | 426 |
Balance | 69,054 |
Remediation and Reuse Segment | |
Goodwill [Line Items] | |
Balance | 43,257 |
Goodwill acquired during the period | 200 |
Balance | $ 43,457 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Schedule of Amounts Related to Finite-Lived Intangible Assets (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Dec. 31, 2019 | |
Finite Lived Intangible Assets [Line Items] | ||
Gross Balance | $ 249,949 | $ 168,716 |
Accumulated Amortization | 87,748 | 66,167 |
Total Intangible Assets—Net | 162,201 | 102,549 |
Customer Relationships | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Balance | 164,782 | 108,782 |
Accumulated Amortization | 49,068 | 36,700 |
Total Intangible Assets—Net | $ 115,714 | $ 72,082 |
Customer Relationships | Minimum | ||
Finite Lived Intangible Assets [Line Items] | ||
Estimated Useful Life | 7 years | 7 years |
Customer Relationships | Maximum [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Estimated Useful Life | 15 years | 10 years |
Covenants Not to Compete | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Balance | $ 29,942 | $ 25,832 |
Accumulated Amortization | 20,444 | 17,572 |
Total Intangible Assets—Net | $ 9,498 | $ 8,260 |
Covenants Not to Compete | Minimum | ||
Finite Lived Intangible Assets [Line Items] | ||
Estimated Useful Life | 4 years | 4 years |
Covenants Not to Compete | Maximum [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Estimated Useful Life | 5 years | 5 years |
Trade Names | ||
Finite Lived Intangible Assets [Line Items] | ||
Gross Balance | $ 16,938 | $ 12,738 |
Accumulated Amortization | 12,196 | 10,230 |
Total Intangible Assets—Net | $ 4,742 | $ 2,508 |
Trade Names | Minimum | ||
Finite Lived Intangible Assets [Line Items] | ||
Estimated Useful Life | 1 year | 1 year |
Trade Names | Maximum [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Estimated Useful Life | 5 years | 5 years |
Proprietary Software | ||
Finite Lived Intangible Assets [Line Items] | ||
Estimated Useful Life | 3 years | |
Gross Balance | $ 20,808 | $ 3,885 |
Accumulated Amortization | 4,915 | 1,359 |
Total Intangible Assets—Net | $ 15,893 | $ 2,526 |
Proprietary Software | Minimum | ||
Finite Lived Intangible Assets [Line Items] | ||
Estimated Useful Life | 3 years | |
Proprietary Software | Maximum [Member] | ||
Finite Lived Intangible Assets [Line Items] | ||
Estimated Useful Life | 5 years | |
Patent | ||
Finite Lived Intangible Assets [Line Items] | ||
Estimated Useful Life | 16 years | 16 years |
Gross Balance | $ 17,479 | $ 17,479 |
Accumulated Amortization | 1,125 | 306 |
Total Intangible Assets—Net | $ 16,354 | $ 17,173 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Goodwill And Intangible Assets Disclosure [Abstract] | ||||
Amortization expense | $ 7.6 | $ 5.3 | $ 21 | $ 14.4 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Schedule of Future Amortization Expense (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Goodwill And Intangible Assets Disclosure [Abstract] | ||
2020 (remaining) | $ 7,543 | |
2021 | 28,140 | |
2022 | 24,053 | |
2023 | 20,073 | |
2024 | 16,951 | |
Thereafter | 65,441 | |
Total Intangible Assets—Net | $ 162,201 | $ 102,549 |
Accounts Payable and Other Ac_3
Accounts Payable and Other Accrued Liabilities - Summary of Accounts Payable and Other Accrued Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Payables And Accruals [Abstract] | ||
Accounts payable | $ 13,360 | $ 15,034 |
Accrued expenses | 10,395 | 10,733 |
Other purchase obligations | 572 | |
Contract liabilities | 9,335 | 3,314 |
Other current liabilities | 235 | 504 |
Total accounts payable and other accrued liabilities | $ 33,897 | $ 29,585 |
Accrued Payroll and Benefits -
Accrued Payroll and Benefits - Schedule of Accrued Payroll and Benefits (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Statement Of Financial Position [Abstract] | ||
Accrued bonuses | $ 7,854 | $ 3,449 |
Accrued paid time off | 2,157 | 2,154 |
Accrued payroll | 5,536 | 4,470 |
Accrued other | 2,410 | 959 |
Total accrued payroll and benefits | $ 17,957 | $ 11,032 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Income Tax Disclosure [Abstract] | ||||
Annual effective tax rate ("ETR") from continuing operations | (12.20%) | 5.80% | 2.60% | 9.60% |
Federal statutory rate | 21.00% | |||
Income tax expense/(benefits) | $ 3,348,000 | $ (412,000) | $ (1,563,000) | $ (1,308,000) |
Net deferred tax assets valuation allowance | 7,400,000 | 7,400,000 | ||
Uncertain tax positions | $ 0 | $ 0 |
Warrant Options - Additional In
Warrant Options - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | Jul. 30, 2020 | Jul. 27, 2020 | Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Jul. 29, 2020 | Apr. 30, 2020 | Apr. 13, 2020 | Dec. 31, 2019 | Oct. 31, 2018 | Oct. 19, 2018 |
Class Of Warrant Or Right [Line Items] | ||||||||||||
Period between issuance and expiration of outstanding warrant | 10 years | |||||||||||
Share price | $ 16.36 | $ 27.30 | $ 16.36 | $ 27.30 | ||||||||
Exercise of the series A-2 preferred stock warrant | $ 44,441 | |||||||||||
Common Stock | ||||||||||||
Class Of Warrant Or Right [Line Items] | ||||||||||||
Warrant exercise price per share | $ 0.01 | |||||||||||
Exercise of the series A-1 preferred stock warrant, shares | 534,240 | |||||||||||
Exercise of the series A-2 preferred stock warrant,shares | 1,999,999 | 1,999,999 | ||||||||||
Exercise of the series A-2 preferred stock warrant | $ 44,400 | |||||||||||
Redeemable Series A-1 Preferred Stock | ||||||||||||
Class Of Warrant Or Right [Line Items] | ||||||||||||
Warrants to purchase common stock | 534,240 | 534,240 | ||||||||||
Warrant exercise price per share | $ 0.01 | |||||||||||
Period between issuance and expiration of outstanding warrant | 10 years | |||||||||||
Fair value of warrants | $ 11,900 | $ 16,900 | ||||||||||
Warrants exercised in full for cash, date | Jul. 30, 2020 | |||||||||||
Redeemable Series A-1 Preferred Stock | Other Expense | ||||||||||||
Class Of Warrant Or Right [Line Items] | ||||||||||||
Fair value gains/(losses) of warrants | $ 5,000 | $ (2,500) | $ 5,000 | $ (4,100) | ||||||||
Redeemable Series A-1 Preferred Stock | Common Stock | ||||||||||||
Class Of Warrant Or Right [Line Items] | ||||||||||||
Warrant exercise price per share | $ 0.01 | |||||||||||
Exercise of the series A-1 preferred stock warrant, shares | 534,240 | |||||||||||
Redeemable Series A-2 Preferred Stock | ||||||||||||
Class Of Warrant Or Right [Line Items] | ||||||||||||
Warrants to purchase common stock | 1,351,960 | |||||||||||
Warrant exercise price per share | $ 0.01 | |||||||||||
Period between issuance and expiration of outstanding warrant | 10 years | |||||||||||
Aggregate value to determine number of shares underlying the warrant and issuable upon exercise of warrants | $ 30,000 | |||||||||||
Convertible And Redeemable Series A-2 Preferred Stock | ||||||||||||
Class Of Warrant Or Right [Line Items] | ||||||||||||
Warrants to purchase common stock | 1,999,999 | |||||||||||
Share price | $ 15 | |||||||||||
Increase of shares | 648,039 | |||||||||||
Convertible And Redeemable Series A-2 Preferred Stock | Other Expense | ||||||||||||
Class Of Warrant Or Right [Line Items] | ||||||||||||
Fair value gains/(losses) of warrants | $ (14,300) | $ (14,300) |
Debt - Schedule of Debt (Detail
Debt - Schedule of Debt (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Apr. 13, 2020 | Dec. 31, 2019 |
Line Of Credit Facility [Line Items] | |||
Total debt | $ 225,000 | ||
Capital leases | $ 3,127 | $ 3,765 | |
Other leases | 2 | 12 | |
Less deferred debt issuance costs | (4,345) | (1,052) | |
Total debt | 176,451 | 152,189 | |
Less current portion of long term debt | (5,034) | (7,143) | |
Long-term debt, less current portion | 171,417 | 145,046 | |
Term Loan Facility | |||
Line Of Credit Facility [Line Items] | |||
Total debt | 174,453 | 175,000 | 48,750 |
Revolving Line of Credit | |||
Line Of Credit Facility [Line Items] | |||
Total debt | $ 50,000 | 97,590 | |
Equipment Line Of Credit | |||
Line Of Credit Facility [Line Items] | |||
Total debt | $ 3,214 | $ 3,124 |
Debt - Additional Information (
Debt - Additional Information (Details) - USD ($) | Sep. 30, 2022 | Sep. 30, 2021 | Sep. 30, 2020 | Apr. 13, 2020 | Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2022 | Dec. 31, 2021 | May 16, 2019 | Mar. 12, 2019 |
Line Of Credit Facility [Line Items] | |||||||||||||
Line of credit | $ 225,000,000 | ||||||||||||
New credit facility maturity date | Apr. 30, 2025 | ||||||||||||
Debt instrument, repayments term | quarterly | ||||||||||||
Debt instrument, repayments | $ 500,000 | ||||||||||||
Maximum consolidated leverage ratio | 425.00% | 425.00% | 425.00% | 400.00% | |||||||||
Minimum consolidated fixed charge coverage ratio | 125.00% | 125.00% | |||||||||||
Weighted average interest rate | 6.00% | 6.00% | 6.00% | ||||||||||
Capital Lease Obligations | |||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||
Capital leased assets, gross | $ 6,300,000 | $ 6,300,000 | $ 6,300,000 | $ 6,900,000 | |||||||||
Capital leases, income statement, amortization expense | 600,000 | $ 400,000 | $ 1,600,000 | $ 1,000,000 | |||||||||
Minimum | Capital Lease Obligations | |||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||
Capital lease asset estimated useful lives | 4 years | ||||||||||||
Maximum [Member] | Capital Lease Obligations | |||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||
Capital lease asset estimated useful lives | 6 years | ||||||||||||
Forecast | |||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||
Debt instrument, repayments | $ 1,600,000 | $ 1,100,000 | |||||||||||
Maximum consolidated leverage ratio | 375.00% | 400.00% | |||||||||||
Incremental Term Loans | |||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||
Line of credit facility, maximum borrowing capacity | $ 100,000,000 | ||||||||||||
Incremental Term Loans | Minimum | |||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||
Percentage of pari passu debt of all lenders to be held by unitranche lenders | 70.00% | ||||||||||||
Leverage Ratio Greater Than Equal to 3.25 | |||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||
Percentage of prepayment on excess cash flow less voluntary prepayments of term loan | 50.00% | ||||||||||||
Consolidated fixed leverage ratio | 3.25% | ||||||||||||
Leverage Ratio Less Than 3.00 | |||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||
Percentage of prepayment on excess cash flow less voluntary prepayments of term loan | 25.00% | ||||||||||||
Consolidated fixed leverage ratio | 3.00% | ||||||||||||
Prior Senior Secured Credit Facility | |||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||
Loss on extinguishment | $ 1,400,000 | ||||||||||||
Debt fee paid | 400,000 | ||||||||||||
Unamortized debt issuance costs | 1,000,000 | ||||||||||||
Equipment Line Of Credit | |||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||
Line of credit facility, maximum borrowing capacity | $ 2,000,000 | ||||||||||||
Canadian Equipment Line Of Credit | |||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||
Line of credit facility, maximum borrowing capacity | $ 1,000,000 | ||||||||||||
LIBOR Plus | Prior Senior Secured Credit Facility | |||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||
Interest rate | 1.00% | ||||||||||||
Federal Funds Rate Plus | Prior Senior Secured Credit Facility | |||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||
Interest rate | 0.50% | ||||||||||||
Term Loan Facility | |||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||
Line of credit | $ 174,453,000 | $ 175,000,000 | $ 174,453,000 | $ 174,453,000 | $ 48,750,000 | ||||||||
Term Loan Facility | Prior Senior Secured Credit Facility | |||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||
Line of credit | 50,000,000 | ||||||||||||
Term Loan Facility | LIBOR Plus | |||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||
Interest rate | 5.00% | ||||||||||||
Term Loan Facility | Base Rate Plus | |||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||
Interest rate | 4.00% | ||||||||||||
Term Loan Facility | LIBOR Floor | |||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||
Interest rate | 1.00% | ||||||||||||
Revolving Line of Credit | |||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||
Line of credit | $ 50,000,000 | 97,590,000 | |||||||||||
Line of credit facility unused commitment fee | 0.35% | ||||||||||||
Revolving Line of Credit | Prior Senior Secured Credit Facility | |||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||
Line of credit | $ 130,000,000 | ||||||||||||
Revolving Line of Credit | LIBOR Plus | |||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||
Interest rate | 3.50% | ||||||||||||
Revolving Line of Credit | Base Rate Plus | |||||||||||||
Line Of Credit Facility [Line Items] | |||||||||||||
Interest rate | 2.50% |
Debt - Schedule of Applicable P
Debt - Schedule of Applicable Percentages (Details) - Prior Senior Secured Credit Facility | 12 Months Ended |
Dec. 31, 2019 | |
Pricing Tier 1 | |
Line Of Credit Facility [Line Items] | |
Commitment Fee | 0.50% |
Pricing Tier 1 | Minimum | |
Line Of Credit Facility [Line Items] | |
Consolidated Leverage Ratio | 375.00% |
Pricing Tier 1 | Eurodollar Rate Loans and LIBOR Letter of Credit Fee | |
Line Of Credit Facility [Line Items] | |
Interest rate | 4.00% |
Pricing Tier 1 | Daily Floating Rate Loans | |
Line Of Credit Facility [Line Items] | |
Interest rate | 4.00% |
Pricing Tier 1 | Rate Loans | |
Line Of Credit Facility [Line Items] | |
Interest rate | 3.00% |
Pricing Tier 2 | |
Line Of Credit Facility [Line Items] | |
Commitment Fee | 0.50% |
Pricing Tier 2 | Maximum [Member] | |
Line Of Credit Facility [Line Items] | |
Consolidated Leverage Ratio | 375.00% |
Pricing Tier 2 | Minimum | |
Line Of Credit Facility [Line Items] | |
Consolidated Leverage Ratio | 300.00% |
Pricing Tier 2 | Eurodollar Rate Loans and LIBOR Letter of Credit Fee | |
Line Of Credit Facility [Line Items] | |
Interest rate | 3.50% |
Pricing Tier 2 | Daily Floating Rate Loans | |
Line Of Credit Facility [Line Items] | |
Interest rate | 3.50% |
Pricing Tier 2 | Rate Loans | |
Line Of Credit Facility [Line Items] | |
Interest rate | 2.50% |
Pricing Tier 3 | |
Line Of Credit Facility [Line Items] | |
Commitment Fee | 0.40% |
Pricing Tier 3 | Maximum [Member] | |
Line Of Credit Facility [Line Items] | |
Consolidated Leverage Ratio | 300.00% |
Pricing Tier 3 | Minimum | |
Line Of Credit Facility [Line Items] | |
Consolidated Leverage Ratio | 225.00% |
Pricing Tier 3 | Eurodollar Rate Loans and LIBOR Letter of Credit Fee | |
Line Of Credit Facility [Line Items] | |
Interest rate | 3.00% |
Pricing Tier 3 | Daily Floating Rate Loans | |
Line Of Credit Facility [Line Items] | |
Interest rate | 3.00% |
Pricing Tier 3 | Rate Loans | |
Line Of Credit Facility [Line Items] | |
Interest rate | 2.00% |
Pricing Tier 4 | |
Line Of Credit Facility [Line Items] | |
Commitment Fee | 0.30% |
Pricing Tier 4 | Maximum [Member] | |
Line Of Credit Facility [Line Items] | |
Consolidated Leverage Ratio | 225.00% |
Pricing Tier 4 | Eurodollar Rate Loans and LIBOR Letter of Credit Fee | |
Line Of Credit Facility [Line Items] | |
Interest rate | 2.50% |
Pricing Tier 4 | Daily Floating Rate Loans | |
Line Of Credit Facility [Line Items] | |
Interest rate | 2.50% |
Pricing Tier 4 | Rate Loans | |
Line Of Credit Facility [Line Items] | |
Interest rate | 1.50% |
Debt - Schedule of Capital Leas
Debt - Schedule of Capital Leases Mature by 2025 (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2020USD ($) | |
Line Of Credit Facility [Line Items] | |
Payments | $ 7,146 |
Interest | 805 |
Principal | 6,341 |
2021 | |
Line Of Credit Facility [Line Items] | |
Payments | 2,670 |
Interest | 368 |
Principal | 2,302 |
2022 | |
Line Of Credit Facility [Line Items] | |
Payments | 2,178 |
Interest | 265 |
Principal | 1,913 |
2023 | |
Line Of Credit Facility [Line Items] | |
Payments | 1,582 |
Interest | 139 |
Principal | 1,443 |
2024 | |
Line Of Credit Facility [Line Items] | |
Payments | 667 |
Interest | 32 |
Principal | 635 |
2025 | |
Line Of Credit Facility [Line Items] | |
Payments | 49 |
Interest | 1 |
Principal | $ 48 |
Debt - Schedule of Aggregate An
Debt - Schedule of Aggregate Annual Maturities of Long-Term Debt (Details) $ in Thousands | Sep. 30, 2020USD ($) |
Debt Disclosure [Abstract] | |
2021 | $ 5,034 |
2022 | 6,839 |
2023 | 8,006 |
2024 | 7,198 |
2025 | 153,719 |
Total | $ 180,796 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments - Summary of Financial Liabilities Measured at Fair Value on Recurring Basis (Details) - Fair Value, Recurring - Level 3 - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Dec. 31, 2018 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||
Level 3 Liabilities | $ 76,971 | $ 32,971 | $ 18,438 | $ 15,572 |
Business Acquisitions Contingent Consideration, Current | ||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||
Level 3 Liabilities | 49,170 | 8,614 | 1,561 | 2,754 |
Business Acquisitions Contingent Consideration, Long-Term | ||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||
Level 3 Liabilities | 9,742 | 379 | ||
Warrant Options | ||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||
Level 3 Liabilities | 16,878 | $ 16,877 | $ 12,818 | |
Conversion Option | ||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||
Level 3 Liabilities | $ 18,059 | |||
Contingent Put Option | ||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||||
Level 3 Liabilities | $ 7,100 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments - Summary of Financial Instruments Measured at Fair Value on Recurring Basis (Details) - Fair Value, Recurring - Level 3 - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Beginning balance | $ 32,971 | $ 15,572 |
Foreign currency translation of contingent consideration payment | (208) | |
Payment of contingent consideration payable | (12,464) | (554) |
Acquisitions | 45,204 | 31 |
Series A-2 compound embedded option | (9,361) | |
Issuance of warrant option | 30,097 | |
Changes in fair value included in earnings | 34,879 | 3,389 |
Write off of the contingent put option | 12,140 | |
Exercise of the warrant options | (56,287) | |
Ending balance | 76,971 | 18,438 |
Contingent Put Option | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Beginning balance | 7,100 | |
Changes in fair value included in earnings | (19,240) | |
Write off of the contingent put option | 12,140 | |
Embedded Option | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Series A-2 compound embedded option | (9,361) | |
Changes in fair value included in earnings | 27,420 | |
Ending balance | 18,059 | |
Business Acquisitions Contingent Consideration, Current | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Beginning balance | 8,614 | 2,754 |
Foreign currency translation of contingent consideration payment | (208) | |
Payment of contingent consideration payable | (12,464) | (554) |
Acquisitions | 34,661 | 31 |
Reclass of long term to short term contingent liabilities | 180 | |
Changes in fair value included in earnings | 18,387 | (670) |
Ending balance | 49,170 | 1,561 |
Business Acquisitions Contingent Consideration, Long-Term | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Beginning balance | 379 | |
Acquisitions | 10,543 | |
Reclass of long term to short term contingent liabilities | (180) | |
Changes in fair value included in earnings | (1,000) | |
Ending balance | 9,742 | |
Warrant Options | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Beginning balance | 16,878 | 12,818 |
Issuance of warrant option | 30,097 | |
Changes in fair value included in earnings | 9,312 | 4,059 |
Exercise of the warrant options | $ (56,287) | |
Ending balance | $ 16,877 |
Fair Value of Financial Instr_5
Fair Value of Financial Instruments - Summary of Fair Value of Warrant Options Associated with Issuance of Redeemable Preferred Stock (Details) | Jul. 30, 2020 | Apr. 30, 2020 | Apr. 13, 2020 | Sep. 30, 2019 | Oct. 31, 2018 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | |||||
Assumptions used in calculating fair value of the warrant option | 10 years | ||||
Series A-1 Preferred Stock Warrant Option | |||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | |||||
Assumptions used in calculating fair value of the warrant option | 10 years | ||||
Series A-2 Preferred Stock Warrant Option | |||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | |||||
Assumptions used in calculating fair value of the warrant option | 10 years | ||||
Common Stock Value (per Share) | Series A-1 Preferred Stock Warrant Option | |||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | |||||
Assumptions used in calculating fair value of the warrant option | 22.22 | 31.60 | |||
Common Stock Value (per Share) | Series A-2 Preferred Stock Warrant Option | |||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | |||||
Assumptions used in calculating fair value of the warrant option | 22.22 | ||||
Expected Volatility | Series A-1 Preferred Stock Warrant Option | |||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | |||||
Assumptions used in calculating fair value of the warrant option | 0.4435 | 0.4763 | |||
Expected Volatility | Series A-2 Preferred Stock Warrant Option | |||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | |||||
Assumptions used in calculating fair value of the warrant option | 0.4435 | ||||
Risk-free Interest Rate | Series A-1 Preferred Stock Warrant Option | |||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | |||||
Assumptions used in calculating fair value of the warrant option | 0.0055 | 0.0168 | |||
Risk-free Interest Rate | Series A-2 Preferred Stock Warrant Option | |||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | |||||
Assumptions used in calculating fair value of the warrant option | 0.0055 | ||||
Expected Life (Years) | Series A-1 Preferred Stock Warrant Option | |||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | |||||
Assumptions used in calculating fair value of the warrant option | 10 years | 10 years | |||
Expected Life (Years) | Series A-2 Preferred Stock Warrant Option | |||||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis Valuation Techniques [Line Items] | |||||
Assumptions used in calculating fair value of the warrant option | 10 years |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Commitments And Contingencies [Line Items] | ||||
Lessee operating lease, expiration year | 2028 | |||
Rent expense | $ 2.2 | $ 2 | $ 6.4 | $ 5.6 |
Office Equipment | ||||
Commitments And Contingencies [Line Items] | ||||
Lessee operating lease, expiration year | 2025 |
Commitments and Contingencies_2
Commitments and Contingencies - Schedule of Future Minimum Lease Payments under Leases (Details) $ in Thousands | Sep. 30, 2020USD ($) |
Commitments And Contingencies [Line Items] | |
2021 | $ 6,195 |
2022 | 5,192 |
2023 | 3,090 |
2024 | 1,449 |
2025 and thereafter | 1,386 |
Total | 17,312 |
Rent | |
Commitments And Contingencies [Line Items] | |
2021 | 5,863 |
2022 | 4,865 |
2023 | 2,961 |
2024 | 1,410 |
2025 and thereafter | 1,385 |
Total | 16,484 |
Office Equipment | |
Commitments And Contingencies [Line Items] | |
2021 | 332 |
2022 | 327 |
2023 | 129 |
2024 | 39 |
2025 and thereafter | 1 |
Total | $ 828 |
Redeemable Series A-1 Preferr_2
Redeemable Series A-1 Preferred Stock - Additional Information (Details) - USD ($) | Jul. 27, 2020 | Jul. 26, 2020 | Apr. 13, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2020 | Dec. 31, 2019 | Oct. 31, 2018 | Oct. 19, 2018 |
Temporary Equity [Line Items] | |||||||||||||
Share price | $ 16.36 | $ 27.30 | $ 16.36 | ||||||||||
Payments for repurchase of redeemable preferred stock in cash | $ 131,800,000 | $ 131,821,000 | |||||||||||
Common stock shares sold under IPO | 1,786,739 | ||||||||||||
Percentage of dividends paid in cash | 14.20% | ||||||||||||
Fair value changes in the contingent put option | $ (26,265,000) | $ (19,240,000) | |||||||||||
Redeemable Series A-1 Preferred Stock | |||||||||||||
Temporary Equity [Line Items] | |||||||||||||
Temporary equity, shares issued | 0 | 0 | 12,000 | 12,000 | |||||||||
Temporary equity, par value per share | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | |||||||||
Warrants to purchase common stock | 534,240 | 534,240 | |||||||||||
Temporary equity, liquidation preference per share | $ 10,000 | ||||||||||||
Temporary equity, maturity month and year | 2024-10 | ||||||||||||
Temporary equity, penalty term | 3 years | ||||||||||||
Temporary equity, penalty term upon full exercise of warrant | 2 years | ||||||||||||
Percentage of increase in accrued dividend | 1.00% | ||||||||||||
Total accreted value | $ 40,800,000 | $ 6,542,000 | $ 5,644,000 | $ 5,415,000 | $ 5,030,000 | $ 4,777,000 | $ 4,534,000 | ||||||
Accretion of dividends | $ 24,300,000 | ||||||||||||
Temporary equity, covenant description | The Redeemable Series A-1 Preferred Stock contained restrictive covenants. As of December 31, 2019, the Company was subject to a consolidated total leverage ratio (including the outstanding principal and accrued dividend on the Redeemable Series A-1 Preferred Stock) limit of less than 10.0 times as of the end of any fiscal quarter ending until maturity. The Company was in compliance with the covenants as of December 31, 2019. | ||||||||||||
Percentage of dividends paid in cash | 15.00% | ||||||||||||
Percentage of dividends accrued | 14.20% | ||||||||||||
Accrued and unpaid dividends | $ 21,900,000 | ||||||||||||
Fair value changes in the contingent put option | $ 12,100,000 | $ 7,100,000 | |||||||||||
Changes in fair value | $ 26,300,000 | $ 19,200,000 | |||||||||||
Redeemable Series A-1 Preferred Stock | Maximum [Member] | |||||||||||||
Temporary Equity [Line Items] | |||||||||||||
Temporary equity, aggregate amount of redemption requirement | $ 50,000,000 | ||||||||||||
Percentage of accumulated dividends payable in common stock upon IPO | 50.00% | ||||||||||||
Share price | $ 31.60 | ||||||||||||
Percentage of dividend payable in cash | 15.00% | ||||||||||||
Redeemable Series A-1 Preferred Stock | Minimum | |||||||||||||
Temporary Equity [Line Items] | |||||||||||||
Percentage of dividend payable in cash | 9.00% |
Convertible and Redeemable Se_2
Convertible and Redeemable Series A-2 Preferred Stock - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | Apr. 13, 2020 | Sep. 30, 2020 | Sep. 30, 2020 | Dec. 31, 2019 |
Temporary Equity [Line Items] | ||||
Period between issuance and expiration of outstanding warrant | 10 years | |||
Proceeds from the Series A-2 and Warrant | $ 175,000 | |||
Percentage of dividends accrued | 14.20% | |||
Preferred stock, dividends paid | $ 2,870 | |||
Convertible And Redeemable Series A-2 Preferred Stock | ||||
Temporary Equity [Line Items] | ||||
Temporary equity, shares issued | 17,500 | 17,500 | 17,500 | 0 |
Temporary equity, par value per share | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 |
Debt fee paid | $ 1,300 | |||
Percentage of dividends accrued | 15.00% | |||
Preferred stock, dividends paid | $ 2,900 | $ 2,900 | ||
Percentage of discount on common stock market price | 15.00% | |||
Percentage of dividend rate stepped downs per year | 9.00% | |||
Percentage of dividend rate increase per annum in the event of noncompliance | 12.00% | |||
Number of days dividend increase rate applicable noncompliance event occurred | 90 days | |||
Percentage of dividend rate increase per annum upon noncompliance occurred and thereafter | 14.00% | |||
Number of times increased in debt incurrence test ratio | 4.5 | |||
Minimum repayment amount | $ 50,000 | |||
Minimum repayment amount droppped down | $ 25,000 | |||
Temporary equity description | The Company may, at its option on any one or more dates, redeem all or a minimum portion (the lesser of (i) $25.0 million in aggregate stated value of the Convertible and Redeemable Series A-2 Preferred Stock and (ii) all of the Convertible and Redeemable Series A-2 Preferred Stock then outstanding) of the outstanding Convertible and Redeemable Series A-2 Preferred Stock in cash. In the event the Company redeems all or a portion of the Convertible and Redeemable Series A-2 Preferred Stock prior to the three year anniversary of the issuance date, such redemption amount shall include stated value, accrued but unpaid dividends and a make whole payment such that the aggregate redemption amount reflects three years of dividends. | |||
Aggregate stated value of stock redeemed | 25,000 | $ 25,000 | ||
Aggregate liquidation preference | 182,200 | 182,200 | $ 0 | |
Compound embedded derivative, fair value net | 18,100 | 18,100 | ||
Convertible And Redeemable Series A-2 Preferred Stock | Other Expense | ||||
Temporary Equity [Line Items] | ||||
Compound embedded derivative, change in value | 26,700 | 27,400 | ||
Convertible And Redeemable Series A-2 Preferred Stock | 60-Day Period Prior to Seventh Anniversary | ||||
Temporary Equity [Line Items] | ||||
Temporary equity convertible into common stock | 60,000 | 60,000 | ||
Convertible And Redeemable Series A-2 Preferred Stock | Year 5 | ||||
Temporary Equity [Line Items] | ||||
Temporary equity convertible into common stock | 60,000 | 60,000 | ||
Convertible And Redeemable Series A-2 Preferred Stock | Year 6 | ||||
Temporary Equity [Line Items] | ||||
Temporary equity convertible into common stock | $ 120,000 | $ 120,000 |
Stockholder's Equity (Deficit_2
Stockholder's Equity (Deficit) - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | May 31, 2015 | |
Class Of Stock [Line Items] | ||||
Common stock, shares authorized | 190,000,000 | 25,000,000 | ||
Common stock, par value | $ 0.000004 | $ 0.000004 | ||
Total unrecognized stock compensation expense related to unvested options and restricted stock granted under the Plans | $ 10.4 | $ 6.7 | ||
Unrecognized expense expected to be recognized period | 2 years | |||
Montrose Amended & Restated 2017 Stock Incentive Plan | ||||
Class Of Stock [Line Items] | ||||
Number of restricted stock shares issued | 33,229 | 30,000 | ||
Montrose Amended & Restated 2017 Stock Incentive Plan | Restricted Stock | ||||
Class Of Stock [Line Items] | ||||
Restricted stock fair value market price per share | $ 31.60 | $ 24 | ||
Shares of vested over period | 1 year | 3 years | ||
Restricted shares became fully vested and released as common stock | 10,000 | 0 | ||
Restricted shares outstanding | 267,173 | 242,025 | ||
Restricted shares forfeited | 1,667 | 0 | ||
Montrose Amended & Restated 2017 Stock Incentive Plan | Stock Options | Board of Directors | ||||
Class Of Stock [Line Items] | ||||
Shares of vested over period | 4 years | |||
Montrose Amended & Restated 2017 Stock Incentive Plan | Stock Options | Executive Officers | ||||
Class Of Stock [Line Items] | ||||
Shares of vested over period | 3 years | |||
Montrose Amended and Restated 2013 Stock Option Plan | ||||
Class Of Stock [Line Items] | ||||
Shares outstanding from exercised options | 221,950 | 201,600 | ||
Private Offering | ||||
Class Of Stock [Line Items] | ||||
Warrants to purchase common stock | 116,350 | |||
Warrant exercise price per share | $ 17.19 |
Stockholder's Equity (Deficit_3
Stockholder's Equity (Deficit) - Summary of Issued and Cancelled Shares of Common Stock (Details) - $ / shares | Jul. 27, 2020 | Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Common stock issued, shares | 1,786,739 | ||||
Number of common stock shares issued in connection with business acquisition | 25,408 | 791,139 | 150,439 | ||
Acquisitions, Average Price per Share | $ 26.90 | $ 31.60 | $ 22.41 | ||
Redemption of Series A-1, Shares | 1,786,739 | 1,786,739 | |||
Redemption of Series A-1, Average Price per Share | $ 15 | $ 15 | |||
Exercise of warrant options, Shares | 2,534,239 | 2,534,239 | |||
Exercise of warrant options, Average Price per Share | $ 0.01 | $ 0.01 | |||
Exercise of options, Shares | 16,850 | 7,150 | 20,350 | 22,675 | |
Exercise of options, Average Price per Share | $ 8.92 | $ 6.03 | $ 9.27 | $ 18.01 | |
Restricted shares, net | 8,333 | 8,333 | |||
Restricted shares, net, Average Price per Share | $ 24 | $ 24 | |||
Cancellation of shares | (117,785) | (117,785) | |||
Cancellation of shares, Average Price per Share | $ 17.15 | $ 17.15 | |||
Common Stock Issued and Cancelled, Shares | 15,728,376 | 32,558 | 16,523,015 | 173,114 | |
Common Stock Issued and Cancelled, Average Price per share | $ 12.82 | $ 22.32 | $ 13.72 | $ 21.83 | |
Redemption of the series A-1, shares | 1,786,739 | 1,786,739 | |||
Exercise of warrant options | 2,534,239 | 2,534,239 | |||
IPO | |||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||
Common stock issued, shares | 11,500,000 | 11,500,000 | 11,500,000 | ||
Common stock issued in connection with initial public offering, Average Price per Share | $ 15 | $ 15 |
Stockholder's Equity (Deficit_4
Stockholder's Equity (Deficit) - Summary of Number of Shares Authorized to be Issued and Available for Grant (Details) - shares | Sep. 30, 2020 | Sep. 30, 2019 |
2017 Plan | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Shares authorized to be issued | 2,945,443 | 981,800 |
Shares available for grant | 1,233,266 | 159,428 |
2013 Plan | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Shares authorized to be issued | 2,047,269 | 2,074,604 |
Stockholder's Equity (Deficit_5
Stockholder's Equity (Deficit) - Schedule of Stock Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock compensation expense | $ 1,149 | $ 1,055 | $ 3,439 | $ 3,577 |
2017 Plan | Stock Options | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock compensation expense | 868 | 463 | 2,151 | 1,080 |
2017 Plan | Restricted Stock | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock compensation expense | 233 | 111 | 973 | 323 |
2013 Plan | Stock Options | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock compensation expense | 48 | 481 | 315 | 2,174 |
Cost of Revenue | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock compensation expense | 271 | 375 | 1,099 | 1,013 |
Cost of Revenue | 2017 Plan | Stock Options | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock compensation expense | 276 | 278 | 973 | 623 |
Cost of Revenue | 2013 Plan | Stock Options | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock compensation expense | (5) | 97 | 126 | 390 |
Selling, General and Administrative Expense | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock compensation expense | 878 | 680 | 2,340 | 2,564 |
Selling, General and Administrative Expense | 2017 Plan | Stock Options | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock compensation expense | 592 | 185 | 1,178 | 457 |
Selling, General and Administrative Expense | 2017 Plan | Restricted Stock | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock compensation expense | 233 | 111 | 973 | 323 |
Selling, General and Administrative Expense | 2013 Plan | Stock Options | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Stock compensation expense | $ 53 | $ 384 | $ 189 | $ 1,784 |
Stockholder's Equity (Deficit_6
Stockholder's Equity (Deficit) - Summary of Stock Option Activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||||||
Options to Purchase Common Stock Exercised | (16,850) | (7,150) | (20,350) | (22,675) | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | ||||||
Weighted Average Remaining Contract Life, Exercised at September 30, 2020 | 7 years | 7 years | ||||
Montrose Amended & Restated 2017 Stock Incentive Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | ||||||
Weighted-Average Exercise Price per Share Beginning Balance | $ 24 | $ 20 | $ 20 | |||
Weighted-Average Exercise Price per Share Granted | 32 | 27 | ||||
Weighted-Average Exercise Price per Share Forfeited/cancelled | 22 | 19 | ||||
Weighted-Average Exercise Price per Share Exercised | 14 | |||||
Weighted-Average Exercise Price per Share Ending Balance | $ 21 | $ 24 | 21 | 24 | 24 | $ 20 |
Weighted-Average Exercise Price per Share, Exercised at September 30, 2020 | 14 | 14 | ||||
Weighted-Average Exercise Price per Share Options vested and expected to vest | 21 | 21 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | ||||||
Weighted Average Grant Date Fair Value per Share Beginning Balance | 12 | 10 | 10 | |||
Weighted Average Grant Date Fair Value per Share Granted | 12 | 14 | ||||
Weighted Average Grant Date Fair Value per Share Ending Balance | $ 12 | $ 12 | $ 12 | $ 12 | $ 12 | $ 10 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | ||||||
Weighted Average Remaining Contract Life (in Years) Outstanding | 7 years 7 months 2 days | 8 years 25 days | 7 years 9 months 25 days | |||
Weighted Average Remaining Contract Life, Exercised at September 30, 2020 | 7 years 3 months 29 days | |||||
Weighted Average Remaining Contract Life (in Years) Options vested and expected to vest | 9 years 14 days | |||||
Aggregate Intrinsic Value of In-The-Money Options Outstanding | $ 4,693 | $ 1,151 | $ 1,151 | |||
Aggregate Intrinsic Value of In-The-Money Options Exercised | 7,918 | |||||
Aggregate Intrinsic Value of In-The-Money Options Outstanding | $ 7,649 | $ 4,693 | 7,649 | $ 4,693 | $ 4,693 | $ 1,151 |
Aggregate Intrinsic Value of In-The-Money Options Exercised at September 30, 2020 | 7,649 | 7,649 | ||||
Aggregate Intrinsic Value of In-The-Money Options vested and expected to vest | $ 7,649 | $ 7,649 | ||||
Montrose Amended & Restated 2017 Stock Incentive Plan | Common Stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||||||
Options to Purchase Common Stock Outstanding Beginning Balance | 617,852 | 257,762 | 257,762 | |||
Options to Purchase Common Stock Granted | 851,877 | 356,470 | ||||
Options to Purchase Common Stock Forfeited/cancelled | (14,375) | (17,700) | ||||
Options to Purchase Common Stock Exercised | (925) | |||||
Options to Purchase Common Stock Outstanding Ending Balance | 1,454,429 | 596,532 | 1,454,429 | 596,532 | 617,852 | 257,762 |
Options to Purchase Common Stock, Exercised at September 30, 2020 | 925 | 925 | ||||
Options to Purchase Common Stock Options vested and expected to vest | 1,454,429 | 1,454,429 | ||||
Montrose Amended and Restated 2013 Stock Option Plan | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||||||
Options to Purchase Common Stock, Exercised at September 30, 2020 | 221,950 | 221,950 | 201,600 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | ||||||
Weighted-Average Exercise Price per Share Beginning Balance | $ 6 | $ 6 | $ 6 | |||
Weighted-Average Exercise Price per Share Forfeited/cancelled | 10 | 8 | ||||
Weighted-Average Exercise Price per Share Expired | 6 | 8 | ||||
Weighted-Average Exercise Price per Share Exercised | 8 | 6 | ||||
Weighted-Average Exercise Price per Share Ending Balance | $ 6 | $ 6 | 6 | 6 | 6 | $ 6 |
Weighted-Average Exercise Price per Share, Exercised at September 30, 2020 | 6 | 6 | ||||
Weighted-Average Exercise Price per Share Options vested and expected to vest | 6 | 6 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | ||||||
Weighted Average Grant Date Fair Value per Share Beginning Balance | 1 | 1 | 1 | |||
Weighted Average Grant Date Fair Value per Share Ending Balance | $ 1 | $ 1 | $ 1 | $ 1 | $ 1 | $ 1 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | ||||||
Weighted Average Remaining Contract Life (in Years) Outstanding | 5 years 7 months 17 days | 6 years 7 months 24 days | 6 years 4 months 24 days | 7 years 3 months 18 days | ||
Weighted Average Remaining Contract Life, Exercised at September 30, 2020 | 5 years 1 month 20 days | |||||
Weighted Average Remaining Contract Life (in Years) Options vested and expected to vest | 5 years 2 months 1 day | |||||
Aggregate Intrinsic Value of In-The-Money Options Outstanding | $ 46,617 | $ 33,290 | $ 33,290 | |||
Aggregate Intrinsic Value of In-The-Money Options Exercised | 354 | 466 | ||||
Aggregate Intrinsic Value of In-The-Money Options Outstanding | $ 33,772 | $ 47,381 | 33,772 | $ 47,381 | $ 46,617 | $ 33,290 |
Aggregate Intrinsic Value of In-The-Money Options Exercised at September 30, 2020 | 33,772 | 33,772 | ||||
Aggregate Intrinsic Value of In-The-Money Options vested and expected to vest | $ 33,772 | $ 33,772 | ||||
Montrose Amended and Restated 2013 Stock Option Plan | Common Stock | ||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | ||||||
Options to Purchase Common Stock Outstanding Beginning Balance | 1,855,469 | 1,900,404 | 1,900,404 | |||
Options to Purchase Common Stock Forfeited/cancelled | (7,500) | (14,500) | ||||
Options to Purchase Common Stock Expired | (11,300) | (5,400) | ||||
Options to Purchase Common Stock Exercised | (19,175) | (19,010) | ||||
Options to Purchase Common Stock Outstanding Ending Balance | 1,817,494 | 1,861,494 | 1,817,494 | 1,861,494 | 1,855,469 | 1,900,404 |
Options to Purchase Common Stock, Exercised at September 30, 2020 | 221,025 | 221,025 | ||||
Options to Purchase Common Stock Options vested and expected to vest | 1,817,494 | 1,817,494 |
Stockholder's Equity (Deficit_7
Stockholder's Equity (Deficit) - Summary of Weighted Average Assumptions Used in Black-Sholes Option-pricing Model (Details) - $ / shares | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ||
Common stock value (per share) | $ 16.36 | $ 27.30 |
Expected volatility | 46.14% | 47.94% |
Risk-free interest rate | 0.41% | 2.15% |
Expected life (years) | 7 years | 7 years |
Forfeiture rate | 0.00% | 0.00% |
Dividend rate | 0.00% | 0.00% |
Stockholder's Equity (Deficit_8
Stockholder's Equity (Deficit) - Schedule of Common Stock Reserved for Future Issuance (Details) - shares | Sep. 30, 2020 | Dec. 31, 2019 |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Common stock reserved for future issuance | 5,109,062 | 3,706,994 |
Warrants | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Common stock reserved for future issuance | 116,350 | 650,590 |
Montrose 2013 Stock Incentive Plan | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Common stock reserved for future issuance | 2,047,269 | 2,058,619 |
Montrose 2017 Stock Incentive Plan | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Common stock reserved for future issuance | 2,945,443 | 997,785 |
Net Loss Per Share - Computatio
Net Loss Per Share - Computation of Basic and Diluted Net Loss Per Share Attributable to Common Stockholders (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Earnings Per Share [Abstract] | ||||||||
Net loss | $ (30,737) | $ 13,224 | $ (41,248) | $ (6,683) | $ (322) | $ (5,242) | $ (58,761) | $ (12,247) |
Accretion of redeemable series A-1 preferred stock | (6,542) | (5,030) | (17,601) | (14,341) | ||||
Redeemable series A-1 preferred stock deemed dividend | (24,341) | (24,341) | ||||||
Convertible and redeemable series A-2 preferred stock dividend | (2,870) | (2,870) | ||||||
Net loss attributable to common stockholders – basic and diluted | $ (64,490) | $ (11,713) | $ (103,573) | $ (26,588) | ||||
Weighted-average common shares outstanding – basic and diluted | 21,554 | 8,718 | 13,669 | 8,640 | ||||
Net loss per share attributable to common stockholders – basic and diluted | $ (2.99) | $ (1.34) | $ (7.58) | $ (3.08) |
Net Loss Per Share - Equity Sha
Net Loss Per Share - Equity Shares Excluded from Calculation of Diluted Net Loss per Share Attributable to Common Stockholders (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Stock Options | ||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of loss per share amount | 2,423,900 | 2,062,825 | 2,423,900 | 2,062,825 |
Restricted Stock | ||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of loss per share amount | 176,384 | 158,426 | 176,384 | 158,426 |
Warrants | ||||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||||
Antidilutive securities excluded from computation of loss per share amount | 116,350 | 116,350 | 116,350 | 116,350 |
Segment Information - Additiona
Segment Information - Additional Information (Details) | 9 Months Ended |
Sep. 30, 2020Segment | |
Segment Reporting [Abstract] | |
Number of operating segments | 3 |
Number of reportable segments | 3 |
Segment Information - Component
Segment Information - Components of Segment Revenues and Adjusted EBITDA (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Segment Reporting Information [Line Items] | ||||
Segment Revenues | $ 84,705 | $ 57,623 | $ 219,502 | $ 165,978 |
Segment Adjusted EBITDA | 16,706 | 8,219 | 36,157 | 21,836 |
Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Segment Revenues | 84,705 | 57,623 | 219,502 | 165,978 |
Segment Adjusted EBITDA | 21,468 | 11,786 | 51,582 | 32,771 |
Assessment, Permitting and Response | Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Segment Revenues | 26,593 | 5,413 | 49,768 | 15,017 |
Segment Adjusted EBITDA | 8,230 | 1,695 | 14,665 | 5,693 |
Measurement and Analysis | Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Segment Revenues | 39,770 | 35,672 | 113,130 | 98,521 |
Segment Adjusted EBITDA | 11,226 | 7,691 | 30,422 | 19,761 |
Remediation and Reuse | Operating Segments | ||||
Segment Reporting Information [Line Items] | ||||
Segment Revenues | 18,342 | 16,538 | 56,604 | 52,440 |
Segment Adjusted EBITDA | 2,012 | 2,400 | 6,495 | 7,317 |
Corporate and Other | ||||
Segment Reporting Information [Line Items] | ||||
Segment Adjusted EBITDA | $ (4,762) | $ (3,567) | $ (15,425) | $ (10,935) |
Segment Information - Reconcili
Segment Information - Reconciliation of Segment Measure to Loss Before Benefit from Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Segment Reporting [Abstract] | ||||
Total | $ 16,706 | $ 8,219 | $ 36,157 | $ 21,836 |
Interest expense, net | (3,043) | (2,130) | (10,896) | (4,590) |
Income tax (expense) benefit | (3,348) | 412 | 1,563 | 1,308 |
Depreciation and amortization | (9,740) | (7,412) | (27,084) | (20,262) |
Stock-based compensation | (1,149) | (1,055) | (3,439) | (3,577) |
Start-up losses and investment in new services | (602) | (634) | (1,283) | (1,091) |
Acquisition costs | (6) | (1,278) | (3,767) | (2,350) |
Fair value changes in contingent put option | 26,265 | 19,240 | ||
Fair value changes in warrant options | (9,311) | (2,510) | (9,312) | (4,059) |
Fair value changes in compound embedded option | (26,664) | (27,420) | ||
Fair value changes in business acquisitions contingent consideration | (13,404) | (256) | (17,387) | 670 |
Short term purchase accounting fair value adjustment to deferred revenue | (243) | |||
IPO preparation costs and IPO related bonuses | (6,378) | (20) | (6,908) | (105) |
Discontinued services | (30) | (7,526) | ||
Expenses related to financing transactions | (277) | |||
Other expenses | (33) | (19) | (179) | (27) |
Net loss | $ (30,737) | $ (6,683) | $ (58,761) | $ (12,247) |
Related-Party Transactions - Ad
Related-Party Transactions - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Related Party Transaction [Line Items] | |||||
Amount due to related party | $ 0 | $ 0 | $ 0 | ||
Number of shares issued as dividend payment | 1,786,739 | ||||
Number of additional common stock outstanding owned by related party | 2,534,239 | 2,534,239 | |||
Percentage of common stock shares outstanding owned by related party | 17.30% | 17.30% | |||
Acquisition Targets | Selling, General and Administrative Expense | |||||
Related Party Transaction [Line Items] | |||||
Payment to related party | $ 0 | $ 100,000 | $ 100,000 | $ 400,000 |
Defined Contribution Plan - Add
Defined Contribution Plan - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 5 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | May 22, 2020 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Defined Contribution Plan Disclosure [Line Items] | ||||||
Defined contribution plan, description | 401(k) Savings Plan | |||||
Defined contribution plan, maximum annual contributions per employee, percent | 85.00% | 85.00% | ||||
Defined contribution plan, employer matching contribution, percent of match | 100.00% | |||||
Defined contribution plan participant's compensation percent | 3.00% | |||||
Defined contribution plan percentage of participant's elective deferrals | 50.00% | |||||
Selling, General and Administrative Expenses | ||||||
Defined Contribution Plan Disclosure [Line Items] | ||||||
Defined contribution plan, employer discretionary contribution amount | $ 0 | $ 0.5 | $ 1.2 | $ 1.9 | ||
Minimum | ||||||
Defined Contribution Plan Disclosure [Line Items] | ||||||
Defined contribution plan participant's compensation percent | 3.00% | |||||
Maximum [Member] | ||||||
Defined Contribution Plan Disclosure [Line Items] | ||||||
Defined contribution plan participant's compensation percent | 4.00% |
Subsequent Events - Additional
Subsequent Events - Additional Information (Details) - Term Loan Facility | Oct. 06, 2020 | Apr. 13, 2020 |
LIBOR Plus | ||
Subsequent Event [Line Items] | ||
Interest rate | 5.00% | |
LIBOR Plus | Subsequent Event | ||
Subsequent Event [Line Items] | ||
Interest rate | 4.50% | |
LIBOR Floor | ||
Subsequent Event [Line Items] | ||
Interest rate | 1.00% | |
LIBOR Floor | Subsequent Event | ||
Subsequent Event [Line Items] | ||
Interest rate | 1.00% |