ARC DOCUMENT SOLUTIONS, INC., 10-K filed on 3/12/2020
Annual Report
v3.20.1
Document and Entity Information - USD ($)
12 Months Ended
Dec. 31, 2019
Feb. 24, 2020
Jun. 28, 2019
Document And Entity Information [Abstract]      
Document Type 10-K    
Amendment Flag false    
Document Period End Date Dec. 31, 2019    
Document Fiscal Year Focus 2019    
Document Fiscal Period Focus FY    
Entity Registrant Name ARC Document Solutions, Inc.    
Entity Central Index Key 0001305168    
Current Fiscal Year End Date --12-31    
Entity Filer Category Accelerated Filer    
Entity Common Stock, Shares Outstanding   45,228,183  
Entity Current Reporting Status Yes    
Entity Voluntary Filers No    
Entity Well-known Seasoned Issuer No    
Entity Shell Company false    
Entity Small Business true    
Entity Emerging Growth false    
Entity Public Float     $ 80,490,517
v3.20.1
Consolidated Balance Sheets - USD ($)
$ in Thousands
Dec. 31, 2019
Dec. 31, 2018
Current assets:    
Cash and cash equivalents $ 29,425 $ 29,433
Accounts receivable, net of allowances for accounts receivable of $2,099 and $2,016 51,432 58,035
Inventories, net 13,936 16,768
Prepaid expenses 4,783 4,937
Other current assets 6,807 6,202
Total current assets 106,383 115,375
Property and equipment, net of accumulated depreciation of $210,849 and $199,480 70,334  
Property and equipment, net of accumulated depreciation of $210,849 and $199,480   70,668
Right-of-use assets from operating leases 41,238  
Goodwill 121,051 121,051
Other intangible assets, net 1,996 5,126
Deferred income taxes 19,755 24,946
Other assets 2,400 2,550
Total assets 363,157 339,716
Current liabilities:    
Accounts payable 23,231 24,218
Accrued payroll and payroll-related expenses 14,569 17,029
Accrued expenses 20,440 17,571
Current operating lease liabilities 11,060  
Current portion of long-term debt and finance leases 17,075 22,132
Total current liabilities 86,375 80,950
Long-term operating lease liabilities 37,260  
Long-term debt and finance leases 89,082 105,060
Other long-term liabilities 400 6,404
Total liabilities 213,117 192,414
Commitments and contingencies (Note 7)
ARC Document Solutions, Inc. stockholders’ equity:    
Preferred stock, $0.001 par value, 25,000 shares authorized; 0 shares issued and outstanding 0 0
Common stock, $0.001 par value, 150,000 shares authorized; 49,189 and 48,492 shares issued and 45,228 and 45,818 shares outstanding 49 48
Additional paid-in capital 126,117 123,525
Retained earnings 31,969 29,397
Accumulated other comprehensive loss (3,357) (3,351)
Total stockholders equity before adjustment of treasury stock 154,778 149,619
Less cost of common stock in treasury, 3,960 and 2,674 shares 11,410 9,350
Total ARC Document Solutions, Inc. stockholders’ equity 143,368 140,269
Noncontrolling interest 6,672 7,033
Total equity 150,040 147,302
Total liabilities and equity $ 363,157 $ 339,716
v3.20.1
Consolidated Balance Sheets (Parenthetical) - USD ($)
$ in Thousands
Dec. 31, 2019
Dec. 31, 2018
Statement of Financial Position [Abstract]    
Allowances for accounts receivable $ 2,099 $ 2,016
Accumulated depreciation on property and equipment $ 210,849  
Accumulated depreciation on property and equipment   $ 199,480
Preferred stock, par value (in dollars per share) $ 0.001 $ 0.001
Preferred stock, shares authorized (in shares) 25,000,000 25,000,000
Preferred stock, shares issued (in shares) 0 0
Preferred stock, shares outstanding (in shares) 0 0
Common stock, par value (in dollars per share) $ 0.001 $ 0.001
Common stock, shares authorized (in shares) 150,000,000 150,000,000
Common stock, shares issued (in shares) 49,189,000 48,492,000
Common stock, shares outstanding (in shares) 45,228,000 45,818,000
Treasury stock, shares (in shares) 3,960,000 2,674,000
v3.20.1
Consolidated Statements of Operations - USD ($)
shares in Thousands, $ in Thousands
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Total net sales $ 382,415 $ 400,784
Cost of sales 257,246 269,934
Gross profit 125,169 130,850
Selling, general and administrative expenses 107,260 109,122
Amortization of intangible assets 3,141 3,868
Restructuring expense 660 0
Income from operations 14,108 17,860
Other income, net (71) (81)
Loss on extinguishment and modification of debt 389 0
Interest expense, net 5,226 5,880
Income before income tax provision 8,564 12,061
Income tax provision 5,724 3,334
Net income 2,840 8,727
Loss attributable to noncontrolling interest 175 146
Net income attributable to ARC Document Solutions, Inc. shareholders $ 3,015 $ 8,873
Earnings per share attributable to ARC Document Solutions, Inc. shareholders:    
Basic (in dollars per share) $ 0.07 $ 0.20
Diluted (in dollars per share) $ 0.07 $ 0.20
Weighted average common shares outstanding:    
Basic (shares) 44,997 44,918
Diluted (shares) 45,083 45,050
Service sales    
Total net sales $ 342,912 $ 353,300
Equipment and supplies sales    
Total net sales $ 39,503 $ 47,484
v3.20.1
Consolidated Statements of Comprehensive Income - USD ($)
$ in Thousands
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Statement of Comprehensive Income [Abstract]    
Net income $ 2,840 $ 8,727
Other comprehensive loss, net of tax    
Foreign currency translation adjustments, net of tax (192) (1,548)
Other comprehensive loss, net of tax (192) (1,548)
Comprehensive income 2,648 7,179
Comprehensive loss attributable to noncontrolling interest (361) (341)
Comprehensive income attributable to ARC Document Solutions, Inc. shareholders $ 3,009 $ 7,520
v3.20.1
Consolidated Statements of Equity Statement - USD ($)
$ in Thousands
Total
Common Stock
Additional Paid-in Capital
Retained Earnings
Accumulated Other Comprehensive Loss
Common Stock in Treasury
Noncontrolling Interest
Beginning Balance, shares (in shares) at Dec. 31, 2017   47,913,000          
Beginning Balance at Dec. 31, 2017 $ 137,611 $ 48 $ 120,953 $ 20,524 $ (1,998) $ (9,290) $ 7,374
Increase (Decrease) in Stockholders' Equity [Roll Forward]              
Stock-based compensation (in shares)   503,000          
Stock-based compensation $ 2,445 2,445        
Issuance of common stock under Employee Stock Purchase Plan (in shares) 76,000 76,000          
Issuance of common stock under Employee Stock Purchase Plan $ 127   127        
Treasury shares (60)         (60)  
Comprehensive income $ 7,179     8,873 (1,353)   (341)
Ending Balance, shares (in shares) at Dec. 31, 2018 48,492,000 48,492,000          
Ending Balance at Dec. 31, 2018 $ 147,302 $ 48 123,525 29,397 (3,351) (9,350) 7,033
Increase (Decrease) in Stockholders' Equity [Roll Forward]              
Stock-based compensation (in shares)   607,000          
Stock-based compensation $ 2,460 $ 1 2,459        
Issuance of common stock under Employee Stock Purchase Plan (in shares) 90,000 90,000          
Issuance of common stock under Employee Stock Purchase Plan $ 133   133        
Treasury shares (2,060)         (2,060)  
Common stock cash dividends (443)     (443)      
Comprehensive income $ 2,648     3,015 (6)   (361)
Ending Balance, shares (in shares) at Dec. 31, 2019 49,189,000 49,189,000          
Ending Balance at Dec. 31, 2019 $ 150,040 $ 49 $ 126,117 $ 31,969 $ (3,357) $ (11,410) $ 6,672
v3.20.1
Consolidated Statements of Cash Flows - USD ($)
$ in Thousands
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Cash flows from operating activities    
Net income $ 2,840 $ 8,727
Adjustments to reconcile net income to net cash provided by operating activities:    
Allowance for accounts receivable 590 1,083
Depreciation 28,763 29,019
Amortization of intangible assets 3,141 3,868
Amortization of deferred financing costs 208 232
Stock-based compensation 2,459 2,445
Deferred income taxes 5,157 3,128
Deferred tax valuation allowance 51 (140)
Restructuring expense, non-cash portion 148 0
Loss on extinguishment and modification of debt 389 0
Other non-cash items, net (444) (314)
Changes in operating assets and liabilities:    
Accounts receivable 6,119 (2,767)
Inventory 2,791 2,737
Prepaid expenses and other assets 11,828 (1,814)
Accounts payable and accrued expenses (11,259) 8,760
Net cash provided by operating activities 52,781 54,964
Cash flows from investing activities    
Capital expenditures (12,885) (14,930)
Other 641 695
Net cash used in investing activities (12,244) (14,235)
Cash flows from financing activities    
Proceeds from issuance of common stock under Employee Stock Purchase Plan 133 127
Share repurchases (2,060) (60)
Contingent consideration on prior acquisitions (3) (236)
Payments on long-term debt agreements and capital leases (71,657) (23,031)
Borrowings under revolving credit facilities 71,250 16,875
Payments under revolving credit facilities (38,000) (32,375)
Payment of deferred financing costs (96) 0
Net cash used in financing activities (40,433) (38,700)
Effect of foreign currency translation on cash balances (112) (655)
Net change in cash and cash equivalents (8) 1,374
Cash and cash equivalents at beginning of period 29,433 28,059
Cash and cash equivalents at end of period 29,425 29,433
Supplemental disclosure of cash flow information:    
Cash paid for interest 5,151 5,437
Income taxes paid, net 522 713
Noncash financing activities:    
Finance lease obligations incurred 17,057 $ 21,531
Operating lease obligations incurred $ 6,728  
v3.20.1
Description of Business and Basis of Presentation
12 Months Ended
Dec. 31, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Description of Business and Basis of Presentation
DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION
ARC Document Solutions, Inc. (“ARC Document Solutions,” “ARC” or the “Company”) is a leading document solutions provider to architectural, engineering, construction, and facilities management professionals, while also providing document solutions to businesses of all types. ARC offers a variety of services including: Construction Document Information Management ("CDIM"), Managed Print Services ("MPS"), and Archive and Information Management ("AIM"). In addition, ARC also sells Equipment and Supplies. The Company conducts its operations through its wholly-owned operating subsidiary, ARC Document Solutions, LLC, a Texas limited liability company, and its affiliates.
Basis of Presentation
The accompanying Consolidated Financial Statements include the accounts of the Company and its subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation.
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the amounts reported in the Consolidated Financial Statements and accompanying notes. The Company evaluates its estimates and assumptions on an ongoing basis and relies on historical experience and various other factors that it believes to be reasonable under the circumstances to determine such estimates. Actual results could differ from those estimates and such differences may be material to the Consolidated Financial Statements.
Risk and Uncertainties
The Company generates the majority of its revenue from sales of services and products to customers in the architectural, engineering, construction and building owner/operator (AEC/O) industry. As a result, the Company’s operating results and financial condition can be significantly affected by economic factors that influence the AEC/O industry, such as non-residential construction spending, GDP growth, interest rates, unemployment rates, and office vacancy rates. Reduced activity (relative to historic levels) in the AEC/O industry would diminish demand for some of ARC’s services and products, and would therefore negatively affect revenues and have a material adverse effect on its business, operating results and financial condition.
As part of the Company’s growth strategy, ARC intends to continue to offer and grow a variety of service offerings, some of which are relatively new to the Company. The success of the Company’s efforts will be affected by its ability to acquire new customers for the Company’s new service offerings, as well as to sell the new service offerings to existing customers. The Company’s inability to successfully market and execute these relatively new service offerings could significantly affect its business and reduce its long term revenue, resulting in an adverse effect on its results of operations and financial condition.
v3.20.1
Summary of Significant Accounting Policies
12 Months Ended
Dec. 31, 2019
Accounting Policies [Abstract]  
Summary of Significant Accounting Policies
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Cash Equivalents
Cash equivalents include demand deposits and short-term investments with a maturity of three months or less when purchased.
The Company maintains its cash deposits at numerous banks located throughout the United States, Canada, India, Australia, United Arab Emirates, the United Kingdom and China, which at times, may exceed federally insured limits. UDS, the Company’s joint venture in China, held $12.7 million and $11.5 million of the Company’s cash and cash equivalents as of December 31, 2019 and 2018, respectively. The Company has not experienced any losses in such accounts and believes it is not exposed to any significant risk on cash and cash equivalents.
Concentrations of Credit Risk and Significant Vendors
Concentrations of credit risk with respect to trade receivables are limited due to a large, diverse customer base. No individual customer represented more than 2% of net sales during 2019 and 2018.
The Company has geographic concentration risk as sales in California, as a percent of total sales, were approximately 34% for 2019 and 2018.
The Company contracts with various suppliers. Although there are a limited number of suppliers that could supply the Company’s inventory, management believes any shortfalls from existing suppliers would be absorbed from other suppliers on comparable terms. However, a change in suppliers could cause a delay in sales and adversely affect results.
Purchases from the Company’s three largest vendors during 2019 and 2018 comprised approximately 41% and 46% respectively, of the Company’s total purchases of inventory and supplies.

Allowance for Doubtful Accounts
The Company performs periodic credit evaluations of the financial condition of its customers, monitors collections and payments from customers, and generally does not require collateral. The Company provides for the possible inability to collect accounts receivable by recording an allowance for doubtful accounts. The Company writes off an account when it is considered uncollectible. The Company estimates the allowance for doubtful accounts based on historical experience, aging of accounts receivable, and information regarding the credit worthiness of its customers. Additionally, the Company provides an allowance for returns and discounts based on historical experience. The allowance for doubtful accounts activity was as follows:
 
Balance at
Beginning
of Period
 
Charges to
Cost and
Expenses
 
Deductions (1)
 
Balance at
End of
Period
Year ended December 31, 2019
 
 
 
 
 
 
 
Allowance for accounts receivable
$
2,016

 
$
590

 
$
(507
)
 
$
2,099

Year ended December 31, 2018
 
 
 
 
 
 
 
Allowance for accounts receivable
$
2,341

 
$
1,083

 
$
(1,408
)
 
$
2,016

 (1) Deductions represent uncollectible accounts written-off net of recoveries.
Inventories
Inventories are valued at the lower of cost (determined on a first-in, first-out basis; or average cost) or net realizable value. Inventories primarily consist of reprographics materials for use and resale, and equipment for resale. On an ongoing basis, inventories are reviewed and adjusted for estimated obsolescence or unmarketable inventories to reflect the lower of cost or net realizable value. Charges to increase inventory reserves are recorded as an increase in cost of sales. As of December 31, 2019 and 2018, the reserves for inventory obsolescence was $0.9 million.
Income Taxes
Deferred tax assets and liabilities reflect temporary differences between the amount of assets and liabilities for financial and tax reporting purposes. Such amounts are adjusted, as appropriate, to reflect changes in tax rates expected to be in effect when the temporary differences reverse. A valuation allowance is recorded to reduce the Company's deferred tax assets to the amount that is more likely than not to be realized. Changes in tax laws or accounting standards and methods may affect recorded deferred taxes in future periods.

When establishing a valuation allowance, the Company considers future sources of taxable income such as future reversals of existing taxable temporary differences, future taxable income exclusive of reversing temporary differences and carryforwards and tax planning strategies. A tax planning strategy is an action that: is prudent and feasible; an enterprise ordinarily might not take, but would take to prevent an operating loss or tax credit carryforward from expiring unused; and would result in realization of deferred tax assets. In the event the Company determines that its deferred tax assets, more likely than not, will not be realized in the future, the valuation adjustment to the deferred tax assets will be charged to earnings in the period in which the Company makes such a determination. The Company has a $2.3 million valuation allowance against certain deferred tax assets as of December 31, 2019.
In future quarters the Company will continue to evaluate its historical results for the preceding twelve quarters and its future projections to determine whether the Company will generate sufficient taxable income to utilize its deferred tax assets, and whether a valuation allowance is required.
The Company calculates its current and deferred tax provision based on estimates and assumptions that could differ from the actual results reflected in income tax returns filed in subsequent years. Adjustments based on filed returns are recorded when identified.

Income taxes have not been provided on certain undistributed earnings of foreign subsidiaries because such earnings are considered to be permanently reinvested.

The amount of taxable income or loss the Company reports to the various tax jurisdictions is subject to ongoing audits by federal, state and foreign tax authorities. The Company's estimate of the potential outcome of any uncertain tax issue is subject to management’s assessment of relevant risks, facts, and circumstances existing at that time. The Company uses a more-likely-than-not threshold for financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. The Company records a liability for the difference between the benefit recognized and measured and tax position taken or expected to be taken on its tax return. To the extent that the Company's assessment of such tax positions changes, the change in estimate is recorded in the period in which the determination is made. The Company reports tax-related interest and penalties as a component of income tax expense.
Property and Equipment
Property and equipment are stated at cost and are depreciated using the straight-line method over their estimated useful lives, as follows:
 
Buildings
  
10-20 years
Leasehold improvements
  
10-20 years or lease term, if shorter
Machinery and equipment
  
3-7 years
Furniture and fixtures
  
3-7 years
Assets acquired under capital lease arrangements are included in machinery and equipment, are recorded at the present value of the minimum lease payments, and are depreciated using the straight-line method over the life of the asset or term of the lease, whichever is shorter. Expenses for repairs and maintenance are charged to expense as incurred, while renewals and betterments are capitalized. Gains or losses on the sale or disposal of property and equipment are reflected in operating income.

The Company accounts for software costs developed for internal use in accordance with ASC 350-40, Intangibles – Goodwill and Other, which requires companies to capitalize certain qualifying costs incurred during the application development stage of the related software development project. The primary use of this software is for internal use and, accordingly, such capitalized software development costs are depreciated on a straight-line basis over the economic lives of the related products not to exceed three years. The Company’s machinery and equipment (see Note 5, Property and Equipment) includes $1.3 million and $1.3 million of capitalized software development costs as of December 31, 2019 and 2018, net of accumulated amortization of $20.7 million and $20.0 million as of December 31, 2019 and 2018, respectively. Depreciation expense includes the amortization of capitalized software development costs which amounted to $1.0 million and $1.1 million, during the years ended December 31, 2019 and 2018, respectively.
Impairment of Long-Lived Assets
The Company periodically assesses potential impairments of its long-lived assets in accordance with the provisions of ASC 360, Accounting for the Impairment or Disposal of Long-lived Assets. An impairment review is performed whenever events or changes in circumstances indicate that the carrying value of the assets may not be recoverable. The Company groups its assets at the lowest level for which identifiable cash flows are largely independent of the cash flows of the other assets and liabilities. The Company has determined that the lowest level for which identifiable cash flows are available is the regional level, which is the operating segment level.
Factors considered by the Company include, but are not limited to, significant underperformance relative to historical or projected operating results; significant changes in the manner of use of the acquired assets or the strategy for the overall business; and significant negative industry or economic trends. When the carrying value of a long-lived asset may not be recoverable based upon the existence of one or more of the above indicators of impairment, the Company estimates the future undiscounted cash flows expected to result from the use of the asset and its eventual disposition. If the sum of the expected future undiscounted cash flows and eventual disposition is less than the carrying amount of the asset, the Company recognizes an impairment loss. An impairment loss is reflected as the amount by which the carrying amount of the asset exceeds the fair value of the asset, based on the fair value if available, or discounted cash flows, if fair value is not available. The Company had no long-lived asset impairments in 2019 or 2018.

Goodwill and Other Intangible Assets
In accordance with ASC 350, Intangibles - Goodwill and Other, the Company assesses goodwill for impairment annually as of September 30, and more frequently if events and circumstances indicate that goodwill might be impaired.
Goodwill impairment testing is performed at the reporting unit level. Goodwill is assigned to reporting units at the date the goodwill is initially recorded. Once goodwill has been assigned to reporting units, it no longer retains its association with a particular acquisition, and all of the activities within a reporting unit, whether acquired or internally generated, are available to support the value of the goodwill.
Traditionally, goodwill impairment testing is a two-step process. Step one involves comparing the fair value of the reporting units to its carrying amount. If the carrying amount of a reporting unit is greater than zero and its fair value is greater than its carrying amount, there is no impairment. If the reporting unit’s carrying amount is greater than the fair value, the second step must be completed to measure the amount of impairment, if any. Step two involves calculating an implied fair value of goodwill.
In 2017, the Company elected to early-adopt ASU 2017-04 which simplifies subsequent goodwill measurement by eliminating step two from the goodwill impairment test.
The Company determines the fair value of its reporting units using an income approach. Under the income approach, the Company determined fair value based on estimated discounted future cash flows of each reporting unit. Determining the fair value of a reporting unit is judgmental in nature and requires the use of significant estimates and assumptions, including revenue growth rates and EBITDA margins, discount rates and future market conditions, among others.
Other intangible assets that have finite lives are amortized over their useful lives. Customer relationships are amortized using the accelerated method, based on customer attrition rates, over their estimated useful lives of 13 (weighted average) years.
Deferred Financing Costs
Direct costs incurred in connection with debt agreements are recorded as incurred and amortized based on the effective interest method for the Company's borrowings under its credit agreement ("Credit Agreement"). At December 31, 2019 and 2018, the Company had deferred financing costs of zero and $0.6 million, respectively, net of accumulated amortization of $0.3 million, as of December 31, 2018. The Company extinguished its term loan in December of 2019. See Note 6, Long-Term Debt, for additional information.

Fair Values of Financial Instruments
The following methods and assumptions were used by the Company in estimating the fair value of its financial instruments for disclosure purposes:
Cash equivalents: Cash equivalents are time deposits with maturity of three months or less when purchased, which are highly liquid and readily convertible to cash. Cash equivalents reported in the Company’s Consolidated Balance Sheet were $9.3 million and $7.3 million as of December 31, 2019 and 2018, respectively, and are carried at cost and approximate fair value due to the relatively short period to maturity of these instruments.
Short- and long-term debt and capital leases: The carrying amount of the Company’s capital leases reported in the Consolidated Balance Sheets approximates fair value based on the Company’s current incremental borrowing rate for similar types of borrowing arrangements. The carrying amount reported in the Company’s Consolidated Balance Sheet as of December 31, 2019 for borrowings under its Credit Agreement is $60.0 million. The Company has determined that borrowings under its Credit Agreement of $60.0 million as of December 31, 2019 approximates its fair value.
Insurance Liability
The Company maintains a high deductible insurance policy for a significant portion of its risks and associated liabilities with respect to workers’ compensation. The Company’s deductible is $250 thousand per individual. The accrued liabilities associated with this program are based on the Company’s estimate of the ultimate costs to settle known claims, as well as claims incurred but not yet reported to the Company, as of the balance sheet date. The Company’s estimated liability is not discounted and is based upon an actuarial report obtained from a third party. The actuarial report uses information provided by the Company’s insurance brokers and insurers, combined with the Company’s judgments regarding a number of assumptions and factors, including the frequency and severity of claims, claims development history, case jurisdiction, applicable legislation, and the Company’s claims settlement practices.
The Company is self-insured for healthcare benefits provided to certain employees in the United States, with a stop-loss at $250 thousand per individual. Liabilities associated with the risks that are retained by the Company are estimated, in part, by considering historical claims experience, demographic factors, severity factors and other actuarial assumptions. The Company’s results could be materially affected by claims and other expenses related to such plans if future occurrences and claims differ from these assumptions and historical trends. Other employees are covered by other offered healthcare benefits.
Commitments and Contingencies
In the normal course of business, the Company estimates potential future loss accruals related to legal, workers’ compensation, healthcare, tax and other contingencies. These accruals require management’s judgment on the outcome of various events based on the best available information. However, due to changes in facts and circumstances, the ultimate outcomes could differ from management’s estimates.
Revenue Recognition
In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2014-09, Revenue from Contracts with Customers (Topic 606). The guidance requires entities to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration that is expected to be received in exchange for those goods or services. In addition, Topic 606 provides guidance on the recognition of costs related to obtaining and fulfilling customer contracts.

On January 1, 2018, the Company adopted Topic 606 using the modified retrospective method applied to those contracts which were not completed as of January 1, 2018.  Results for reporting periods beginning after January 1, 2018 are presented under Topic 606, while prior period amounts are not adjusted and continue to be reported in accordance with the Company's historical accounting. The adoption of Topic 606 did not result in an adjustment to retained earnings in the Company's consolidated balance sheet as of January 1, 2018.
 
Revenue is recognized when control of the promised goods or services is transferred to the Company's customers, in an amount that reflects the consideration that the Company is expected to be entitled to in exchange for those goods or services. The Company applied practical expedients related to unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts for which the Company recognizes revenue at the amount to which it has the right to invoice for services performed.
Net sales of the Company’s principal services and products were as follows:
 
 
Year Ended December 31,
 
2019
 
2018
Service Sales
 
 
 
CDIM
$
205,536

 
$
211,389

MPS
123,279

 
128,775

AIM
14,097

 
13,136

Total services sales
342,912

 
353,300

Equipment and Supplies Sales
39,503

 
47,484

Total net sales
$
382,415

 
$
400,784


 
Construction Document and Information Management (CDIM) consists of professional services and software services to (i) re-produce and distribute large-format and small-format documents in either black & white or color (“Ordered Prints”) and (ii) specialized graphic color printing. Substantially all the Company’s revenue from CDIM comes from professional services to re-produce Ordered Prints. Sales of Ordered Prints are initiated through a customer order or quote and are governed by established terms and conditions agreed upon at the onset of the customer relationship. Revenue is recognized when the performance obligation under the terms of a contract with a customer are satisfied; generally, this occurs with the transfer of control of the re-produced Ordered Prints. Transfer of control occurs at a specific point-in-time, when the Ordered Prints are delivered to the customer’s site or handed to the customer for walk in orders. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring goods or providing services. Taxes collected concurrent with revenue-producing activities are excluded from revenue.
MPS consists of placement, management, and optimization of print and imaging equipment in the customers' offices, job sites, and other facilities. MPS relieves the Company’s customers of the burden of purchasing print equipment and related supplies and maintaining print devices and print networks, and shifts their costs to a “per-use” basis. MPS is supported by the Company's hosted proprietary technology, Abacus®, which allows customers to capture, control, manage, print, and account for their documents. Under its MPS contracts, the Company is paid a fixed rate per unit for each print produced (per-use), often referred to as a “click charge”. MPS sales are driven by the ongoing print needs of the Company’s customers at their facilities. Upon the issuance of ASC 842, Leases, the Company concluded that certain of its MPS arrangements, which had previously been accounted for as service revenue under ASC 606, Revenue from Contracts with Customers, are accounted for as operating leases under ASC 842. The pattern of revenue recognition for the Company's MPS revenue has remained substantially unchanged following the adoption of ASC 842. See Note 8, Leasing, for additional information.
Archiving and Information Management (AIM), combines software and professional services to facilitate the capture, management, access and retrieval of documents and information that have been produced in the past. AIM includes the Company's hosted SKYSITE ® software to organize, search and retrieve documents, as well as the provision of services that include the capture and conversion of hardcopy and electronic documents into digital files (“Scanned Documents”), and their cloud-based storage and maintenance. Sales of AIM professional services, which represent substantially all revenue for AIM, are initiated through a customer order or proposal and are governed by established terms and conditions agreed upon at the onset of the customer relationship. Revenue is recognized when the performance obligation under the terms of a contract with a customer are satisfied; generally, this occurs with the transfer of control of the digital files. Transfer of control occurs at a specific point-in-time, when the Scanned Documents are delivered to the customer either through SKYSITE or through electronic media. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring goods or providing services. Taxes collected concurrent with revenue-producing activities are excluded from revenue.

Equipment and Supplies sales consist of reselling printing, imaging, and related equipment (“Goods”) to customers primarily in architectural, engineering and construction firms. Sales of Equipment and Supplies are initiated through a customer order and are governed by established terms and conditions agreed upon at the onset of the customer relationship. Revenue is recognized when the performance obligations under the terms of a contract with a customer are satisfied; generally, this occurs with the transfer of control of the Goods. Transfer of control occurs at a specific point-in-time, when the Goods are delivered to the customer’s site. Revenue is measured as the amount of consideration we expect to receive in exchange for transferring goods or providing services. Taxes collected concurrent with revenue-producing activities are excluded from revenue. The Company has experienced minimal customer returns or refunds and does not offer a warranty on equipment that it is reselling.
The Company has established contractual pricing for certain large national customer accounts (“Global Solutions”). These contracts generally establish uniform pricing at all operating segments for Global Solutions. Revenues earned from the Company’s Global Solutions are recognized in the same manner as non-Global Solutions revenues.
Included in revenues are fees charged to customers for shipping, handling, and delivery services. Such revenues amounted to $11.1 million for 2019 and 2018, respectively.
Revenues from hosted software licensing activities are recognized ratably over the term of the license. Revenues from software licensing activities comprise less than 2% of the Company’s consolidated revenues during the years ended December 31, 2019 and 2018.
Management provides for returns, discounts and allowances based on historic experience and adjusts such allowances as considered necessary.
Comprehensive Income (Loss)
The Company’s comprehensive income (loss) includes foreign currency translation adjustments, net of taxes.
Asset and liability accounts of international operations are translated into the Company’s functional currency, U.S. dollars, at current rates. Revenues and expenses are translated at the average currency rate for the fiscal year.

Segment and Geographic Reporting
The provisions of ASC 280, Segment Reporting, require public companies to report financial and descriptive information about their reportable operating segments. The Company identifies operating segments based on the various business activities that earn revenue and incur expense and whose operating results are reviewed by the Company's Chief Executive Officer, who is the Company's chief operating decision maker. Because its operating segments have similar products and services, classes of customers, production processes, distribution methods and economic characteristics, the Company operates as a single reportable segment.

The Company recognizes revenues in geographic areas based on the location to which the product was shipped or services have been rendered. See table below for revenues and property and equipment, net, attributable to the Company’s U.S. operations and foreign operations. 
 
 
Year Ended December 31,
 
 
2019
 
2018
 
 
U.S.
 
Foreign
Countries
 
Total
 
U.S.
 
Foreign
Countries
 
Total
Revenues from external customers
 
$
329,372

 
$
53,043

 
$
382,415

 
$
340,650

 
$
60,134

 
$
400,784

Property and equipment, net
 
$
63,458

 
$
6,876

 
$
70,334

 
$
64,878

 
$
5,790

 
$
70,668


Advertising and Shipping and Handling Costs
Advertising costs are expensed as incurred and approximated $1.8 million and $2.1 million during 2019 and 2018, respectively. Shipping and handling costs incurred by the Company are included in cost of sales.
Stock-Based Compensation
The Company applies the Black-Scholes valuation model in determining the fair value of share-based payments to employees, which is then amortized on a straight-line basis over the requisite service period.
Total stock-based compensation for 2019 and 2018, was $2.5 million and $2.4 million, respectively, and was recorded in selling, general, and administrative expenses, consistent with the classification of the underlying salaries. In accordance with ASC 718, Income Taxes, any excess tax benefit resulting from stock-based compensation, in the Consolidated Statements of Cash Flows, are classified along with other income tax cash flows as an operating activity.
The weighted average fair value at the grant date for options issued in 2019 and 2018, was $1.30 and $1.21, respectively. The fair value of each option grant was estimated on the date of grant using the Black-Scholes option-pricing model using the following weighted average assumptions for 2019 and 2018: 
 
 
Year Ended December 31,
 
 
2019
 
2018
Weighted average assumptions used:
 
 
 
 
Risk free interest rate
 
2.51
%
 
2.74
%
Expected volatility
 
54.8
%
 
53.0
%
Expected dividend yield
 
%
 
%
Using historical exercise data as a basis, the Company determined that the expected term for stock options issued in 2019 and 2018, was 6.7 years and 6.6 years, respectively.
For fiscal years 2019 and 2018, expected stock price volatility is based on the Company’s historical volatility for a period equal to the expected term. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant with an equivalent remaining term. Since inception the Company has never paid out dividends and did not plan to issue dividend until the fourth quarter of 2019. There have been no stock options granted since this change and any future stock options granted will include a dividend yield. The Company accounts for forfeitures of share-based awards when they occur.
As of December 31, 2019, total unrecognized stock-based compensation expense related to nonvested stock-based compensation was approximately $2.4 million, which is expected to be recognized over a weighted average period of approximately 1.8 years.
For additional information, see Note 10, Employee Stock Purchase Plan and Stock Plan.
Research and Development Expenses
Research and development activities relate to costs associated with the design and testing of new technology or enhancements and maintenance to existing technology. Such costs are expensed as incurred are primarily recorded to cost of sales. In total, research and development amounted to $9.3 million and $8.4 million, during 2019 and 2018, respectively.
Noncontrolling Interest
The Company accounted for its investment in UNIS Document Solutions Co. Ltd., (“UDS”) under the purchase method of accounting, in accordance with ASC 805, Business Combinations. UDS has been consolidated in the Company’s financial statements from the date of acquisition. Noncontrolling interest, which represents the 35 percent non-controlling interest in UDS, is reflected on the Company’s Consolidated Financial Statements.
Sales Taxes
The Company bills sales taxes, as applicable, to its customers. The Company acts as an agent and bills, collects, and remits the sales tax to the proper government jurisdiction. The sales taxes are accounted for on a net basis, and therefore are not included as part of the Company’s revenue.
Earnings Per Share
The Company accounts for earnings per share in accordance with ASC 260, Earnings Per Share. Basic earnings per share is computed by dividing net income attributable to ARC by the weighted-average number of common shares outstanding for the period. Diluted earnings per common share is computed similarly to basic earnings per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if common shares subject to outstanding options and acquisition rights had been issued and if the additional common shares were dilutive. Common share equivalents are excluded from the computation if their effect is anti-dilutive. There were 4.8 million and 5.1 million common shares excluded from the calculation of diluted net income attributable to ARC per common share as their effect would have been anti-dilutive for 2019 and 2018, respectively. The Company’s common share equivalents consist of stock options issued under the Company’s Stock Plan.
Basic and diluted weighted average common shares outstanding were calculated as follows for 2019 and 2018:
 
 
Year Ended December 31,
 
2019
 
2018
Weighted average common shares outstanding during the period — basic
44,997

 
44,918

Effect of dilutive stock options
86

 
132

Weighted average common shares outstanding during the period — diluted
45,083

 
45,050



Recently Adopted Accounting Pronouncements

In February 2016, the FASB issued Accounting Standards Codification (“ASC”) 842 (“ASC 842”), Leases. The new guidance replaced the existing guidance in ASC 840, Leases. ASC 842 requires a dual approach for lessee accounting under which a lessee accounts for leases as finance leases or operating leases. Both finance leases and operating leases will result in the lessee recognizing a right-of-use ("ROU") asset and a corresponding lease liability. For finance leases, the lessee recognizes interest expense and amortization of the ROU asset and for operating leases the lessee will recognize a straight-line total lease expense. The Company adopted ASC 842 on January 1, 2019. In July 2018, the FASB issued ASU 2018-11, Leases (Topic 842): Targeted Improvements, which provided entities the option to use the effective date as the date of initial application on transition to the new guidance. The Company elected this transition method, and as a result, the Company did not adjust comparative information for prior periods. The adoption of ASC 842 resulted in an increase to total assets and liabilities due to the recording of operating lease ROU assets of approximately $46.9 million and operating lease liabilities of approximately $53.7 million, as of January 1, 2019. Finance leases were not impacted by the adoption of ASC 842, as finance lease liabilities and the corresponding ROU assets were already recorded in the balance sheet under the previous guidance, ASC 840. For additional information about the impact of the adoption of ASC 842, see Note 8, Leasing.

Recent Accounting Pronouncements Not Yet Adopted

In August 2018, FASB issued Accounting Standards Update No. 2018-15, Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract ("ASU 2018-15"). ASU 2018-15 requires a customer in a cloud computing arrangement that is a service contract to follow the internal-use software guidance in Accounting Standards Codification 350-40 to determine which implementation costs to defer and recognize as an asset. ASU 2018-15 generally aligns the guidance on recognizing implementation costs incurred in a cloud computing arrangement that is a service contract with that for implementation costs incurred to develop or obtain internal-use software, including hosting arrangements that include an internal-use software license. The Company is currently evaluating the impact of ASU 2018-15 on its consolidated financial statements and related disclosures, but does not expect them to be material.

In December 2019, FASB issued Accounting Standards Update No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019-12”), which simplifies the accounting for income taxes by removing certain exceptions to the general principles for recording income taxes, while also simplifying certain recognition and allocation approaches to accounting for income taxes. ASU 2019-12 will be effective for the first interim period within annual periods beginning after December 15, 2020 on a prospective basis, and early adoption is permitted. The Company is currently evaluating the impact of ASU 2019-12 on its consolidated financial statements and related disclosures.
v3.20.1
Restructuring
12 Months Ended
Dec. 31, 2019
Restructuring and Related Activities [Abstract]  
Restructuring
RESTRUCTURING
To better align the Company's costs and resources with demand for its current portfolio of services and products, the Company initiated a restructuring plan in the third quarter of 2019. Activities associated with this restructuring plan concluded by the fourth quarter of 2019. The Company reduced sales and marketing infrastructure for its ancillary technology services, restructured its regional and corporate organization structure and labor force, and implemented system and equipment upgrades to increase operating efficiency. This restructuring resulted in a reduction in headcount of approximately 90 employees, which represents approximately 5% of the Company's U.S. total workforce. Expenses related to employee terminations as a result of this restructuring totaled $0.7 million in 2019. The Company expects to pay an additional $0.1 million in the three months ended March 31, 2020, related to employee termination costs incurred as of December 31, 2019.
v3.20.1
Goodwill and Other Intangibles
12 Months Ended
Dec. 31, 2019
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill and Other Intangibles
GOODWILL AND OTHER INTANGIBLES
Goodwill
In accordance with ASC 350, Intangibles - Goodwill and Other, the Company assesses goodwill for impairment annually as of September 30, and more frequently if events and circumstances indicate that goodwill might be impaired. At September 30, 2019, the Company performed its assessment and determined that goodwill was not impaired.
Goodwill impairment testing is performed at the reporting unit level. Goodwill is assigned to reporting units at the date the goodwill is initially recorded. Once goodwill has been assigned to reporting units, it no longer retains its association with a particular acquisition, and all of the activities within a reporting unit, whether acquired or internally generated, are available to support the value of the goodwill.

In 2017 the Company elected to early-adopt ASU 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment, which simplifies subsequent goodwill measurement by eliminating step two from the goodwill impairment test.
Given the changing document and printing needs of the Company’s customers, and the uncertainties regarding the effect on the Company’s business, there can be no assurance that the estimates and assumptions made for purposes of the Company’s goodwill impairment test in 2019 will prove to be accurate predictions of the future. If the Company’s assumptions, including forecasted EBITDA of certain reporting units, are not achieved, the Company may be required to record additional goodwill impairment charges in future periods, whether in connection with the Company’s next annual impairment testing in the third quarter of 2020, or on an interim basis, if any such change constitutes a triggering event (as defined under ASC 350, Intangibles-Goodwill and Other) outside of the quarter when the Company regularly performs its annual goodwill impairment test. It is not possible at this time to determine if any such future impairment charge would result or, if it does, whether such charge would be material.
The carrying amount of goodwill from January 1, 2018 through December 31, 2019 is summarized as follows:
 
Gross
Goodwill
 
Accumulated
Impairment
Loss
 
Net
Carrying
Amount
January 1, 2018
$
405,558

 
$
284,507

 
$
121,051

December 31, 2018
405,558

 
284,507

 
121,051

December 31, 2019
$
405,558

 
$
284,507

 
$
121,051



Long-lived and Other Intangible Assets

The Company periodically assesses potential impairments of its long-lived assets in accordance with the provisions of ASC 360, Accounting for the Impairment or Disposal of Long-lived Assets. An impairment review is performed whenever events or changes in circumstances indicate that the carrying value of the assets may not be recoverable. The Company groups its assets at the lowest level for which identifiable cash flows are largely independent of the cash flows of the other assets and liabilities. The Company has determined that the lowest level for which identifiable cash flows are available is the regional level, which is the operating segment level.

Factors considered by the Company include, but are not limited to, significant underperformance relative to historical or projected operating results; significant changes in the manner of use of the acquired assets or the strategy for the overall business; and significant negative industry or economic trends. When the carrying value of a long-lived asset may not be recoverable based upon the existence of one or more of the above indicators of impairment, the Company estimates the future undiscounted cash flows expected to result from the use of the asset and its eventual disposition. If the sum of the expected future undiscounted cash flows and eventual disposition is less than the carrying amount of the asset, the Company recognizes an impairment loss. An impairment loss is reflected as the amount by which the carrying amount of the asset exceeds the fair value of the asset, based on the fair value if available, or discounted cash flows, if fair value is not available. The Company assessed potential impairments of its long lived assets as of September 30, 2019 and concluded that there was no impairment.
The following table sets forth the Company’s other intangible assets resulting from business acquisitions as of December 31, 2019 and 2018 which continue to be amortized:
 
 
December 31, 2019
 
December 31, 2018
 
Gross
Carrying
Amount
 
Accumulated
Amortization
 
Net
Carrying
Amount
 
Gross
Carrying
Amount
 
Accumulated
Amortization
 
Net
Carrying
Amount
Amortizable other intangible assets
 
 
 
 
 
 
 
 
 
 
 
Customer relationships
$
99,127

 
$
97,430

 
$
1,697

 
$
99,136

 
$
94,345

 
$
4,791

Trade names and trademarks
20,279

 
19,980

 
299

 
20,259

 
19,924

 
335

 
$
119,406

 
$
117,410

 
$
1,996

 
$
119,395

 
$
114,269

 
$
5,126


Estimated future amortization expense of other intangible assets for each of the next five fiscal years and thereafter are as follows:
 
2020
$
1,528

2021
172

2022
98

2023
42

2024
40

Thereafter
116

 
$
1,996

v3.20.1
Property and Equipment
12 Months Ended
Dec. 31, 2019
Property, Plant and Equipment [Abstract]  
Property and Equipment
PROPERTY AND EQUIPMENT
Property and equipment consist of the following:
 
December 31,
 
2019
 
2018
Machinery and equipment
$
256,249

 
$
248,546

Buildings and leasehold improvements
22,050

 
18,819

Furniture and fixtures
2,884

 
2,783

 
281,183

 
270,148

Less accumulated depreciation
(210,849
)
 
(199,480
)
 
$
70,334

 
$
70,668


Depreciation expense was $28.8 million and $29.0 million for 2019 and 2018, respectively.
v3.20.1
Long-Term Debt
12 Months Ended
Dec. 31, 2019
Debt Disclosure [Abstract]  
Long-Term Debt
LONG-TERM DEBT
Long-term debt consists of the following:
 
 
December 31,
 
2019
 
2018
Term Loan, net of deferred financing fees of $556; 4.11% interest rate at December 31, 2018
$

 
$
52,694

Revolving Loans; 3.63% and 4.74% interest rate at December 31, 2019 and 2018
60,000

 
26,750

Various capital leases; weighted average interest rate of 4.9% and 4.8% at December 31, 2019 and 2018; principal and interest payable monthly through December 2025
46,157

 
47,737

Various other notes payable with a weighted average interest rate of 10.7% at December 31, 2018

 
11

 
106,157

 
127,192

Less current portion
(17,075
)
 
(22,132
)
 
$
89,082

 
$
105,060


Credit Agreement
On December 17, 2019, the Company amended its Credit Agreement which was originally entered into on November 20, 2014 with Wells Fargo Bank, National Association, as administrative agent and the lenders party thereto.
The amendment increased the maximum aggregate principal amount of revolving loans under the Credit Agreement from $65 million to $80 million. Proceeds of a portion of the revolving loans available to be drawn under the Credit Agreement were used to fully repay the $49.5 million term loan that was outstanding under the Credit Agreement.
As of December 31, 2019, the Company's borrowing availability of Revolving Loans under the Revolving Loan commitment was $17.8 million, after deducting outstanding letters of credit of $2.2 million and outstanding Revolving Loans of $60.0 million.
Loans borrowed under the Credit Agreement bear interest, in the case of LIBOR rate loans, at a per annum rate equal to the applicable LIBOR rate, plus a margin ranging from 1.25% to 1.75%, based on the Company’s Total Leverage Ratio (as defined in the Credit Agreement). Loans borrowed under the Credit Agreement that are not LIBOR rate loans bear interest at a per annum rate equal to (i) the greatest of (A) the Federal Funds Rate plus 0.50%, (B) the one month LIBOR rate plus 1.00% per annum, and (C) the rate of interest announced, from time to time, by Wells Fargo Bank, National Association as its “prime rate,” plus (ii) a margin ranging from 0.25% to 0.75%, based on the Company’s Total Leverage Ratio.
The Company pays certain recurring fees with respect to the credit facility, including administration fees to the administrative agent.
Subject to certain exceptions, including in certain circumstances, reinvestment rights, the loans extended under the Credit Agreement are subject to customary mandatory prepayment provisions with respect to: the net proceeds from certain asset sales; the net proceeds from certain issuances or incurrences of debt (other than debt permitted to be incurred under the terms of the Credit Agreement); the net proceeds from certain issuances of equity securities; and net proceeds of certain insurance recoveries and condemnation events of the Company.
The Credit Agreement contains customary representations and warranties, subject to limitations and exceptions, and customary covenants restricting the ability (subject to various exceptions) of the Company and its subsidiaries to: incur additional indebtedness (including guarantee obligations); incur liens; sell certain property or assets; engage in mergers or other fundamental changes; consummate acquisitions; make investments; pay dividends, other distributions or repurchase equity interest of the Company or its subsidiaries; change the nature of their business; prepay or amend certain indebtedness; engage in certain transactions with affiliates; amend their organizational documents; or enter into certain restrictive agreements. In addition, the Credit Agreement contains financial covenants which requires the Company to maintain (i) at all times, a Total Leverage Ratio in an amount not to exceed 2.75 to 1.00; and (ii) a Fixed Charge Coverage Ratio (as defined in the Credit Agreement), as of the last day of each fiscal quarter, an amount not less than 1.15 to 1.00.
The amendment also modified certain tests the Company is required to meet in order to pay dividends, repurchase stock and make other restricted payments. In order to make such payments which are permitted subject to certain customary conditions set forth in the Credit Agreement, the amount of all such payments will be limited to $15 million during any twelve-month period. Per the amendment, when calculating the fixed charge coverage ratio the Company may now exclude up to $10 million of such restricted payments that would otherwise constitute fixed charges in any twelve month period.
The amendment supported the creation of a new dividend program. In December 2019, the Company’s board of directors declared a quarterly cash dividend of $0.01 per share payable February 28, 2020 to shareholders of record as of January 31, 2020. Accordingly, the Company recorded a dividend payable of $443 thousand within accrued expenses.
The Credit Agreement contains customary events of default, including with respect to: nonpayment of principal, interest, fees or other amounts; failure to perform or observe covenants; material inaccuracy of a representation or warranty when made; cross-default to other material indebtedness; bankruptcy, insolvency and dissolution events; inability to pay debts; monetary judgment defaults; actual or asserted invalidity or impairment of any definitive loan documentation, repudiation of guaranties or subordination terms; certain ERISA related events; or a change of control.
The obligations of the Company’s subsidiary that is the borrower under the Credit Agreement are guaranteed by the Company and each of its other United States subsidiaries. The Credit Agreement and any interest rate protection and other hedging arrangements provided by any lender party to the Credit facility or any affiliate of such a lender are secured on a first priority basis by a perfected security interest in substantially all of the borrower’s, the Company’s and each guarantor’s assets (subject to certain exceptions).
v3.20.1
Commitments and Contingencies
12 Months Ended
Dec. 31, 2019
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies
COMMITMENTS AND CONTINGENCIES
The Company leases machinery, equipment, and office and operational facilities under non-cancelable operating lease agreements. Certain lease agreements for the Company’s facilities generally contain renewal options and provide for annual increases in rent based on the local Consumer Price Index. Refer to Note 8, Leasing, for the schedule of the Company’s future minimum operating lease payments as of December 31, 2019.
The Company has entered into indemnification agreements with each director and named executive officer which provide indemnification under certain circumstances for acts and omissions which may not be covered by any directors’ and officers’ liability insurance. The indemnification agreements may require the Company, among other things, to indemnify its officers and directors against certain liabilities that may arise by reason of their status or service as officers and directors (other than liabilities arising from willful misconduct of a culpable nature), to advance their expenses incurred as a result of any proceeding against them as to which they could be indemnified, and to obtain officers’ and directors’ insurance if available on reasonable terms. There have been no events to date which would require the Company to indemnify its officers or directors.
The Company is involved in various additional legal proceedings and other legal matters from time to time in the normal course of business. The Company does not believe that the outcome of any of these matters will have a material effect on its consolidated financial position, results of operations or cash flows.
v3.20.1
Leasing
12 Months Ended
Dec. 31, 2019
Leases [Abstract]  
Leasing
LEASING
Adoption of ASC Topic 842, Leases
In February 2016, the FASB issued ASC 842, Leases. The new guidance replaces the existing guidance in ASC 840, Leases. ASC 842 requires a dual approach for lessee accounting under which a lessee accounts for leases as finance leases or operating leases. Both finance leases and operating leases result in the lessee recognizing a ROU asset and a corresponding lease liability. For finance leases the lessee recognizes interest expense and amortization of the ROU asset, and for operating leases the lessee will recognize a straight-line total lease expense. In addition, ASC 842 changes the definition of a lease, which resulted in changes to the classification of certain service contracts with customers to lease arrangements. The Company adopted ASC 842 on January 1, 2019.
In July 2018, the FASB issued ASU 2018-11, Leases (Topic 842): Targeted Improvements, which provided entities the option to use the effective date as the date of initial application on transition to the new guidance. The Company elected this transition method, and as a result, the Company did not adjust comparative information for prior periods. The Company elected certain additional practical expedients permitted by the new guidance allowing the Company to carry forward historical accounting related to lease identification and classification for existing leases upon adoption. The Company elected, for its equipment asset classes, the practical expedient that allows lessees to treat the lease and non-lease components of leases as a single lease component. Leases with an initial term of 12 months or less are not recorded on the Company's consolidated balance sheet.
As part of the transition, the Company completed a comprehensive review of its lease portfolio, including significant leases by geography and by asset type that were impacted by the new guidance, and enhanced its controls around leasing. The adoption of ASC 842 resulted in an increase to total assets and liabilities due to the recording of operating lease ROU assets of approximately $46.9 million and operating lease liabilities of approximately $53.7 million, as of January 1, 2019. Finance leases were not impacted by the adoption of ASC 842, as finance lease liabilities and the corresponding ROU assets were already recorded in the balance sheet under the previous guidance, ASC 840. The adoption did not materially impact the Company’s Consolidated Statements of Operations or Cash Flows.
Lessee Accounting
The Company determines whether an arrangement is a lease at contract inception. The Company's material lease contracts are generally for real estate or print equipment, and the determination of whether such contracts contain leases generally does not require significant estimates or judgments. The Company’s leases that are classified as operating leases primarily consist of real estate leases. The Company’s real estate leases contain both lease and non-lease components, which are accounted for separately. The Company’s leases that are classified as finance leases primarily consist of print equipment. Certain print equipment leases have lease and non-lease components, which are accounted for as a single lease component as discussed above. Other than the election to treat the Company's fixed lease payment as a single lease component, the accounting for finance leases will remain unchanged under ASC 842.
Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of the Company's operating leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The operating lease ROU assets also include any lease payments made and are reduced by any lease incentives received. The lease terms range from one to ten years, with renewal terms that can extend the lease term from 1 to 5 years. A portion of the Company’s real estate leases are generally subject to annual changes in the Consumer Price Index (CPI), which are treated as variable lease payments and recognized in the period in which the obligation for those payments was incurred. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants.
The tables below present financial information associated with the Company's leases. This information is only presented as of, and the year ended, December 31, 2019 because, as noted above, the Company adopted ASC 842 using a transition method that does not require application to periods prior to adoption.
 
Classification
December 31, 2019
Assets
 
 
Operating lease assets
Right-of-use assets from operating leases
$
41,238

Finance lease assets
Property and equipment
85,914

 
Less accumulated depreciation
(43,166
)
 
Property and equipment, net
42,748

Total lease assets
 
$
83,986

 
 
 
Liabilities
 
 
Current
 
 
Operating
Current portion of operating lease liabilities
$
11,060

Finance
Current portion of long-term finance leases
17,075

Long-term
 
 
Operating
Long-term portion of operating lease liabilities
37,260

Finance
Long-term portion of finance leases
29,082

Total lease liabilities
 
$
94,477


 
Classification
 
Year Ended December 31, 2019
Operating lease cost
Cost of sales
 
$
16,436

 
Selling, general and administrative expenses
 
3,381

Total operating lease cost (1)
 
 
$
19,817

 
 
 
 
Finance lease cost
 
 
 
Amortization of leased assets
Cost of sales
 
$
18,314

 
Selling, general and administrative expenses
 
246

Interest on lease liabilities
Interest expense, net
 
2,353

Total finance lease cost
 
 
20,913

Total lease cost
 
 
$
40,730

(1) Includes variable lease costs and short-term lease costs of $2,893 and $433, respectively for the year ended December 31, 2019.
Maturity of lease liabilities (as of December 31, 2019)
Operating Leases(1) (2)
 
Finance Leases(3)
2020
 
$
15,247

 
$
19,421

2021
 
12,709

 
15,183

2022
 
10,797

 
9,784

2023
 
8,418

 
5,229

2024
 
5,709

 
1,777

Thereafter
 
11,970

 
65

Total
 
64,850

 
51,459

Less amount representing interest
 
16,530

 
5,302

Present value of lease liability
 
$
48,320

 
$
46,157


(1) Reflects payments for non-cancelable operating leases with initial terms of one year or more as of December 31, 2019. The table above does not include any legally binding minimum lease payments for leases signed but not yet commenced, and such leases are not material in the aggregate.

(2) The Company leased several of its facilities under lease agreements with entities owned by certain of its current and former executive officers which expire through December 2023. The rental payments on these facilities amounted to $0.5 million during 2019 and 2018. In the table above, annual rental payments of $0.5 million for related parties are included in 2020 through 2023.

(3) The table above does not include any legally binding minimum lease payments for leases signed but not yet commenced, and such leases are not material in the aggregate.

As previously disclosed in the Company's 2018 Annual Report on Form 10-K and under the previous lease accounting standard, future minimum lease payments for operating leases and capital lease obligation as of December 31, 2018 were as follows:
Maturity of lease liabilities (as of December 31, 2018)
Operating Leases
 
Capital Leases
2019
 
$
16,355

 
$
16,872

2020
 
12,956

 
13,817

2021
 
10,130

 
10,141

2022
 
8,510

 
5,274

2023
 
7,054

 
1,633

Thereafter
 
16,650

 

Total
 
$
71,655

 
$
47,737



 
December 31, 2019
Weighted average remaining lease term (years)
 
Operating leases
 
5.5

Finance leases
 
3.2

 
 
 
Weighted average discount rate
 
Operating leases
 
5.9
%
Finance leases
 
4.9
%
Other information
Year Ended December 31, 2019
Cash paid for amounts included in the measurement of lease liabilities
 
Operating cash flows from operating leases
$
15,415

Operating cash flows from finance leases
$
2,373

Financing cash flows from finance leases
$
18,407


Lessor Accounting
The Company concluded that certain of its contracts with customers contain leases under the new leasing standard and accordingly should be accounted for as operating leases upon adoption of ASC 842. Specifically, certain of the Company's MPS arrangements, which had previously been accounted for as service revenue under ASC 606, Revenue from Contracts with Customers, are now accounted for as operating leases under ASC 842.
The Company's MPS arrangements consists of the placement, management, and optimization of print and imaging equipment in customers' offices, job sites, and other facilities under which the Company is paid a fixed rate per unit for each print produced (per-use), often referred to as a “click charge.” Accordingly, the fixed rate per unit charged to the customer covers the use of the equipment (i.e., the lease component), as well as the additional services performed by the Company as described above (i.e., the non-lease component). Certain of the Company's MPS contracts provide the customer the option to renew or terminate the agreement, which are considered when assessing the lease term. The Company elected the practical expedient to not separate certain lease and non-lease components related to its MPS arrangements, and accounts for the combined component under ASC 842. The pattern of revenue recognition for the Company's MPS revenue has remained substantially unchanged following the adoption of ASC 842.
MPS revenue includes $114.7 million of rental income and $8.6 million of service income for the year ended December 31, 2019. The Company's property and equipment, net of accumulated depreciation, includes approximately $40 million of equipment subject to leases with customers under the Company's MPS arrangements. Following termination of an MPS arrangement, the Company will place existing equipment at an alternate customer site pursuant to an MPS arrangement, at one of the Company's service centers, or dispose of the equipment.
Leasing
LEASING
Adoption of ASC Topic 842, Leases
In February 2016, the FASB issued ASC 842, Leases. The new guidance replaces the existing guidance in ASC 840, Leases. ASC 842 requires a dual approach for lessee accounting under which a lessee accounts for leases as finance leases or operating leases. Both finance leases and operating leases result in the lessee recognizing a ROU asset and a corresponding lease liability. For finance leases the lessee recognizes interest expense and amortization of the ROU asset, and for operating leases the lessee will recognize a straight-line total lease expense. In addition, ASC 842 changes the definition of a lease, which resulted in changes to the classification of certain service contracts with customers to lease arrangements. The Company adopted ASC 842 on January 1, 2019.
In July 2018, the FASB issued ASU 2018-11, Leases (Topic 842): Targeted Improvements, which provided entities the option to use the effective date as the date of initial application on transition to the new guidance. The Company elected this transition method, and as a result, the Company did not adjust comparative information for prior periods. The Company elected certain additional practical expedients permitted by the new guidance allowing the Company to carry forward historical accounting related to lease identification and classification for existing leases upon adoption. The Company elected, for its equipment asset classes, the practical expedient that allows lessees to treat the lease and non-lease components of leases as a single lease component. Leases with an initial term of 12 months or less are not recorded on the Company's consolidated balance sheet.
As part of the transition, the Company completed a comprehensive review of its lease portfolio, including significant leases by geography and by asset type that were impacted by the new guidance, and enhanced its controls around leasing. The adoption of ASC 842 resulted in an increase to total assets and liabilities due to the recording of operating lease ROU assets of approximately $46.9 million and operating lease liabilities of approximately $53.7 million, as of January 1, 2019. Finance leases were not impacted by the adoption of ASC 842, as finance lease liabilities and the corresponding ROU assets were already recorded in the balance sheet under the previous guidance, ASC 840. The adoption did not materially impact the Company’s Consolidated Statements of Operations or Cash Flows.
Lessee Accounting
The Company determines whether an arrangement is a lease at contract inception. The Company's material lease contracts are generally for real estate or print equipment, and the determination of whether such contracts contain leases generally does not require significant estimates or judgments. The Company’s leases that are classified as operating leases primarily consist of real estate leases. The Company’s real estate leases contain both lease and non-lease components, which are accounted for separately. The Company’s leases that are classified as finance leases primarily consist of print equipment. Certain print equipment leases have lease and non-lease components, which are accounted for as a single lease component as discussed above. Other than the election to treat the Company's fixed lease payment as a single lease component, the accounting for finance leases will remain unchanged under ASC 842.
Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of the Company's operating leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The operating lease ROU assets also include any lease payments made and are reduced by any lease incentives received. The lease terms range from one to ten years, with renewal terms that can extend the lease term from 1 to 5 years. A portion of the Company’s real estate leases are generally subject to annual changes in the Consumer Price Index (CPI), which are treated as variable lease payments and recognized in the period in which the obligation for those payments was incurred. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants.
The tables below present financial information associated with the Company's leases. This information is only presented as of, and the year ended, December 31, 2019 because, as noted above, the Company adopted ASC 842 using a transition method that does not require application to periods prior to adoption.
 
Classification
December 31, 2019
Assets
 
 
Operating lease assets
Right-of-use assets from operating leases
$
41,238

Finance lease assets
Property and equipment
85,914

 
Less accumulated depreciation
(43,166
)
 
Property and equipment, net
42,748

Total lease assets
 
$
83,986

 
 
 
Liabilities
 
 
Current
 
 
Operating
Current portion of operating lease liabilities
$
11,060

Finance
Current portion of long-term finance leases
17,075

Long-term
 
 
Operating
Long-term portion of operating lease liabilities
37,260

Finance
Long-term portion of finance leases
29,082

Total lease liabilities
 
$
94,477


 
Classification
 
Year Ended December 31, 2019
Operating lease cost
Cost of sales
 
$
16,436

 
Selling, general and administrative expenses
 
3,381

Total operating lease cost (1)
 
 
$
19,817

 
 
 
 
Finance lease cost
 
 
 
Amortization of leased assets
Cost of sales
 
$
18,314

 
Selling, general and administrative expenses
 
246

Interest on lease liabilities
Interest expense, net
 
2,353

Total finance lease cost
 
 
20,913

Total lease cost
 
 
$
40,730

(1) Includes variable lease costs and short-term lease costs of $2,893 and $433, respectively for the year ended December 31, 2019.
Maturity of lease liabilities (as of December 31, 2019)
Operating Leases(1) (2)
 
Finance Leases(3)
2020
 
$
15,247

 
$
19,421

2021
 
12,709

 
15,183

2022
 
10,797

 
9,784

2023
 
8,418

 
5,229

2024
 
5,709

 
1,777

Thereafter
 
11,970

 
65

Total
 
64,850

 
51,459

Less amount representing interest
 
16,530

 
5,302

Present value of lease liability
 
$
48,320

 
$
46,157


(1) Reflects payments for non-cancelable operating leases with initial terms of one year or more as of December 31, 2019. The table above does not include any legally binding minimum lease payments for leases signed but not yet commenced, and such leases are not material in the aggregate.

(2) The Company leased several of its facilities under lease agreements with entities owned by certain of its current and former executive officers which expire through December 2023. The rental payments on these facilities amounted to $0.5 million during 2019 and 2018. In the table above, annual rental payments of $0.5 million for related parties are included in 2020 through 2023.

(3) The table above does not include any legally binding minimum lease payments for leases signed but not yet commenced, and such leases are not material in the aggregate.

As previously disclosed in the Company's 2018 Annual Report on Form 10-K and under the previous lease accounting standard, future minimum lease payments for operating leases and capital lease obligation as of December 31, 2018 were as follows:
Maturity of lease liabilities (as of December 31, 2018)
Operating Leases
 
Capital Leases
2019
 
$
16,355

 
$
16,872

2020
 
12,956

 
13,817

2021
 
10,130

 
10,141

2022
 
8,510

 
5,274

2023
 
7,054

 
1,633

Thereafter
 
16,650

 

Total
 
$
71,655

 
$
47,737



 
December 31, 2019
Weighted average remaining lease term (years)
 
Operating leases
 
5.5

Finance leases
 
3.2

 
 
 
Weighted average discount rate
 
Operating leases
 
5.9
%
Finance leases
 
4.9
%
Other information
Year Ended December 31, 2019
Cash paid for amounts included in the measurement of lease liabilities
 
Operating cash flows from operating leases
$
15,415

Operating cash flows from finance leases
$
2,373

Financing cash flows from finance leases
$
18,407


Lessor Accounting
The Company concluded that certain of its contracts with customers contain leases under the new leasing standard and accordingly should be accounted for as operating leases upon adoption of ASC 842. Specifically, certain of the Company's MPS arrangements, which had previously been accounted for as service revenue under ASC 606, Revenue from Contracts with Customers, are now accounted for as operating leases under ASC 842.
The Company's MPS arrangements consists of the placement, management, and optimization of print and imaging equipment in customers' offices, job sites, and other facilities under which the Company is paid a fixed rate per unit for each print produced (per-use), often referred to as a “click charge.” Accordingly, the fixed rate per unit charged to the customer covers the use of the equipment (i.e., the lease component), as well as the additional services performed by the Company as described above (i.e., the non-lease component). Certain of the Company's MPS contracts provide the customer the option to renew or terminate the agreement, which are considered when assessing the lease term. The Company elected the practical expedient to not separate certain lease and non-lease components related to its MPS arrangements, and accounts for the combined component under ASC 842. The pattern of revenue recognition for the Company's MPS revenue has remained substantially unchanged following the adoption of ASC 842.
MPS revenue includes $114.7 million of rental income and $8.6 million of service income for the year ended December 31, 2019. The Company's property and equipment, net of accumulated depreciation, includes approximately $40 million of equipment subject to leases with customers under the Company's MPS arrangements. Following termination of an MPS arrangement, the Company will place existing equipment at an alternate customer site pursuant to an MPS arrangement, at one of the Company's service centers, or dispose of the equipment.
Leasing
LEASING
Adoption of ASC Topic 842, Leases
In February 2016, the FASB issued ASC 842, Leases. The new guidance replaces the existing guidance in ASC 840, Leases. ASC 842 requires a dual approach for lessee accounting under which a lessee accounts for leases as finance leases or operating leases. Both finance leases and operating leases result in the lessee recognizing a ROU asset and a corresponding lease liability. For finance leases the lessee recognizes interest expense and amortization of the ROU asset, and for operating leases the lessee will recognize a straight-line total lease expense. In addition, ASC 842 changes the definition of a lease, which resulted in changes to the classification of certain service contracts with customers to lease arrangements. The Company adopted ASC 842 on January 1, 2019.
In July 2018, the FASB issued ASU 2018-11, Leases (Topic 842): Targeted Improvements, which provided entities the option to use the effective date as the date of initial application on transition to the new guidance. The Company elected this transition method, and as a result, the Company did not adjust comparative information for prior periods. The Company elected certain additional practical expedients permitted by the new guidance allowing the Company to carry forward historical accounting related to lease identification and classification for existing leases upon adoption. The Company elected, for its equipment asset classes, the practical expedient that allows lessees to treat the lease and non-lease components of leases as a single lease component. Leases with an initial term of 12 months or less are not recorded on the Company's consolidated balance sheet.
As part of the transition, the Company completed a comprehensive review of its lease portfolio, including significant leases by geography and by asset type that were impacted by the new guidance, and enhanced its controls around leasing. The adoption of ASC 842 resulted in an increase to total assets and liabilities due to the recording of operating lease ROU assets of approximately $46.9 million and operating lease liabilities of approximately $53.7 million, as of January 1, 2019. Finance leases were not impacted by the adoption of ASC 842, as finance lease liabilities and the corresponding ROU assets were already recorded in the balance sheet under the previous guidance, ASC 840. The adoption did not materially impact the Company’s Consolidated Statements of Operations or Cash Flows.
Lessee Accounting
The Company determines whether an arrangement is a lease at contract inception. The Company's material lease contracts are generally for real estate or print equipment, and the determination of whether such contracts contain leases generally does not require significant estimates or judgments. The Company’s leases that are classified as operating leases primarily consist of real estate leases. The Company’s real estate leases contain both lease and non-lease components, which are accounted for separately. The Company’s leases that are classified as finance leases primarily consist of print equipment. Certain print equipment leases have lease and non-lease components, which are accounted for as a single lease component as discussed above. Other than the election to treat the Company's fixed lease payment as a single lease component, the accounting for finance leases will remain unchanged under ASC 842.
Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of the Company's operating leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The operating lease ROU assets also include any lease payments made and are reduced by any lease incentives received. The lease terms range from one to ten years, with renewal terms that can extend the lease term from 1 to 5 years. A portion of the Company’s real estate leases are generally subject to annual changes in the Consumer Price Index (CPI), which are treated as variable lease payments and recognized in the period in which the obligation for those payments was incurred. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants.
The tables below present financial information associated with the Company's leases. This information is only presented as of, and the year ended, December 31, 2019 because, as noted above, the Company adopted ASC 842 using a transition method that does not require application to periods prior to adoption.
 
Classification
December 31, 2019
Assets
 
 
Operating lease assets
Right-of-use assets from operating leases
$
41,238

Finance lease assets
Property and equipment
85,914

 
Less accumulated depreciation
(43,166
)
 
Property and equipment, net
42,748

Total lease assets
 
$
83,986

 
 
 
Liabilities
 
 
Current
 
 
Operating
Current portion of operating lease liabilities
$
11,060

Finance
Current portion of long-term finance leases
17,075

Long-term
 
 
Operating
Long-term portion of operating lease liabilities
37,260

Finance
Long-term portion of finance leases
29,082

Total lease liabilities
 
$
94,477


 
Classification
 
Year Ended December 31, 2019
Operating lease cost
Cost of sales
 
$
16,436

 
Selling, general and administrative expenses
 
3,381

Total operating lease cost (1)
 
 
$
19,817

 
 
 
 
Finance lease cost
 
 
 
Amortization of leased assets
Cost of sales
 
$
18,314

 
Selling, general and administrative expenses
 
246

Interest on lease liabilities
Interest expense, net
 
2,353

Total finance lease cost
 
 
20,913

Total lease cost
 
 
$
40,730

(1) Includes variable lease costs and short-term lease costs of $2,893 and $433, respectively for the year ended December 31, 2019.
Maturity of lease liabilities (as of December 31, 2019)
Operating Leases(1) (2)
 
Finance Leases(3)
2020
 
$
15,247

 
$
19,421

2021
 
12,709

 
15,183

2022
 
10,797

 
9,784

2023
 
8,418

 
5,229

2024
 
5,709

 
1,777

Thereafter
 
11,970

 
65

Total
 
64,850

 
51,459

Less amount representing interest
 
16,530

 
5,302

Present value of lease liability
 
$
48,320

 
$
46,157


(1) Reflects payments for non-cancelable operating leases with initial terms of one year or more as of December 31, 2019. The table above does not include any legally binding minimum lease payments for leases signed but not yet commenced, and such leases are not material in the aggregate.

(2) The Company leased several of its facilities under lease agreements with entities owned by certain of its current and former executive officers which expire through December 2023. The rental payments on these facilities amounted to $0.5 million during 2019 and 2018. In the table above, annual rental payments of $0.5 million for related parties are included in 2020 through 2023.

(3) The table above does not include any legally binding minimum lease payments for leases signed but not yet commenced, and such leases are not material in the aggregate.

As previously disclosed in the Company's 2018 Annual Report on Form 10-K and under the previous lease accounting standard, future minimum lease payments for operating leases and capital lease obligation as of December 31, 2018 were as follows:
Maturity of lease liabilities (as of December 31, 2018)
Operating Leases
 
Capital Leases
2019
 
$
16,355

 
$
16,872

2020
 
12,956

 
13,817

2021
 
10,130

 
10,141

2022
 
8,510

 
5,274

2023
 
7,054

 
1,633

Thereafter
 
16,650

 

Total
 
$
71,655

 
$
47,737



 
December 31, 2019
Weighted average remaining lease term (years)
 
Operating leases
 
5.5

Finance leases
 
3.2

 
 
 
Weighted average discount rate
 
Operating leases
 
5.9
%
Finance leases
 
4.9
%
Other information
Year Ended December 31, 2019
Cash paid for amounts included in the measurement of lease liabilities
 
Operating cash flows from operating leases
$
15,415

Operating cash flows from finance leases
$
2,373

Financing cash flows from finance leases
$
18,407


Lessor Accounting
The Company concluded that certain of its contracts with customers contain leases under the new leasing standard and accordingly should be accounted for as operating leases upon adoption of ASC 842. Specifically, certain of the Company's MPS arrangements, which had previously been accounted for as service revenue under ASC 606, Revenue from Contracts with Customers, are now accounted for as operating leases under ASC 842.
The Company's MPS arrangements consists of the placement, management, and optimization of print and imaging equipment in customers' offices, job sites, and other facilities under which the Company is paid a fixed rate per unit for each print produced (per-use), often referred to as a “click charge.” Accordingly, the fixed rate per unit charged to the customer covers the use of the equipment (i.e., the lease component), as well as the additional services performed by the Company as described above (i.e., the non-lease component). Certain of the Company's MPS contracts provide the customer the option to renew or terminate the agreement, which are considered when assessing the lease term. The Company elected the practical expedient to not separate certain lease and non-lease components related to its MPS arrangements, and accounts for the combined component under ASC 842. The pattern of revenue recognition for the Company's MPS revenue has remained substantially unchanged following the adoption of ASC 842.
MPS revenue includes $114.7 million of rental income and $8.6 million of service income for the year ended December 31, 2019. The Company's property and equipment, net of accumulated depreciation, includes approximately $40 million of equipment subject to leases with customers under the Company's MPS arrangements. Following termination of an MPS arrangement, the Company will place existing equipment at an alternate customer site pursuant to an MPS arrangement, at one of the Company's service centers, or dispose of the equipment.
Leasing
LEASING
Adoption of ASC Topic 842, Leases
In February 2016, the FASB issued ASC 842, Leases. The new guidance replaces the existing guidance in ASC 840, Leases. ASC 842 requires a dual approach for lessee accounting under which a lessee accounts for leases as finance leases or operating leases. Both finance leases and operating leases result in the lessee recognizing a ROU asset and a corresponding lease liability. For finance leases the lessee recognizes interest expense and amortization of the ROU asset, and for operating leases the lessee will recognize a straight-line total lease expense. In addition, ASC 842 changes the definition of a lease, which resulted in changes to the classification of certain service contracts with customers to lease arrangements. The Company adopted ASC 842 on January 1, 2019.
In July 2018, the FASB issued ASU 2018-11, Leases (Topic 842): Targeted Improvements, which provided entities the option to use the effective date as the date of initial application on transition to the new guidance. The Company elected this transition method, and as a result, the Company did not adjust comparative information for prior periods. The Company elected certain additional practical expedients permitted by the new guidance allowing the Company to carry forward historical accounting related to lease identification and classification for existing leases upon adoption. The Company elected, for its equipment asset classes, the practical expedient that allows lessees to treat the lease and non-lease components of leases as a single lease component. Leases with an initial term of 12 months or less are not recorded on the Company's consolidated balance sheet.
As part of the transition, the Company completed a comprehensive review of its lease portfolio, including significant leases by geography and by asset type that were impacted by the new guidance, and enhanced its controls around leasing. The adoption of ASC 842 resulted in an increase to total assets and liabilities due to the recording of operating lease ROU assets of approximately $46.9 million and operating lease liabilities of approximately $53.7 million, as of January 1, 2019. Finance leases were not impacted by the adoption of ASC 842, as finance lease liabilities and the corresponding ROU assets were already recorded in the balance sheet under the previous guidance, ASC 840. The adoption did not materially impact the Company’s Consolidated Statements of Operations or Cash Flows.
Lessee Accounting
The Company determines whether an arrangement is a lease at contract inception. The Company's material lease contracts are generally for real estate or print equipment, and the determination of whether such contracts contain leases generally does not require significant estimates or judgments. The Company’s leases that are classified as operating leases primarily consist of real estate leases. The Company’s real estate leases contain both lease and non-lease components, which are accounted for separately. The Company’s leases that are classified as finance leases primarily consist of print equipment. Certain print equipment leases have lease and non-lease components, which are accounted for as a single lease component as discussed above. Other than the election to treat the Company's fixed lease payment as a single lease component, the accounting for finance leases will remain unchanged under ASC 842.
Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of the Company's operating leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The operating lease ROU assets also include any lease payments made and are reduced by any lease incentives received. The lease terms range from one to ten years, with renewal terms that can extend the lease term from 1 to 5 years. A portion of the Company’s real estate leases are generally subject to annual changes in the Consumer Price Index (CPI), which are treated as variable lease payments and recognized in the period in which the obligation for those payments was incurred. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants.
The tables below present financial information associated with the Company's leases. This information is only presented as of, and the year ended, December 31, 2019 because, as noted above, the Company adopted ASC 842 using a transition method that does not require application to periods prior to adoption.
 
Classification
December 31, 2019
Assets
 
 
Operating lease assets
Right-of-use assets from operating leases
$
41,238

Finance lease assets
Property and equipment
85,914

 
Less accumulated depreciation
(43,166
)
 
Property and equipment, net
42,748

Total lease assets
 
$
83,986

 
 
 
Liabilities
 
 
Current
 
 
Operating
Current portion of operating lease liabilities
$
11,060

Finance
Current portion of long-term finance leases
17,075

Long-term
 
 
Operating
Long-term portion of operating lease liabilities
37,260

Finance
Long-term portion of finance leases
29,082

Total lease liabilities
 
$
94,477


 
Classification
 
Year Ended December 31, 2019
Operating lease cost
Cost of sales
 
$
16,436

 
Selling, general and administrative expenses
 
3,381

Total operating lease cost (1)
 
 
$
19,817

 
 
 
 
Finance lease cost
 
 
 
Amortization of leased assets
Cost of sales
 
$
18,314

 
Selling, general and administrative expenses
 
246

Interest on lease liabilities
Interest expense, net
 
2,353

Total finance lease cost
 
 
20,913

Total lease cost
 
 
$
40,730

(1) Includes variable lease costs and short-term lease costs of $2,893 and $433, respectively for the year ended December 31, 2019.
Maturity of lease liabilities (as of December 31, 2019)
Operating Leases(1) (2)
 
Finance Leases(3)
2020
 
$
15,247

 
$
19,421

2021
 
12,709

 
15,183

2022
 
10,797

 
9,784

2023
 
8,418

 
5,229

2024
 
5,709

 
1,777

Thereafter
 
11,970

 
65

Total
 
64,850

 
51,459

Less amount representing interest
 
16,530

 
5,302

Present value of lease liability
 
$
48,320

 
$
46,157


(1) Reflects payments for non-cancelable operating leases with initial terms of one year or more as of December 31, 2019. The table above does not include any legally binding minimum lease payments for leases signed but not yet commenced, and such leases are not material in the aggregate.

(2) The Company leased several of its facilities under lease agreements with entities owned by certain of its current and former executive officers which expire through December 2023. The rental payments on these facilities amounted to $0.5 million during 2019 and 2018. In the table above, annual rental payments of $0.5 million for related parties are included in 2020 through 2023.

(3) The table above does not include any legally binding minimum lease payments for leases signed but not yet commenced, and such leases are not material in the aggregate.

As previously disclosed in the Company's 2018 Annual Report on Form 10-K and under the previous lease accounting standard, future minimum lease payments for operating leases and capital lease obligation as of December 31, 2018 were as follows:
Maturity of lease liabilities (as of December 31, 2018)
Operating Leases
 
Capital Leases
2019
 
$
16,355

 
$
16,872

2020
 
12,956

 
13,817

2021
 
10,130

 
10,141

2022
 
8,510

 
5,274

2023
 
7,054

 
1,633

Thereafter
 
16,650

 

Total
 
$
71,655

 
$
47,737



 
December 31, 2019
Weighted average remaining lease term (years)
 
Operating leases
 
5.5

Finance leases
 
3.2

 
 
 
Weighted average discount rate
 
Operating leases
 
5.9
%
Finance leases
 
4.9
%
Other information
Year Ended December 31, 2019
Cash paid for amounts included in the measurement of lease liabilities
 
Operating cash flows from operating leases
$
15,415

Operating cash flows from finance leases
$
2,373

Financing cash flows from finance leases
$
18,407


Lessor Accounting
The Company concluded that certain of its contracts with customers contain leases under the new leasing standard and accordingly should be accounted for as operating leases upon adoption of ASC 842. Specifically, certain of the Company's MPS arrangements, which had previously been accounted for as service revenue under ASC 606, Revenue from Contracts with Customers, are now accounted for as operating leases under ASC 842.
The Company's MPS arrangements consists of the placement, management, and optimization of print and imaging equipment in customers' offices, job sites, and other facilities under which the Company is paid a fixed rate per unit for each print produced (per-use), often referred to as a “click charge.” Accordingly, the fixed rate per unit charged to the customer covers the use of the equipment (i.e., the lease component), as well as the additional services performed by the Company as described above (i.e., the non-lease component). Certain of the Company's MPS contracts provide the customer the option to renew or terminate the agreement, which are considered when assessing the lease term. The Company elected the practical expedient to not separate certain lease and non-lease components related to its MPS arrangements, and accounts for the combined component under ASC 842. The pattern of revenue recognition for the Company's MPS revenue has remained substantially unchanged following the adoption of ASC 842.
MPS revenue includes $114.7 million of rental income and $8.6 million of service income for the year ended December 31, 2019. The Company's property and equipment, net of accumulated depreciation, includes approximately $40 million of equipment subject to leases with customers under the Company's MPS arrangements. Following termination of an MPS arrangement, the Company will place existing equipment at an alternate customer site pursuant to an MPS arrangement, at one of the Company's service centers, or dispose of the equipment.
v3.20.1
Income Taxes
12 Months Ended
Dec. 31, 2019
Income Tax Disclosure [Abstract]  
Income Taxes
INCOME TAXES
In December 2017, the Tax Cuts and Jobs Act (the “TCJA”) was enacted. The TCJA includes a number of changes to existing U.S. tax laws that impact the Company. This includes a reduction to the federal corporate tax rate from 35 percent to 21 percent for the tax years beginning after December 31, 2017. The TCJA also provides for a one-time transition tax on certain foreign earnings as well as changes beginning in 2018 regarding the deductibility of interest expense, additional limitations on executive compensation, meals and entertainment expenses and the inclusion of certain foreign earnings in U.S. taxable income.
      
The Company recognized $11.9 million of tax expense in the fourth quarter of 2017 primarily due to the reduction in its net U.S. deferred tax assets for the 14 percentage points decrease in the U.S. federal statutory rate. In accordance with Staff Accounting Bulletin No. 118, which provides guidance on accounting for the impact of the TCJA, in effect allowing an entity to use a methodology similar to the measurement period in a business combination. The Company completed its accounting for the tax effects of the TCJA. Additionally, further guidance from the Internal Revenue Service ("IRS"), SEC, or the FASB could result in changes to the Company’s accounting for the tax effects of the TCJA in its 2019 tax year and future tax years.

The following table includes the consolidated income tax provision for federal, state, and foreign income taxes related to the Company’s total earnings before taxes for 2019 and 2018:
 
 
 
Year Ended December 31,
 
 
2019
 
2018
Current:
 
 
 
 
Federal
 
$
(45
)
 
$
(89
)
State
 
187

 
65

Foreign
 
354

 
370

 
 
496

 
346

Deferred:
 
 
 
 
Federal
 
3,680

 
2,331

State
 
1,606

 
560

Foreign
 
(58
)
 
97

 
 
5,228

 
2,988

Income tax provision
 
$
5,724

 
$
3,334


The Company's foreign earnings before taxes were $0.7 million and $1.2 million for 2019 and 2018, respectively.
The consolidated deferred tax assets and liabilities consist of the following:
 
 
December 31,
 
2019
 
2018
Deferred tax assets:
 
 
 
Financial statement accruals not currently deductible
$
2,047

 
$
2,332

Deferred rent expense

 
1,563

Accrued vacation
849

 
873

Deferred revenue, net
84

 
24

Fixed assets
3,637

 
3,624

Right of use operating lease liabilities
12,025

 

Goodwill and other identifiable intangibles
7,297

 
9,917

Stock-based compensation
2,952

 
5,022

Federal tax net operating loss carryforward
16,914

 
16,353

State tax net operating loss carryforward, net
5,803

 
5,791

Foreign tax net operating loss carryforward
602

 
691

Tax credits, net
1,726

 
1,770

Gross deferred tax assets
53,936

 
47,960

Less: valuation allowance
(2,254
)
 
(2,203
)
Net deferred tax assets
$
51,682

 
$
45,757

 
 
 
 
Deferred tax liabilities:
 
 
 
Goodwill
$
(21,705
)
 
$
(20,811
)
Right of use assets
(10,222
)
 

Net deferred tax assets
$
19,755

 
$
24,946



A reconciliation of the statutory federal income tax rate to the Company’s effective tax rate is as follows:
 
 
Year Ended December 31,
 
2019
 
2018
Statutory federal income tax rate
21
%
 
21
%
State taxes, net of federal benefit
7

 
5

Foreign taxes
2

 
2

Valuation allowance
1

 
(1
)
Non-deductible expenses and other
2

 
1

Section 162(m) limitation
3

 
1

Stock based compensation
29

 

Discrete items for federal, state and foreign taxes
1

 
(2
)
Global intangible low taxed income
1

 
1

Effective income tax rate
67
%
 
28
%


In accordance with ASC 740-10, Income Taxes, the Company evaluates the need for deferred tax asset valuation allowances based on a more likely than not standard. The ability to realize deferred tax assets depends on the ability to generate sufficient taxable income within the carryback or carryforward periods provided for in the tax law for each applicable tax jurisdiction. The Company considers the following possible sources of taxable income when assessing the realization of deferred tax assets:

Future reversals of existing taxable temporary differences;
Future taxable income exclusive of reversing temporary differences and carryforwards;
Taxable income in prior carryback years; and
Tax-planning strategies.

The assessment regarding whether a valuation allowance is required or should be adjusted also considers all available positive and negative evidence factors, including but not limited to:

Nature, frequency, and severity of recent losses;
Duration of statutory carryforward periods;
Historical experience with tax attributes expiring unused; and
Near- and medium-term financial outlook.

The Company utilizes a rolling three years of actual and current year anticipated results as the primary measure of cumulative income/losses in recent years, as adjusted for permanent differences. The evaluation of deferred tax assets requires judgment in assessing the likely future tax consequences of events that have been recognized in the Company's financial statements or tax returns and future profitability. The Company's accounting for deferred tax consequences represents its best estimate of those future events. Changes in the Company's current estimates, due to unanticipated events or otherwise, could have a material effect on its financial condition and results of operations. The Company has a $2.3 million valuation allowance against certain deferred tax assets as of December 31, 2019.

Based on the Company’s current assessment, the remaining net deferred tax assets as of December 31, 2019 are considered more likely than not to be realized. The valuation allowance of $2.3 million may be increased or reduced as conditions change or if the Company is unable to implement certain available tax planning strategies. The realization of the Company’s net deferred tax assets ultimately depends on future taxable income, reversals of existing taxable temporary differences or through a loss carry back. The Company has income tax receivables of $0.2 million as of December 31, 2019 included in other current assets in its consolidated balance sheet primarily related to income tax refunds for prior years.
As of December 31, 2019, the Company had approximately $80.5 million of consolidated federal, $93.3 million of state and $3.6 million of foreign net operating loss carryforwards available to offset future taxable income, respectively. The pre TCJA federal net operating loss carryforwards will begin to expire in varying amounts between 2031 and 2037. The pre TCJA state net operating loss carryforwards will begin to expire in varying amounts between 2020 and 2039. The foreign net operating loss carryforwards begin to expire in varying amounts beginning in 2022.

The Company and some of its subsidiaries files income tax returns in the U.S. federal jurisdiction, and various states and foreign jurisdictions. With few exceptions, the Company is no longer subject to U.S. federal, state and local, or non-U.S. income tax examinations by tax authorities for years before 2013.
There were no unrecognized tax benefits as of and for the years ended December 31, 2019 or 2018. The Company includes interest and penalties related to uncertain tax positions as a component of income tax expense. The Company does not anticipate any significant changes to unrecognized tax benefits over the next 12 months. During the years ended December 31, 2019 and 2018, no interest or penalties were required to be recognized related to unrecognized tax benefits.
v3.20.1
Employee Stock Purchase Plan and Stock Plan
12 Months Ended
Dec. 31, 2019
Share-based Payment Arrangement [Abstract]  
Employee Stock Purchase Plan and Stock Plan
EMPLOYEE STOCK PURCHASE PLAN AND STOCK PLAN
Employee Stock Purchase Plan
Under the Company’s Employee Stock Purchase Plan (the “ESPP”) eligible employees may purchase up to a calendar year maximum per eligible employee of the lesser of (i) 2,500 shares of common stock, or (ii) a number of shares of common stock having an aggregate fair market value of $25 thousand as determined on the date of purchase at 85% of the fair market value of such shares of common stock on the applicable purchase date. The compensation expense in connection with the ESPP in 2019 and 2018, was $23 thousand and $22 thousand, respectively.

Employees purchased the following shares in the periods presented:
 
 
Year Ended December 31,
 
2019
 
2018
Shares purchased
90

 
76

Average price per share
$
1.51

 
$
1.67


Stock Plan
The Company's Stock Plan provides for the grant of incentive and non-statutory stock options, stock appreciation rights, restricted stock, restricted stock units, stock bonuses and other forms of awards granted or denominated in the Company's common stock or units of the Company's common stock, as well as cash bonus awards to employees, directors and consultants of the Company. The Company's Stock Plan authorizes the Company to issue up to 3.5 million shares of common stock. At December 31, 2019, 2.0 million shares remain available for issuance under the Stock Plan.
Stock options granted under the Company's Stock Plan generally expire no later than ten years from the date of grant. Options generally vest and become fully exercisable over a period of three to four years from date of award, except that options granted to non-employee directors may vest over a shorter time period. The exercise price of options must be equal to at least 100% of the fair market value of the Company’s common stock on the date of grant. The Company allows for cashless exercises of vested outstanding options.
During 2019 and 2018, the Company granted options to acquire a total of 747 thousand shares and 686 thousand shares, respectively, of the Company's common stock to certain key employees with an exercise price equal to the fair market value of the Company’s common stock on the date of grant. The granted stock options vest annually over three to four years from the grant date and expire 10 years after the date of grant.
The following is a further breakdown of the stock option activity under the Stock Plan:
 
Shares
 
Weighted
Average
Exercise
Price
 
Weighted
Average
Contractual
Life
(In years)
 
Aggregate
Intrinsic
Value
(In thousands)
Outstanding at December 31, 2017
4,735

 
$
5.44

 
 
 
 
Granted
686

 
$
2.21

 
 
 
 
Exercised

 
$

 
 
 
 
Forfeited/Canceled
(164
)
 
$
6.23

 
 
 
 
Outstanding at December 31, 2018
5,257

 
$
4.95

 
 
 
 
Granted
747

 
$
2.30

 
 
 
 
Exercised

 
$

 
 
 
 
Forfeited/Canceled
(1,097
)
 
$
7.11

 
 
 
 
Outstanding at December 31, 2019
4,907

 
$
4.06

 
5.27
 
$

Vested or expected to vest at December 31, 2019
4,907

 
$
4.06

 
5.27
 
$

Exercisable at December 31, 2019
3,661

 
$
4.56

 
4.17
 
$


The aggregate intrinsic value in the table above represents the total pretax intrinsic value (the difference between the closing stock price on December 31, 2019 and the exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all the option holders exercised their options on December 31, 2019. This amount changes based on the fair market value of the common stock. There were no options exercised during the years ended 2019 and 2018.

A summary of the Company’s non-vested stock options as of December 31, 2019, and changes during the year then ended is as follows:
 
 
 
Weighted
Average Grant Date
Non-vested Options
Shares
 
Fair Market Value
Non-vested at December 31, 2018
1,191

 
$
1.76

Granted
747

 
$
1.30

Vested
(514
)
 
$
1.92

Forfeited/Canceled
(178
)
 
$
1.54

Non-vested at December 31, 2019
1,246

 
$
1.44


The following table summarizes certain information concerning outstanding options at December 31, 2019:
 
 
 
Range of Exercise Price
Options Outstanding at
December 31, 2019
$1.14 – $2.70
2,568

$3.65 – $4.82
911

$5.37 – $7.19
949

$8.66 – $9.09
479

$1.14 – $9.09
4,907

Restricted Stock
The Stock Plan provides for automatic grants of restricted stock awards to non-employee directors of the Company, as of each annual meeting of the Company’s stockholders having a then fair market value equal to $60 thousand.
In 2019, the Company granted 450 thousand shares of restricted stock to certain key employees at a price per share equal to the closing price of the Company's common stock on the date the restricted stock was granted. The granted stock options and restricted stock vest annually over three years from the grant date. In addition, the Company granted approximately 26 thousand shares of restricted stock to each of the Company's six non-employee members of its board of directors at a price per share equal to the closing price of the Company's common stock on the date the restricted stock was granted. The restricted stock vests on the one-year anniversary of the grant date.
In 2018, the Company granted 325 thousand shares of restricted stock to certain key employees at a price per share equal to the closing price of the Company's common stock on the date the restricted stock was granted. The granted stock options and restricted stock vest annually over three years from the grant date. In addition, the Company granted approximately 28 thousand shares of restricted stock to each of the Company's six non-employee members of its board of directors at a price per share equal to the closing price of the Company's common stock on the date the restricted stock was granted. Additionally, the Company granted approximately 13 thousand shares of restricted stock to an non-employee member of its board of directors that joined during the fourth quarter of 2018.The restricted stock vests on the one-year anniversary of the grant date.

A summary of the Company’s non-vested restricted stock as of December 31, 2019, and changes during the year then ended is as follows:
 
 
 
Weighted
Average Grant Date
Non-vested Restricted Stock
Shares
 
Fair Market Value
Non-vested at December 31, 2018
751

 
$
3.37

Granted
607

 
$
2.41

Vested
(432
)
 
$
3.47

Forfeited/Canceled

 
$

Non-vested at December 31, 2019
926

 
$
2.69


The total fair value of restricted stock awards vested during the years ended December 31, 2019 and 2018 was $1.0 million and $0.8 million, respectively.
v3.20.1
Retirement Plans
12 Months Ended
Dec. 31, 2019
Retirement Benefits [Abstract]  
Retirement Plans
RETIREMENT PLANS
The Company sponsors a 401(k) Plan, which covers substantially all employees of the Company who have attained age 21. Under the Company’s 401(k) Plan, eligible employees may contribute up to 75% of their annual eligible compensation (or in the case of highly compensated employees, up to 6% of their annual eligible compensation), subject to contribution limitations imposed by the Internal Revenue Service. The Company matches 20% of an employee’s contributions, up to a total of 4% of that employee’s compensation. An independent third party administers the Company’s 401(k) Plan. The Company's total expense under these plans amounted to $0.5 million and $0.4 million annually during 2019 and 2018, respectively.
v3.20.1
Fair Value Measurements
12 Months Ended
Dec. 31, 2019
Fair Value Disclosures [Abstract]  
Fair Value Measurements
FAIR VALUE MEASUREMENTS
In accordance with ASC 820, Fair Value Measurement, the Company has categorized its assets and liabilities that are measured at fair value into a three-level fair value hierarchy as set forth below. If the inputs used to measure fair value fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the fair value measurement. The three levels of the hierarchy are defined as follows:
Level 1-inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.
Level 2-inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument.
Level 3-inputs to the valuation methodology are unobservable and significant to the fair value measurement.

The following table summarizes the bases used to measure certain assets and liabilities at fair value on a nonrecurring basis in the consolidated financial statements as of and for the year ended December 31, 2019 and 2018:

 
Significant Other Unobservable Inputs
 
December 31, 2019
 
December 31, 2018
 
Level 3
 
Total Losses
 
Level 3
 
Total Losses
Nonrecurring Fair Value Measure
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Goodwill
$
121,051

 
$

 
$
121,051

 
$

v3.20.1
Summary of Significant Accounting Policies (Policies)
12 Months Ended
Dec. 31, 2019
Accounting Policies [Abstract]  
Basis of Presentation
Basis of Presentation
The accompanying Consolidated Financial Statements include the accounts of the Company and its subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation.
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the amounts reported in the Consolidated Financial Statements and accompanying notes. The Company evaluates its estimates and assumptions on an ongoing basis and relies on historical experience and various other factors that it believes to be reasonable under the circumstances to determine such estimates. Actual results could differ from those estimates and such differences may be material to the Consolidated Financial Statements.
Risk And Uncertainties
Risk and Uncertainties
The Company generates the majority of its revenue from sales of services and products to customers in the architectural, engineering, construction and building owner/operator (AEC/O) industry. As a result, the Company’s operating results and financial condition can be significantly affected by economic factors that influence the AEC/O industry, such as non-residential construction spending, GDP growth, interest rates, unemployment rates, and office vacancy rates. Reduced activity (relative to historic levels) in the AEC/O industry would diminish demand for some of ARC’s services and products, and would therefore negatively affect revenues and have a material adverse effect on its business, operating results and financial condition.
As part of the Company’s growth strategy, ARC intends to continue to offer and grow a variety of service offerings, some of which are relatively new to the Company. The success of the Company’s efforts will be affected by its ability to acquire new customers for the Company’s new service offerings, as well as to sell the new service offerings to existing customers. The Company’s inability to successfully market and execute these relatively new service offerings could significantly affect its business and reduce its long term revenue, resulting in an adverse effect on its results of operations and financial condition.
Cash Equivalents
Cash Equivalents
Cash equivalents include demand deposits and short-term investments with a maturity of three months or less when purchased.
Concentrations of Credit Risk and Significant Vendors
Concentrations of Credit Risk and Significant Vendors
Concentrations of credit risk with respect to trade receivables are limited due to a large, diverse customer base. No individual customer represented more than 2% of net sales during 2019 and 2018.
The Company has geographic concentration risk as sales in California, as a percent of total sales, were approximately 34% for 2019 and 2018.
The Company contracts with various suppliers. Although there are a limited number of suppliers that could supply the Company’s inventory, management believes any shortfalls from existing suppliers would be absorbed from other suppliers on comparable terms. However, a change in suppliers could cause a delay in sales and adversely affect results.
Allowance for Doubtful Accounts
Allowance for Doubtful Accounts
The Company performs periodic credit evaluations of the financial condition of its customers, monitors collections and payments from customers, and generally does not require collateral. The Company provides for the possible inability to collect accounts receivable by recording an allowance for doubtful accounts. The Company writes off an account when it is considered uncollectible. The Company estimates the allowance for doubtful accounts based on historical experience, aging of accounts receivable, and information regarding the credit worthiness of its customers. Additionally, the Company provides an allowance for returns and discounts based on historical experience.
Inventories
Inventories
Inventories are valued at the lower of cost (determined on a first-in, first-out basis; or average cost) or net realizable value. Inventories primarily consist of reprographics materials for use and resale, and equipment for resale. On an ongoing basis, inventories are reviewed and adjusted for estimated obsolescence or unmarketable inventories to reflect the lower of cost or net realizable value. Charges to increase inventory reserves are recorded as an increase in cost of sales.
Income Taxes
Income Taxes
Deferred tax assets and liabilities reflect temporary differences between the amount of assets and liabilities for financial and tax reporting purposes. Such amounts are adjusted, as appropriate, to reflect changes in tax rates expected to be in effect when the temporary differences reverse. A valuation allowance is recorded to reduce the Company's deferred tax assets to the amount that is more likely than not to be realized. Changes in tax laws or accounting standards and methods may affect recorded deferred taxes in future periods.

When establishing a valuation allowance, the Company considers future sources of taxable income such as future reversals of existing taxable temporary differences, future taxable income exclusive of reversing temporary differences and carryforwards and tax planning strategies. A tax planning strategy is an action that: is prudent and feasible; an enterprise ordinarily might not take, but would take to prevent an operating loss or tax credit carryforward from expiring unused; and would result in realization of deferred tax assets. In the event the Company determines that its deferred tax assets, more likely than not, will not be realized in the future, the valuation adjustment to the deferred tax assets will be charged to earnings in the period in which the Company makes such a determination. The Company has a $2.3 million valuation allowance against certain deferred tax assets as of December 31, 2019.
In future quarters the Company will continue to evaluate its historical results for the preceding twelve quarters and its future projections to determine whether the Company will generate sufficient taxable income to utilize its deferred tax assets, and whether a valuation allowance is required.
The Company calculates its current and deferred tax provision based on estimates and assumptions that could differ from the actual results reflected in income tax returns filed in subsequent years. Adjustments based on filed returns are recorded when identified.

Income taxes have not been provided on certain undistributed earnings of foreign subsidiaries because such earnings are considered to be permanently reinvested.

The amount of taxable income or loss the Company reports to the various tax jurisdictions is subject to ongoing audits by federal, state and foreign tax authorities. The Company's estimate of the potential outcome of any uncertain tax issue is subject to management’s assessment of relevant risks, facts, and circumstances existing at that time. The Company uses a more-likely-than-not threshold for financial statement recognition and measurement of tax positions taken or expected to be taken in a tax return. The Company records a liability for the difference between the benefit recognized and measured and tax position taken or expected to be taken on its tax return. To the extent that the Company's assessment of such tax positions changes, the change in estimate is recorded in the period in which the determination is made. The Company reports tax-related interest and penalties as a component of income tax expense.
Property and Equipment
Property and Equipment
Property and equipment are stated at cost and are depreciated using the straight-line method over their estimated useful lives, as follows:
 
Buildings
  
10-20 years
Leasehold improvements
  
10-20 years or lease term, if shorter
Machinery and equipment
  
3-7 years
Furniture and fixtures
  
3-7 years
Assets acquired under capital lease arrangements are included in machinery and equipment, are recorded at the present value of the minimum lease payments, and are depreciated using the straight-line method over the life of the asset or term of the lease, whichever is shorter. Expenses for repairs and maintenance are charged to expense as incurred, while renewals and betterments are capitalized. Gains or losses on the sale or disposal of property and equipment are reflected in operating income.

The Company accounts for software costs developed for internal use in accordance with ASC 350-40, Intangibles – Goodwill and Other, which requires companies to capitalize certain qualifying costs incurred during the application development stage of the related software development project. The primary use of this software is for internal use and, accordingly, such capitalized software development costs are depreciated on a straight-line basis over the economic lives of the related products not to exceed three years.
Impairment of Long-Lived Assets
Impairment of Long-Lived Assets
The Company periodically assesses potential impairments of its long-lived assets in accordance with the provisions of ASC 360, Accounting for the Impairment or Disposal of Long-lived Assets. An impairment review is performed whenever events or changes in circumstances indicate that the carrying value of the assets may not be recoverable. The Company groups its assets at the lowest level for which identifiable cash flows are largely independent of the cash flows of the other assets and liabilities. The Company has determined that the lowest level for which identifiable cash flows are available is the regional level, which is the operating segment level.
Factors considered by the Company include, but are not limited to, significant underperformance relative to historical or projected operating results; significant changes in the manner of use of the acquired assets or the strategy for the overall business; and significant negative industry or economic trends. When the carrying value of a long-lived asset may not be recoverable based upon the existence of one or more of the above indicators of impairment, the Company estimates the future undiscounted cash flows expected to result from the use of the asset and its eventual disposition. If the sum of the expected future undiscounted cash flows and eventual disposition is less than the carrying amount of the asset, the Company recognizes an impairment loss. An impairment loss is reflected as the amount by which the carrying amount of the asset exceeds the fair value of the asset, based on the fair value if available, or discounted cash flows, if fair value is not available.
Goodwill and Other Intangible Assets
Goodwill and Other Intangible Assets
In accordance with ASC 350, Intangibles - Goodwill and Other, the Company assesses goodwill for impairment annually as of September 30, and more frequently if events and circumstances indicate that goodwill might be impaired.
Goodwill impairment testing is performed at the reporting unit level. Goodwill is assigned to reporting units at the date the goodwill is initially recorded. Once goodwill has been assigned to reporting units, it no longer retains its association with a particular acquisition, and all of the activities within a reporting unit, whether acquired or internally generated, are available to support the value of the goodwill.
Traditionally, goodwill impairment testing is a two-step process. Step one involves comparing the fair value of the reporting units to its carrying amount. If the carrying amount of a reporting unit is greater than zero and its fair value is greater than its carrying amount, there is no impairment. If the reporting unit’s carrying amount is greater than the fair value, the second step must be completed to measure the amount of impairment, if any. Step two involves calculating an implied fair value of goodwill.
In 2017, the Company elected to early-adopt ASU 2017-04 which simplifies subsequent goodwill measurement by eliminating step two from the goodwill impairment test.
The Company determines the fair value of its reporting units using an income approach. Under the income approach, the Company determined fair value based on estimated discounted future cash flows of each reporting unit. Determining the fair value of a reporting unit is judgmental in nature and requires the use of significant estimates and assumptions, including revenue growth rates and EBITDA margins, discount rates and future market conditions, among others.
Other intangible assets that have finite lives are amortized over their useful lives. Customer relationships are amortized using the accelerated method, based on customer attrition rates, over their estimated useful lives of 13 (weighted average) years.
Deferred Financing Costs
Deferred Financing Costs
Direct costs incurred in connection with debt agreements are recorded as incurred and amortized based on the effective interest method for the Company's borrowings under its credit agreement ("Credit Agreement").
Fair Values of Financial Instruments
Fair Values of Financial Instruments
The following methods and assumptions were used by the Company in estimating the fair value of its financial instruments for disclosure purposes:
Cash equivalents: Cash equivalents are time deposits with maturity of three months or less when purchased, which are highly liquid and readily convertible to cash. Cash equivalents reported in the Company’s Consolidated Balance Sheet were $9.3 million and $7.3 million as of December 31, 2019 and 2018, respectively, and are carried at cost and approximate fair value due to the relatively short period to maturity of these instruments.
Short- and long-term debt and capital leases: The carrying amount of the Company’s capital leases reported in the Consolidated Balance Sheets approximates fair value based on the Company’s current incremental borrowing rate for similar types of borrowing arrangements.
Insurance Liability
Insurance Liability
The Company maintains a high deductible insurance policy for a significant portion of its risks and associated liabilities with respect to workers’ compensation. The Company’s deductible is $250 thousand per individual. The accrued liabilities associated with this program are based on the Company’s estimate of the ultimate costs to settle known claims, as well as claims incurred but not yet reported to the Company, as of the balance sheet date. The Company’s estimated liability is not discounted and is based upon an actuarial report obtained from a third party. The actuarial report uses information provided by the Company’s insurance brokers and insurers, combined with the Company’s judgments regarding a number of assumptions and factors, including the frequency and severity of claims, claims development history, case jurisdiction, applicable legislation, and the Company’s claims settlement practices.
The Company is self-insured for healthcare benefits provided to certain employees in the United States, with a stop-loss at $250 thousand per individual. Liabilities associated with the risks that are retained by the Company are estimated, in part, by considering historical claims experience, demographic factors, severity factors and other actuarial assumptions. The Company’s results could be materially affected by claims and other expenses related to such plans if future occurrences and claims differ from these assumptions and historical trends. Other employees are covered by other offered healthcare benefits.
Commitments and Contingencies
Commitments and Contingencies
In the normal course of business, the Company estimates potential future loss accruals related to legal, workers’ compensation, healthcare, tax and other contingencies. These accruals require management’s judgment on the outcome of various events based on the best available information. However, due to changes in facts and circumstances, the ultimate outcomes could differ from management’s estimates.
Revenue Recognition
Construction Document and Information Management (CDIM) consists of professional services and software services to (i) re-produce and distribute large-format and small-format documents in either black & white or color (“Ordered Prints”) and (ii) specialized graphic color printing. Substantially all the Company’s revenue from CDIM comes from professional services to re-produce Ordered Prints. Sales of Ordered Prints are initiated through a customer order or quote and are governed by established terms and conditions agreed upon at the onset of the customer relationship. Revenue is recognized when the performance obligation under the terms of a contract with a customer are satisfied; generally, this occurs with the transfer of control of the re-produced Ordered Prints. Transfer of control occurs at a specific point-in-time, when the Ordered Prints are delivered to the customer’s site or handed to the customer for walk in orders. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring goods or providing services. Taxes collected concurrent with revenue-producing activities are excluded from revenue.
MPS consists of placement, management, and optimization of print and imaging equipment in the customers' offices, job sites, and other facilities. MPS relieves the Company’s customers of the burden of purchasing print equipment and related supplies and maintaining print devices and print networks, and shifts their costs to a “per-use” basis. MPS is supported by the Company's hosted proprietary technology, Abacus®, which allows customers to capture, control, manage, print, and account for their documents. Under its MPS contracts, the Company is paid a fixed rate per unit for each print produced (per-use), often referred to as a “click charge”. MPS sales are driven by the ongoing print needs of the Company’s customers at their facilities. Upon the issuance of ASC 842, Leases, the Company concluded that certain of its MPS arrangements, which had previously been accounted for as service revenue under ASC 606, Revenue from Contracts with Customers, are accounted for as operating leases under ASC 842. The pattern of revenue recognition for the Company's MPS revenue has remained substantially unchanged following the adoption of ASC 842. See Note 8, Leasing, for additional information.
Archiving and Information Management (AIM), combines software and professional services to facilitate the capture, management, access and retrieval of documents and information that have been produced in the past. AIM includes the Company's hosted SKYSITE ® software to organize, search and retrieve documents, as well as the provision of services that include the capture and conversion of hardcopy and electronic documents into digital files (“Scanned Documents”), and their cloud-based storage and maintenance. Sales of AIM professional services, which represent substantially all revenue for AIM, are initiated through a customer order or proposal and are governed by established terms and conditions agreed upon at the onset of the customer relationship. Revenue is recognized when the performance obligation under the terms of a contract with a customer are satisfied; generally, this occurs with the transfer of control of the digital files. Transfer of control occurs at a specific point-in-time, when the Scanned Documents are delivered to the customer either through SKYSITE or through electronic media. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring goods or providing services. Taxes collected concurrent with revenue-producing activities are excluded from revenue.

Equipment and Supplies sales consist of reselling printing, imaging, and related equipment (“Goods”) to customers primarily in architectural, engineering and construction firms. Sales of Equipment and Supplies are initiated through a customer order and are governed by established terms and conditions agreed upon at the onset of the customer relationship. Revenue is recognized when the performance obligations under the terms of a contract with a customer are satisfied; generally, this occurs with the transfer of control of the Goods. Transfer of control occurs at a specific point-in-time, when the Goods are delivered to the customer’s site. Revenue is measured as the amount of consideration we expect to receive in exchange for transferring goods or providing services. Taxes collected concurrent with revenue-producing activities are excluded from revenue. The Company has experienced minimal customer returns or refunds and does not offer a warranty on equipment that it is reselling.
The Company has established contractual pricing for certain large national customer accounts (“Global Solutions”). These contracts generally establish uniform pricing at all operating segments for Global Solutions. Revenues earned from the Company’s Global Solutions are recognized in the same manner as non-Global Solutions revenues.
Revenue Recognition
In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2014-09, Revenue from Contracts with Customers (Topic 606). The guidance requires entities to recognize revenues when promised goods or services are transferred to customers in an amount that reflects the consideration that is expected to be received in exchange for those goods or services. In addition, Topic 606 provides guidance on the recognition of costs related to obtaining and fulfilling customer contracts.

On January 1, 2018, the Company adopted Topic 606 using the modified retrospective method applied to those contracts which were not completed as of January 1, 2018.  Results for reporting periods beginning after January 1, 2018 are presented under Topic 606, while prior period amounts are not adjusted and continue to be reported in accordance with the Company's historical accounting. The adoption of Topic 606 did not result in an adjustment to retained earnings in the Company's consolidated balance sheet as of January 1, 2018.
 
Revenue is recognized when control of the promised goods or services is transferred to the Company's customers, in an amount that reflects the consideration that the Company is expected to be entitled to in exchange for those goods or services. The Company applied practical expedients related to unsatisfied performance obligations for (i) contracts with an original expected length of one year or less and (ii) contracts for which the Company recognizes revenue at the amount to which it has the right to invoice for services performed.
Comprehensive Income (Loss)
Comprehensive Income (Loss)
The Company’s comprehensive income (loss) includes foreign currency translation adjustments, net of taxes.
Asset and liability accounts of international operations are translated into the Company’s functional currency, U.S. dollars, at current rates. Revenues and expenses are translated at the average currency rate for the fiscal year.
Segment and Geographic Reporting
Segment and Geographic Reporting
The provisions of ASC 280, Segment Reporting, require public companies to report financial and descriptive information about their reportable operating segments. The Company identifies operating segments based on the various business activities that earn revenue and incur expense and whose operating results are reviewed by the Company's Chief Executive Officer, who is the Company's chief operating decision maker. Because its operating segments have similar products and services, classes of customers, production processes, distribution methods and economic characteristics, the Company operates as a single reportable segment.

The Company recognizes revenues in geographic areas based on the location to which the product was shipped or services have been rendered. See table below for revenues and property and equipment, net, attributable to the Company’s U.S. operations and foreign operations. 
Advertising and Shipping and Handling Costs
Advertising and Shipping and Handling Costs
Advertising costs are expensed as incurred and approximated $1.8 million and $2.1 million during 2019 and 2018, respectively. Shipping and handling costs incurred by the Company are included in cost of sales.
Stock-Based Compensation
Stock-Based Compensation
The Company applies the Black-Scholes valuation model in determining the fair value of share-based payments to employees, which is then amortized on a straight-line basis over the requisite service period.
Research and Development Expenses
Research and Development Expenses
Research and development activities relate to costs associated with the design and testing of new technology or enhancements and maintenance to existing technology. Such costs are expensed as incurred are primarily recorded to cost of sales.
Noncontrolling Interest
Noncontrolling Interest
The Company accounted for its investment in UNIS Document Solutions Co. Ltd., (“UDS”) under the purchase method of accounting, in accordance with ASC 805, Business Combinations. UDS has been consolidated in the Company’s financial statements from the date of acquisition.
Sales Taxes
Sales Taxes
The Company bills sales taxes, as applicable, to its customers. The Company acts as an agent and bills, collects, and remits the sales tax to the proper government jurisdiction. The sales taxes are accounted for on a net basis, and therefore are not included as part of the Company’s revenue.
Earnings Per Share
Earnings Per Share
The Company accounts for earnings per share in accordance with ASC 260, Earnings Per Share. Basic earnings per share is computed by dividing net income attributable to ARC by the weighted-average number of common shares outstanding for the period. Diluted earnings per common share is computed similarly to basic earnings per share except that the denominator is increased to include the number of additional common shares that would have been outstanding if common shares subject to outstanding options and acquisition rights had been issued and if the additional common shares were dilutive. Common share equivalents are excluded from the computation if their effect is anti-dilutive.
Recently Adopted Accounting Pronouncements and Recent Accounting Pronouncements Not Yet Adopted
Recently Adopted Accounting Pronouncements

In February 2016, the FASB issued Accounting Standards Codification (“ASC”) 842 (“ASC 842”), Leases. The new guidance replaced the existing guidance in ASC 840, Leases. ASC 842 requires a dual approach for lessee accounting under which a lessee accounts for leases as finance leases or operating leases. Both finance leases and operating leases will result in the lessee recognizing a right-of-use ("ROU") asset and a corresponding lease liability. For finance leases, the lessee recognizes interest expense and amortization of the ROU asset and for operating leases the lessee will recognize a straight-line total lease expense. The Company adopted ASC 842 on January 1, 2019. In July 2018, the FASB issued ASU 2018-11, Leases (Topic 842): Targeted Improvements, which provided entities the option to use the effective date as the date of initial application on transition to the new guidance. The Company elected this transition method, and as a result, the Company did not adjust comparative information for prior periods. The adoption of ASC 842 resulted in an increase to total assets and liabilities due to the recording of operating lease ROU assets of approximately $46.9 million and operating lease liabilities of approximately $53.7 million, as of January 1, 2019. Finance leases were not impacted by the adoption of ASC 842, as finance lease liabilities and the corresponding ROU assets were already recorded in the balance sheet under the previous guidance, ASC 840. For additional information about the impact of the adoption of ASC 842, see Note 8, Leasing.

Recent Accounting Pronouncements Not Yet Adopted

In August 2018, FASB issued Accounting Standards Update No. 2018-15, Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract ("ASU 2018-15"). ASU 2018-15 requires a customer in a cloud computing arrangement that is a service contract to follow the internal-use software guidance in Accounting Standards Codification 350-40 to determine which implementation costs to defer and recognize as an asset. ASU 2018-15 generally aligns the guidance on recognizing implementation costs incurred in a cloud computing arrangement that is a service contract with that for implementation costs incurred to develop or obtain internal-use software, including hosting arrangements that include an internal-use software license. The Company is currently evaluating the impact of ASU 2018-15 on its consolidated financial statements and related disclosures, but does not expect them to be material.

In December 2019, FASB issued Accounting Standards Update No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (“ASU 2019-12”), which simplifies the accounting for income taxes by removing certain exceptions to the general principles for recording income taxes, while also simplifying certain recognition and allocation approaches to accounting for income taxes. ASU 2019-12 will be effective for the first interim period within annual periods beginning after December 15, 2020 on a prospective basis, and early adoption is permitted. The Company is currently evaluating the impact of ASU 2019-12 on its consolidated financial statements and related disclosures.
Adoption of ASC Topic 842, Leases
In February 2016, the FASB issued ASC 842, Leases. The new guidance replaces the existing guidance in ASC 840, Leases. ASC 842 requires a dual approach for lessee accounting under which a lessee accounts for leases as finance leases or operating leases. Both finance leases and operating leases result in the lessee recognizing a ROU asset and a corresponding lease liability. For finance leases the lessee recognizes interest expense and amortization of the ROU asset, and for operating leases the lessee will recognize a straight-line total lease expense. In addition, ASC 842 changes the definition of a lease, which resulted in changes to the classification of certain service contracts with customers to lease arrangements. The Company adopted ASC 842 on January 1, 2019.
In July 2018, the FASB issued ASU 2018-11, Leases (Topic 842): Targeted Improvements, which provided entities the option to use the effective date as the date of initial application on transition to the new guidance. The Company elected this transition method, and as a result, the Company did not adjust comparative information for prior periods. The Company elected certain additional practical expedients permitted by the new guidance allowing the Company to carry forward historical accounting related to lease identification and classification for existing leases upon adoption. The Company elected, for its equipment asset classes, the practical expedient that allows lessees to treat the lease and non-lease components of leases as a single lease component. Leases with an initial term of 12 months or less are not recorded on the Company's consolidated balance sheet.
Lessee Accounting
Lessee Accounting
The Company determines whether an arrangement is a lease at contract inception. The Company's material lease contracts are generally for real estate or print equipment, and the determination of whether such contracts contain leases generally does not require significant estimates or judgments. The Company’s leases that are classified as operating leases primarily consist of real estate leases. The Company’s real estate leases contain both lease and non-lease components, which are accounted for separately. The Company’s leases that are classified as finance leases primarily consist of print equipment. Certain print equipment leases have lease and non-lease components, which are accounted for as a single lease component as discussed above. Other than the election to treat the Company's fixed lease payment as a single lease component, the accounting for finance leases will remain unchanged under ASC 842.
Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of the Company's operating leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The operating lease ROU assets also include any lease payments made and are reduced by any lease incentives received. The lease terms range from one to ten years, with renewal terms that can extend the lease term from 1 to 5 years. A portion of the Company’s real estate leases are generally subject to annual changes in the Consumer Price Index (CPI), which are treated as variable lease payments and recognized in the period in which the obligation for those payments was incurred. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants.
Lessor Accounting
Lessor Accounting
The Company concluded that certain of its contracts with customers contain leases under the new leasing standard and accordingly should be accounted for as operating leases upon adoption of ASC 842. Specifically, certain of the Company's MPS arrangements, which had previously been accounted for as service revenue under ASC 606, Revenue from Contracts with Customers, are now accounted for as operating leases under ASC 842.
The Company's MPS arrangements consists of the placement, management, and optimization of print and imaging equipment in customers' offices, job sites, and other facilities under which the Company is paid a fixed rate per unit for each print produced (per-use), often referred to as a “click charge.” Accordingly, the fixed rate per unit charged to the customer covers the use of the equipment (i.e., the lease component), as well as the additional services performed by the Company as described above (i.e., the non-lease component). Certain of the Company's MPS contracts provide the customer the option to renew or terminate the agreement, which are considered when assessing the lease term. The Company elected the practical expedient to not separate certain lease and non-lease components related to its MPS arrangements, and accounts for the combined component under ASC 842. The pattern of revenue recognition for the Company's MPS revenue has remained substantially unchanged following the adoption of ASC 842.
v3.20.1
Summary of Significant Accounting Policies (Tables)
12 Months Ended
Dec. 31, 2019
Accounting Policies [Abstract]  
Summary of Allowance for Doubtful Accounts
The allowance for doubtful accounts activity was as follows:
 
Balance at
Beginning
of Period
 
Charges to
Cost and
Expenses
 
Deductions (1)
 
Balance at
End of
Period
Year ended December 31, 2019
 
 
 
 
 
 
 
Allowance for accounts receivable
$
2,016

 
$
590

 
$
(507
)
 
$
2,099

Year ended December 31, 2018
 
 
 
 
 
 
 
Allowance for accounts receivable
$
2,341

 
$
1,083

 
$
(1,408
)
 
$
2,016

 (1) Deductions represent uncollectible accounts written-off net of recoveries.
Schedule of Useful Lives of Property and Equipment
Property and equipment are stated at cost and are depreciated using the straight-line method over their estimated useful lives, as follows:
 
Buildings
  
10-20 years
Leasehold improvements
  
10-20 years or lease term, if shorter
Machinery and equipment
  
3-7 years
Furniture and fixtures
  
3-7 years
Property and equipment consist of the following:
 
December 31,
 
2019
 
2018
Machinery and equipment
$
256,249

 
$
248,546

Buildings and leasehold improvements
22,050

 
18,819

Furniture and fixtures
2,884

 
2,783

 
281,183

 
270,148

Less accumulated depreciation
(210,849
)
 
(199,480
)
 
$
70,334

 
$
70,668

Schedule of Net Sales of Principal Services and Products
Net sales of the Company’s principal services and products were as follows:
 
 
Year Ended December 31,
 
2019
 
2018
Service Sales
 
 
 
CDIM
$
205,536

 
$
211,389

MPS
123,279

 
128,775

AIM
14,097

 
13,136

Total services sales
342,912

 
353,300

Equipment and Supplies Sales
39,503

 
47,484

Total net sales
$
382,415

 
$
400,784

Schedule of Segment and Geographic Reporting
See table below for revenues and property and equipment, net, attributable to the Company’s U.S. operations and foreign operations. 
 
 
Year Ended December 31,
 
 
2019
 
2018
 
 
U.S.
 
Foreign
Countries
 
Total
 
U.S.
 
Foreign
Countries
 
Total
Revenues from external customers
 
$
329,372

 
$
53,043

 
$
382,415

 
$
340,650

 
$
60,134

 
$
400,784

Property and equipment, net
 
$
63,458

 
$
6,876

 
$
70,334

 
$
64,878

 
$
5,790

 
$
70,668


Schedule of Weighted Average Assumptions for Stock-Based Compensation
The fair value of each option grant was estimated on the date of grant using the Black-Scholes option-pricing model using the following weighted average assumptions for 2019 and 2018: 
 
 
Year Ended December 31,
 
 
2019
 
2018
Weighted average assumptions used:
 
 
 
 
Risk free interest rate
 
2.51
%
 
2.74
%
Expected volatility
 
54.8
%
 
53.0
%
Expected dividend yield
 
%
 
%
Schedule of Basic and Diluted Earnings Per Share
Basic and diluted weighted average common shares outstanding were calculated as follows for 2019 and 2018:
 
 
Year Ended December 31,
 
2019
 
2018
Weighted average common shares outstanding during the period — basic
44,997

 
44,918

Effect of dilutive stock options
86

 
132

Weighted average common shares outstanding during the period — diluted
45,083

 
45,050



v3.20.1
Goodwill and Other Intangibles (Tables)
12 Months Ended
Dec. 31, 2019
Goodwill and Intangible Assets Disclosure [Abstract]  
Schedule of Goodwill
The carrying amount of goodwill from January 1, 2018 through December 31, 2019 is summarized as follows:
 
Gross
Goodwill
 
Accumulated
Impairment
Loss
 
Net
Carrying
Amount
January 1, 2018
$
405,558

 
$
284,507

 
$
121,051

December 31, 2018
405,558

 
284,507

 
121,051

December 31, 2019
$
405,558

 
$
284,507

 
$
121,051

Schedule of Other Intangible Assets Resulting from Business Acquisitions
The following table sets forth the Company’s other intangible assets resulting from business acquisitions as of December 31, 2019 and 2018 which continue to be amortized:
 
 
December 31, 2019
 
December 31, 2018
 
Gross
Carrying
Amount
 
Accumulated
Amortization
 
Net
Carrying
Amount
 
Gross
Carrying
Amount
 
Accumulated
Amortization
 
Net
Carrying
Amount
Amortizable other intangible assets
 
 
 
 
 
 
 
 
 
 
 
Customer relationships
$
99,127

 
$
97,430

 
$
1,697

 
$
99,136

 
$
94,345

 
$
4,791

Trade names and trademarks
20,279

 
19,980

 
299

 
20,259

 
19,924

 
335

 
$
119,406

 
$
117,410

 
$
1,996

 
$
119,395

 
$
114,269

 
$
5,126

Schedule of Estimated Future Amortization Expense
Estimated future amortization expense of other intangible assets for each of the next five fiscal years and thereafter are as follows:
 
2020
$
1,528

2021
172

2022
98

2023
42

2024
40

Thereafter
116

 
$
1,996

v3.20.1
Property and Equipment (Tables)
12 Months Ended
Dec. 31, 2019
Property, Plant and Equipment [Abstract]  
Schedule of Property and Equipment
Property and equipment are stated at cost and are depreciated using the straight-line method over their estimated useful lives, as follows:
 
Buildings
  
10-20 years
Leasehold improvements
  
10-20 years or lease term, if shorter
Machinery and equipment
  
3-7 years
Furniture and fixtures
  
3-7 years
Property and equipment consist of the following:
 
December 31,
 
2019
 
2018
Machinery and equipment
$
256,249

 
$
248,546

Buildings and leasehold improvements
22,050

 
18,819

Furniture and fixtures
2,884

 
2,783

 
281,183

 
270,148

Less accumulated depreciation
(210,849
)
 
(199,480
)
 
$
70,334

 
$
70,668

v3.20.1
Long-Term Debt (Tables)
12 Months Ended
Dec. 31, 2019
Debt Disclosure [Abstract]  
Schedule of Long-Term Debt
Long-term debt consists of the following:
 
 
December 31,
 
2019
 
2018
Term Loan, net of deferred financing fees of $556; 4.11% interest rate at December 31, 2018
$

 
$
52,694

Revolving Loans; 3.63% and 4.74% interest rate at December 31, 2019 and 2018
60,000

 
26,750

Various capital leases; weighted average interest rate of 4.9% and 4.8% at December 31, 2019 and 2018; principal and interest payable monthly through December 2025
46,157

 
47,737

Various other notes payable with a weighted average interest rate of 10.7% at December 31, 2018

 
11

 
106,157

 
127,192

Less current portion
(17,075
)
 
(22,132
)
 
$
89,082

 
$
105,060

v3.20.1
Leasing (Tables)
12 Months Ended
Dec. 31, 2019
Leases [Abstract]  
Schedule of Operating and Financing Lease Components and Classification
The tables below present financial information associated with the Company's leases. This information is only presented as of, and the year ended, December 31, 2019 because, as noted above, the Company adopted ASC 842 using a transition method that does not require application to periods prior to adoption.
 
Classification
December 31, 2019
Assets
 
 
Operating lease assets
Right-of-use assets from operating leases
$
41,238

Finance lease assets
Property and equipment
85,914

 
Less accumulated depreciation
(43,166
)
 
Property and equipment, net
42,748

Total lease assets
 
$
83,986

 
 
 
Liabilities
 
 
Current
 
 
Operating
Current portion of operating lease liabilities
$
11,060

Finance
Current portion of long-term finance leases
17,075

Long-term
 
 
Operating
Long-term portion of operating lease liabilities
37,260

Finance
Long-term portion of finance leases
29,082

Total lease liabilities
 
$
94,477

Schedule of Lease Costs and Supplemental Costs
 
December 31, 2019
Weighted average remaining lease term (years)
 
Operating leases
 
5.5

Finance leases
 
3.2

 
 
 
Weighted average discount rate
 
Operating leases
 
5.9
%
Finance leases
 
4.9
%
Other information
Year Ended December 31, 2019
Cash paid for amounts included in the measurement of lease liabilities
 
Operating cash flows from operating leases
$
15,415

Operating cash flows from finance leases
$
2,373

Financing cash flows from finance leases
$
18,407

 
Classification
 
Year Ended December 31, 2019
Operating lease cost
Cost of sales
 
$
16,436

 
Selling, general and administrative expenses
 
3,381

Total operating lease cost (1)
 
 
$
19,817

 
 
 
 
Finance lease cost
 
 
 
Amortization of leased assets
Cost of sales
 
$
18,314

 
Selling, general and administrative expenses
 
246

Interest on lease liabilities
Interest expense, net
 
2,353

Total finance lease cost
 
 
20,913

Total lease cost
 
 
$
40,730

(1) Includes variable lease costs and short-term lease costs of $2,893 and $433, respectively for the year ended December 31, 2019.
Schedule of Operating Lease Liability Maturity
Maturity of lease liabilities (as of December 31, 2019)
Operating Leases(1) (2)
 
Finance Leases(3)
2020
 
$
15,247

 
$
19,421

2021
 
12,709

 
15,183

2022
 
10,797

 
9,784

2023
 
8,418

 
5,229

2024
 
5,709

 
1,777

Thereafter
 
11,970

 
65

Total
 
64,850

 
51,459

Less amount representing interest
 
16,530

 
5,302

Present value of lease liability
 
$
48,320

 
$
46,157


(1) Reflects payments for non-cancelable operating leases with initial terms of one year or more as of December 31, 2019. The table above does not include any legally binding minimum lease payments for leases signed but not yet commenced, and such leases are not material in the aggregate.

(2) The Company leased several of its facilities under lease agreements with entities owned by certain of its current and former executive officers which expire through December 2023. The rental payments on these facilities amounted to $0.5 million during 2019 and 2018. In the table above, annual rental payments of $0.5 million for related parties are included in 2020 through 2023.

(3) The table above does not include any legally binding minimum lease payments for leases signed but not yet commenced, and such leases are not material in the aggregate.
Schedule of Financing Lease Liability Maturity
Maturity of lease liabilities (as of December 31, 2019)
Operating Leases(1) (2)
 
Finance Leases(3)
2020
 
$
15,247

 
$
19,421

2021
 
12,709

 
15,183

2022
 
10,797

 
9,784

2023
 
8,418

 
5,229

2024
 
5,709

 
1,777

Thereafter
 
11,970

 
65

Total
 
64,850

 
51,459

Less amount representing interest
 
16,530

 
5,302

Present value of lease liability
 
$
48,320

 
$
46,157


(1) Reflects payments for non-cancelable operating leases with initial terms of one year or more as of December 31, 2019. The table above does not include any legally binding minimum lease payments for leases signed but not yet commenced, and such leases are not material in the aggregate.

(2) The Company leased several of its facilities under lease agreements with entities owned by certain of its current and former executive officers which expire through December 2023. The rental payments on these facilities amounted to $0.5 million during 2019 and 2018. In the table above, annual rental payments of $0.5 million for related parties are included in 2020 through 2023.

(3) The table above does not include any legally binding minimum lease payments for leases signed but not yet commenced, and such leases are not material in the aggregate.

Schedule of Operating Lease Maturities, before Adoption of 842
As previously disclosed in the Company's 2018 Annual Report on Form 10-K and under the previous lease accounting standard, future minimum lease payments for operating leases and capital lease obligation as of December 31, 2018 were as follows:
Maturity of lease liabilities (as of December 31, 2018)
Operating Leases
 
Capital Leases
2019
 
$
16,355

 
$
16,872

2020
 
12,956

 
13,817

2021
 
10,130

 
10,141

2022
 
8,510

 
5,274

2023
 
7,054

 
1,633

Thereafter
 
16,650

 

Total
 
$
71,655

 
$
47,737

Schedule of Capital Lease Maturities, before Adoption of 842
As previously disclosed in the Company's 2018 Annual Report on Form 10-K and under the previous lease accounting standard, future minimum lease payments for operating leases and capital lease obligation as of December 31, 2018 were as follows:
Maturity of lease liabilities (as of December 31, 2018)
Operating Leases
 
Capital Leases
2019
 
$
16,355

 
$
16,872

2020
 
12,956

 
13,817

2021
 
10,130

 
10,141

2022
 
8,510

 
5,274

2023
 
7,054

 
1,633

Thereafter
 
16,650

 

Total
 
$
71,655

 
$
47,737

v3.20.1
Income Taxes (Tables)
12 Months Ended
Dec. 31, 2019
Income Tax Disclosure [Abstract]  
Schedule of Income Tax Provision
The following table includes the consolidated income tax provision for federal, state, and foreign income taxes related to the Company’s total earnings before taxes for 2019 and 2018:
 
 
 
Year Ended December 31,
 
 
2019
 
2018
Current:
 
 
 
 
Federal
 
$
(45
)
 
$
(89
)
State
 
187

 
65

Foreign
 
354

 
370

 
 
496

 
346

Deferred:
 
 
 
 
Federal
 
3,680

 
2,331

State
 
1,606

 
560

Foreign
 
(58
)
 
97

 
 
5,228

 
2,988

Income tax provision
 
$
5,724

 
$
3,334

Schedule of Deferred Tax Assets and Liabilities
The consolidated deferred tax assets and liabilities consist of the following:
 
 
December 31,
 
2019
 
2018
Deferred tax assets:
 
 
 
Financial statement accruals not currently deductible
$
2,047

 
$
2,332

Deferred rent expense

 
1,563

Accrued vacation
849

 
873

Deferred revenue, net
84

 
24

Fixed assets
3,637

 
3,624

Right of use operating lease liabilities
12,025

 

Goodwill and other identifiable intangibles
7,297

 
9,917

Stock-based compensation
2,952

 
5,022

Federal tax net operating loss carryforward
16,914

 
16,353

State tax net operating loss carryforward, net
5,803

 
5,791

Foreign tax net operating loss carryforward
602

 
691

Tax credits, net
1,726

 
1,770

Gross deferred tax assets
53,936

 
47,960

Less: valuation allowance
(2,254
)
 
(2,203
)
Net deferred tax assets
$
51,682

 
$
45,757

 
 
 
 
Deferred tax liabilities:
 
 
 
Goodwill
$
(21,705
)
 
$
(20,811
)
Right of use assets
(10,222
)
 

Net deferred tax assets
$
19,755

 
$
24,946

Schedule of Effective Income Tax Rate Reconciliation
A reconciliation of the statutory federal income tax rate to the Company’s effective tax rate is as follows:
 
 
Year Ended December 31,
 
2019
 
2018
Statutory federal income tax rate
21
%
 
21
%
State taxes, net of federal benefit
7

 
5

Foreign taxes
2

 
2

Valuation allowance
1

 
(1
)
Non-deductible expenses and other
2

 
1

Section 162(m) limitation
3

 
1

Stock based compensation
29

 

Discrete items for federal, state and foreign taxes
1

 
(2
)
Global intangible low taxed income
1

 
1

Effective income tax rate
67
%
 
28
%
v3.20.1
Employee Stock Purchase Plan and Stock Plan (Tables)
12 Months Ended
Dec. 31, 2019
Share-based Payment Arrangement [Abstract]  
Schedule of Employee Share Purchases
Employees purchased the following shares in the periods presented:
 
 
Year Ended December 31,
 
2019
 
2018
Shares purchased
90

 
76

Average price per share
$
1.51

 
$
1.67

Schedule of Stock Option Plan Activity
The following is a further breakdown of the stock option activity under the Stock Plan:
 
Shares
 
Weighted
Average
Exercise
Price
 
Weighted
Average
Contractual
Life
(In years)
 
Aggregate
Intrinsic
Value
(In thousands)
Outstanding at December 31, 2017
4,735

 
$
5.44

 
 
 
 
Granted
686

 
$
2.21

 
 
 
 
Exercised

 
$

 
 
 
 
Forfeited/Canceled
(164
)
 
$
6.23

 
 
 
 
Outstanding at December 31, 2018
5,257

 
$
4.95

 
 
 
 
Granted
747

 
$
2.30

 
 
 
 
Exercised

 
$

 
 
 
 
Forfeited/Canceled
(1,097
)
 
$
7.11

 
 
 
 
Outstanding at December 31, 2019
4,907

 
$
4.06

 
5.27
 
$

Vested or expected to vest at December 31, 2019
4,907

 
$
4.06

 
5.27
 
$

Exercisable at December 31, 2019
3,661

 
$
4.56

 
4.17
 
$

Schedule of Non-vested Stock Options
A summary of the Company’s non-vested stock options as of December 31, 2019, and changes during the year then ended is as follows:
 
 
 
Weighted
Average Grant Date
Non-vested Options
Shares
 
Fair Market Value
Non-vested at December 31, 2018
1,191

 
$
1.76

Granted
747

 
$
1.30

Vested
(514
)
 
$
1.92

Forfeited/Canceled
(178
)
 
$
1.54

Non-vested at December 31, 2019
1,246

 
$
1.44

Schedule of Range of Exercise Price for Options Outstanding
The following table summarizes certain information concerning outstanding options at December 31, 2019:
 
 
 
Range of Exercise Price
Options Outstanding at
December 31, 2019
$1.14 – $2.70
2,568

$3.65 – $4.82
911

$5.37 – $7.19
949

$8.66 – $9.09
479

$1.14 – $9.09
4,907

Schedule of Nonvested Restricted Stock Options
A summary of the Company’s non-vested restricted stock as of December 31, 2019, and changes during the year then ended is as follows:
 
 
 
Weighted
Average Grant Date
Non-vested Restricted Stock
Shares
 
Fair Market Value
Non-vested at December 31, 2018
751

 
$
3.37

Granted
607

 
$
2.41

Vested
(432
)
 
$
3.47

Forfeited/Canceled

 
$

Non-vested at December 31, 2019
926

 
$
2.69

v3.20.1
Fair Value Measurements (Tables)
12 Months Ended
Dec. 31, 2019
Fair Value Disclosures [Abstract]  
Fair Value, Assets Measured on Recurring and Nonrecurring Basis
The following table summarizes the bases used to measure certain assets and liabilities at fair value on a nonrecurring basis in the consolidated financial statements as of and for the year ended December 31, 2019 and 2018:

 
Significant Other Unobservable Inputs
 
December 31, 2019
 
December 31, 2018
 
Level 3
 
Total Losses
 
Level 3
 
Total Losses
Nonrecurring Fair Value Measure
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Goodwill
$
121,051

 
$

 
$
121,051

 
$

v3.20.1
Summary of Significant Accounting Policies - Cash Equivalents (Details) - USD ($)
$ in Thousands
Dec. 31, 2019
Dec. 31, 2018
Cash and Cash Equivalents [Line Items]    
Cash and cash equivalents $ 29,425 $ 29,433
UDS    
Cash and Cash Equivalents [Line Items]    
Cash and cash equivalents $ 12,700 $ 11,500
v3.20.1
Summary of Significant Accounting Policies - Concentrations of Credit Risk and Significant Vendors (Details)
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Revenue from Contract with Customer | Customer Concentration Risk    
Concentration Risk [Line Items]    
Concentration risk 2.00% 2.00%
Revenue from Contract with Customer | Geographic Concentration Risk | California    
Concentration Risk [Line Items]    
Concentration risk 34.00% 34.00%
Purchases of inventory and supplies | Supplier Concentration Risk | Three Largest Vendors    
Concentration Risk [Line Items]    
Concentration risk 41.00% 46.00%
v3.20.1
Summary of Significant Accounting Policies - Summary of Allowance for Doubtful Accounts (Details) - Allowance for Doubtful Accounts - USD ($)
$ in Thousands
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward]    
Balance at Beginning of Period $ 2,016 $ 2,341
Charges to Cost and Expenses 590 1,083
Deductions (507) (1,408)
Balance at End of Period $ 2,099 $ 2,016
v3.20.1
Summary of Significant Accounting Policies - Narrative (Details) - USD ($)
shares in Millions
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Accounting Policies [Abstract]    
Total net sales $ 382,415,000 $ 400,784,000
Reserves for inventory obsolescence 900,000 900,000
Valuation allowance 2,254,000 2,203,000
Deferred financing fees 0 600,000
Accumulated amortization   300,000
Cash equivalents 9,300,000 7,300,000
Carrying amount of notes 60,000,000  
Fair value of notes 60,000,000  
Deductible insurance policy 250,000  
Self-insured for healthcare benefits 250,000  
Advertising costs 1,800,000 2,100,000
Research and development $ 9,300,000 $ 8,400,000
Noncontrolling Interest [Line Items]    
Common stock options excluded for anti-dilutive (in shares) 4.8 5.1
UDS    
Noncontrolling Interest [Line Items]    
Noncontrolling interest 35.00%  
v3.20.1
Summary of Significant Accounting Policies - Property and Equipment and Impairment of Long-Lived Assets (Details) - USD ($)
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Property, Plant and Equipment [Line Items]    
Capitalized software development costs $ 1,300,000 $ 1,300,000
Net of accumulated amortization 20,700,000 20,000,000
Depreciation expense and amortization of capitalized software development costs 1,000,000 1,100,000
Impairment of long-lived assets $ 0 $ 0
Software    
Property, Plant and Equipment [Line Items]    
Estimated useful lives of other intangible assets 3 years  
Minimum | Buildings    
Property, Plant and Equipment [Line Items]    
Estimated useful lives 10 years  
Minimum | Leasehold improvements    
Property, Plant and Equipment [Line Items]    
Estimated useful lives 10 years  
Minimum | Machinery and equipment    
Property, Plant and Equipment [Line Items]    
Estimated useful lives 3 years  
Minimum | Furniture and fixtures    
Property, Plant and Equipment [Line Items]    
Estimated useful lives 3 years  
Maximum | Buildings    
Property, Plant and Equipment [Line Items]    
Estimated useful lives 20 years  
Maximum | Leasehold improvements    
Property, Plant and Equipment [Line Items]    
Estimated useful lives 20 years  
Maximum | Machinery and equipment    
Property, Plant and Equipment [Line Items]    
Estimated useful lives 7 years  
Maximum | Furniture and fixtures    
Property, Plant and Equipment [Line Items]    
Estimated useful lives 7 years  
v3.20.1
Summary of Significant Accounting Policies - Goodwill and Other Intangible Assets (Details)
12 Months Ended
Dec. 31, 2019
Customer relationships  
Finite-Lived Intangible Assets [Line Items]  
Estimated useful lives of other intangible assets 13 years
v3.20.1
Summary of Significant Accounting Policies - Revenue Recognition (Details) - USD ($)
$ in Thousands
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Disaggregation of Revenue [Line Items]    
Description of timing one year or less  
Total net sales $ 382,415 $ 400,784
Service Sales    
Disaggregation of Revenue [Line Items]    
Total net sales 342,912 353,300
CDIM    
Disaggregation of Revenue [Line Items]    
Total net sales 205,536 211,389
MPS    
Disaggregation of Revenue [Line Items]    
Total net sales 123,279 128,775
AIM    
Disaggregation of Revenue [Line Items]    
Total net sales 14,097 13,136
Equipment and Supplies Sales    
Disaggregation of Revenue [Line Items]    
Total net sales 39,503 47,484
Shipping and Handling    
Disaggregation of Revenue [Line Items]    
Total net sales $ 11,100 $ 11,100
Software Licensing Activities | Product Concentration Risk | Revenue from Contract with Customer    
Disaggregation of Revenue [Line Items]    
Concentration risk 2.00% 2.00%
v3.20.1
Summary of Significant Accounting Policies - Schedule of Segment and Geographic Reporting (Details) - USD ($)
$ in Thousands
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Revenues from External Customers and Long-Lived Assets [Line Items]    
Total net sales $ 382,415 $ 400,784
Property and equipment, net 70,334  
Property and equipment, net   70,668
U.S.    
Revenues from External Customers and Long-Lived Assets [Line Items]    
Total net sales 329,372 340,650
Property and equipment, net 63,458  
Property and equipment, net   64,878
Foreign Countries    
Revenues from External Customers and Long-Lived Assets [Line Items]    
Total net sales 53,043 60,134
Property and equipment, net $ 6,876  
Property and equipment, net   $ 5,790
v3.20.1
Summary of Significant Accounting Policies - Stock-Based Compensation (Details) - USD ($)
$ / shares in Units, $ in Thousands
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Accounting Policies [Abstract]    
Total stock-based compensation $ 2,459 $ 2,445
Weighted average fair value of option (in dollars per share) $ 1.30 $ 1.21
Weighted average assumptions used:    
Risk free interest rate 2.51% 2.74%
Expected volatility 54.80% 53.00%
Expected dividend yield 0.00% 0.00%
Expected term of stock options granted 6 years 8 months 6 years 7 months
Total unrecognized stock-based compensation $ 2,400  
Expected weighted-average period to recognize compensation cost 1 year 9 months  
v3.20.1
Summary of Significant Accounting Policies - Schedule of Basic and Diluted Earnings Per Share (Details) - shares
shares in Thousands
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Accounting Policies [Abstract]    
Weighted average common shares outstanding during the period—basic (in shares) 44,997 44,918
Effect of dilutive stock options (in shares) 86 132
Weighted average common shares outstanding during the period—diluted (in shares) 45,083 45,050
v3.20.1
Summary of Significant Accounting Policies - Recently Adopted Accounting Pronouncements (Details) - USD ($)
$ in Thousands
Dec. 31, 2019
Jan. 01, 2019
New Accounting Pronouncements or Change in Accounting Principle [Line Items]    
Right-of-use assets from operating leases $ 41,238  
Operating lease liabilities $ 48,320  
Accounting Standards Update 2016-02    
New Accounting Pronouncements or Change in Accounting Principle [Line Items]    
Right-of-use assets from operating leases   $ 46,900
Operating lease liabilities   $ 53,700
v3.20.1
Restructuring (Details)
$ in Thousands
12 Months Ended
Dec. 31, 2019
USD ($)
employee
Dec. 31, 2018
USD ($)
Restructuring Cost and Reserve [Line Items]    
Restructuring charges $ 660 $ 0
Employee Severance    
Restructuring Cost and Reserve [Line Items]    
Reduction in headcount | employee 90  
Percentage of total workforce eliminated 5.00%  
Restructuring charges $ 700  
Additional restructuring cost expected $ 100  
v3.20.1
Goodwill and Other Intangibles - Schedule of Goodwill (Details) - USD ($)
$ in Thousands
Dec. 31, 2019
Dec. 31, 2018
Dec. 31, 2017
Goodwill and Intangible Assets Disclosure [Abstract]      
Gross Goodwill $ 405,558 $ 405,558 $ 405,558
Accumulated Impairment Loss 284,507 284,507 284,507
Net Carrying Amount $ 121,051 $ 121,051 $ 121,051
v3.20.1
Goodwill and Other Intangibles - Schedule of Other Intangible Assets Resulting from Business Acquisitions (Details) - USD ($)
$ in Thousands
Dec. 31, 2019
Dec. 31, 2018
Finite-Lived Intangible Assets [Line Items]    
Gross Carrying Amount $ 119,406 $ 119,395
Accumulated Amortization 117,410 114,269
Net Carrying Amount 1,996 5,126
Customer relationships    
Finite-Lived Intangible Assets [Line Items]    
Gross Carrying Amount 99,127 99,136
Accumulated Amortization 97,430 94,345
Net Carrying Amount 1,697 4,791
Trade names and trademarks    
Finite-Lived Intangible Assets [Line Items]    
Gross Carrying Amount 20,279 20,259
Accumulated Amortization 19,980 19,924
Net Carrying Amount $ 299 $ 335
v3.20.1
Goodwill and Other Intangibles - Schedule of Estimated Future Amortization Expense (Details) - USD ($)
$ in Thousands
Dec. 31, 2019
Dec. 31, 2018
Goodwill and Intangible Assets Disclosure [Abstract]    
2020 $ 1,528  
2021 172  
2022 98  
2023 42  
2024 40  
Thereafter 116  
Net Carrying Amount $ 1,996 $ 5,126
v3.20.1
Property and Equipment - Schedule of Property and Equipment (Details) - USD ($)
$ in Thousands
Dec. 31, 2019
Dec. 31, 2018
Property, Plant and Equipment [Line Items]    
Property and equipment, gross $ 281,183  
Property and equipment, gross   $ 270,148
Less accumulated depreciation (210,849)  
Less accumulated depreciation   (199,480)
Property and equipment total 70,334  
Property and equipment total   70,668
Machinery and equipment    
Property, Plant and Equipment [Line Items]    
Property and equipment, gross 256,249  
Property and equipment, gross   248,546
Buildings and leasehold improvements    
Property, Plant and Equipment [Line Items]    
Property and equipment, gross 22,050  
Property and equipment, gross   18,819
Furniture and fixtures    
Property, Plant and Equipment [Line Items]    
Property and equipment, gross $ 2,884  
Property and equipment, gross   $ 2,783
v3.20.1
Property and Equipment - Narrative (Details) - USD ($)
$ in Thousands
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Property, Plant and Equipment [Abstract]    
Depreciation $ 28,763 $ 29,019
v3.20.1
Long-Term Debt - Schedule of Long-Term Debt (Details) - USD ($)
Dec. 31, 2019
Dec. 31, 2018
Debt Instrument [Line Items]    
Various capital leases $ 46,157,000  
Various capital leases   $ 47,737,000
Long-term debt and capital lease obligations, including current maturities 106,157,000 127,192,000
Less current portion (17,075,000) (22,132,000)
Long-term debt and finance leases 89,082,000 105,060,000
Deferred financing fees 0 600,000
Line of Credit | Revolving Credit Facility    
Debt Instrument [Line Items]    
Long-term debt $ 60,000,000 $ 26,750,000
Debt instrument, interest rate, effective percentage 3.63% 4.74%
Line of Credit | Term A Loan Facility    
Debt Instrument [Line Items]    
Long-term debt $ 0 $ 52,694,000
Deferred financing fees   $ 556,000
Debt instrument, interest rate, effective percentage   4.11%
Various capital leases    
Debt Instrument [Line Items]    
Long-term debt, weighted average interest rate 4.90%  
Various capital leases    
Debt Instrument [Line Items]    
Long-term debt, weighted average interest rate   4.80%
Other Notes Payable    
Debt Instrument [Line Items]    
Long-term debt $ 0 $ 11,000
Long-term debt, weighted average interest rate   10.70%
v3.20.1
Long-Term Debt - Narrative (Details)
1 Months Ended
Dec. 17, 2019
USD ($)
Dec. 31, 2019
USD ($)
$ / shares
Dec. 31, 2018
USD ($)
Nov. 20, 2014
USD ($)
Debt Instrument [Line Items]        
Cash dividends, per hare, declared (in dollars per share) | $ / shares   $ 0.01    
Cash dividends payable   $ 443,000    
Term A Loan Facility | Line of Credit        
Debt Instrument [Line Items]        
Repayments of outstanding term loan $ 49,500,000      
Long-term debt   0 $ 52,694,000  
Revolving Credit Facility | Line of Credit        
Debt Instrument [Line Items]        
Term loan, maximum borrowing capacity $ 80,000,000     $ 65,000,000
Line of credit, remaining borrowing capacity   17,800,000    
Long-term debt   60,000,000 $ 26,750,000  
Total leverage ratio 2.75      
Debt instrument, covenant terms, fixed charged coverage ratio 1.15      
Debt instrument covenant terms maximum payments $ 15,000,000      
Debt instrument covenant terms fixed charges $ 10,000,000      
Revolving Credit Facility | Line of Credit | London Interbank Offered Rate (LIBOR)        
Debt Instrument [Line Items]        
Debt instrument, basis spread on variable rate 1.00%      
Revolving Credit Facility | Line of Credit | London Interbank Offered Rate (LIBOR) | Minimum        
Debt Instrument [Line Items]        
Debt instrument, basis spread on variable rate 1.25%      
Revolving Credit Facility | Line of Credit | London Interbank Offered Rate (LIBOR) | Maximum        
Debt Instrument [Line Items]        
Debt instrument, basis spread on variable rate 1.75%      
Revolving Credit Facility | Line of Credit | Federal Funds Effective Swap Rate        
Debt Instrument [Line Items]        
Debt instrument, basis spread on variable rate 0.50%      
Revolving Credit Facility | Line of Credit | Prime Rate | Minimum        
Debt Instrument [Line Items]        
Debt instrument, basis spread on variable rate 0.25%      
Revolving Credit Facility | Line of Credit | Prime Rate | Maximum        
Debt Instrument [Line Items]        
Debt instrument, basis spread on variable rate 0.75%      
Revolving Credit Facility | Letter of Credit        
Debt Instrument [Line Items]        
Line of credit facility, fair value of amount outstanding   $ 2,200,000    
v3.20.1
Leasing - Additional Information, Lessee (Details) - USD ($)
$ in Thousands
Dec. 31, 2019
Jan. 01, 2019
Lessee, Lease, Description [Line Items]    
Right-of-use assets from operating leases $ 41,238  
Present value of lease liability $ 48,320  
Minimum    
Lessee, Lease, Description [Line Items]    
Range of lease terms 1 year  
Renewal lease extension terms 1 year  
Maximum    
Lessee, Lease, Description [Line Items]    
Range of lease terms 10 years  
Renewal lease extension terms 5 years  
Accounting Standards Update 2016-02    
Lessee, Lease, Description [Line Items]    
Right-of-use assets from operating leases   $ 46,900
Present value of lease liability   $ 53,700
v3.20.1
Leasing - Lessee, Operating and Financing Lease Components and Classifications (Details)
$ in Thousands
Dec. 31, 2019
USD ($)
Assets  
Right-of-use assets from operating leases $ 41,238
Property and equipment 85,914
Less accumulated depreciation (43,166)
Property and equipment, net 42,748
Total lease assets 83,986
Current  
Current portion of operating lease liabilities 11,060
Current portion of long-term finance leases 17,075
Long-term  
Long-term portion of operating lease liabilities 37,260
Long-term portion of finance leases 29,082
Total lease liabilities $ 94,477
v3.20.1
Leasing - Components of Lease Cost (Details)
$ in Thousands
12 Months Ended
Dec. 31, 2019
USD ($)
Lessee, Lease, Description [Line Items]  
Total operating lease cost $ 19,817
Interest on lease liabilities 2,353
Total finance lease cost 20,913
Total lease cost 40,730
Variable lease cost 2,893
Short-term lease cost 433
Cost of sales  
Lessee, Lease, Description [Line Items]  
Total operating lease cost 16,436
Amortization of leased assets 18,314
Selling, general and administrative expenses  
Lessee, Lease, Description [Line Items]  
Total operating lease cost 3,381
Amortization of leased assets $ 246
v3.20.1
Leasing - Maturity of Lease Liabilities (Details) - USD ($)
$ in Thousands
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Operating leases    
2020 $ 15,247  
2021 12,709  
2022 10,797  
2023 8,418  
2024 5,709  
Thereafter 11,970  
Total 64,850  
Less amount representing interest 16,530  
Present value of lease liability 48,320  
Finance leases    
2020 19,421  
2021 15,183  
2022 9,784  
2023 5,229  
2024 1,777  
Thereafter 65  
Total 51,459  
Less amount representing interest 5,302  
Present value of lease liability 46,157  
Annual Rental Payments    
2020 15,247  
2021 12,709  
2022 10,797  
2023 8,418  
Related Party    
Operating leases    
2020 500  
2021 500  
2022 500  
2023 500  
Annual Rental Payments    
Rental expense 500  
Rental expense   $ 500
2020 500  
2021 500  
2022 500  
2023 $ 500  
v3.20.1
Leasing - Maturity of Lease Liabilities, before Adoption of New Standard (Details)
$ in Thousands
Dec. 31, 2018
USD ($)
Operating Leases  
2019 $ 16,355
2020 12,956
2021 10,130
2022 8,510
2023 7,054
Thereafter 16,650
Total 71,655
Capital Leases  
2019 16,872
2020 13,817
2021 10,141
2022 5,274
2023 1,633
Thereafter 0
Total $ 47,737
v3.20.1
Leasing - Weighted Average Remaining Lease Term and Discount Rate (Details)
Dec. 31, 2019
Weighted average remaining lease term (years)  
Operating leases 5 years 6 months
Finance leases 3 years 2 months
Weighted average discount rate  
Operating leases 5.90%
Finance leases 4.90%
v3.20.1
Leasing - Cash Paid for Amount Included in the Measurement of Lease Liabilities (Details)
$ in Thousands
12 Months Ended
Dec. 31, 2019
USD ($)
Cash paid for amounts included in the measurement of lease liabilities  
Operating cash flows from operating leases $ 15,415
Operating cash flows from finance leases 2,373
Financing cash flows from finance leases $ 18,407
v3.20.1
Leasing - Additional Information, Lessor (Details)
$ in Thousands
12 Months Ended
Dec. 31, 2019
USD ($)
Property, Plant and Equipment [Line Items]  
Property and equipment, net $ 42,748
MPS  
Property, Plant and Equipment [Line Items]  
Rental income 114,700
Service income 8,600
MPS | Equipment Subject to Leases  
Property, Plant and Equipment [Line Items]  
Property and equipment, net $ 40,000
v3.20.1
Income Taxes - Narrative (Details) - USD ($)
3 Months Ended 12 Months Ended
Dec. 31, 2017
Dec. 31, 2019
Dec. 31, 2018
Income Tax Disclosure [Abstract]      
Tax cuts and jobs act of 2017, income tax expense (benefit) $ 11,900,000    
Foreign earnings (losses) before taxes   $ 700,000 $ 1,200,000
Valuation allowance   2,254,000 2,203,000
Income taxes receivable   200,000  
Operating Loss Carryforwards [Line Items]      
Unrecognized tax benefits   0 0
Unrecognized tax benefits, interest and penalties   0 $ 0
Federal      
Operating Loss Carryforwards [Line Items]      
Operating loss carryforwards   80,500,000  
State and Local Jurisdiction      
Operating Loss Carryforwards [Line Items]      
Operating loss carryforwards   93,300,000  
Foreign Tax Authority      
Operating Loss Carryforwards [Line Items]      
Operating loss carryforwards   $ 3,600,000  
v3.20.1
Income Taxes - Schedule of Income Tax Provision (Details) - USD ($)
$ in Thousands
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Current:    
Federal $ (45) $ (89)
State 187 65
Foreign 354 370
Current income tax, total 496 346
Deferred:    
Federal 3,680 2,331
State 1,606 560
Foreign (58) 97
Deferred income taxes 5,228 2,988
Income tax provision $ 5,724 $ 3,334
v3.20.1
Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($)
$ in Thousands
Dec. 31, 2019
Dec. 31, 2018
Deferred tax assets:    
Financial statement accruals not currently deductible $ 2,047 $ 2,332
Deferred rent expense 0 1,563
Accrued vacation 849 873
Deferred revenue, net 84 24
Fixed assets 3,637 3,624
Right of use operating lease liabilities 12,025  
Goodwill and other identifiable intangibles 7,297 9,917
Stock-based compensation 2,952 5,022
Federal tax net operating loss carryforward 16,914 16,353
State tax net operating loss carryforward, net 5,803 5,791
Foreign tax net operating loss carryforward 602 691
Tax credits, net 1,726 1,770
Gross deferred tax assets 53,936 47,960
Less: valuation allowance (2,254) (2,203)
Net deferred tax assets 51,682 45,757
Deferred tax liabilities:    
Goodwill (21,705) (20,811)
Right of use assets (10,222)  
Net deferred tax assets $ 19,755 $ 24,946
v3.20.1
Income Taxes - Schedule of Effective Income Tax Rate Reconciliation (Details)
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Reconciliation of the statutory federal income tax rate    
Statutory federal income tax rate 21.00% 21.00%
State taxes, net of federal benefit 7.00% 5.00%
Foreign taxes 2.00% 2.00%
Valuation allowance 1.00% (1.00%)
Non-deductible expenses and other 2.00% 1.00%
Section 162(m) limitation 3.00% 1.00%
Stock based compensation 29.00% 0.00%
Discrete items for federal, state and foreign taxes 1.00% (2.00%)
Global intangible low taxed income 1.00% 1.00%
Effective income tax rate 67.00% 28.00%
v3.20.1
Employee Stock Purchase Plan and Stock Plan - Narrative (Details)
$ in Thousands
3 Months Ended 12 Months Ended
Dec. 31, 2018
shares
Dec. 31, 2019
USD ($)
director
shares
Dec. 31, 2018
USD ($)
director
shares
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Percentage on market value of common stock   100.00%  
Shares authorized under the plan (in shares)   3,500,000.0  
Shares available under Stock Plan (in shares)   2,000,000  
Maturity period of share   10 years  
Vesting period   3 years 3 years
Granted (in shares)   747,000 686,000
Exercised (in shares)   0 0
Restricted Stock      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Expiration period   10 years  
Fair market value of restricted stock | $   $ 60  
Shares, granted (in shares)   607,000  
Vested in period | $   $ 1,000 $ 800
Minimum      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Vesting period   3 years  
Minimum | Restricted Stock      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Vesting period   3 years  
Maximum      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Vesting period   4 years  
Maximum | Restricted Stock      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Vesting period   4 years  
Key Employees | Restricted Stock      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Shares, granted (in shares)   450,000 325,000
Non-employee Board Members | Restricted Stock      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Vesting period   1 year 1 year
Shares, granted (in shares) 13,000 26,000 28,000
Number of employees | director   6 6
ESPP      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Common stock, shares (in shares)   2,500  
Aggregate fair market value of common stock | $   $ 25  
Percentage on market value of common stock   85.00%  
Share-based compensation, expense | $   $ 23 $ 22
v3.20.1
Employee Stock Purchase Plan and Stock Plan - Schedule of Employee Share Purchases (Details) - $ / shares
shares in Thousands
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Share-based Payment Arrangement [Abstract]    
Shares purchased (in shares) 90 76
Average price per share (in dollars per share) $ 1.51 $ 1.67
v3.20.1
Employee Stock Purchase Plan and Stock Plan - Schedule of Stock Option Plan Activity (Details) - USD ($)
$ / shares in Units, $ in Thousands
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Shares    
Beginning balance (in shares) 5,257,000 4,735,000
Granted (in shares) 747,000 686,000
Exercised (in shares) 0 0
Forfeited/canceled (in shares) (1,097,000) (164,000)
Ending balance (in shares) 4,907,000 5,257,000
Vested or expected to vest (in shares) 4,907,000  
Exercisable (in shares) 3,661,000  
Weighted Average Exercise Price    
Beginning balance (in dollars per share) $ 4.95 $ 5.44
Granted (in dollars per share) 2.30 2.21
Exercised (in dollars per share) 0.00 0.00
Forfeited/canceled (in dollars per share) 7.11 6.23
Ending balance (in dollars per share) 4.06 $ 4.95
Vested or expected to vest (in dollars per share) 4.06  
Exercisable (in dollars per share) $ 4.56  
Weighted Average Contractual Life (In years) and Aggregate Intrinsic Value    
Weighted average contractual life (in years), outstanding 5 years 3 months 8 days  
Weighted average contractual life (in years), vested or expected to vest 5 years 3 months 8 days  
Weighted average contractual life (in years), exercisable 4 years 2 months 2 days  
Aggregate intrinsic value, outstanding $ 0  
Aggregate intrinsic value, vested or expected to vest 0  
Aggregate intrinsic value, exercisable $ 0  
v3.20.1
Employee Stock Purchase Plan and Stock Plan - Schedule of Non-vested Stock Options (Details) - $ / shares
shares in Thousands
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Shares    
Beginning balance (in shares) 5,257 4,735
Granted (in shares) 747 686
Forfeited/canceled (in shares) (1,097) (164)
Ending balance (in shares) 4,907 5,257
Weighted Average Grant Date    
Beginning balance (in dollars per share) $ 4.95 $ 5.44
Granted (in dollars per share) 2.30 2.21
Ending balance (in dollars per share) $ 4.06 $ 4.95
Non-Vested Options    
Shares    
Beginning balance (in shares) 1,191  
Shares, vested (in shares) (514)  
Forfeited/canceled (in shares) (178)  
Ending balance (in shares) 1,246 1,191
Weighted Average Grant Date    
Beginning balance (in dollars per share) $ 1.76  
Granted (in dollars per share) 1.30  
Vested (in dollars per share) 1.92  
Forfeited/canceled (in dollars per share) 1.54  
Ending balance (in dollars per share) $ 1.44 $ 1.76
v3.20.1
Employee Stock Purchase Plan and Stock Plan - Schedule of Range of Exercise Price for Options Outstanding (Details) - $ / shares
shares in Thousands
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Dec. 31, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Share-based compensation arrangement, options, outstanding, number (in shares) 4,907 5,257 4,735
$1.14 – $2.70      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Range of exercise price range minimum (in dollars per share) $ 1.14    
Range of exercise price range maximum (in dollars per share) $ 2.70    
Share-based compensation arrangement, options, outstanding, number (in shares) 2,568    
$3.65 – $4.82      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Range of exercise price range minimum (in dollars per share) $ 3.65    
Range of exercise price range maximum (in dollars per share) $ 4.82    
Share-based compensation arrangement, options, outstanding, number (in shares) 911    
$5.37 – $7.19      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Range of exercise price range minimum (in dollars per share) $ 5.37    
Range of exercise price range maximum (in dollars per share) $ 7.19    
Share-based compensation arrangement, options, outstanding, number (in shares) 949    
$8.66 – $9.09      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Range of exercise price range minimum (in dollars per share) $ 8.66    
Range of exercise price range maximum (in dollars per share) $ 9.09    
Share-based compensation arrangement, options, outstanding, number (in shares) 479    
$1.14 – $9.09      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Range of exercise price range minimum (in dollars per share) $ 1.14    
Range of exercise price range maximum (in dollars per share) $ 9.09    
Share-based compensation arrangement, options, outstanding, number (in shares) 4,907    
v3.20.1
Employee Stock Purchase Plan and Stock Plan - Schedule of Nonvested Restricted Stock Options (Details) - Restricted Stock
shares in Thousands
12 Months Ended
Dec. 31, 2019
$ / shares
shares
Shares  
Beginning balance (in shares) | shares 751
Granted (in shares) | shares 607
Vested (in shares) | shares (432)
Forfeited/canceled (in shares) | shares 0
Ending balance (in shares) | shares 926
Weighted Average Grant Date  
Beginning balance (in dollars per share) | $ / shares $ 3.37
Granted (in dollars per share) | $ / shares 2.41
Vested (in dollars per share) | $ / shares 3.47
Forfeited/canceled (in dollars per share) | $ / shares 0.00
Ending balance (in dollars per share) | $ / shares $ 2.69
v3.20.1
Retirement Plans (Details) - USD ($)
$ in Millions
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Defined Contribution Plan Disclosure [Line Items]    
Employer contribution 20.00%  
Percentage of employee's compensation 4.00%  
Defined contribution plan, cost recognized $ 0.5 $ 0.4
Eligible Employees    
Defined Contribution Plan Disclosure [Line Items]    
Employee contribution 75.00%  
Highly Compensated Employees    
Defined Contribution Plan Disclosure [Line Items]    
Employee contribution 6.00%  
v3.20.1
Fair Value Measurements (Details) - USD ($)
$ in Thousands
12 Months Ended
Dec. 31, 2019
Dec. 31, 2018
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]    
Total Losses $ 0 $ 0
Level 3    
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]    
Goodwill $ 121,051 $ 121,051