Note 5 - Commitments and Contingencies

3 Months Ended

Mar. 31, 2016

Notes to Financial Statements

Commitments and Contingencies Disclosure [Text Block]

5. Commitments and Contingencies

The Company is required by our insurance provider to obtain and hold a standby letter of credit. This letter of credit serves as a guarantee by the banking institution to pay our insurance provider the incurred claim costs attributable to our general liability, workers compensation and automobile liability claims, up to the amount stated in the standby letter of credit, in the event that these claims were not paid by the Company. Due to our Equipment-based Facility, we have cash collateralized the letter of credit, resulting in the cash being designated as restricted. Refer to Note 2 for more information on our restricted cash.

At March 31, 2016, the Company has recorded a legal reserve of $0.8 million as a result of a dispute between one of the Company’s wholly-owned subsidiaries and a subcontractor. The dispute is currently in arbitration and the Company has extended an offer of $0.8 million to settle the case. This amount was recorded in “other current liabilities” and as “cost of revenues” in our condensed consolidated balance sheets and statements of operations, respectively.

The Company is the subject of certain other claims and lawsuits occurring in the normal course of business. Management, after consultation with legal counsel, does not believe that the outcome of these actions will have a material impact on the condensed consolidated financial statements of the Company.