Quarterly report pursuant to Section 13 or 15(d)

Business Combination

v3.7.0.1
Business Combination
3 Months Ended
Mar. 31, 2017
Business Combinations [Abstract]  
Business Combination Disclosure [Text Block]
Note 4 – Business Combination
 
On July 20, 2016, pursuant to the Merger Agreement, a wholly owned subsidiary of the Company merged with and into LHLLC in a transaction accounted for as a business combination. Following this transaction, 1347 Capital changed its name to Limbach Holdings, Inc.
 
LHLLC’s equity holders and option holders received consideration comprised of (a) $32.4 million in cash, (b) 2,200,005 shares of Company common stock at a fair value of $17.5 million, (c) 666,670 merger warrants, each exercisable for one share of Company common stock at an exercise price of $12.50 per share at a fair value of $0.5 million, and (d) 1,000,006 additional warrants, each exercisable for one share of Company common stock at an exercise price of $11.50 per share with a fair value of $0.6 million on July 20, 2016. Certain of the shares and warrants are subject to lockup agreements and securities law restrictions. Additional cash in excess of fair value of $0.6 million was paid to LHLLC (Predecessor) Class C Unit Option holders, resulting in share-based compensation expense to Limbach Holdings, Inc. (Successor) of $0.6 million for the period from July 20, 2016 through December 31, 2016. Total cash paid, including the additional share-based compensation, was $33.0 million.
 
As part of the consideration in the Business Combination, the Company issued equity securities to LHLLC’s equity holders pursuant to an effective registration statement (common stock and Merger Warrants) and pursuant to a private placement (Additional Merger Warrants) under Section 4(a)(2) of the Securities Act of 1933, as amended (“Securities Act”). Securities Act restrictions on the resale of such securities constitute a security-specific restriction under fair value guidance; therefore, a price adjustment to the fair value is appropriate for affiliates of the Company who own in excess of 10% of the outstanding securities. Fair value determinations for the securities used as consideration are valued at market prices, unless they have a security-specific restriction. Fair value determination for securities with security-specific restrictions under federal securities laws incorporate a price adjustment to the market price.
 
The final valuations of assets acquired and liabilities assumed were: 
 
 
 
As of
 
(in thousands)
 
July 20, 2016
 
Cash and cash equivalents
 
$
238
 
Restricted cash
 
 
63
 
Accounts receivable
 
 
80,930
 
Property and equipment
 
 
20,990
 
Intangible assets
 
 
20,910
 
Costs and estimated earnings in excess of billings on uncompleted contracts
 
 
38,215
 
Other current assets
 
 
2,272
 
Other assets
 
 
130
 
Advances to and equity in joint ventures, net
 
 
6
 
Deferred tax assets
 
 
380
 
Total assets acquired
 
 
164,134
 
Accounts payable, including retainage
 
 
35,596
 
Accrued expenses and other current liabilities
 
 
26,507
 
Billings in excess of costs on and estimated earnings on uncompleted contracts
 
 
30,068
 
Long-term debt
 
 
30,858
 
Other long term liabilities
 
 
645
 
Total liabilities assumed
 
 
123,674
 
Net assets acquired
 
$
40,460