Document and Entity Information - shares	9 Months Ended
Document and Entity Information - shares	Sep. 27, 2019	Oct. 30, 2019
Document and Entity Information
Document Type	10-Q
Document Period End Date	Sep. 27, 2019
Entity Registrant Name	Willdan Group, Inc.
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		11,316,457
Entity Central Index Key	0001370450
Current Fiscal Year End Date	--12-28
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q3
Amendment Flag	false

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 27, 2019	Dec. 28, 2018
Current assets:
Cash and cash equivalents		$ 15,259
Accounts receivable, net of allowance for doubtful accounts of $555 and $442 at September 27, 2019 and December 28, 2018, respectively	$ 51,960	61,346
Contract assets	86,676	51,851
Other receivables	4,934	1,893
Prepaid expenses and other current assets	4,817	5,745
Total current assets	148,387	136,094
Equipment and leasehold improvements, net	11,690	7,998
Goodwill	103,090	97,748
Right-of-use assets	12,767
Other intangible assets, net	68,808	44,364
Other assets	9,771	2,386
Deferred income taxes, net	8,099	12,321
Total assets	362,612	300,911
Current liabilities:
Accounts payable	34,254	36,829
Accrued liabilities	45,937	37,401
Contingent consideration payable	1,573	3,113
Contract liabilities	5,938	5,075
Notes payable	8,220	8,572
Finance lease obligations	529	320
Lease liability	4,194
Total current liabilities	100,645	91,310
Contingent consideration payable	1,235	1,616
Notes payable	95,062	62,214
Finance lease obligations, less current portion	230	224
Lease liability, less current portion	9,726
Deferred lease obligations		724
Other noncurrent liabilities	683	534
Total liabilities	207,581	156,622
Commitments and contingencies
Stockholders’ equity:
Preferred stock, $0.01 par value, 10,000 shares authorized, no shares issued and outstanding
Common stock, $0.01 par value, 40,000 shares authorized; 11,317 and 10,968 shares issued and outstanding at September 27, 2019 and December 28, 2018, respectively	113	110
Additional paid-in capital	123,588	114,008
Accumulated other comprehensive loss	(480)
Retained earnings	31,810	30,171
Total stockholders’ equity	155,031	144,289
Total liabilities and stockholders’ equity	$ 362,612	$ 300,911

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) shares in Thousands, $ in Thousands	Sep. 27, 2019	Dec. 28, 2018
CONDENSED CONSOLIDATED BALANCE SHEETS
Accounts receivable, allowance for doubtful accounts (in dollars)	$ 555	$ 442
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized	10,000	10,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	40,000	40,000
Common stock, shares issued	11,317	10,968
Common stock, shares outstanding	11,317	10,968

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 27, 2019	Sep. 28, 2018	Sep. 27, 2019	Sep. 28, 2018
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Contract revenue	$ 117,494	$ 71,386	$ 313,683	$ 185,814
Direct costs of contract revenue (inclusive of directly related depreciation and amortization):
Salaries and wages	16,145	11,233	46,679	33,358
Subcontractor services and other direct costs	66,677	36,840	175,248	86,453
Total direct costs of contract revenue	82,822	48,073	221,927	119,811
General and administrative expenses:
Salaries and wages, payroll taxes and employee benefits	15,761	11,125	46,167	31,875
Facilities and facility related	2,250	1,492	6,069	4,087
Stock-based compensation	4,107	1,705	8,148	4,431
Depreciation and amortization	5,788	1,117	11,308	3,292
Other	5,471	2,961	16,230	11,226
Total general and administrative expenses	33,377	18,400	87,922	54,911
Income from operations	1,295	4,913	3,834	11,092
Other income (expense):
Interest expense, net	(1,257)	(22)	(3,599)	(75)
Other, net	2	17	31	36
Total other expense, net	(1,255)	(5)	(3,568)	(39)
Income before income taxes	40	4,908	266	11,053
Income tax (benefit) expense	(376)	1,597	(1,373)	2,224
Net income	416	3,311	1,639	8,829
Other comprehensive income:
Net unrealized loss on derivative contracts	(42)		(480)
Comprehensive income	$ 374	$ 3,311	$ 1,159	$ 8,829
Earnings per share:
Basic (in dollars per share)	$ 0.04	$ 0.37	$ 0.15	$ 1.00
Diluted (in dollars per share)	$ 0.04	$ 0.35	$ 0.14	$ 0.95
Weighted-average shares outstanding:
Basic	11,217	8,844	11,097	8,798
Diluted	11,789	9,343	11,714	9,283

CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands	Common Stock	Additional Paid-in Capital	Accumulated Other Comprehensive Loss/Gain	Retained Earnings	Total
Balances at Dec. 29, 2017	$ 88	$ 50,976		$ 20,141	$ 71,205
Balances (in shares) at Dec. 29, 2017	8,799
Increase (Decrease) in Stockholders' Equity
Shares of common stock issued in connection with employee stock purchase plan		617			617
Shares of common stock issued in connection with employee stock purchase plan (in shares)	30
Shares of common stock issued in connection with incentive stock plan	$ 1	278			279
Shares of common stock issued in connection with incentive stock plan (in shares)	32
Stock-based compensation expense		1,064			1,064
Net income (loss)				2,203	2,203
Balances at Mar. 30, 2018	$ 89	52,935		22,344	75,368
Balances (in shares) at Mar. 30, 2018	8,861
Balances at Dec. 29, 2017	$ 88	50,976		20,141	71,205
Balances (in shares) at Dec. 29, 2017	8,799
Increase (Decrease) in Stockholders' Equity
Net income (loss)					8,829
Balances at Sep. 28, 2018	$ 89	56,739		28,970	85,798
Balances (in shares) at Sep. 28, 2018	8,921
Balances at Mar. 30, 2018	$ 89	52,935		22,344	75,368
Balances (in shares) at Mar. 30, 2018	8,861
Increase (Decrease) in Stockholders' Equity
Shares of common stock issued in connection with incentive stock plan		61			61
Shares of common stock issued in connection with incentive stock plan (in shares)	11
Shares used to pay taxes on stock grants		(442)			(442)
Shares used to pay taxes on stock grants (in shares)	(15)
Stock-based compensation expense		1,662			1,662
Net income (loss)				3,315	3,315
Balances at Jun. 29, 2018	$ 89	54,216		25,659	79,964
Balances (in shares) at Jun. 29, 2018	8,857
Increase (Decrease) in Stockholders' Equity
Shares of common stock issued in connection with employee stock purchase plan		682			682
Shares of common stock issued in connection with employee stock purchase plan (in shares)	35
Shares of common stock issued in connection with incentive stock plan		136			136
Shares of common stock issued in connection with incentive stock plan (in shares)	8
Issuance of restricted stock award and units (in shares)	21
Stock-based compensation expense		1,705			1,705
Net income (loss)				3,311	3,311
Balances at Sep. 28, 2018	$ 89	56,739		28,970	85,798
Balances (in shares) at Sep. 28, 2018	8,921
Balances at Dec. 28, 2018	$ 110	114,008		30,171	$ 144,289
Balances (in shares) at Dec. 28, 2018	10,968				10,968
Increase (Decrease) in Stockholders' Equity
Shares of common stock issued in connection with employee stock purchase plan		749			$ 749
Shares of common stock issued in connection with employee stock purchase plan (in shares)	28
Shares of common stock issued in connection with incentive stock plan		291			291
Shares of common stock issued in connection with incentive stock plan (in shares)	21
Unregistered sales of equity securities and use of proceeds	$ (1)	(2,515)			(2,516)
Unregistered sales of equity securities and use of proceeds (in shares)	(66)
Issuance of restricted stock award and units	$ 2	(2)
Issuance of restricted stock award and units (in shares)	175
Stock-based compensation expense		1,817			1,817
Net income (loss)				(417)	(417)
Net unrealized loss on derivative contracts			$ (219)		(219)
Balances at Mar. 29, 2019	$ 111	114,348	(219)	29,754	143,994
Balances (in shares) at Mar. 29, 2019	11,126
Balances at Dec. 28, 2018	$ 110	114,008		30,171	$ 144,289
Balances (in shares) at Dec. 28, 2018	10,968				10,968
Increase (Decrease) in Stockholders' Equity
Net income (loss)					$ 1,639
Net unrealized loss on derivative contracts					(480)
Balances at Sep. 27, 2019	$ 113	123,588	(480)	31,810	$ 155,031
Balances (in shares) at Sep. 27, 2019	11,317				11,317
Balances at Mar. 29, 2019	$ 111	114,348	(219)	29,754	$ 143,994
Balances (in shares) at Mar. 29, 2019	11,126
Increase (Decrease) in Stockholders' Equity
Shares of common stock issued in connection with incentive stock plan	$ 1	231			232
Shares of common stock issued in connection with incentive stock plan (in shares)	77
Shares used to pay taxes on stock grants		(346)			(346)
Shares used to pay taxes on stock grants (in shares)	(9)
Stock-based compensation expense		2,224			2,224
Net income (loss)				1,640	1,640
Net unrealized loss on derivative contracts			(219)		(219)
Balances at Jun. 28, 2019	$ 112	116,457	(438)	31,394	147,525
Balances (in shares) at Jun. 28, 2019	11,194
Increase (Decrease) in Stockholders' Equity
Shares of common stock issued in connection with employee stock purchase plan		991			991
Shares of common stock issued in connection with employee stock purchase plan (in shares)	34
Shares of common stock issued in connection with incentive stock plan		334			334
Shares of common stock issued in connection with incentive stock plan (in shares)	14
Issuance of restricted stock award and units (in shares)	22
Unregistered sales of stock	$ 1	1,699			1,700
Unregistered sales of stock (in shares)	53
Stock-based compensation expense		4,107			4,107
Net income (loss)				416	416
Net unrealized loss on derivative contracts			(42)		(42)
Balances at Sep. 27, 2019	$ 113	$ 123,588	$ (480)	$ 31,810	$ 155,031
Balances (in shares) at Sep. 27, 2019	11,317				11,317

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	9 Months Ended
	Sep. 27, 2019	Sep. 28, 2018
Cash flows from operating activities:
Net income	$ 1,639	$ 8,829
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization	11,624	3,391
Deferred income taxes, net	(285)	(1,460)
Gain on sale/disposal of equipment	(5)	(17)
Provision for doubtful accounts	256	317
Stock-based compensation	8,148	4,431
Accretion and fair value adjustments of contingent consideration	(540)	(713)
Changes in operating assets and liabilities, net of effects from business acquisitions:
Accounts receivable	13,491	19,492
Contract assets	(20,221)	(18,252)
Other receivables	(3,004)	1,518
Prepaid expenses and other current assets	1,060	78
Other assets	(336)	(78)
Accounts payable	(5,836)	(1,960)
Accrued liabilities	1,164	(1,672)
Contract liabilities	705	(2,320)
Deferred lease obligations		(15)
Right-of-use assets	429
Net cash provided by operating activities	8,289	11,569
Cash flows from investing activities:
Purchase of equipment and leasehold improvements	(5,636)	(720)
Proceeds from sale of equipment	45	41
Cash paid for acquisitions, net of cash acquired	(46,539)	(2,994)
Net cash used in investing activities	(52,130)	(3,673)
Cash flows from financing activities:
Change in excess of outstanding checks over bank balance	(1,514)
Payments on contingent consideration	(1,381)	(3,768)
Payments on notes payable	(1,371)	(383)
Payments on debt issuance costs	(749)
Borrowings under term loan facility and line of credit	105,000
Repayments under term loan facility and line of credit	(72,500)	(2,500)
Principal payments on finance leases	(338)	(321)
Proceeds from stock option exercise	858	476
Proceeds from sales of common stock under employee stock purchase plan	1,740	1,299
Shares used to pay taxes on stock grants	(2,862)	(442)
Proceeds from unregistered sales of equity	1,699
Net cash provided by (used in) financing activities	28,582	(5,639)
Net increase (decrease) in cash and cash equivalents	(15,259)	2,257
Cash and cash equivalents at beginning of period	15,259	14,424
Cash and cash equivalents at end of period		16,681
Cash paid during the period for:
Interest	3,314	75
Income taxes	2,247	2,061
Supplemental disclosures of noncash investing and financing activities:
Loss on cash flow hedge valuations, net of tax	$ (480)
Contingent consideration related to business acquisitions		943
Other payable for working capital adjustment		698
Equipment acquired under finance leases		$ 281

BASIS OF PRESENTATION, ORGANIZATION AND OPERATIONS OF THE COMPANY

9 Months Ended

Sep. 27, 2019

BASIS OF PRESENTATION, ORGANIZATION AND OPERATIONS OF THE COMPANY

BASIS OF PRESENTATION, ORGANIZATION AND OPERATIONS OF THE COMPANY

1. BASIS OF PRESENTATION, ORGANIZATION AND OPERATIONS OF THE COMPANY

Basis of Presentation

The accompanying unaudited interim condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) and reflect all adjustments, which consist of only normal recurring adjustments, which are, in the opinion of management, necessary for a fair presentation of the consolidated results for the interim periods presented. Willdan Group, Inc. and its subsidiaries (the “Company”) operates and reports its quarterly financial results based on the 13-week period ending on the Friday closest to March 31, June 30 and September 30 and the 13 or 14-week period ending on the Friday closest to December 31, as applicable, with consideration of business days. Results for the interim periods are not necessarily indicative of results for the full year. Certain information and footnote disclosures normally included in annual consolidated financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. The condensed consolidated financial statements should be read in conjunction with the Company’s Annual Report on Form 10-K for the fiscal year ended December 28, 2018.

The condensed consolidated statement of stockholders' equity includes repurchases of shares of our common stock from employees to satisfy tax withholding obligations incurred in connection with the vesting of restricted stock or performance stock units, which amount is presented as a reduction of additional paid-in capital and common stock.

Nature of Business

The Company is a provider of professional technical and consulting services to utilities, private industry, and public agencies at all levels of government. The Company enables its clients to realize cost and energy savings by providing a wide range of specialized services without having to incur and maintain the overhead necessary to develop staffing in-house. Such services include energy and sustainability, engineering, construction management and planning and economic and financial consulting. The Company operates its business through a nationwide network of offices spread across 24 states and the District of Columbia. Its clients primarily consist of public and governmental agencies, including cities, counties, public utilities, redevelopment agencies, water districts, school districts and universities, state agencies, federal agencies, a variety of other special districts and agencies, private utilities and industry and tribal governments. The Company’s business with public and private utilities is concentrated primarily in California, New York and North Carolina and its business with public agencies is concentrated in California, New York and Arizona.

Principles of Consolidation

The condensed consolidated financial statements include the accounts of Willdan Group, Inc. (“WGI”) and its wholly-owned subsidiaries, Willdan Energy Solutions (“WES”), Willdan Engineering, Willdan Infrastructure, Public Agency Resources and Willdan Financial Services and their respective subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation.

The Company accounts for variable interest entities in accordance with Accounting Standards Codification (“ASC”) 810, Consolidation. Under ASC 810, a variable interest entity (“VIE”) is created when any of the following criteria are present: (a) the equity investment at risk in the entity is not sufficient to permit the entity to finance its activities without additional subordinated financial support provided by other parties, including the equity holders; (b) the entity’s equity holders as a group either (i) lack the direct or indirect ability to make decisions about the entity, (ii) are not obligated to absorb expected losses of the entity or (iii) do not have the right to receive expected residual returns of the entity; or (c) the entity’s equity holders have voting rights that are not proportionate to their economic interests, and the activities of the entity involve or are conducted on behalf of the equity holder with disproportionately few voting

rights. If an entity is deemed to be a VIE pursuant to ASC 810, the enterprise that has both (i) the power to direct the activities of a VIE that most significantly impact the entity’s economic performance and (ii) the obligation to absorb the expected losses of the entity or right to receive benefits from the entity that could be potentially significant to the VIE is considered the primary beneficiary and must consolidate the VIE. In accordance with ASC 810, the Company performs ongoing reassessments of whether an enterprise is the primary beneficiary of a VIE.

As of September 27, 2019, the Company had one VIE—Genesys Engineering, P.C. (“Genesys”). Pursuant to New York law, the Company does not own capital stock of Genesys and does not have control over the professional decision making of Genesys’ engineering services. The Company, however, has entered into an administrative services agreement with Genesys pursuant to which WES, the Company’s wholly-owned subsidiary, will provide Genesys with ongoing administrative, operational and other non-professional support services. The Company manages Genesys and has the power to direct the activities that most significantly impact Genesys’ performance, in addition to being obligated to absorb expected losses from Genesys. Accordingly, the Company is the primary beneficiary of Genesys and consolidates Genesys as a VIE.

Management also concluded there is no noncontrolling interest related to the consolidation of Genesys because management determined that (i) the shareholder of Genesys does not have more than a nominal amount of equity investment at risk, (ii) WES absorbs the expected losses of Genesys through its deferral of Genesys’ service fees owed to WES, and the Company has, since entering into the administrative services agreement, had to continuously defer the service fees for Genesys, and (iii) the Company believes Genesys will continue to have a shortfall on payment of its service fees for the foreseeable future, leaving no expected residual returns for the shareholder.

Segment Information

WGI is a holding company with five wholly-owned subsidiaries. The Company presents segment information externally consistent with the manner in which the Company’s chief operating decision maker reviews information to assess performance and allocate resources. WGI performs administrative functions on behalf of its subsidiaries, such as treasury, legal, accounting, information systems, human resources and certain business development activities, and earns revenue that is only incidental to the activities of the enterprise. As a result, WGI does not meet the definition of an operating segment. The Company’s two segments are Energy and Engineering and Consulting. The Company’s principal segment, Energy, consists of the business of its subsidiary, WES, which offers energy and sustainability consulting services to utilities, public agencies and private industry. The Company’s Engineering and Consulting segment includes the operation of the Company’s remaining direct subsidiaries, Willdan Engineering, Willdan Infrastructure, Public Agency Resources and Willdan Financial Services. Willdan Engineering provides civil engineering-related construction management, building and safety, city engineering, city planning, geotechnical, material testing and other engineering consulting services to its clients. Willdan Infrastructure, which was launched in fiscal year 2013, provides engineering services to larger rail, port, water, mining and other civil engineering projects. Public Agency Resources primarily provides staffing to Willdan Engineering. Willdan Financial Services provides economic and financial consulting to public agencies. See Note 11 “—Segment Information” for segment information for the current and prior period.

Contract Assets and Liabilities

Billing practices are governed by the contract terms of each project based upon costs incurred, achievement of milestones or pre-agreed schedules. Billings do not necessarily correlate with revenue recognized using the percentage-of-completion method of revenue recognition. Contract assets include unbilled amounts typically resulting from revenue under long-term contracts when the percentage-of-completion method of revenue recognition is utilized and revenue recognized exceeds the amount billed to the customer and right to payment is not unconditional. In addition, contract assets include retainage amounts withheld from billings to the Company’s clients pursuant to provisions in the contracts. Contract liabilities consist of advance payments and billings in excess of revenue recognized and deferred revenue.

The increase in contract assets and contract liabilities for the nine months ended September 27, 2019 were primarily attributable to our recent acquisitions and normal business operations.

Off‑Balance Sheet Arrangements

The Company does not have any off‑balance sheet financing arrangements or liabilities. In addition, the Company does not have any majority‑owned subsidiaries or any interests in, or relationships with, any special‑purpose entities that are not included in the condensed consolidated financial statements. The Company has, however, entered into an administrative services agreement with Genesys pursuant to which WES, the Company’s wholly-owned subsidiary, will provide Genesys with ongoing administrative, operational and other non-professional support services. The Company manages Genesys and has the power to direct the activities that most significantly impact Genesys’ performance, in addition to being obligated to absorb expected losses from Genesys. Accordingly, the Company is the primary beneficiary of Genesys and consolidates Genesys as a variable interest entity.

Contract Accounting

The Company enters into contracts with its clients that contain various types of pricing provisions, including fixed price, time-and-materials and unit-based provisions. The Company recognizes revenues in accordance with ASU 2014-09, Revenue from Contracts with Customer, codified as ASC Topic 606 and the related amendments (collectively, “ASC 606”). As such, the Company identifies a contract with a customer, identifies the performance obligations in the contract, determines the transaction price, allocates the transaction price to each performance obligation in the contract and recognizes revenues when (or as) the Company satisfies a performance obligation.

The following table reflects the Company’s two reportable segments and the types of contracts that each most commonly enters into for revenue generating activities.


Segment	Contract Type	Revenue Recognition Method
	Time-and-materials	Time-and-materials
Energy	Unit-based	Unit-based
	Software license	Unit-based
	Fixed price	Percentage-of-completion
	Time-and-materials	Time-and-materials
Engineering and Consulting	Unit-based	Unit-based
	Fixed price	Percentage-of-completion

Revenue on the vast majority of the Company’s contracts is recognized over time because of the continuous transfer of control to the customer. Revenue on fixed price contracts is recognized on the percentage-of-completion method based generally on the ratio of direct costs incurred-to-date to estimated total direct costs at completion. The Company uses the percentage-of-completion method to better match the level of work performed at a certain point in time in relation to the effort that will be required to complete a project. In addition, the percentage-of-completion method is a common method of revenue recognition in the Company’s industry.

Many of the Company’s fixed price contracts involve a high degree of subcontracted fixed price effort and are relatively short in duration, thereby lowering the risks of not properly estimating the percent complete. Revenue on time-and-materials and unit-based contracts is recognized as the work is performed in accordance with the specific rates and terms of the contract. The Company recognizes revenues for time-and-materials contracts based upon the actual hours incurred during a reporting period at contractually agreed upon rates per hour and also includes in revenue all reimbursable costs incurred during a reporting period. Certain of the Company’s time-and-materials contracts are subject to maximum contract values and, accordingly, when revenue is expected to meet the maximum contract value, these contracts are generally recognized under the percentage-of-completion method, consistent with fixed price contracts. For unit-based contracts, the Company recognizes the contract price of units of a basic production product as revenue when the production product is delivered during a period. Revenue recognition for software licenses issued by the Energy segment is generally recognized at a point in time, utilizing the unit-based revenue recognition method, upon acceptance of the software by the customer and in recognition of the fulfillment of the performance obligation. Certain additional performance obligations beyond the base software license may be separated from the gross license fee and recognized on a straight-line basis over time. Revenue for amounts that have been billed but not earned is deferred, and such deferred revenue is referred to as contract liabilities in the accompanying condensed consolidated balance sheets.

To determine the proper revenue recognition method for contracts, the Company evaluates whether two or more contracts should be combined and accounted for as one single contract and whether the combined contract should be accounted for as one performance obligation. With respect to the Company’s contracts, it is rare that multiple contracts should be combined into a single performance obligation. This evaluation requires significant judgment and the decision to combine a group of contracts or separate a single contract into multiple performance obligations could change the amount of revenue and profit recorded in a given period. Contracts are considered to have a single performance obligation if the promise to transfer the individual goods or services is not separately identifiable from other promises in the contracts, which is mainly because the Company provides a significant service of integrating a complex set of tasks and components into a single project or capability.

The Company may enter into contracts that include separate phases or elements. If each phase or element is negotiated separately based on the technical resources required and/or the supply and demand for the services being provided, the Company evaluates if the contracts should be segmented. If certain criteria are met, the contracts would be segmented which could result in revenues being assigned to the different elements or phases with different rates of profitability based on the relative value of each element or phase to the estimated total contract revenue.

Contracts that cover multiple phases or elements of the project or service lifecycle (development, construction and maintenance and support) may be considered to have multiple performance obligations even when they are part of a single contract. For contracts with multiple performance obligations, the Company allocates the transaction price to each performance obligation using the best estimate of the standalone selling price of each distinct good or service in the contract. For the periods presented, the value of the separate performance obligations under contracts with multiple performance obligations (generally measurement and verification tasks under certain energy performance contracts) were not material. In cases where the Company does not provide the distinct good or service on a standalone basis, the primary method used to estimate standalone selling price is the expected cost plus a margin approach, under which the Company forecasts the Company’s expected costs of satisfying a performance obligation and then adds an appropriate margin for the distinct good or service.

The Company provides quality of workmanship warranties to customers that are included in the sale and are not priced or sold separately or do not provide customers with a service in addition to assurance of compliance with agreed-upon specifications and industry standards. The Company does not consider these types of warranties to be separate performance obligations.

In some cases, the Company has a master service or blanket agreement with a customer under which each task order releases the Company to perform specific portions of the overall scope in the service contract. Each task order is typically accounted for as a separate contract because the task order establishes the enforceable rights and obligations, and payment terms.

Under ASC 606, variable consideration should be considered when determining the transaction price and estimates should be made for the variable consideration component of the transaction price, as well as assessing whether an estimate of variable consideration is constrained. For certain of the Company’s contracts, variable consideration can arise from modifications to the scope of services resulting from unapproved change orders or customer claims. Variable consideration is included in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. The Company’s estimates of variable consideration and determination of whether to include estimated amounts in the transaction price are based largely on assessments of legal enforceability, the Company’s performance, and all information (historical, current and forecasted) that is reasonably available to the Company.

Due to the nature of the work required to be performed on many of the Company’s performance obligations, the estimation of total revenue and cost at completion is complex, subject to many variables and requires significant judgment. As a significant change in one or more of these estimates could affect the profitability of the Company’s contracts, the Company reviews and updates the Company’s contract-related estimates regularly through a company-wide disciplined project review process in which management reviews the progress and execution of the Company’s performance obligations and the estimate at completion (EAC). As part of this process, management reviews information including, but not limited to, any outstanding key contract matters, progress towards completion and the related program schedule and the related changes in estimates of revenues and costs. Management must make assumptions and estimates regarding labor productivity and availability, the complexity of the work to be performed, the cost and availability of materials, the performance of subcontractors, and the availability and timing of funding from the customer, among other variables.

The Company recognizes adjustments in estimated profit on contracts under the cumulative catch-up method. Under this method, the impact of the adjustment on profit recorded to date is recognized in the period the adjustment is identified. Revenue and profit in future periods of contract performance is recognized using the adjusted estimate. If at any time the estimate of contract profitability indicates an anticipated loss on the contract, the Company recognizes the full amount of estimated loss in the period it is identified.

Contracts are often modified to account for changes in contract specifications and requirements. The Company considers contract modifications to exist when the modification either creates new rights or obligations or changes the existing enforceable rights or obligations. Most of the Company’s contract modifications are for goods or services that are not distinct from existing contracts due to the significant integration provided in the context of the contract and are accounted for as if they were part of the original contract. The effect of a contract modification that is not distinct from the existing contract on the transaction price and the Company’s measure of progress for the performance obligation to which it relates is recognized as an adjustment to revenue (either as an increase in or a reduction of revenue) on a cumulative catch-up basis.

For contract modifications that result in the promise to deliver goods or services that are distinct from the existing contract and the increase in price of the contract is for the same amount as the standalone selling price of the additional goods or services included in the modification, the Company accounts for such contract modifications as a separate contract.

The Company includes claims to vendors, subcontractors and others as a receivable and a reduction in recognized costs when enforceability of the claim is established by the contract and the amounts are reasonably estimable and probable of being recovered. The amounts are recorded up to the extent of the lesser of the amounts management expects to recover or to costs incurred.

Direct costs of contract revenue consist primarily of that portion of technical and nontechnical salaries and wages that has been incurred in connection with revenue producing projects. Direct costs of contract revenue also include production expenses, subcontractor services and other expenses that are incurred in connection with revenue producing projects.

Direct costs of contract revenue exclude that portion of technical and nontechnical salaries and wages related to marketing efforts, vacations, holidays and other time not spent directly generating revenue under existing contracts. Such costs are included in general and administrative expenses in the accompanying condensed consolidated statements of comprehensive income. Additionally, payroll taxes, bonuses and employee benefit costs for all Company personnel are included in general and administrative expenses in the accompanying condensed consolidated statements of comprehensive income since no allocation of these costs is made to direct costs of contract revenue. No allocation of facilities costs is made to direct costs of contract revenue. Other companies may classify as direct costs of contract revenue some of the costs that the Company classifies as general and administrative costs. The Company expenses direct costs of contract revenue when incurred.

Included in revenue and costs are all reimbursable costs for which the Company has the risk or on which the fee was based at the time of bid or negotiation. No revenue or cost is recorded for costs in which the Company acts solely in the capacity of an agent and has no risks associated with such costs.

Accounts receivable are carried at original invoice amount less an estimate made for doubtful accounts based upon a review of all outstanding amounts on a quarterly basis. Management determines allowances for doubtful accounts through specific identification of amounts considered to be uncollectible and potential write-offs, plus a non-specific allowance for other amounts for which some potential loss has been determined to be probable based on current and past experience. The Company’s historical credit losses have been minimal with governmental entities and large public utilities, but disputes may arise related to these receivable amounts. Accounts receivable are written off when deemed uncollectible. Recoveries of accounts receivable previously written off are recorded when received.

Retainage, included in contract assets, represents amounts withheld from billings to the Company’s clients pursuant to provisions in the contracts and may not be paid to the Company until specific tasks are completed or the project is completed and, in some instances, for even longer periods. At September 27, 2019 and December 28, 2018, contract assets included retainage of $5.2 million and $6.7 million, respectively.

Disaggregation of Revenue

The following tables provides information about disaggregated revenue of the Company’s two segments Energy and Engineering and Consulting, by contract type, client type and geographical region for the nine months ended September 27, 2019:


	Energy		Engineering and Consulting		Total
	(in thousands)
Contract Type
Time-and-materials	$	10,154	$	42,624	$	52,778
Unit-based		188,388		10,719		199,107
Fixed price		59,420		2,378		61,798
Total	$	257,962	$	55,721	$	313,683

Client Type
Commercial	$	28,063	$	4,176	$	32,239
Government		41,400		51,251		92,651
Utilities		188,499		294		188,793
Total	$	257,962	$	55,721	$	313,683

Geography
Domestic	$	257,962	$	55,721	$	313,683

Goodwill

Goodwill represents the excess of costs over fair value of the assets acquired. The Company completes its annual testing of goodwill as of the last day of the first month of its fourth fiscal quarter each year to determine whether there is impairment. Goodwill, which has an indefinite useful life, is not amortized, but instead tested for impairment at least annually or more frequently if events and circumstances indicate that the asset might be impaired. Impairment losses for reporting units are recognized to the extent that a reporting unit’s carrying amount exceeds its fair value. The reporting units for purposes of testing goodwill impairment coincide with the Company’s reportable segments used for segment reporting purposes.

Fair Value of Financial Instruments

The Company uses the three-tier hierarchy of fair value measurement, which prioritizes the inputs. These tiers include: Level 1 (the highest priority), defined as observable inputs, such as quoted prices in active markets, Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable; and Level 3 (the lowest priority), defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions.

The Company’s financial instruments consist primarily of cash, cash equivalents, accounts receivable, contract assets, other receivables, prepaid expenses and other current assets, accounts payable, accrued liabilities and contract liabilities, and approximate their fair values because of the relatively short period of time between the origination of these instruments and their expected realization or payment.

The carrying amounts of certain other assets and contingent consideration are discounted to their present value because the time between the origination of these instruments and their expected realization or payment is greater than one year.

The carrying amounts of the derivative financial instrument is valued based on Level 2 inputs.

The carrying amounts of debt obligations approximate their fair values since the terms are comparable to terms currently offered by local lending institutions for loans of similar terms to companies with comparable credit risk.

On January 31, 2019, the Company entered into an interest rate swap agreement that the Company designated as cash flow hedge to fix the variable interest rate on a portion of the Company’s 2018 Term Loan Facility (as defined in Note 7 “—Debt Obligations”). The interest rate swap agreement has a total notional amount of $35.0 million, a fixed annual interest rate of 2.47% and expires on January 31, 2022. For further discussion of this derivative contract, see Note 13 “—Derivative Financial Instruments” below.

Use of Estimates

The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements. Estimates also affect the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.

Liquidity

The Company’s primary source of liquidity is cash generated from operations. As of September 27, 2019, as a result of the timing of payments where checks outstanding were in excess of the Company’s cash balance, the Company had $0.0 of cash and cash equivalents. In addition, as of September 27, 2019, the Company had $97.5 million outstanding on its Term A Loan (as defined in Note 7 “—Debt Obligations”), a $50.0 million Revolving Credit Facility (as defined in Note 7 “—Debt Obligations”) with $5.0 million outstanding and $2.7 million in letters of credit issued, and a $50.0 million Delayed Draw Term Loan (as defined in Note 7 “—Debt Obligations”) with no amounts outstanding, each with a syndicate of financial institutions as lenders and BMO Harris Bank, N.A. (“BMO”), as administrative agent, and scheduled to mature on June 26, 2024 (see Note 7 “—Debt Obligations” below). Subsequent to September 27, 2019, the Company borrowed $27.0 million under its Delayed Draw Term Loan to finance the purchase of its acquisition of Energy and Environmental Economics, Inc. (“E3, Inc.”), which reduced the future borrowing capacity under the Delayed Draw Term Loan to $23.0 million (see Note 14 “—Subsequent Events”). The Company believes that cash generated by operating activities and funds available under its Credit Facilities (as defined in Note 7 “—Debt Obligations”) will be sufficient to finance its operating activities for at least the next 12 months.

Reclassifications

Certain prior year amounts have been reclassified in the condensed consolidated balance sheets to conform to the current year presentation.

Adoption of New Accounting Standards

Stock Compensation

In June 2018, the FASB issued ASU 2018-07, Compensation – Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting, which expands the scope of current stock compensation recognition standards to include share-based payment transactions for acquiring goods and services from nonemployees. ASU 2018-07 became effective for fiscal years beginning after December 15, 2018, including interim periods within that fiscal year. Effective December 29, 2018, the Company adopted ASU 2018-07 and the impact did not have a material effect on the Company’s condensed consolidated financial statements.

Recent Accounting Pronouncements

Intangibles-Goodwill and Other

In January 2017, the FASB issued ASU No. 2017-04, Intangibles-Goodwill and Other (Topic 350), which eliminates the requirement to compare the implied fair value of reporting unit goodwill with the carrying amount of that goodwill (commonly referred to as Step 2) from the goodwill impairment test. The new standard does not change how a goodwill impairment is identified. The Company will continue to perform its quantitative and qualitative goodwill impairment test by comparing the fair value of each reporting unit to its carrying amount, but if the Company were required to recognize a goodwill impairment charge, under the new standard the amount of the charge would be calculated by subtracting the reporting unit’s fair value from its carrying amount. Under the prior standard, if the Company were required to recognize a goodwill impairment charge, Step 2 required us to calculate the implied value of goodwill by assigning the fair value of a reporting unit to all of its assets and liabilities as if that reporting unit had been acquired in a business combination and the amount of the charge was calculated by subtracting the reporting unit’s implied fair value of goodwill from its actual goodwill balance. The new standard is effective for interim and annual reporting periods beginning after December 15, 2019, with early adoption permitted, and should be applied prospectively from the date of adoption. The Company adopted the new standard for future goodwill impairment tests at the beginning of the fourth quarter of 2019 because it significantly simplifies the evaluation of goodwill for impairment. The adoption of ASU 2017-04 did not have a material impact on the Company’s condensed consolidated financial statements.

Proposed Accounting Standards

A variety of proposed or otherwise potential accounting standards are currently being studied by standard-setting organizations and certain regulatory agencies. Because of the tentative and preliminary nature of such proposed standards, the Company has not yet determined the effect, if any, that the implementation of such proposed standards would have on its condensed consolidated financial statements.

BUSINESS COMBINATIONS

9 Months Ended

Sep. 27, 2019

BUSINESS COMBINATIONS

BUSINESS COMBINATIONS

2. BUSINESS COMBINATIONS

Acquisition of Onsite Energy Corporation

On July 2, 2019, the Company acquired substantially all of the assets and liabilities of Onsite Energy Corporation (“Onsite Energy”), an energy efficiency services and project implementation firm that specializes in energy upgrades and commissioning for industrial facilities. The Company believes the acquisition will expand its presence in the California-based industrial energy management services. Pursuant to the terms of the Asset Purchase Agreement, dated July 2, 2019, by and between WES and Onsite Energy, WES will pay a maximum aggregate purchase price of $26.4 million, subject to certain holdback and working capital adjustments, to be paid in cash. Onsite Energy’s financial information is included within the Energy segment. The Company expects to finalize the purchase price allocation with respect to this transaction during the second quarter of fiscal year 2020.

The acquisition was accounted for as a business combination in accordance with ASC 805. Under ASC 805, the Company recorded the acquired assets and assumed liabilities at their estimated fair value with the excess allocated to goodwill. Goodwill represents the value the Company expects to achieve through the operational synergies, the expansion into new markets and the acquired company’s assembled work force. The Company estimates that the entire $5.3 million of goodwill resulting from the acquisition will be tax deductible.

Consideration for the acquisition includes the following:


	Onsite Energy
		(in thousands)
Cash paid	$	24,273
Other working capital adjustment		-
Total consideration	$	24,273

The following table summarizes the preliminary amounts for the acquired assets recorded at their estimated fair value as of the acquisition date:


	Onsite Energy
		(in thousands)
Current assets	$	22,493
Non-current assets1		10
Equipment and leasehold improvements, net		39
Right-of-use assets		828
Current lease liability		(168)
Non-current lease liability		(660)
Liabilities		(12,222)
Backlog		800
Customer relationships		7,374
Tradename		500
Goodwill		5,279
Net assets acquired	$	24,273

(1)

Excluded from non-current assets are equipment and leasehold improvements, net, right-of-use assets, customer relationships, tradename, backlog and goodwill.

The following unaudited pro forma financial information for the three and nine months ended September 27, 2019 and September 28, 2018 assumes that the acquisitions of substantially all of the assets and liabilities of Onsite Energy and The Weidt Group and that the acquisition of all the outstanding shares of Lime Energy each occurred on the first day of the year prior to the year of acquisition:


	Three Months Ended				Nine Months Ended
	September 27,		September 28,		September 27,		September 28,
	2019		2018		2019		2018
	(in thousands, except per share data)
Pro forma revenue	$	117,494	$	119,354	$	328,731	$	318,248

Pro forma income from operations	$	1,295	$	6,173	$	6,258	$	12,426
Pro forma net income1	$	416	$	3,317	$	3,284	$	6,299

Earnings per share:
Basic	$	0.04	$	0.31	$	0.30	$	0.58
Diluted	$	0.04	$	0.29	$	0.28	$	0.56

Weighted average shares outstanding:
Basic		11,217		10,857		11,097		10,810
Diluted		11,789		11,356		11,714		11,285

(1)

Adjustments to pro forma net income include income from operations, amortization and interest expenses.

This pro forma supplemental information does not purport to be indicative of what the Company’s operating results would have been had the acquisitions of substantially all of the assets of Onsite Energy and The Weidt Group and the acquisition of all the outstanding shares of Lime Energy each occurred on the first day of the year prior to the year of acquisition and may not be indicative of future operating results.

There were $0.1 million in acquisition related costs associated with Onsite Energy that were included in other general and administrative expenses in the condensed consolidated statements of comprehensive income for the three and nine months ended September 27, 2019.

During the three and nine months ended September 27, 2019, the acquisition of Onsite Energy contributed $4.8 million in revenue and $1.0 million in income from operations, respectively.

Acquisition of The Weidt Group

On March 8, 2019, the Company acquired substantially all of the assets of the energy practice division of The Weidt Group Inc. (“The Weidt Group”). The Company believes the acquisition will expand its presence in the upper Midwest and better position the Company to help utilities make their grids more resilient. Pursuant to the terms of the Asset Purchase Agreement, dated March 8, 2019, by and among the Company, WES and The Weidt Group, WES paid a cash purchase price of $22.1 million, inclusive of working capital adjustments. The Weidt Group’s financial information is included within the Energy segment. The Company expects to finalize the purchase price allocation with respect to this transaction during the first quarter of 2020.

The acquisition was accounted for as a business combination in accordance with ASC 805. Under ASC 805, the Company recorded the acquired assets and assumed liabilities at their estimated fair value with the excess allocated to goodwill. Goodwill represents the value the Company expects to achieve through the operational synergies, the expansion into new markets and the acquired company’s assembled work force. The Company estimates that the entire $11.5 million of goodwill resulting from the acquisition will be tax deductible.

Consideration for the acquisition includes the following:


	The Weidt Group
		(in thousands)
Cash paid	$	22,136
Other working capital adjustment		-
Total consideration	$	22,136

The following table summarizes the preliminary amounts for the acquired assets recorded at their estimated fair value as of the acquisition date:


	The Weidt Group
		(in thousands)
Current assets	$	2,317
Non-current assets1		25
Equipment and leasehold improvements, net		198
Right-of-use assets		1,730
Current lease liability		(245)
Non-current lease liability		(1,533)
Liabilities		(612)
Backlog		750
Customer relationships		4,330
Tradename		550
Developed technology		3,170
Goodwill		11,456
Net assets acquired	$	22,136

(1)

Excluded from non-current assets are equipment and leasehold improvements, net, right-of-use assets, customer relationships, tradename, developed technology, backlog and goodwill.

During the three months ended September 27, 2019, the Company made adjustments to the preliminary purchase price allocation related to The Weidt Group which resulted in an aggregate increase of $1.0 million in the carrying value of backlog, customer relationships, tradename, and developed technology and an offsetting $1.0 million decrease to the carrying value of goodwill. The increase in the fair value of intangible assets resulted in an additional amortization expense charge of $0.2 million for the three months ended September 27, 2019.


	Three Months Ended				Nine Months Ended
	September 27,		September 28,		September 27,		September 28,
	2019		2018		2019		2018
	(in thousands, except per share data)
Pro forma revenue	$	117,494	$	119,354	$	328,731	$	318,248

Pro forma income from operations	$	1,295	$	6,173	$	6,258	$	12,426
Pro forma net income1	$	416	$	3,317	$	3,284	$	6,299

Earnings per share:
Basic	$	0.04	$	0.31	$	0.30	$	0.58
Diluted	$	0.04	$	0.29	$	0.28	$	0.56

Weighted average shares outstanding:
Basic		11,217		10,857		11,097		10,810
Diluted		11,789		11,356		11,714		11,285

(1)

Adjustments to pro forma net income include income from operations, amortization and interest expenses.

This pro forma supplemental information does not purport to be indicative of what the Company’s operating results would have been had the acquisition of substantially all of the assets and liabilities of Onsite Energy, The Weidt Group, and that the acquisition of all the outstanding shares of Lime Energy each occurred on the first day of the year prior to the year of acquisition and may not be indicative of future operating results.

There were $0.1 million and $0.4 million in acquisition related costs associated with The Weidt Group that were included in other general and administrative expenses in the condensed consolidated statements of comprehensive income for the three and nine months ended September 27, 2019, respectively.

During the three and nine months ended September 27, 2019, the acquisition of The Weidt Group contributed $3.5 million and $7.6 million in revenue and $0.6 million and $1.1 million in income from operations, respectively.

Acquisition of Lime Energy

On October 1, 2018, the Company, through two of its wholly-owned subsidiaries, WES and Luna Fruit, Inc., a Delaware corporation and wholly-owned subsidiary of WES (“Merger Sub”), entered into an agreement to acquire all of the outstanding shares of capital stock of Lime Energy Co. (“Lime Energy”), pursuant to an agreement and plan of merger dated October 1, 2018 (the “Merger Agreement”), by and among WES, Merger Sub, Lime Energy, and Luna Stockholder Representative, LLC, as representative of the participating securityholders of Lime Energy. The Company believes the addition of Lime Energy’s capabilities will significantly expand and diversify its client base within the energy efficiency services market and geographic presence across the United States. Lime Energy’s financial information is included within the Energy segment. The Company expects to finalize the purchase price allocation with respect to this transaction during the fourth quarter of 2019.

On November 9, 2018, the Company completed the acquisition and, pursuant to the Merger Agreement, Merger Sub was merged with and into Lime Energy, with Lime Energy surviving as a wholly-owned indirect subsidiary of the Company. The aggregate purchase price paid in the acquisition was $122.4 million, inclusive of closing holdbacks and adjustments. A portion of the purchase price was deposited into escrow accounts to secure certain potential post-closing obligations of the participating securityholders. The Company paid the purchase price for the acquisition using a combination of cash on hand (including $50.0 million of the $56.4 million in net proceeds received from the Company’s equity offering in October 2018) and proceeds from the Company’s borrowings under a term loan under its 2018 Credit Facilities (see Note 7 “—Debt Obligations” below).

The acquisition was accounted for as a business combination in accordance with ASC 805. Under ASC 805, the Company recorded the acquired assets and assumed liabilities at their estimated fair value with the excess allocated to goodwill. Goodwill represents the value the Company expects to achieve through the operational synergies, the expansion into new markets and the acquired company’s assembled work force. The Company estimates that the entire $46.1 million of goodwill resulting from the acquisition will not be tax deductible. Consideration for the acquisition includes the following:


	Lime Energy
		(in thousands)
Cash paid	$	122,439
Other working capital adjustment		-
Total consideration	$	122,439

The following table summarizes the preliminary amounts for the acquired assets and liabilities recorded at their estimated fair value as of the acquisition date:


	Lime Energy
		(in thousands)
Current assets1	$	45,401
Non-current assets2		13,847
Cash		1,090
Equipment and leasehold improvements, net		1,892
Liabilities		(38,110)
Customer relationships		34,400
Tradename		5,970
Developed technology		10,600
Backlog		1,230
Goodwill		46,119
Net assets acquired	$	122,439

(1)

Excluded from current assets is cash

(2)

Excluded from non-current assets are equipment and leasehold improvements, net, customer relationships, tradename, developed technology, backlog and goodwill.

During the three months ended September 27, 2019, the Company made adjustments to the preliminary purchase price allocation related to Lime Energy which resulted in an aggregate increase of $11.4 million in the carrying value of liabilities, customer relationships, developed technology, and backlog and an offsetting $11.4 million decrease to the carrying value of goodwill. The increase in the fair value of intangible assets resulted in an additional amortization expense charge of $1.9 million for the three months ended September 27, 2019.

There were no acquisition related costs associated with Lime Energy for the three months ended September 27, 2019. There were $0.2 million in acquisition related costs associated with Lime Energy included in other general and administrative expenses in the condensed consolidated statements of comprehensive income for nine months ended September 27, 2019.

The following unaudited pro forma financial information for the three and nine months ended September 27, 2019 and September 28, 2018 assumes that the acquisition of all the outstanding shares of Lime Energy and that the acquisitions of substantially all of the assets and liabilities of Onsite Energy and The Weidt Group each occurred on the first day of the year prior to the year of acquisition:


	Three Months Ended				Nine Months Ended
	September 27,		September 28,		September 27,		September 28,
	2019		2018		2019		2018
	(in thousands, except per share data)
Pro forma revenue	$	117,494	$	119,354	$	328,731	$	318,248

Pro forma income from operations	$	1,295	$	6,173	$	6,258	$	12,426
Pro forma net income1	$	416	$	3,317	$	3,284	$	6,299

Earnings per share:
Basic	$	0.04	$	0.31	$	0.30	$	0.58
Diluted	$	0.04	$	0.29	$	0.28	$	0.56

Weighted average shares outstanding:
Basic		11,217		10,857		11,097		10,810
Diluted		11,789		11,356		11,714		11,285

(1)

Adjustments to pro forma net income include income from operations, amortization and interest expenses.

This pro forma supplemental information does not purport to be indicative of what the Company’s operating results would have been had the acquisition of all the outstanding shares of Lime Energy and that the acquisitions of substantially all of the assets and liabilities of Onsite Energy and The Weidt Group each occurred on the first day of the year prior to the year of acquisition and may not be indicative of future operating results.

During the three and nine months ended September 27, 2019, the acquisition of Lime Energy contributed $40.8 million and $116.2 million in revenue and $1.3 million and $2.5 million in income from operations, respectively.

Acquisition of Newcomb Anderson McCormick

On April 30, 2018, the Company, through its wholly-owned subsidiary, WES, acquired all of the outstanding equity interests of Newcomb Anderson McCormick, Inc. (“NAM”). NAM is an energy engineering and consulting company with offices in San Francisco and Los Angeles that provides clients with mechanical engineering expertise and comprehensive energy efficiency programs and services. Pursuant to the terms of the Stock Purchase Agreement, dated April 30, 2018, by and among the Company, WES and NAM, WES paid NAM shareholders a cash purchase price of $4.0 million, inclusive of earn-out payments and working capital adjustments. The Company finalized the purchase price allocation with respect to this transaction during the second quarter of 2019. NAM’s financial information is included within the Energy segment.

GOODWILL AND OTHER INTANGIBLE ASSETS

9 Months Ended

Sep. 27, 2019

GOODWILL AND OTHER INTANGIBLE ASSETS

GOODWILL AND OTHER INTANGIBLE ASSETS

3. GOODWILL AND OTHER INTANGIBLE ASSETS

As of September 27, 2019, the Company had $103.1 million of goodwill, which primarily relates to the Energy segment and the acquisitions within this segment of Lime Energy, NAM, Integral Analytics and Abacus Resource Management Company (“Abacus”) and substantially all of the assets of Onsite Energy, The Weidt Group, Genesys and 360 Energy Engineers, LLC (“360 Energy”). The remaining goodwill relates to the Engineering and Consulting segment and the acquisition within this segment of Economists.com, LLC. The changes in the carrying value of goodwill by reporting unit for the nine months ended September 27, 2019 were as follows:


	December 28,		Additional		Additions /		September 27,
	2018		Purchase Cost		Adjustments		2019
	(in thousands)
Reporting Unit:
Energy	$	96,999	$	16,735	$	(11,393)	$	102,341
Engineering and Consulting		749		—		—		749
	$	97,748	$	16,735	$	(11,393)	$	103,090

The gross amounts and accumulated amortization of the Company’s acquired identifiable intangible assets with finite useful lives as of September 27, 2019 included in other intangible assets, net in the accompanying condensed consolidated balance sheets, were as follows:


	September 27, 2019				December 28, 2018
	Gross		Accumulated		Gross		Accumulated		Amortization
	Amount		Amortization		Amount		Amortization		Period
	(in thousands)								(in years)
Finite:
Backlog	$	4,564	$	3,214	$	2,514	$	2,155	0.2	-	5.0
Tradename		11,351		4,400		10,301		3,118	3.0	-	6.0
Non-compete agreements		1,420		1,270		1,420		1,042	4.0	-	5.0
Developed technology		18,180		3,286		12,920		944	5.0	-	8.0
Customer relationships		51,923		6,460		25,219		2,441	5.0	-	10.0
Total finite intangible assets		87,438	$	18,630		52,374	$	9,700
In-process research and technology1		—		—		1,690		—
Total intangible assets	$	87,438	$	18,630	$	54,064	$	9,700

(1)

In-process research and technology will not be amortized until put into use.

As part of prior acquisitions, the Company recorded at the time of the acquisition acquired in-process research and development (“IPR&D”) for projects in progress that had not yet reached technological feasibility. IPR&D is initially accounted for as an indefinite-lived intangible asset. Once a project reaches technological feasibility, the Company reclassifies the balance to developed technology and begins to amortize the intangible asset over its estimated useful life. During the three and nine months ended September 27, 2019, the Company reclassified $1.7 million of acquired IPR&D to developed technology and commenced amortization over its estimated useful life of 7 years.

The Company’s amortization expense for acquired identifiable intangible assets with finite useful lives was $4.9 million and $8.9 million for the fiscal three and nine months ended September 27, 2019 as compared to $0.7 million and $2.1 million for the fiscal three and nine months ended September 28, 2018, respectively. Estimated amortization expense for acquired identifiable intangible assets for the remainder of fiscal year 2019 and the succeeding years are as follows:


		Future Intangible Asset
		Amortization expense
		(in thousands)
Fiscal year:
Remainder of 2019	$	3,040
2020		11,589
2021		10,186
2022		9,936
2023		9,278
2024		5,781
Thereafter		18,998
	$	68,808

At the time of acquisition, the Company estimates the fair value of the acquired identifiable intangible assets based upon the facts and circumstances related to the particular intangible asset. Inherent in such estimates are judgments and estimates of future revenue, profitability, cash flows and appropriate discount rates for any present value calculations. The Company preliminarily estimates the value of the acquired identifiable intangible assets and then finalizes the estimated fair values during the purchase allocation period, which does not extend beyond 12 months from the date of acquisition.

The Company tests its goodwill at least annually for possible impairment. The Company completes its annual testing of goodwill as of the last day of the first month of its fourth fiscal quarter each year to determine whether there is impairment. In addition to the Company’s annual test, it regularly evaluates whether events and circumstances have occurred that may indicate a potential impairment of goodwill. No impairment was recorded during the nine months ended September 27, 2019.

EARNINGS PER SHARE (EPS)

9 Months Ended

Sep. 27, 2019

EARNINGS PER SHARE (EPS)

EARNINGS PER SHARE (EPS)

4. EARNINGS PER SHARE (EPS)

Basic EPS is computed by dividing net income available to common stockholders by the weighted-average number of common shares outstanding. Diluted EPS is computed by dividing net income by the weighted-average number of common shares outstanding and dilutive potential common shares for the period. Potential common shares include the weighted-average dilutive effects of outstanding stock options and restricted stock awards using the treasury stock method.

The following table sets forth the number of weighted-average common shares outstanding used to compute basic and diluted EPS:


	Three months ended				Nine months ended
	September 27,		September 28,		September 27,		September 28,
	2019		2018		2019		2018
	(in thousands, except per share amounts)
Net income	$	416	$	3,311	$	1,639	$	8,829
Weighted-average common shares outstanding		11,217		8,844		11,097		8,798
Effect of dilutive stock options and restricted stock awards		572		499		617		485
Weighted-average common shares outstanding-diluted		11,789		9,343		11,714		9,283
Earnings per share:
Basic	$	0.04	$	0.37	$	0.15	$	1.00
Diluted	$	0.04	$	0.35	$	0.14	$	0.95

For the three and nine months ended September 27, 2019, 155,000 options were excluded from the calculation of dilutive potential common shares, as compared to 241,000 and 215,000 options for the three and nine months ended September 28, 2018, respectively. These options were not included in the computation of dilutive potential common shares because the assumed proceeds per share exceeded the average market price per share for the 2019 and 2018 periods, respectively. Accordingly, the inclusion of these options would have been anti-dilutive.

EQUIPMENT AND LEASEHOLD IMPROVEMENTS, NET

9 Months Ended

Sep. 27, 2019

EQUIPMENT AND LEASEHOLD IMPROVEMENTS, NET

EQUIPMENT AND LEASEHOLD IMPROVEMENTS, NET

5. EQUIPMENT AND LEASEHOLD IMPROVEMENTS, NET

Equipment and leasehold improvements consisted of the following at September 27, 2019 and December 28, 2018:


	September 27,		December 28,
	2019		2018
	(in thousands)
Furniture and fixtures	$	4,264	$	3,551
Computer hardware and software		13,975		10,874
Leasehold improvements		2,282		1,419
Equipment under finance leases		1,850		1,304
Automobiles, trucks, and field equipment		3,533		2,635
		25,904		19,783
Accumulated depreciation and amortization		(14,214)		(11,785)
Equipment and leasehold improvements, net	$	11,690	$	7,998

Included in accumulated depreciation and amortization is $366,000 and $374,000 of amortization expense related to equipment held under finance leases in the nine months ended September 27, 2019 and fiscal year 2018, respectively.

ACCRUED LIABILITIES

9 Months Ended

Sep. 27, 2019

ACCRUED LIABILITIES

ACCRUED LIABILITIES

6. ACCRUED LIABILITIES

Accrued liabilities consist of the following:


	September 27,		December 28,
	2019		2018
	(in thousands)
Accrued bonuses	$	1,803	$	5,273
Accrued interest		35		127
Paid leave bank		4,259		3,512
Compensation and payroll taxes		1,529		2,544
Accrued legal		18		153
Accrued workers’ compensation insurance		188		273
Accrued rent		—		233
Employee withholdings		1,452		2,137
Client deposits		234		280
Accrued subcontractor costs		34,164		21,446
Other		2,255		1,423
Total accrued liabilities	$	45,937	$	37,401

DEBT OBLIGATIONS

9 Months Ended

Sep. 27, 2019

DEBT OBLIGATIONS

DEBT OBLIGATIONS

7. DEBT OBLIGATIONS

Debt obligations, excluding obligations under finance leases (see Note 8 “—Leases” below), consist of the following at September 27, 2019 and December 28, 2018:


	September 27,		December 28,
	2019		2018
	(in thousands)
Outstanding borrowings on Term A Loan	$	97,500	$	70,000
Outstanding borrowings on Revolving Credit Facility		5,000		—
Other debt agreements		1,531		1,711
Total debt		104,031		71,711
Issuance costs and debt discounts		(749)		(925)
Subtotal		103,282		70,786
Less current portion of long-term debt		8,220		8,572
Long-term debt portion	$	95,062	$	62,214

New Credit Facilities

On June 26, 2019, the Company and certain of its subsidiaries entered into an Amended and Restated Credit Agreement (the “Credit Agreement”) with a syndicate of financial institutions as lenders and BMO Harris Bank, N.A. (“BMO”), as administrative agent. The Credit Agreement amends and restates the Company’s prior credit agreement, which was entered into on October 1, 2018 with a syndicate of financial institutions as lenders and BMO and was scheduled to mature on October 1, 2023.

The Credit Agreement provides for (i) a $100.0 million term loan (the “Term A Loan”), (ii) up to $50.0 million in delayed draw term loans (the “Delayed Draw Term Loan”), and (iii) a $50.0 million revolving credit facility (the “Revolving Credit Facility” and, collectively with the Term A Loan and the Delayed Draw Term Loan, the “Credit Facilities”), each maturing on June 26, 2024. The Company may borrow under the Delayed Draw Term Loan any time and from time to time until June 26, 2022; provided that each borrowing under the Delayed Draw Term Loan must be a minimum of $10.0 million, the Company may not make more than five borrowings under the Delayed Draw Term Loan and any borrowings made under the Delayed Draw Term Loan will permanently reduce future borrowing capacity under the Delayed Draw Term Loan. In addition, the Company must satisfy certain conditions prior to borrowing under the Delayed Draw Term Loan, including, but not limited to, that upon giving effect to such borrowing under the Delayed Draw Term Loan and any Credit Event (as defined in the Credit Agreement) in connection therewith, the Company will be in compliance with all financial covenants on a pro forma basis and the Company’s consolidated total leverage ratio will be no greater than 0.25x less than the consolidated total leverage ratio covenant compliance level in effect at the time of such borrowing. On October 28, 2019, the Company borrowed $27.0 million under the Delayed Draw Term Loan to finance the purchase of its acquisition of E3, Inc., which reduced the future borrowing capacity under the Delayed Draw Term Loan to $23.0 million.

The Company may also request lenders to add incremental term loans or increase the aggregate commitment under the Revolving Credit Facility by an aggregate amount of up to $100.0 million, subject to meeting certain conditions, and only if the existing or new lenders agree to provide the additional term or revolving commitments.

Borrowings under the Credit Facilities bear interest at a rate equal to either, at the Company’s option, (i) the highest of the prime rate, the Federal Funds Rate plus 0.50% or one-month LIBOR plus 1.00% (the “Base Rate”) or (ii) LIBOR, in each case plus an applicable margin ranging from 0.125% to 1.00% with respect to Base Rate borrowings and 1.125% to 2.00% with respect to LIBOR borrowings. The applicable margin varies based upon the Company’s consolidated total leverage ratio. The Company will also pay commitment fees for the unused portion of the Revolving Credit Facility and the Delayed Draw Term Loan, which ranges from 0.15% to 0.35% per annum depending on the Company’s consolidated total leverage ratio, and fees on the face amount of any letters of credit outstanding under the Revolving Credit Facility, which range from 0.84% to 2.00% per annum, in each case, depending on whether such letter of credit is a performance or financial letter of credit and the Company’s consolidated total leverage ratio. The Term A Loan issuance costs are amortized to interest expense over the term of the loan, and as of September 27, 2019, issuance costs of $0.7 million remained unamortized. The Delayed Draw Term Loan and Revolving Credit Facility issuance cost of $0.8 million are included in assets in the accompanying condensed consolidated balance sheets.

The Term A Loan amortizes quarterly in installments of $2.5 million beginning with the fiscal quarter ending September 27, 2019, with a final payment of all then remaining principal and interest due on the maturity date of June 26, 2024. Any Delayed Draw Term Loan will amortize quarterly in an amount equal to 2.5% of the aggregate outstanding borrowings under the Delayed Draw Term Loan, beginning with the first full fiscal quarter ending after the initial borrowing date, with a final payment of all then remaining principal and interest due on the maturity date of June 26, 2024. The amounts outstanding under the Credit Facilities may be prepaid in whole or in part at any time without penalty.

Willdan Group, Inc. is the borrower under the Credit Agreement and its obligations under the Credit Agreement are guaranteed by its present and future domestic subsidiaries (other than inactive subsidiaries). In addition, subject to certain exceptions, all such obligations are secured by substantially all of the assets of Willdan Group, Inc. and the subsidiary guarantors.

The Credit Agreement requires compliance with financial covenants, including a maximum total consolidated leverage ratio and a minimum fixed charge coverage ratio. The Credit Agreement also contains customary restrictive covenants including (i) restrictions on the incurrence of additional indebtedness and additional liens on property, (ii) restrictions on permitted acquisitions and other investments and (iii) limitations on asset sales, mergers and acquisitions. Further, the Credit Agreement limits the Company’s payment of future dividends and distributions and share repurchases by the Company. Subject to certain exceptions, the borrowings under the Credit Agreement are also subject to mandatory prepayment from (a) any issuances of debt or equity securities, (b) any sale or disposition of assets, (c) insurance and condemnation proceeds (d) representation and warranty insurance proceeds related to insurance policies issued in connection with acquisitions and (e) excess cash flow. The Credit Agreement includes customary events of default.

The Company believes that, as of September 27, 2019, it was in compliance with all covenants contained in the Credit Agreement.

On January 31, 2019, the Company entered into an interest swap agreement for $35.0 million notional amount. The interest swap agreement was designated as a cash flow hedge to fix the variable interest rate on a portion of the outstanding principal amount under the Company’s 2018 Term Loan Facility. The interest swap fixed annual rate is 2.47% and the amortization is quarterly in an amount equal to 10% annually. The interest swap agreement expires on January 31, 2022. As of September 27, 2019, the Company’s composite interest rate, exclusive of the effects of upfront fees, undrawn fees and issuance cost amortization, was 4.40%.

Prior Credit Facilities

2018 Credit Facility

On October 1, 2018, in connection with the acquisition of Lime Energy, the Company entered into a credit agreement (the “2018 Credit Agreement”) with a syndicate of financial institutions as lenders, and BMO Harris Bank, N.A., as administrative agent. The 2018 Credit Agreement initially provided for up to a $90.0 million delayed draw term loan facility (the “2018 Term Loan Facility”) and a $30.0 million revolving credit facility (collectively, the “2018 Credit Facilities”), each maturing on October 1, 2023. On October 10, 2018, as a result of the Company’s completed equity offering, the amount available for borrowing under the 2018 Term Loan Facility was reduced to $70.0 million. On November 9, 2018, in connection with the closing of the acquisition of Lime Energy, the Company borrowed $70.0 million (the “2018 Term Loan”) under the 2018 Term Loan Facility. The proceeds of such borrowing were used to pay part of the consideration owed in connection with the acquisition along with related fees and expenses. On June 26, 2019, in connection with the Company entering into the Credit Agreement, the 2018 Credit Agreement was amended and restated.

The 2018 Credit Facilities bore interest at a rate equal to either, at the Company’s option, (i) the highest of the prime rate, the Federal Funds Rate plus 0.50% or one-month LIBOR plus 1.00% (“Base Rate”) or (ii) LIBOR, in each case plus an applicable margin ranging from 0.25% to 3.00% with respect to Base Rate borrowings and 1.25% to 4.00% with respect to LIBOR borrowings. The applicable margin was based upon the Company’s consolidated total leverage ratio. The Company was also required to pay a commitment fee for the unused portion of the revolving credit facility, which ranged from 0.20% to 0.40% per annum depending on the Company’s consolidated total leverage ratio, and fees on the face amount of any letters of credit outstanding under the revolving credit facility, which ranged from 0.94% to 4.00% per annum, in each case, depending on whether such letter of credit was a performance or financial letter of credit and the Company’s consolidated total leverage ratio.

Borrowings under the 2018 Credit Agreement were guaranteed by all of the Company’s direct and indirect domestic subsidiaries (other than inactive subsidiaries). In addition, subject to certain exceptions, all such obligations were secured by substantially all of the assets of Willdan Group, Inc. and the subsidiary guarantors.

2017 Credit Facility

On January 20, 2017, the Company and each of its subsidiaries, as guarantors, entered into an Amended and Restated Credit Agreement (the “2017 Credit Agreement”) with BMO, as lender. The 2017 Credit Agreement amended and extended the Company’s prior credit agreement. The 2017 Credit Agreement provided for a $35.0 million revolving line of credit, including a $10.0 million standby letter of credit sub-facility, and was scheduled to mature on January 20, 2020. Borrowings under the 2017 Credit Agreement bore interest at a rate equal to either, at the Company’s option, (i) the highest of the prime rate, the Federal Funds Rate plus 0.5% or one-month London Interbank Offered Rate (“LIBOR”) plus 1% (the “Base Rate”) or (ii) LIBOR, in each case plus an applicable margin ranging from 0.25% to 1.00% with respect to Base Rate borrowings and 1.25% to 2.00% with respect to LIBOR borrowings. The applicable margin was based upon the consolidated leverage ratio of the Company. The Company was also required to pay a commitment fee for the unused portion of the revolving line of credit, which ranged from 0.20% to 0.35% per annum, and fees on any letters of credit drawn under the facility, which ranged from 0.94% to 1.50%, in each case, depending on the Company’s consolidated leverage ratio.

Borrowings under the 2017 Credit Agreement were guaranteed by all of the Company’s direct and indirect subsidiaries and secured by substantially all of the Company’s and the Guarantors’ assets. On October 1, 2018, in connection with the Company entering into the 2018 Credit Agreement, the 2017 Credit Agreement was terminated.

Other Debt Agreements

Insurance Premiums

The Company has also financed, from time to time, insurance premiums by entering into unsecured notes payable with insurance companies. During the Company’s annual insurance renewals in the fourth quarter of its fiscal year ended December 28, 2018, the Company elected to finance its insurance premiums for the 2019 fiscal year with a note payable bearing interest at an annual rate of 4.3%, payable in monthly principal and interest installments of $149,881 through October 2019. Included in the Company’s insurance renewal terms are individual stop loss amount of $100,000 and an aggregate of 125%. As of September 27, 2019 and December 28, 2018, the unpaid balance of the financed premiums totaled $0.3 million and $1.5 million, respectively.

Software Agreements

The Company has also financed, from time to time, software costs by entering into unsecured notes payable with software providers. During the fiscal year ended December 28, 2018, the Company elected to finance its IBM software costs of $0.2 million with a note payable bearing interest at an annual rate of 4.656%, payable in monthly principal and interest installments of $6,315 through November 2021. As of September 27, 2019 and December 28, 2018, the unpaid balance related to the IBM software agreement totaled $150,000 and $211,000, respectively.

Utility Customer Agreement

In connection with the acquisition of substantially all of the assets of Onsite Energy, the Company assumed a contract dispute settlement agreement between Onsite Energy and one of its utility customers dated December 20, 2018 (the “Utility Customer Agreement”) where Onsite Energy agreed to pay $1.7 million, bearing interest at an imputed annual rate of 4.332%, payable in quarterly principal and interest installments through June 2021. The unpaid balance of the Utility Customer Agreement totaled $1.1 million as of September 27, 2019.

LEASES

9 Months Ended

Sep. 27, 2019

LEASES

LEASES

8. LEASES

The Company is obligated under finance leases for certain furniture and office equipment that expire at various dates through the year 2022.

The Company also leases certain office facilities under non-cancelable operating leases that expire at various dates through the year 2027.

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). The FASB issued this update to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing arrangements. The updated guidance was effective for annual periods beginning after December 15, 2018, including interim periods within those fiscal years.

Change in Accounting Policy

On January 1, 2019, the Company adopted ASU No. 2016-02, Leases (Topic 842) using the modified retrospective method. Under this guidance, the net present value of future lease payments is recorded as right-of-use assets and lease liabilities. In addition, the Company elected the ‘package of practical expedients’ permitted under the transition guidance within the new standard, which among other things, allowed the Company to carry forward the historical lease classification. In addition, the Company elected not to utilize the hindsight practical expedient to determine the lease term for existing leases. The Company elected the short-term lease recognition exemption for all leases that qualify. This means, for those leases that qualify, the Company did not recognize right-of-use assets or lease liabilities, including not recognizing right-of-use assets or lease liabilities for existing short-term leases of those assets in transition. The Company also elected the practical expedient to not separate lease and non-lease components for our facilities leases. Adoption of the new standard resulted in the recording of additional right-of-use assets and operating lease liabilities of approximately $10.9 million and $11.9 million, respectively, as of January 1, 2019. The adoption of Topic 842 did not impact the Company’s retained earnings, consolidated net earnings or cash flows.

From time to time, the Company enters into non-cancelable leases for some of our facility and equipment needs. These leases allow the Company to conserve cash by paying a monthly lease rental fee for the use of facilities and equipment rather than purchasing them. The Company’s leases have remaining terms ranging from one to eight years, some of which may include options to extend the leases for up to five years, and some of which may include options to terminate the leases within one year. Currently, all of the Company’s leases contain fixed payment terms. The Company may decide to cancel or terminate a lease before the end of its term, in which case we are typically liable to the lessor for the remaining lease payments under the term of the lease. Additionally, all of our month-to-month leases are cancelable by the Company or the lessor, at any time and are not included in our right-of-use asset or lease liability. As of September 27, 2019, the Company had no leases with residual value guarantees. Typically, the Company has purchase options on the equipment underlying its long-term leases. The Company may exercise some of these purchase options when the need for equipment is on-going and the purchase option price is attractive. Nonperformance-related default covenants, cross-default provisions, subjective default provisions and material adverse change clauses contained in material lease agreements, if any, are also evaluated to determine whether those clauses affect lease classification in accordance with “ASC” Topic 842-10-25. Leases are accounted for as operating or financing leases, depending on the terms of the lease.

Financing Leases

The Company leases certain equipment under financing leases. The economic substance of the leases is a financing transaction for acquisition of equipment and leasehold improvements. Accordingly, the right-of-use assets for these leases are included in the balance sheets in equipment and leasehold improvements, net of accumulated depreciation, with a corresponding amount recorded in current portion of financing lease obligations or noncurrent portion of financing lease obligations, as appropriate. The financing lease assets are amortized over the life of the lease or, if shorter, the life of the leased asset, on a straight-line basis and included in depreciation expense. The interest associated with financing lease obligations is included in interest expense.

Right-of-use assets

Operating leases are included in right-of-use assets, and current portion of lease liability and noncurrent portion of lease liability, as appropriate. Right-of-use assets and lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As most of the Company’s leases do not provide an implicit rate to calculate present value, the Company determines this rate by estimating the Company’s incremental borrowing rate at the lease commencement date. The right-of-use asset also includes any lease payments made and initial direct costs incurred at lease commencement and excludes lease incentives. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term.

The following is a summary of the lease expense recorded for the three and nine months ended September 27, 2019:


	Three Months Ended		Nine Months Ended
	September 27, 2019		September 27, 2019
	(in thousands)
Operating lease cost	$	1,288	$	3,558
Finance lease cost:
Amortization of assets		242		366
Interest on lease liabilities		19		28
Total net lease cost	$	1,549	$	3,952

The following is a summary of lease information presented on the Company’s condensed consolidated balance sheet as of September 27, 2019 and for the nine months then ended:


	September 27, 2019
	(in thousands)
Operating leases:
Right-of-use assets	$	12,767

Lease liability	$	4,194
Lease liability, less current portion		9,726
Total lease liabilities	$	13,920

Finance leases (included in equipment and leasehold improvements, net):
Equipment and leasehold improvements, net	$	1,850
Accumulated depreciation		(1,148)
Total equipment and leasehold improvements, net	$	702

Finance lease obligations	$	529
Finance lease obligations, less current portion		230
Total finance lease obligations	$	759

Weighted average remaining lease term (in years):
Operating Leases		3.74
Finance Leases		1.56

Weighted average discount rate:
Operating Leases		5.15	%
Finance Leases		4.91	%

The following is a summary of other information and supplemental cash flow information related to finance and operating leases for nine months ended September 27, 2019:


	Nine Months Ended
	September 27, 2019
	(in thousands)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flow from operating leases	$	3,645
Operating cash flow from finance leases		98
Financing cash flow from finance leases		338

Right-of-use assets obtained in exchange for lease liabilities:
Operating leases		3,029

The following is a summary of the maturities of lease liabilities as of September 27, 2019:


	Operating		Finance
	(in thousands)
Fiscal year:
Remainder of 2019	$	1,276	$	177
2020		4,355		464
2021		3,520		137
2022		2,778		8
2023		1,641		—
2024 and thereafter		1,963		—
Total lease payments	$	15,533	$	786
Less: Imputed interest		(1,613)		(27)
Total lease obligations		13,920		759
Less: Current obligations		4,194		529
Noncurrent lease obligations	$	9,726	$	230

The imputed interest for finance lease obligations represents the interest component of finance leases that will be recognized as interest expense in future periods. The financing component for operating lease obligations represents the effect of discounting the operating lease payments to their present value.

Capital Leases

Prior to the adoption of ASU No. 2016-02, Leases (Topic 842), the Company leased certain equipment under capital leases. The economic substance of these leases was a financing transaction for purchase of the equipment and leasehold improvements, accordingly, the leases were included in the balance sheets in equipment and leasehold improvement, net of accumulated depreciation, with a corresponding amount recorded in current portion of lease obligations or noncurrent portion of lease obligations, as appropriate. The capital lease assets were amortized on a straight-line basis over the life of the lease or, if shorter, the life of the leased asset, and were included in depreciation expense in the statements of operations. The interest associated with capital leases was included in interest expense in the statements of operations.

As of December 28, 2018, the Company had $0.5 million of capital lease obligations outstanding, $0.3 million of which was classified as a current liability.

As of December 28, 2018, $0.5 million of leased assets were capitalized in equipment and leasehold improvements, net of accumulated depreciation.

COMMITMENTS	9 Months Ended
COMMITMENTS	Sep. 27, 2019
COMMITMENTS
COMMITMENTS	9. COMMITMENTS Employee Benefit Plans The Company has a qualified profit sharing plan pursuant to Code Section 401(a) and qualified cash or deferred arrangement pursuant to Code Section 401(k) covering all employees. Employees may elect to contribute up to 50% of their compensation limited to the amount allowed by tax laws. Company contributions are made solely at the discretion of the Company’s board of directors. The Company also has a defined contribution plan (the “Plan”) covering employees who have completed three months of service and who have attained 21 years of age. During the nine months ended September 27, 2019, the Company elected to make matching contributions equal to 50% of the participants’ contributions to the Plan up to 6% of the individual participant’s compensation. Under the defined contribution plan, the Company may make discretionary matching contributions to employee accounts. The Company made matching contributions of approximately $1.6 million during the nine months ended September 27, 2019. The Company has a discretionary bonus plan for regional managers, division managers and others as determined by the president and chief executive officer of the Company. Bonuses are awarded if certain financial goals are achieved. The financial goals are not stated in the plan; rather they are judgmentally determined each year. In addition, the board of directors may declare discretionary bonuses to key employees and all employees are eligible for bonuses for outstanding performance. The Company’s compensation committee of the board of directors determines the compensation of the president and chief executive officer and other executive officers. Post-Employment Health Benefits In May 2006, the Company’s board of directors approved providing lifetime health insurance coverage for Win Westfall, the Company’s former chief executive officer and former member of the board of directors, and his spouse and for Linda Heil, the widow of the Company’s former chief executive officer, Dan Heil. These benefits relate to past services provided to the Company. Accordingly, there is no unamortized compensation cost for the benefits.

INCOME TAXES	9 Months Ended
INCOME TAXES	Sep. 27, 2019
INCOME TAXES
INCOME TAXES	10. INCOME TAXES Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences of temporary differences between the financial reporting basis and tax basis of the Company’s assets and liabilities, subject to a judgmental assessment of the recoverability of deferred tax assets. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance is recorded when it is more-likely-than-not that some of the deferred tax assets may not be realized. Significant judgment is applied when assessing the need for valuation allowances. Areas of estimation include the Company’s consideration of future taxable income and ongoing prudent and feasible tax planning strategies. Should a change in circumstances lead to a change in judgment about the utilization of deferred tax assets in future years, the Company would adjust the related valuation allowances in the period that the change in circumstances occurs, along with a corresponding increase or charge to income. During each fiscal year, management assesses the available positive and negative evidence to estimate if sufficient future taxable income will be generated to utilize existing deferred tax assets. Beginning in fiscal year 2017, the Company determined that it was more-likely-than-not that the entire California net operating loss will not be utilized prior to expiration. Significant pieces of objective evidence evaluated included the Company’s history of utilization of California net operating losses in prior years for each of its subsidiaries, as well as the Company’s forecasted amount of net operating loss utilization for certain members of the combined group. As a result, the Company recorded a valuation allowance in the amount of $86,000 at the end of fiscal year 2018 related to California net operating losses. There was no change to the valuation allowance during the nine month period ended September 27, 2019. For acquired business entities, if the Company identifies changes to acquired deferred tax asset valuation allowances or liabilities related to uncertain tax positions during the measurement period and they relate to new information obtained about facts and circumstances that existed as of the acquisition date, those changes are considered a measurement period adjustment and the Company records the offset to goodwill. The Company records all other changes to deferred tax asset valuation allowances and liabilities related to uncertain tax positions in current period income tax expense. The Company recognizes the tax benefit from uncertain tax positions if it is more likely than not that the tax positions will be sustained on examination by the tax authorities, based on the technical merits of the position. The tax benefit is measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate settlement. The Company recognizes interest and penalties related to unrecognized tax benefits in income tax expense. As of September 27, 2019, the Company recorded a liability of $0.1 million for uncertain tax positions related to miscellaneous tax deductions taken in open tax years. Included in this amount are $0.1 million of tax benefits that, if recognized, would affect the effective tax rate. Interest and penalties of $0.03 million have been recorded related to unrecognized tax benefits as of September 27, 2019. Based on management’s estimates and determination of an effective tax rate for the year, the Company recorded an income tax benefit of $0.44 million and $1.4 million for the three and nine months ended September 27, 2019, as compared to an income tax expense of $1.6 million and $2.2 million for the three and nine months ended September 28, 2018, respectively. During the three and nine months ended September 27, 2019, the difference between the effective tax rate and the federal statutory rate is primarily attributable to the recognition of tax deductions related to the vesting of performance-based restricted stock units, exercise of non-qualified stock options, disqualifying dispositions arising from the sale of employee stock purchase and incentive stock options, and the reduction of the Company’s uncertain tax position. The income tax benefit related to these deductions has been included as an increase of 1,649.65% to the Company’s effective tax rate for the nine months ended September 27, 2019. The effective tax rate also varies from the federal statutory rate due to the impact of state income tax expense and certain expenses that are non-deductible for tax purposes, including meals and entertainment, excess compensation for covered employees and compensation expense related to employee stock purchase and incentive stock options. During the nine months ended September 27, 2019, the Internal Revenue Service continued its audit of the Company’s tax return for the fiscal year ended December 30, 2016. The Company is unable to determine the impact of this examination due to the audit process having not been completed.

SEGMENT INFORMATION

9 Months Ended

Sep. 27, 2019

SEGMENT INFORMATION

SEGMENT INFORMATION

11. SEGMENT INFORMATION

The Company’s two segments are Energy and Engineering and Consulting. The Company’s chief operating decision maker, which continues to be its chief executive officer, receives and reviews financial information in this format. The Company’s principal segment, Energy, consists of the business of its subsidiary WES. WES provides energy efficiency consulting services to utilities, public agencies, municipalities, private industry and non-profit organizations. The Engineering and Consulting segment includes the operation of the Company’s remaining subsidiaries, Willdan Engineering, Willdan Infrastructure, Public Agency Resources and Willdan Financial Services. The Engineering and Consulting segment offers a broad range of engineering and planning services to the Company’s public and private sector clients, expertise and support for the various financing techniques employed by public agencies to finance their operations and infrastructure along with the mandated reporting and other requirements associated with these financing services to cities, related municipal service agencies and other entities.

The accounting policies applied to determine the segment information are the same as those described in the summary of significant accounting policies included in the Company’s Annual Report on Form 10-K for the year ended December 28, 2018. There were no intersegment sales in the three month periods ended September 27, 2019 and September 28, 2018. The Company’s chief operating decision maker evaluates the performance of each segment based upon income or loss from operations before income taxes. Certain segment asset information including expenditures for long-lived assets has not been presented as it is not reported to or reviewed by the chief operating decision maker. In addition, enterprise-wide service line contract revenue is not included as it is impracticable to report this information for each group of similar services.

Financial information with respect to the reportable segments as of and for the fiscal three and nine months ended September 27, 2019 and as of and for the fiscal three and nine months ended September 28, 2018 is as follows:


			Engineering		Unallocated				Consolidated
	Energy		& Consulting		Corporate		Intersegment		Total
	(in thousands)
Fiscal Three Months Ended September 27, 2019
Contract revenue	$	97,934	$	19,560	$	—	$	—	$	117,494
Depreciation and amortization		5,425		363		—		—		5,788
Interest expense, net		20		—		1,237		—		1,257
Segment profit (loss) before income tax expense		1,669		2,586		(4,215)		—		40
Income tax expense (benefit)		461		715		(1,552)		—		(376)
Net income (loss)		1,208		1,871		(2,663)		—		416
Segment assets1		246,675		23,366		115,701		(23,130)		362,612
Fiscal Three Months Ended September 28, 2018
Contract revenue	$	50,085	$	21,301	$	—	$	—	$	71,386
Depreciation and amortization		926		191		—		—		1,117
Interest expense		18		4		—		—		22
Segment profit (loss) before income tax expense		4,349		2,395		(1,836)		—		4,908
Income tax expense (benefit)		1,415		779		(597)		—		1,597
Net income (loss)		2,934		1,616		(1,239)		—		3,311
Segment assets1		103,752		20,057		39,930		(23,130)		140,609
Fiscal Nine Months Ended September 27, 2019
Contract revenue	$	257,910	$	55,773	$	—	$	—	$	313,683
Depreciation and amortization		10,353		955		—		—		11,308
Interest expense, net		20		—		3,579		—		3,599
Segment profit (loss) before income tax expense		2,316		6,603		(8,653)		—		266
Income tax expense (benefit)		640		1,825		(3,838)		—		(1,373)
Net income (loss)		1,676		4,779		(4,816)		—		1,639
Segment assets1		246,675		23,366		115,701		(23,130)		362,612
Fiscal Nine Months Ended September 28, 2018
Contract revenue	$	129,143	$	56,671	$	—	$	—	$	185,814
Depreciation and amortization		2,693		599		—		—		3,292
Interest expense		65		10		—		—		75
Segment profit (loss) before income tax expense		7,483		5,801		(2,231)		—		11,053
Income tax expense (benefit)		1,506		1,167		(449)		—		2,224
Net income (loss)		5,977		4,634		(1,782)		—		8,829
Segment assets1		103,752		20,057		39,930		(23,130)		140,609

(1)

Segment assets represent segment assets, net of intercompany receivables.

CONTINGENCIES	9 Months Ended
CONTINGENCIES	Sep. 27, 2019
CONTINGENCIES
CONTINGENCIES	12. CONTINGENCIES Claims and Lawsuits The Company is subject to claims and lawsuits from time to time, including those alleging professional errors or omissions that arise in the ordinary course of business against firms that operate in the engineering and consulting professions. The Company carries professional liability insurance, subject to certain deductibles and policy limits, for such claims as they arise and may from time to time establish reserves for litigation that is considered probable of a loss. In accordance with accounting standards regarding loss contingencies, the Company accrues an undiscounted liability for those contingencies where the incurrence of a loss is probable and the amount can be reasonably estimated, and discloses the amount accrued and an estimate of any reasonably possible loss in excess of the amount accrued, if such disclosure is necessary for the Company’s financial statements not to be misleading. The Company does not accrue liabilities when the likelihood that the liability has been incurred is probable but the amount cannot be reasonably estimated, or when the liability is believed to be only reasonably possible or remote. Because litigation outcomes are inherently unpredictable, the Company’s evaluation of legal proceedings often involves a series of complex assessments by management about future events and can rely heavily on estimates and assumptions. If the assessments indicate that loss contingencies that could be material to any one of the Company’s financial statements are not probable, but are reasonably possible, or are probable, but cannot be estimated, then the Company will disclose the nature of the loss contingencies, together with an estimate of the possible loss or a statement that such loss is not reasonably estimable. While the consequences of certain unresolved proceedings are not presently determinable, and a reasonable estimate of the probable and reasonably possible loss or range of loss in excess of amounts accrued for such proceedings cannot be made, an adverse outcome from such proceedings could have a material adverse effect on the Company’s earnings in any given reporting period. However, in the opinion of the Company’s management, after consulting with legal counsel, and taking into account insurance coverage, the ultimate liability related to current outstanding claims and lawsuits is not expected to have a material adverse effect on the Company’s financial statements.

DERIVATIVE FINANCIAL INSTRUMENTS

9 Months Ended

Sep. 27, 2019

DERIVATIVE FINANCIAL INSTRUMENTS

DERIVATIVE FINANCIAL INSTRUMENTS

13. DERIVATIVE FINANCIAL INSTRUMENTS

The Company uses certain interest rate derivative contracts to hedge interest rate exposures on its variable rate debt. The Company’s hedging program is not designated for trading or speculative purposes.

The Company recognizes derivative instruments as either assets or liabilities on the accompanying consolidated balance sheets at fair value. The Company records changes in the fair value (i.e., gains or losses) of the derivatives that have been designated as cash flow hedges in its consolidated balance sheets as accumulated other comprehensive income (loss) and in its condensed consolidated statements of comprehensive (loss) income as a loss or gain on cash flow hedge valuation.

On January 31, 2019, the Company entered into an interest rate swap agreement that the Company designated as cash flow hedge to fix the variable interest rate on a portion of the Company’s 2018 Term Loan Facility. The interest rate swap agreement total notional amount of $35.0 million, has a fixed annual interest rate of 2.47% and expires on January 31, 2022. As of September 27, 2019, the effective portion of the Company’s interest rate swap agreement designated as a cash flow hedge before tax effects was $0.7 million, of which no amounts were reclassified from accumulated other comprehensive income to interest expense in the nine months ended September 27, 2019. The Company expects to reclassify $0.3 million from accumulated other comprehensive income to interest expense within the next twelve months.

The fair values of the Company’s outstanding derivatives designated as hedging instruments were as follows:


		Fair Value of Derivative
		Instruments as of
	Balance Sheet Location	September 27, 2019		December 28, 2018
		(in thousands)
Interest rate swap agreement	Accrued liabilities	$	(228)	$	—
Interest rate swap agreement	Other noncurrent (liabilities) assets	$	(436)	$	—

The impact of the effective portions of derivative instruments in cash flow hedging relationships and fair value relationships on other comprehensive income was $ 0.1 million and $0.5 million for the three and nine months ended September 27, 2019, respectively.

The accumulated balances and reporting period activities for the three and nine months ended September 27, 2019 related to reclassifications out of accumulated other comprehensive income (loss) are summarized as follows:


	(Loss) on		Accumulated Other
	Derivative Instruments		Comprehensive Loss
	(in thousands)
Balances at December 28, 2018	$	—	$	—
Other comprehensive loss before reclassifications		(219)		(219)
Amounts reclassified from accumulated other comprehensive income:
Interest rate contracts, net of tax1		—		—
Net current-period other comprehensive loss		(219)		(219)
Balances at March 29, 2019	$	(219)	$	(219)
Other comprehensive loss before reclassifications	$	(219)	$	(219)
Amounts reclassified from accumulated other comprehensive income:
Interest rate contracts, net of tax1		—		—
Net current-period other comprehensive loss		(219)		(219)
Balances at June 28, 2019	$	(438)	$	(438)
Other comprehensive loss before reclassifications	$	(42)	$	(42)
Amounts reclassified from accumulated other comprehensive income:
Interest rate contracts, net of tax1		—		—
Net current-period other comprehensive loss		(42)		(42)
Balances at September 27, 2019	$	(480)	$	(480)

(1)

This accumulated other comprehensive component is reclassified to “Interest expense” in our consolidated statements of income.

SUBSEQUENT EVENTS	9 Months Ended
SUBSEQUENT EVENTS	Sep. 27, 2019
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS	14. SUBSEQUENT EVENTS The Company evaluates subsequent events in accordance with ASC Topic 855, Subsequent Events. The Company evaluates subsequent events up until the date the condensed consolidated financial statements are issued. On October 28, 2019 (the “E3, Inc. Closing Date”), the Company, through its wholly owned subsidiary WES, acquired all of the capital stock of E3, Inc. pursuant to the terms of a stock purchase agreement (the “Stock Purchase Agreement”) by and among the Company, WES, E3, Inc., each of the stockholders of E3, Inc. (the “E3, Inc. Stockholders”) and Ren Orans, as seller representative of the E3, Inc. Stockholders. E3, Inc. is an energy consulting firm that helps utilities, regulators, policy makers, developers, and investors make strategic decisions as they implement new public policies, respond to technological advances, and address customers’ shifting expectations in clean energy. The Company agreed to pay up to $44.0 million for the purchase of all of the capital stock of E3, Inc., which purchase price consists of (i) $27.0 million in cash paid on the E3, Inc. Closing Date (subject to holdbacks and adjustments), (ii) $5.0 million in shares of the Company’s common stock, based on the volume-weighted average price per share of the Company’s common stock for the ten trading days immediately following, but not including, the E3, Inc. Closing Date and (iii) up to $12.0 million in cash if E3, Inc. exceeds certain financial targets during the three years after the E3, Inc. Closing Date, as more fully described below (such potential payments of up to $12.0 million, being referred to as “Earn-Out Payments” and $12.0 million in respect thereof, being referred to as the “Maximum Payout”). The amount of the Earn-Out Payments to be paid will be determined based on E3, Inc.’s earnings before interest, taxes, depreciation and amortization (“EBITDA”). The E3, Inc. Stockholders will receive Earn-Out Payments in each of the three years after the E3, Inc. Closing Date (the “Earn-Out Period”) based on the amount by which E3, Inc.’s EBITDA exceeds certain targets. The amounts due to the E3, Inc. Stockholders as Earn-Out Payments will in no event, individually or in the aggregate, exceed the Maximum Payout. Earn-Out Payments will be made in annual installments for each of the three years of the Earn-Out Period. In addition, the Earn-Out Payments will be subject to certain subordination provisions in favor of the lenders under the Company’s Credit Agreement. The Purchase Agreement also contains customary representations and warranties regarding WES, the Company, E3, Inc. and the E3, Inc. Stockholders, indemnification provisions and other provisions customary for transactions of this nature. The Company borrowed $27.0 million under its Delayed Draw Term Loan on October 28, 2019 to fund the $27.0 million cash payment paid on the E3, Inc. Closing Date, which reduced the future borrowing capacity under the Delayed Draw Term Loan to $23.0 million. See Note 7 “—Debt Obligations” for a description of the Delayed Draw Term Loan. E3, Inc.’s financial information will be included within the Energy segment beginning in the fourth quarter of fiscal year 2019. The Company expects to finalize the purchase price allocation with respect to this transaction during the fourth quarter of fiscal 2020.

BASIS OF PRESENTATION, ORGANIZATION AND OPERATIONS OF THE COMPANY (Policies)

9 Months Ended

Sep. 27, 2019

BASIS OF PRESENTATION, ORGANIZATION AND OPERATIONS OF THE COMPANY

Basis of Presentation

Principles of Consolidation

Segment Information

Contract Assets and Liabilities

The increase in contract assets and contract liabilities for the nine months ended September 27, 2019 were primarily attributable to our recent acquisitions and normal business operations.

Off-Balance Sheet Arrangements

Off‑Balance Sheet Arrangements

Contract Accounting

The following table reflects the Company’s two reportable segments and the types of contracts that each most commonly enters into for revenue generating activities.


Segment	Contract Type	Revenue Recognition Method
	Time-and-materials	Time-and-materials
Energy	Unit-based	Unit-based
	Software license	Unit-based
	Fixed price	Percentage-of-completion
	Time-and-materials	Time-and-materials
Engineering and Consulting	Unit-based	Unit-based
	Fixed price	Percentage-of-completion

Disaggregation of Revenue


	Energy		Engineering and Consulting		Total
	(in thousands)
Contract Type
Time-and-materials	$	10,154	$	42,624	$	52,778
Unit-based		188,388		10,719		199,107
Fixed price		59,420		2,378		61,798
Total	$	257,962	$	55,721	$	313,683

Client Type
Commercial	$	28,063	$	4,176	$	32,239
Government		41,400		51,251		92,651
Utilities		188,499		294		188,793
Total	$	257,962	$	55,721	$	313,683

Geography
Domestic	$	257,962	$	55,721	$	313,683

Goodwill

Fair Value of Financial Instruments

The carrying amounts of the derivative financial instrument is valued based on Level 2 inputs.

On January 31, 2019, the Company entered into an interest rate swap agreement that the Company designated as cash flow hedge to fix the variable interest rate on a portion of the Company’s 2018 Term Loan Facility (as defined in Note 7 “—Debt Obligations”). The interest rate swap agreement has a total notional amount of $35.0 million, a fixed annual interest rate of 2.47% and expires on January 31, 2022. For further discussion of this derivative contract, see Note 13 “—Derivative Financial Instruments” below.

Use of Estimates

Liquidity

Reclassifications

Certain prior year amounts have been reclassified in the condensed consolidated balance sheets to conform to the current year presentation.

Adoption of New Accounting Standards

Stock Compensation

Recent Accounting Pronouncements

Intangibles-Goodwill and Other

Proposed Accounting Standards

BASIS OF PRESENTATION, ORGANIZATION AND OPERATIONS OF THE COMPANY (Tables)

9 Months Ended

Sep. 27, 2019

BASIS OF PRESENTATION, ORGANIZATION AND OPERATIONS OF THE COMPANY

Schedule of contracts by reportable segments and type of contracts


Segment	Contract Type	Revenue Recognition Method
	Time-and-materials	Time-and-materials
Energy	Unit-based	Unit-based
	Software license	Unit-based
	Fixed price	Percentage-of-completion
	Time-and-materials	Time-and-materials
Engineering and Consulting	Unit-based	Unit-based
	Fixed price	Percentage-of-completion

Schedule of disaggregation of revenue


	Energy		Engineering and Consulting		Total
	(in thousands)
Contract Type
Time-and-materials	$	10,154	$	42,624	$	52,778
Unit-based		188,388		10,719		199,107
Fixed price		59,420		2,378		61,798
Total	$	257,962	$	55,721	$	313,683

Client Type
Commercial	$	28,063	$	4,176	$	32,239
Government		41,400		51,251		92,651
Utilities		188,499		294		188,793
Total	$	257,962	$	55,721	$	313,683

Geography
Domestic	$	257,962	$	55,721	$	313,683

BUSINESS COMBINATIONS (Tables)

9 Months Ended

Sep. 27, 2019

The Weidt Group

Schedule of consideration for the acquisition


	The Weidt Group
		(in thousands)
Cash paid	$	22,136
Other working capital adjustment		-
Total consideration	$	22,136

Schedule of amounts for the acquired assets and liabilities recorded at their estimated fair value as of the acquisition date


	The Weidt Group
		(in thousands)
Current assets	$	2,317
Non-current assets1		25
Equipment and leasehold improvements, net		198
Right-of-use assets		1,730
Current lease liability		(245)
Non-current lease liability		(1,533)
Liabilities		(612)
Backlog		750
Customer relationships		4,330
Tradename		550
Developed technology		3,170
Goodwill		11,456
Net assets acquired	$	22,136

(1)

Excluded from non-current assets are equipment and leasehold improvements, net, right-of-use assets, customer relationships, tradename, developed technology, backlog and goodwill.

Schedule of unaudited pro forma financial information


	Three Months Ended				Nine Months Ended
	September 27,		September 28,		September 27,		September 28,
	2019		2018		2019		2018
	(in thousands, except per share data)
Pro forma revenue	$	117,494	$	119,354	$	328,731	$	318,248

Pro forma income from operations	$	1,295	$	6,173	$	6,258	$	12,426
Pro forma net income1	$	416	$	3,317	$	3,284	$	6,299

Earnings per share:
Basic	$	0.04	$	0.31	$	0.30	$	0.58
Diluted	$	0.04	$	0.29	$	0.28	$	0.56

Weighted average shares outstanding:
Basic		11,217		10,857		11,097		10,810
Diluted		11,789		11,356		11,714		11,285

(1)

Adjustments to pro forma net income include income from operations, amortization and interest expenses.

Lime Energy

Schedule of consideration for the acquisition


	Lime Energy
		(in thousands)
Cash paid	$	122,439
Other working capital adjustment		-
Total consideration	$	122,439

Schedule of amounts for the acquired assets and liabilities recorded at their estimated fair value as of the acquisition date


	Lime Energy
		(in thousands)
Current assets1	$	45,401
Non-current assets2		13,847
Cash		1,090
Equipment and leasehold improvements, net		1,892
Liabilities		(38,110)
Customer relationships		34,400
Tradename		5,970
Developed technology		10,600
Backlog		1,230
Goodwill		46,119
Net assets acquired	$	122,439

(1)

Excluded from current assets is cash

(2)

Excluded from non-current assets are equipment and leasehold improvements, net, customer relationships, tradename, developed technology, backlog and goodwill.

Schedule of unaudited pro forma financial information


	Three Months Ended				Nine Months Ended
	September 27,		September 28,		September 27,		September 28,
	2019		2018		2019		2018
	(in thousands, except per share data)
Pro forma revenue	$	117,494	$	119,354	$	328,731	$	318,248

Pro forma income from operations	$	1,295	$	6,173	$	6,258	$	12,426
Pro forma net income1	$	416	$	3,317	$	3,284	$	6,299

Earnings per share:
Basic	$	0.04	$	0.31	$	0.30	$	0.58
Diluted	$	0.04	$	0.29	$	0.28	$	0.56

Weighted average shares outstanding:
Basic		11,217		10,857		11,097		10,810
Diluted		11,789		11,356		11,714		11,285

(1)

Adjustments to pro forma net income include income from operations, amortization and interest expenses.

Onsite Energy Corporation

Schedule of consideration for the acquisition


	Onsite Energy
		(in thousands)
Cash paid	$	24,273
Other working capital adjustment		-
Total consideration	$	24,273

Schedule of amounts for the acquired assets and liabilities recorded at their estimated fair value as of the acquisition date


	Onsite Energy
		(in thousands)
Current assets	$	22,493
Non-current assets1		10
Equipment and leasehold improvements, net		39
Right-of-use assets		828
Current lease liability		(168)
Non-current lease liability		(660)
Liabilities		(12,222)
Backlog		800
Customer relationships		7,374
Tradename		500
Goodwill		5,279
Net assets acquired	$	24,273

(1)

Excluded from non-current assets are equipment and leasehold improvements, net, right-of-use assets, customer relationships, tradename, backlog and goodwill.

Schedule of unaudited pro forma financial information


	Three Months Ended				Nine Months Ended
	September 27,		September 28,		September 27,		September 28,
	2019		2018		2019		2018
	(in thousands, except per share data)
Pro forma revenue	$	117,494	$	119,354	$	328,731	$	318,248

Pro forma income from operations	$	1,295	$	6,173	$	6,258	$	12,426
Pro forma net income1	$	416	$	3,317	$	3,284	$	6,299

Earnings per share:
Basic	$	0.04	$	0.31	$	0.30	$	0.58
Diluted	$	0.04	$	0.29	$	0.28	$	0.56

Weighted average shares outstanding:
Basic		11,217		10,857		11,097		10,810
Diluted		11,789		11,356		11,714		11,285

(1)

Adjustments to pro forma net income include income from operations, amortization and interest expenses.

GOODWILL AND OTHER INTANGIBLE ASSETS (Tables)

9 Months Ended

Sep. 27, 2019

GOODWILL AND OTHER INTANGIBLE ASSETS

Schedule of changes in the carrying value of goodwill by reporting unit


	December 28,		Additional		Additions /		September 27,
	2018		Purchase Cost		Adjustments		2019
	(in thousands)
Reporting Unit:
Energy	$	96,999	$	16,735	$	(11,393)	$	102,341
Engineering and Consulting		749		—		—		749
	$	97,748	$	16,735	$	(11,393)	$	103,090

Schedule of gross amounts and accumulated amortization of the Company's acquired identifiable intangible assets with finite useful lives


	September 27, 2019				December 28, 2018
	Gross		Accumulated		Gross		Accumulated		Amortization
	Amount		Amortization		Amount		Amortization		Period
	(in thousands)								(in years)
Finite:
Backlog	$	4,564	$	3,214	$	2,514	$	2,155	0.2	-	5.0
Tradename		11,351		4,400		10,301		3,118	3.0	-	6.0
Non-compete agreements		1,420		1,270		1,420		1,042	4.0	-	5.0
Developed technology		18,180		3,286		12,920		944	5.0	-	8.0
Customer relationships		51,923		6,460		25,219		2,441	5.0	-	10.0
Total finite intangible assets		87,438	$	18,630		52,374	$	9,700
In-process research and technology1		—		—		1,690		—
Total intangible assets	$	87,438	$	18,630	$	54,064	$	9,700

(1)

In-process research and technology will not be amortized until put into use.

Schedule of estimated amortization expense for acquired identifiable intangible assets


		Future Intangible Asset
		Amortization expense
		(in thousands)
Fiscal year:
Remainder of 2019	$	3,040
2020		11,589
2021		10,186
2022		9,936
2023		9,278
2024		5,781
Thereafter		18,998
	$	68,808

EARNINGS PER SHARE (EPS) (Tables)

9 Months Ended

Sep. 27, 2019

EARNINGS PER SHARE (EPS)

Schedule of number of weighted-average common shares outstanding used to compute basic and diluted EPS


	Three months ended				Nine months ended
	September 27,		September 28,		September 27,		September 28,
	2019		2018		2019		2018
	(in thousands, except per share amounts)
Net income	$	416	$	3,311	$	1,639	$	8,829
Weighted-average common shares outstanding		11,217		8,844		11,097		8,798
Effect of dilutive stock options and restricted stock awards		572		499		617		485
Weighted-average common shares outstanding-diluted		11,789		9,343		11,714		9,283
Earnings per share:
Basic	$	0.04	$	0.37	$	0.15	$	1.00
Diluted	$	0.04	$	0.35	$	0.14	$	0.95

EQUIPMENT AND LEASEHOLD IMPROVEMENTS, NET (Tables)

9 Months Ended

Sep. 27, 2019

EQUIPMENT AND LEASEHOLD IMPROVEMENTS, NET

Schedule of equipment and leasehold improvements


	September 27,		December 28,
	2019		2018
	(in thousands)
Furniture and fixtures	$	4,264	$	3,551
Computer hardware and software		13,975		10,874
Leasehold improvements		2,282		1,419
Equipment under finance leases		1,850		1,304
Automobiles, trucks, and field equipment		3,533		2,635
		25,904		19,783
Accumulated depreciation and amortization		(14,214)		(11,785)
Equipment and leasehold improvements, net	$	11,690	$	7,998

ACCRUED LIABILITIES (Tables)

9 Months Ended

Sep. 27, 2019

ACCRUED LIABILITIES

Schedule of accrued liabilities


	September 27,		December 28,
	2019		2018
	(in thousands)
Accrued bonuses	$	1,803	$	5,273
Accrued interest		35		127
Paid leave bank		4,259		3,512
Compensation and payroll taxes		1,529		2,544
Accrued legal		18		153
Accrued workers’ compensation insurance		188		273
Accrued rent		—		233
Employee withholdings		1,452		2,137
Client deposits		234		280
Accrued subcontractor costs		34,164		21,446
Other		2,255		1,423
Total accrued liabilities	$	45,937	$	37,401

DEBT OBLIGATIONS (Tables)

9 Months Ended

Sep. 27, 2019

DEBT OBLIGATIONS

Schedule of debt obligations, excluding obligations under capital leases


	September 27,		December 28,
	2019		2018
	(in thousands)
Outstanding borrowings on Term A Loan	$	97,500	$	70,000
Outstanding borrowings on Revolving Credit Facility		5,000		—
Other debt agreements		1,531		1,711
Total debt		104,031		71,711
Issuance costs and debt discounts		(749)		(925)
Subtotal		103,282		70,786
Less current portion of long-term debt		8,220		8,572
Long-term debt portion	$	95,062	$	62,214

LEASES (Tables)

9 Months Ended

Sep. 27, 2019

LEASES

Summary of the lease expense


	Three Months Ended		Nine Months Ended
	September 27, 2019		September 27, 2019
	(in thousands)
Operating lease cost	$	1,288	$	3,558
Finance lease cost:
Amortization of assets		242		366
Interest on lease liabilities		19		28
Total net lease cost	$	1,549	$	3,952

Summary of lease information presented on the Company’s condensed consolidated balance sheet


	September 27, 2019
	(in thousands)
Operating leases:
Right-of-use assets	$	12,767

Lease liability	$	4,194
Lease liability, less current portion		9,726
Total lease liabilities	$	13,920

Finance leases (included in equipment and leasehold improvements, net):
Equipment and leasehold improvements, net	$	1,850
Accumulated depreciation		(1,148)
Total equipment and leasehold improvements, net	$	702

Finance lease obligations	$	529
Finance lease obligations, less current portion		230
Total finance lease obligations	$	759

Weighted average remaining lease term (in years):
Operating Leases		3.74
Finance Leases		1.56

Weighted average discount rate:
Operating Leases		5.15	%
Finance Leases		4.91	%

Summary of other information and supplemental cash flow information related to finance and operating leases


	Nine Months Ended
	September 27, 2019
	(in thousands)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flow from operating leases	$	3,645
Operating cash flow from finance leases		98
Financing cash flow from finance leases		338

Right-of-use assets obtained in exchange for lease liabilities:
Operating leases		3,029

Summary of the maturities of operating lease liabilities


	Operating		Finance
	(in thousands)
Fiscal year:
Remainder of 2019	$	1,276	$	177
2020		4,355		464
2021		3,520		137
2022		2,778		8
2023		1,641		—
2024 and thereafter		1,963		—
Total lease payments	$	15,533	$	786
Less: Imputed interest		(1,613)		(27)
Total lease obligations		13,920		759
Less: Current obligations		4,194		529
Noncurrent lease obligations	$	9,726	$	230

Summary of the maturities of finance lease liabilities

The following is a summary of the maturities of lease liabilities as of September 27, 2019:


	Operating		Finance
	(in thousands)
Fiscal year:
Remainder of 2019	$	1,276	$	177
2020		4,355		464
2021		3,520		137
2022		2,778		8
2023		1,641		—
2024 and thereafter		1,963		—
Total lease payments	$	15,533	$	786
Less: Imputed interest		(1,613)		(27)
Total lease obligations		13,920		759
Less: Current obligations		4,194		529
Noncurrent lease obligations	$	9,726	$	230

SEGMENT INFORMATION (Tables)

9 Months Ended

Sep. 27, 2019

SEGMENT INFORMATION

Schedule of financial information with respect to the reportable segments


			Engineering		Unallocated				Consolidated
	Energy		& Consulting		Corporate		Intersegment		Total
	(in thousands)
Fiscal Three Months Ended September 27, 2019
Contract revenue	$	97,934	$	19,560	$	—	$	—	$	117,494
Depreciation and amortization		5,425		363		—		—		5,788
Interest expense, net		20		—		1,237		—		1,257
Segment profit (loss) before income tax expense		1,669		2,586		(4,215)		—		40
Income tax expense (benefit)		461		715		(1,552)		—		(376)
Net income (loss)		1,208		1,871		(2,663)		—		416
Segment assets1		246,675		23,366		115,701		(23,130)		362,612
Fiscal Three Months Ended September 28, 2018
Contract revenue	$	50,085	$	21,301	$	—	$	—	$	71,386
Depreciation and amortization		926		191		—		—		1,117
Interest expense		18		4		—		—		22
Segment profit (loss) before income tax expense		4,349		2,395		(1,836)		—		4,908
Income tax expense (benefit)		1,415		779		(597)		—		1,597
Net income (loss)		2,934		1,616		(1,239)		—		3,311
Segment assets1		103,752		20,057		39,930		(23,130)		140,609
Fiscal Nine Months Ended September 27, 2019
Contract revenue	$	257,910	$	55,773	$	—	$	—	$	313,683
Depreciation and amortization		10,353		955		—		—		11,308
Interest expense, net		20		—		3,579		—		3,599
Segment profit (loss) before income tax expense		2,316		6,603		(8,653)		—		266
Income tax expense (benefit)		640		1,825		(3,838)		—		(1,373)
Net income (loss)		1,676		4,779		(4,816)		—		1,639
Segment assets1		246,675		23,366		115,701		(23,130)		362,612
Fiscal Nine Months Ended September 28, 2018
Contract revenue	$	129,143	$	56,671	$	—	$	—	$	185,814
Depreciation and amortization		2,693		599		—		—		3,292
Interest expense		65		10		—		—		75
Segment profit (loss) before income tax expense		7,483		5,801		(2,231)		—		11,053
Income tax expense (benefit)		1,506		1,167		(449)		—		2,224
Net income (loss)		5,977		4,634		(1,782)		—		8,829
Segment assets1		103,752		20,057		39,930		(23,130)		140,609

Segment assets represent segment assets, net of intercompany receivables.

DERIVATIVE FINANCIAL INSTRUMENTS (Tables)

9 Months Ended

Sep. 27, 2019

DERIVATIVE FINANCIAL INSTRUMENTS

Schedule of fair values of outstanding derivatives designated as hedging instruments


		Fair Value of Derivative
		Instruments as of
	Balance Sheet Location	September 27, 2019		December 28, 2018
		(in thousands)
Interest rate swap agreement	Accrued liabilities	$	(228)	$	—
Interest rate swap agreement	Other noncurrent (liabilities) assets	$	(436)	$	—

Schedule of accumulated other comprehensive income (loss)


	(Loss) on		Accumulated Other
	Derivative Instruments		Comprehensive Loss
	(in thousands)
Balances at December 28, 2018	$	—	$	—
Other comprehensive loss before reclassifications		(219)		(219)
Amounts reclassified from accumulated other comprehensive income:
Interest rate contracts, net of tax1		—		—
Net current-period other comprehensive loss		(219)		(219)
Balances at March 29, 2019	$	(219)	$	(219)
Other comprehensive loss before reclassifications	$	(219)	$	(219)
Amounts reclassified from accumulated other comprehensive income:
Interest rate contracts, net of tax1		—		—
Net current-period other comprehensive loss		(219)		(219)
Balances at June 28, 2019	$	(438)	$	(438)
Other comprehensive loss before reclassifications	$	(42)	$	(42)
Amounts reclassified from accumulated other comprehensive income:
Interest rate contracts, net of tax1		—		—
Net current-period other comprehensive loss		(42)		(42)
Balances at September 27, 2019	$	(480)	$	(480)

This accumulated other comprehensive component is reclassified to “Interest expense” in our consolidated statements of income.

BASIS OF PRESENTATION, ORGANIZATION AND OPERATIONS OF THE COMPANY (Details)	9 Months Ended
	Sep. 27, 2019 state
Basis of Presentation
Length of quarters ending on the Friday closest to March 31, June 30 and September 30	91 days
Organizations and operations of the Company
Number of states in which the business operates	24
Minimum
Basis of Presentation
Length of quarter ending on the Friday closest to December 31	91 days
Maximum
Basis of Presentation
Length of quarter ending on the Friday closest to December 31	98 days

BASIS OF PRESENTATION, ORGANIZATION AND OPERATIONS OF THE COMPANY - Accounting for Contracts (Details)	3 Months Ended		9 Months Ended
	Sep. 27, 2019 USD ($)	Sep. 28, 2018 USD ($)	Sep. 27, 2019 USD ($) subsidiary segment	Sep. 28, 2018 USD ($)	Dec. 28, 2018 USD ($)
Accounting for Contracts
Number of reportable segments \| segment			2
Costs of contract revenue
Payroll taxes, bonuses and employee benefit costs for all Company personnel	$ 15,761,000	$ 11,125,000	$ 46,167,000	$ 31,875,000
Retained accounts receivable	5,200,000		5,200,000		$ 6,700,000
Facilities costs	$ 2,250,000	$ 1,492,000	6,069,000	$ 4,087,000
Revenue Or Cost Of The Entity As An Agent			$ 0
Number of Wholly Owned Subsidiaries \| subsidiary			5
Cost of Sales
Costs of contract revenue
Payroll taxes, bonuses and employee benefit costs for all Company personnel			$ 0
Facilities costs			$ 0

BASIS OF PRESENTATION, ORGANIZATION AND OPERATIONS OF THE COMPANY - Disaggregation of Revenue (Details) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 27, 2019 USD ($)	Sep. 28, 2018 USD ($)	Sep. 27, 2019 USD ($) segment	Sep. 28, 2018 USD ($)
Disaggregation of Revenue [Line Items]
Number of Reportable Segments \| segment			2
Revenue	$ 117,494	$ 71,386	$ 313,683	$ 185,814
Domestic
Disaggregation of Revenue [Line Items]
Revenue			313,683
Energy
Disaggregation of Revenue [Line Items]
Revenue			257,962
Energy \| Domestic
Disaggregation of Revenue [Line Items]
Revenue			257,962
Engineering and Consulting
Disaggregation of Revenue [Line Items]
Revenue			55,721
Engineering and Consulting \| Domestic
Disaggregation of Revenue [Line Items]
Revenue			55,721
Commercial
Disaggregation of Revenue [Line Items]
Revenue			32,239
Commercial \| Energy
Disaggregation of Revenue [Line Items]
Revenue			28,063
Commercial \| Engineering and Consulting
Disaggregation of Revenue [Line Items]
Revenue			4,176
Government
Disaggregation of Revenue [Line Items]
Revenue			92,651
Government \| Energy
Disaggregation of Revenue [Line Items]
Revenue			41,400
Government \| Engineering and Consulting
Disaggregation of Revenue [Line Items]
Revenue			51,251
Utilities
Disaggregation of Revenue [Line Items]
Revenue			188,793
Utilities \| Energy
Disaggregation of Revenue [Line Items]
Revenue			188,499
Utilities \| Engineering and Consulting
Disaggregation of Revenue [Line Items]
Revenue			294
Time-and-materials
Disaggregation of Revenue [Line Items]
Revenue			52,778
Time-and-materials \| Energy
Disaggregation of Revenue [Line Items]
Revenue			10,154
Time-and-materials \| Engineering and Consulting
Disaggregation of Revenue [Line Items]
Revenue			42,624
Unit-based
Disaggregation of Revenue [Line Items]
Revenue			199,107
Unit-based \| Energy
Disaggregation of Revenue [Line Items]
Revenue			188,388
Unit-based \| Engineering and Consulting
Disaggregation of Revenue [Line Items]
Revenue			10,719
Fixed price
Disaggregation of Revenue [Line Items]
Revenue			61,798
Fixed price \| Energy
Disaggregation of Revenue [Line Items]
Revenue			59,420
Fixed price \| Engineering and Consulting
Disaggregation of Revenue [Line Items]
Revenue			$ 2,378

BASIS OF PRESENTATION, ORGANIZATION AND OPERATIONS OF THE COMPANY - Fair Value of Financial Instruments (Details) - Interest swap agreement $ in Millions	Jan. 31, 2019 USD ($)
Basis of Presentation
Notional amount	$ 35.0
Cash flow hedge
Basis of Presentation
Notional amount	$ 35.0
Fixed rate (in percent)	2.47%

BASIS OF PRESENTATION, ORGANIZATION AND OPERATIONS OF THE COMPANY - Liquidity (Details) - USD ($)		9 Months Ended
	Sep. 28, 2019	Sep. 27, 2019	Oct. 28, 2019	Jun. 26, 2019	Dec. 28, 2018	Oct. 10, 2018	Oct. 01, 2018	Jan. 20, 2017
Liquidity
Cash and cash equivalents					$ 15,259,000
Total debt obligations		$ 104,031,000			71,711,000
Amount outstanding		$ 2,700,000
Minimum period over which cash and cash equivalents on hand, cash generated by operating activities and funds available under line of credit will be sufficient to finance operating activities		12 months
Revolving Credit Facility
Liquidity
Total debt obligations		$ 5,000,000
Maximum borrowing capacity				$ 50,000,000
Revolving Credit Facility \| BMO
Liquidity
Total debt obligations		5.0
Maximum borrowing capacity		50,000,000						$ 35,000,000
Delayed Draw Term Loan Facility
Liquidity
Maximum borrowing capacity				50,000,000
Delayed Draw Term Loan Facility \| Subsequent Event
Liquidity
Proceeds from borrowings	$ 27,000,000
Maximum borrowing capacity	$ 23,000,000		$ 23.0
Delayed Draw Term Loan Facility \| BMO
Liquidity
Maximum borrowing capacity						$ 70,000,000	$ 90,000,000
Delayed Draw Term Loan Facility \| Syndicate financial institutions
Liquidity
Total debt obligations		0
Maximum borrowing capacity		50,000,000
Term A Loan
Liquidity
Total debt obligations		97,500,000			$ 70,000,000
Maximum borrowing capacity				$ 100,000,000
Term A Loan \| BMO
Liquidity
Total debt obligations		$ 97,500,000

BUSINESS COMBINATIONS (Details) - USD ($) $ / shares in Units, $ in Thousands					3 Months Ended		9 Months Ended
	Jul. 02, 2019	Nov. 09, 2018	Oct. 01, 2018	Apr. 30, 2018	Sep. 27, 2019	Sep. 28, 2018	Sep. 27, 2019	Sep. 28, 2018	Dec. 28, 2018
BUSINESS COMBINATIONS
Par value (in dollars per share)					$ 0.01		$ 0.01		$ 0.01
Revenues.					$ 117,494	$ 71,386	$ 313,683	$ 185,814
Cash paid							46,539	$ 2,994
Onsite Energy Corporation
BUSINESS COMBINATIONS
Aggregate Purchase price	$ 24,273
Revenues.					4,800		4,800
Cash paid	24,273
Lime Energy
BUSINESS COMBINATIONS
Proceeds from equity raise		$ 50,000
Aggregate Purchase price		122,400	$ 122,439
Cash paid at closing		$ 56,400
Revenues.					$ 40,800		$ 116,200
Cash paid			$ 122,439
NAM \| Maximum
BUSINESS COMBINATIONS
Aggregate Purchase price				$ 4,000
Willdan Energy Solutions \| Onsite Energy Corporation \| Maximum
BUSINESS COMBINATIONS
Aggregate Purchase price	$ 26,400

BUSINESS COMBINATIONS (Acquisitions) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands					3 Months Ended		9 Months Ended
	Jul. 02, 2019	Mar. 08, 2019	Nov. 09, 2018	Oct. 01, 2018	Sep. 27, 2019	Sep. 28, 2018	Sep. 27, 2019	Sep. 28, 2018	Dec. 28, 2018
Consideration for acquisitions
Cash paid							$ 46,539	$ 2,994
Other payable for working capital adjustment								698
Allocation of acquired assets
Goodwill					$ 103,090		103,090		$ 97,748
Additional amortization expense charge due to increase in fair value of intangible assets					4,900	$ 700	8,900	2,100
Unaudited pro forma financial information
Pro forma revenue					117,494	119,354	328,731	318,248
Pro forma income from operations					1,295	6,173	6,258	12,426
Pro forma net income					$ 416	$ 3,317	$ 3,284	$ 6,299
Earnings per share:
Basic (in dollars per share)					$ 0.04	$ 0.31	$ 0.30	$ 0.58
Diluted (in dollars per share)					$ 0.04	$ 0.29	$ 0.28	$ 0.56
Weighted average shares outstanding:
Basic (in shares)					11,217	10,857	11,097	10,810
Diluted (in shares)					11,789	11,356	11,714	11,285
Revenue and Income from operations
Revenues.					$ 117,494	$ 71,386	$ 313,683	$ 185,814
Income from operations					1,295	$ 4,913	3,834	11,092
Onsite Energy Corporation
Consideration for acquisitions
Tax deductible goodwill	$ 5,300
Cash paid	24,273
Total consideration	24,273
Allocation of acquired assets
Current assets	22,493
Non-current assets	10
Equipment and leasehold improvements, net	39
Right-of-use asset	828
Current lease liability	(168)
Non-current lease liability	(660)
Liabilities	(12,222)
Goodwill	5,279
Net assets acquired	24,273
Revenue and Income from operations
Revenues.					4,800		4,800
Income from operations					1,000		1,000
Onsite Energy Corporation \| Other General And Administrative Expense
Revenue and Income from operations
Acquisition costs					100		100
Onsite Energy Corporation \| Backlog
Allocation of acquired assets
Intangible assets	800
Onsite Energy Corporation \| Customer relationships
Allocation of acquired assets
Intangible assets	7,374
Onsite Energy Corporation \| Tradename
Allocation of acquired assets
Intangible assets	$ 500
The Weidt Group
Consideration for acquisitions
Cash paid		$ 22,136
Total consideration		22,136
Allocation of acquired assets
Current assets		2,317
Non-current assets		25
Equipment and leasehold improvements, net		198
Right-of-use asset		1,730
Current lease liability		(245)
Non-current lease liability		(1,533)
Liabilities		(612)
Goodwill		11,456
Net assets acquired		22,136
Increase in carrying value of backlog, customer relationships, tradename, and developed technology					1,000
Decrease in carrying value of goodwill					(1,000)
Additional amortization expense charge due to increase in fair value of intangible assets					200
Revenue and Income from operations
Revenues.					3,500		7,600
Income from operations					600		1,100
The Weidt Group \| Other General And Administrative Expense
Revenue and Income from operations
Acquisition costs					100		400
The Weidt Group \| Backlog
Allocation of acquired assets
Intangible assets		750
The Weidt Group \| Customer relationships
Allocation of acquired assets
Intangible assets		4,330
The Weidt Group \| Tradename
Allocation of acquired assets
Intangible assets		550
The Weidt Group \| Developed technology
Allocation of acquired assets
Intangible assets		$ 3,170
Lime Energy
Consideration for acquisitions
Cash paid				$ 122,439
Total consideration			$ 122,400	122,439
Allocation of acquired assets
Current assets				45,401
Non-current assets				13,847
Cash				1,090
Equipment and leasehold improvements, net				1,892
Liabilities				(38,110)
Goodwill				46,119
Net assets acquired				122,439
Increase in carrying value of backlog, customer relationships, tradename, and developed technology					11,400
Decrease in carrying value of goodwill					(11,400)
Additional amortization expense charge due to increase in fair value of intangible assets					1,900
Unaudited pro forma financial information
Pro forma revenue							328,731	318,248
Pro forma income from operations							6,258	12,426
Pro forma net income							$ 3,284	$ 6,299
Earnings per share:
Basic (in dollars per share)							$ 0.30	$ 0.58
Diluted (in dollars per share)							$ 0.28	$ 0.56
Weighted average shares outstanding:
Basic (in shares)							11,097	10,810
Diluted (in shares)							11,714	11,285
Revenue and Income from operations
Acquisition costs					0
Revenues.					40,800		$ 116,200
Income from operations					$ 1,300		2,500
Lime Energy \| Other General And Administrative Expense
Revenue and Income from operations
Acquisition costs							$ 200
Lime Energy \| Backlog
Allocation of acquired assets
Intangible assets				1,230
Lime Energy \| Customer relationships
Allocation of acquired assets
Intangible assets				34,400
Lime Energy \| Tradename
Allocation of acquired assets
Intangible assets				5,970
Lime Energy \| Developed technology
Allocation of acquired assets
Intangible assets				$ 10,600

GOODWILL AND OTHER INTANGIBLE ASSETS - Carrying Value of Goodwill by Reporting Unit (Details) $ in Thousands	9 Months Ended
	Sep. 27, 2019 USD ($)
Changes in carrying value of goodwill
Goodwill at beginning of period	$ 97,748
Additional Purchase Cost	16,735
Additions/Adjustments	(11,393)
Goodwill at end of period	103,090
Energy
Changes in carrying value of goodwill
Goodwill at beginning of period	96,999
Additional Purchase Cost	16,735
Additions/Adjustments	(11,393)
Goodwill at end of period	102,341
Engineering and Consulting
Changes in carrying value of goodwill
Goodwill at beginning of period	749
Goodwill at end of period	$ 749

GOODWILL AND OTHER INTANGIBLE ASSETS - Gross Amount and Amortization (Details) - USD ($)	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 27, 2019	Sep. 28, 2018	Sep. 27, 2019	Sep. 28, 2018	Dec. 28, 2018
Goodwill and other intangible assets
Gross Amount	$ 87,438,000		$ 87,438,000		$ 52,374,000
Gross Amount of Intangible Assets	87,438,000		87,438,000		54,064,000
Accumulated Amortization	18,630,000		18,630,000		9,700,000
Amortization expense for acquired identifiable intangible assets	4,900,000	$ 700,000	8,900,000	$ 2,100,000
Remainder of 2019	3,040,000		3,040,000
Estimated amortization expense for acquired identifiable intangible assets
Remainder of 2019	3,040,000		3,040,000
2020	11,589,000		11,589,000
2021	10,186,000		10,186,000
2022	9,936,000		9,936,000
2023	9,278,000		9,278,000
2024	5,781,000		5,781,000
Thereafter	18,998,000		18,998,000
Total estimated amortization expense	68,808,000		68,808,000
Goodwill impairment
Goodwill impairment			0
Backlog
Goodwill and other intangible assets
Gross Amount	4,564,000		4,564,000		2,514,000
Accumulated Amortization	3,214,000		$ 3,214,000		$ 2,155,000
Backlog \| Minimum
Goodwill and other intangible assets
Amortization Period (in years)			2 months 12 days		2 months 12 days
Backlog \| Maximum
Goodwill and other intangible assets
Amortization Period (in years)			5 years		5 years
Tradename
Goodwill and other intangible assets
Gross Amount	11,351,000		$ 11,351,000		$ 10,301,000
Accumulated Amortization	4,400,000		$ 4,400,000		$ 3,118,000
Tradename \| Minimum
Goodwill and other intangible assets
Amortization Period (in years)			3 years		3 years
Tradename \| Maximum
Goodwill and other intangible assets
Amortization Period (in years)			6 years		6 years
Non-compete agreements
Goodwill and other intangible assets
Gross Amount	1,420,000		$ 1,420,000		$ 1,420,000
Accumulated Amortization	1,270,000		$ 1,270,000		$ 1,042,000
Non-compete agreements \| Minimum
Goodwill and other intangible assets
Amortization Period (in years)			4 years		4 years
Non-compete agreements \| Maximum
Goodwill and other intangible assets
Amortization Period (in years)			5 years		5 years
Developed technology
Goodwill and other intangible assets
Gross Amount	18,180,000		$ 18,180,000		$ 12,920,000
Accumulated Amortization	$ 3,286,000		$ 3,286,000		$ 944,000
Developed technology \| Minimum
Goodwill and other intangible assets
Amortization Period (in years)			5 years		5 years
Developed technology \| Maximum
Goodwill and other intangible assets
Amortization Period (in years)			8 years		8 years
In-process research and technology
Goodwill and other intangible assets
Gross Amount of Indefinite Lived Intangible Assets					$ 1,690,000
Amortization Period (in years)	7 years		7 years
Customer relationships
Goodwill and other intangible assets
Gross Amount	$ 51,923,000		$ 51,923,000		25,219,000
Accumulated Amortization	$ 6,460,000		$ 6,460,000		$ 2,441,000
Customer relationships \| Minimum
Goodwill and other intangible assets
Amortization Period (in years)			5 years		5 years
Customer relationships \| Maximum
Goodwill and other intangible assets
Amortization Period (in years)			10 years		10 years

EARNINGS PER SHARE (EPS) (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended						9 Months Ended
	Sep. 27, 2019	Jun. 28, 2019	Mar. 29, 2019	Sep. 28, 2018	Jun. 29, 2018	Mar. 30, 2018	Sep. 27, 2019	Sep. 28, 2018
Earnings per share
Net income	$ 416	$ 1,640	$ (417)	$ 3,311	$ 3,315	$ 2,203	$ 1,639	$ 8,829
Weighted-average common shares outstanding (in shares)	11,217,000			8,844,000			11,097,000	8,798,000
Effect of dilutive stock options and restricted stock awards (in shares)	572,000			499,000			617,000	485,000
Weighted-average common shares outstanding-diluted (in shares)	11,789,000			9,343,000			11,714,000	9,283,000
Earnings per share:
Basic	$ 0.04			$ 0.37			$ 0.15	$ 1.00
Diluted	$ 0.04			$ 0.35			$ 0.14	$ 0.95
Anti-dilutive securities excluded from the computation of earnings per share
Number of awards excluded from calculation of dilutive potential common shares (in shares)							155,000
Stock options
Anti-dilutive securities excluded from the computation of earnings per share
Number of awards excluded from calculation of dilutive potential common shares (in shares)				241,000				215,000

EQUIPMENT AND LEASEHOLD IMPROVEMENTS, NET (Details) - USD ($)	Sep. 27, 2019	Dec. 28, 2018	Sep. 28, 2018
EQUIPMENT AND LEASEHOLD IMPROVEMENTS
Equipment and leasehold improvements, net	$ 25,904,000	$ 19,783,000
Accumulated depreciation and amortization	(14,214,000)	(11,785,000)
Total equipment and leasehold improvements, net	11,690,000	7,998,000
Furniture and fixtures
EQUIPMENT AND LEASEHOLD IMPROVEMENTS
Equipment and leasehold improvements, net	4,264,000	3,551,000
Computer hardware and software
EQUIPMENT AND LEASEHOLD IMPROVEMENTS
Equipment and leasehold improvements, net	13,975,000	10,874,000
Leasehold improvements
EQUIPMENT AND LEASEHOLD IMPROVEMENTS
Equipment and leasehold improvements, net	2,282,000	1,419,000
Equipment
EQUIPMENT AND LEASEHOLD IMPROVEMENTS
Equipment and leasehold improvements, net	1,850,000	1,304,000
Automobiles, trucks, and field equipment
EQUIPMENT AND LEASEHOLD IMPROVEMENTS
Equipment and leasehold improvements, net	3,533,000	$ 2,635,000
Equipment finance lease
EQUIPMENT AND LEASEHOLD IMPROVEMENTS
Accumulated depreciation and amortization	$ (366,000)		$ (374,000)

ACCRUED LIABILITIES (Details) - USD ($) $ in Thousands	Sep. 27, 2019	Dec. 28, 2018
ACCRUED LIABILITIES
Accrued bonuses	$ 1,803	$ 5,273
Accrued interest	35	127
Paid leave bank	4,259	3,512
Compensation and payroll taxes	1,529	2,544
Accrued legal	18	153
Accrued workers' compensation insurance	188	273
Accrued rent		233
Employee withholdings	1,452	2,137
Client deposits	234	280
Accrued subcontractor costs	34,164	21,446
Other	2,255	1,423
Total accrued liabilities	$ 45,937	$ 37,401

DEBT OBLIGATIONS (Details) - USD ($)	Sep. 27, 2019	Dec. 28, 2018
Debt Obligations
Total debt obligations	$ 104,031,000	$ 71,711,000
Issuance costs and debt discounts	(749,000)	(925,000)
Long-term Debt, Total	103,282,000	70,786,000
Notes payable	8,220,000	8,572,000
Debt obligations, less current portion	95,062,000	$ 62,214,000
Interest rate (as a percent)		4.30%
Term A Loan
Debt Obligations
Total debt obligations	97,500,000	$ 70,000,000
Revolving Credit Facility
Debt Obligations
Total debt obligations	5,000,000
Other debt agreements
Debt Obligations
Total debt obligations	1,531,000	$ 1,711,000
BMO \| Term A Loan
Debt Obligations
Total debt obligations	97,500,000
BMO \| Revolving Credit Facility
Debt Obligations
Total debt obligations	$ 5.0

DEBT OBLIGATIONS - Line of credit (Details)									3 Months Ended		9 Months Ended	12 Months Ended
DEBT OBLIGATIONS - Line of credit (Details)	Oct. 28, 2019 USD ($)	Sep. 28, 2019 USD ($)	Jun. 26, 2019 USD ($) item	Jan. 31, 2019 USD ($)	Dec. 28, 2018 USD ($)	Oct. 01, 2018 USD ($)	Sep. 09, 2018 USD ($)	Jan. 20, 2017 USD ($)	Sep. 27, 2019 USD ($)	Dec. 28, 2018 USD ($)	Sep. 27, 2019 USD ($)	Dec. 28, 2018 USD ($)	Dec. 20, 2018 USD ($)	Oct. 10, 2018 USD ($)
Debt Instrument [Line Items]
Borrowings under term loan facility and line of credit											$ 105,000,000
Fee on unused commitments (as a percent)			0.25%
Percent of annual amortization											4.40%
Interest rate (as a percent)					4.30%					4.30%		4.30%
Interest and principal payments										$ 149,881
Unsecured notes payable					$ 1,500,000				$ 300,000	$ 1,500,000	$ 300,000	$ 1,500,000
Stop loss amount					$ 100,000
Percent of stop loss					125.00%
Utility Customer Agreement
Debt Instrument [Line Items]
Interest rate (as a percent)									4.332%		4.332%
Unsecured notes payable									$ 1,100,000		$ 1,100,000
Amount committed to repay													$ 1,700,000
Interest swap agreement
Debt Instrument [Line Items]
Notional amount				$ 35,000,000
Prior Credit Facility [Member] \| Maximum \| BMO
Debt Instrument [Line Items]
Commitment fee (as a percent)								1.50%
Prior Credit Facility [Member] \| Minimum \| BMO
Debt Instrument [Line Items]
Commitment fee (as a percent)								0.94%
Prior Credit Facility [Member] \| Federal Funds Effective Swap Rate \| Base rate \| BMO
Debt Instrument [Line Items]
Spread on floating interest rate (as a percent)								0.50%
Prior Credit Facility [Member] \| Base rate \| LIBOR \| Maximum \| BMO
Debt Instrument [Line Items]
Spread on floating interest rate (as a percent)								1.00%
Prior Credit Facility [Member] \| Base rate \| LIBOR \| Minimum \| BMO
Debt Instrument [Line Items]
Spread on floating interest rate (as a percent)								0.25%
Prior Credit Facility [Member] \| LIBOR \| Base rate \| BMO
Debt Instrument [Line Items]
Spread on floating interest rate (as a percent)								1.00%
Prior Credit Facility [Member] \| LIBOR \| Base rate \| Maximum \| BMO
Debt Instrument [Line Items]
Spread on floating interest rate (as a percent)								2.00%
Prior Credit Facility [Member] \| LIBOR \| Base rate \| Minimum \| BMO
Debt Instrument [Line Items]
Spread on floating interest rate (as a percent)								1.25%
Revolving Credit Facility
Debt Instrument [Line Items]
Maximum borrowing capacity			$ 50,000,000
Revolving Credit Facility \| BMO
Debt Instrument [Line Items]
Maximum borrowing capacity								$ 35,000,000	$ 50,000,000		50,000,000
The aggregate amount under the revolving line of credit			$ 100,000,000
Revolving Credit Facility \| Maximum \| BMO
Debt Instrument [Line Items]
Commitment fee (as a percent)								0.35%
Revolving Credit Facility \| Minimum \| BMO
Debt Instrument [Line Items]
Commitment fee (as a percent)								0.20%
Standby letter of credit sub-facility \| BMO
Debt Instrument [Line Items]
Maximum borrowing capacity								$ 10,000,000
New Credit Facilities \| Maximum \| BMO
Debt Instrument [Line Items]
Fee on unused commitments (as a percent)			0.35%			0.40%
Commitment fee (as a percent)			2.00%			4.00%
New Credit Facilities \| Minimum \| BMO
Debt Instrument [Line Items]
Fee on unused commitments (as a percent)			0.15%			0.20%
Commitment fee (as a percent)			0.84%			0.94%
New Credit Facilities \| Federal Funds Effective Swap Rate \| Base rate \| BMO
Debt Instrument [Line Items]
Spread on floating interest rate (as a percent)			0.50%			0.50%
New Credit Facilities \| Base rate \| LIBOR \| BMO
Debt Instrument [Line Items]
Spread on floating interest rate (as a percent)			1.00%			1.00%
New Credit Facilities \| Base rate \| LIBOR \| Maximum \| BMO
Debt Instrument [Line Items]
Spread on floating interest rate (as a percent)			1.00%			4.00%
New Credit Facilities \| Base rate \| LIBOR \| Minimum \| BMO
Debt Instrument [Line Items]
Spread on floating interest rate (as a percent)			0.125%			1.25%
New Credit Facilities \| LIBOR \| Base rate \| Maximum \| BMO
Debt Instrument [Line Items]
Spread on floating interest rate (as a percent)			2.00%			3.00%
New Credit Facilities \| LIBOR \| Base rate \| Minimum \| BMO
Debt Instrument [Line Items]
Spread on floating interest rate (as a percent)			1.125%			0.25%
Revolving Credit Facility Member Two
Debt Instrument [Line Items]
Maximum borrowing capacity						$ 30,000,000
Delayed Draw Term Loan Facility
Debt Instrument [Line Items]
Maximum borrowing capacity			$ 50,000,000
Line of credit facility minimum borrowing under each tranche			$ 10,000,000
Annual amortization of debt (as a Percent)									2.50%
Delayed Draw Term Loan Facility \| Subsequent Event
Debt Instrument [Line Items]
Proceeds from borrowings		$ 27,000,000
Maximum borrowing capacity	$ 23.0	$ 23,000,000
Delayed Draw Term Loan Facility \| BMO
Debt Instrument [Line Items]
Maximum borrowing capacity						$ 90,000,000								$ 70,000,000
Borrowings under term loan facility and line of credit							$ 70,000,000
Delayed Draw Term Loan Facility \| Maximum
Debt Instrument [Line Items]
Number of borrowings \| item			5
Delayed Draw Term Loan Facility \| E3, Inc. \| Subsequent Event
Debt Instrument [Line Items]
Proceeds from borrowings	$ 27,000,000
Delayed Draw Term Loan Facility \| Interest swap agreement
Debt Instrument [Line Items]
Fixed rate (in percent)				2.47%
Percent of annual amortization				10.00%
Composite interest rate				4.40%
Term A Loan
Debt Instrument [Line Items]
Maximum borrowing capacity			$ 100,000,000
Quarterly installments									$ 2,500,000
Term A Loan \| BMO
Debt Instrument [Line Items]
Unamortized debt issuance costs									700,000		700,000
Delayed Draw Term Loan And Revolving Credit Facility
Debt Instrument [Line Items]
Unamortized debt issuance costs									800,000		800,000
Notes payable for IBM
Debt Instrument [Line Items]
Interest rate (as a percent)					4.656%					4.656%		4.656%
Interest and principal payments											6,315
Notes payable for IBM \| Software Agreements
Debt Instrument [Line Items]
Software cost												$ 200,000
Unsecured notes payable					$ 211,000				$ 150,000	$ 211,000	$ 150,000	$ 211,000

LEASES - Narrative (Details)	Jan. 01, 2019
LEASES
Lease practical expedients package	true
Lease practical expedients use of hindsight	false

LEASES - Change in accounting policy (Details) - USD ($)	Jan. 01, 2019	Sep. 27, 2019
Leases
Right-of-use assets		$ 12,767,000
Operating lease liability		13,920,000
Operating lease, option to extend	true
Operating lease, option to terminate	true
Residual value guarantee		$ 0
Minimum
Leases
Operating lease, remaining lease term	1 year
Maximum
Leases
Operating lease, remaining lease term	8 years
Operating lease, extension term	5 years
Operating lease, terminate term	1 year
Accounting Standards Update 2016-02
Leases
Right-of-use assets	$ 10,900,000
Operating lease liability	$ 11,900,000

LEASES - Lease expense (Details) - USD ($) $ in Thousands	3 Months Ended	9 Months Ended
LEASES - Lease expense (Details) - USD ($) $ in Thousands	Sep. 27, 2019	Sep. 27, 2019
Lease cost
Operating lease cost	$ 1,288	$ 3,558
Amortization of assets	242	366
Interest on lease liabilities	19	28
Total Lease Cost	$ 1,549	$ 3,952

LEASES - Impact of Adoption (Details) - USD ($) $ in Thousands	Sep. 27, 2019	Dec. 28, 2018
Operating leases:
Right-of-use assets	$ 12,767
Lease liability	4,194
Lease liability, less current portion	9,726
Total lease obligations	13,920
Finance leases (included in equipment and leasehold improvements, net):
Equipment and leasehold improvements, net	25,904	$ 19,783
Accumulated depreciation and amortization	(14,214)	(11,785)
Total equipment and leasehold improvements, net	11,690	7,998
Finance lease obligations	529	320
Finance lease obligations, less current portion	230	224
Total lease obligations	$ 759	$ 500
Operating Leases	3 years 8 months 27 days
Finance Leases	1 year 6 months 22 days
Operating Leases, discount rate	5.15%
Finance Leases, discount rate	4.91%
Finance leased assets
Finance leases (included in equipment and leasehold improvements, net):
Equipment and leasehold improvements, net	$ 1,850
Accumulated depreciation and amortization	(1,148)
Total equipment and leasehold improvements, net	$ 702

LEASES - Supplemental cash flow information (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 27, 2019	Sep. 28, 2018
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flow from operating leases	$ 3,645
Operating cash flow from finance leases	98
Financing cash flow from finance leases	338	$ 321
Right-of-use assets obtained in exchange for lease liabilities for operating leases	$ 3,029

LEASES - Maturities of lease liabilities (Details) - USD ($) $ in Thousands	Sep. 27, 2019	Dec. 28, 2018
Operating
Remainder of 2019	$ 1,276
2020	4,355
2021	3,520
2022	2,778
2023	1,641
2024 and thereafter	1,963
Total lease payments	15,533
Less: Imputed interest	(1,613)
Total lease obligations	13,920
Lease liability	4,194
Noncurrent lease obligations	9,726
Finance
Remainder of 2019	177
2020	464
2021	137
2022	8
Total lease payments	786
Less: Imputed interest	(27)
Total lease obligations	759	$ 500
Finance lease obligations	529	320
Finance lease obligations, less current portion	$ 230	$ 224

LEASES - Capital Leases (Details) - USD ($) $ in Thousands	Sep. 27, 2019	Dec. 28, 2018
LEASES
Capital lease obligations	$ 759	$ 500
Finance lease obligations	$ 529	320
New Right of Use Assets - Finance Leases		$ 500

COMMITMENTS - Employee Benefit Plans (Details)	9 Months Ended
COMMITMENTS - Employee Benefit Plans (Details)	Sep. 27, 2019 USD ($)
Employee Benefit Plans
Maximum employee contribution as a percentage of compensation under 401 (k) Plan	50.00%
Service period (in months)	3 months
Attained age (in years)	21 years
Defined Contribution Plan, Employer Matching Contribution, Percent of Match	50.00%
Defined Contribution Plan, Employer Matching Contribution, Percent of Employees' Gross Pay	6.00%
Employer matching contributions	$ 1,600,000
Post-Employment Health Benefits
Unamortized compensation cost	$ 0

INCOME TAXES - Operating Loss Carryovers and Unrecognized Tax Benefits (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 27, 2019	Sep. 28, 2018	Sep. 27, 2019	Sep. 28, 2018	Dec. 28, 2018
INCOME TAXES
Valuation reserve related to California net operating losses					$ 86,000
Valuation allowance change			$ 0
Unrecognized tax benefits	$ 100,000		100,000
Liability for uncertain tax positions	100,000		100,000
Interest and penalties related to unrecognized tax benefits			30,000
Income tax expense (benefit)	$ (376,000)	$ 1,597,000	$ (1,373,000)	$ 2,224,000
Increase in effective tax rate			1649.65%

SEGMENT INFORMATION (Details)	3 Months Ended						9 Months Ended
SEGMENT INFORMATION (Details)	Sep. 27, 2019 USD ($)	Jun. 28, 2019 USD ($)	Mar. 29, 2019 USD ($)	Sep. 28, 2018 USD ($)	Jun. 29, 2018 USD ($)	Mar. 30, 2018 USD ($)	Sep. 27, 2019 USD ($) segment	Sep. 28, 2018 USD ($)	Dec. 28, 2018 USD ($)
SEGMENT INFORMATION
Number of operating segments \| segment							2
Number of reporting segments \| segment							2
Segment reconciliation
Contract revenue	$ 117,494,000			$ 71,386,000			$ 313,683,000	$ 185,814,000
Depreciation and amortization	5,788,000			1,117,000			11,308,000	3,292,000
Interest expense, net	1,257,000			22,000			3,599,000	75,000
Segment profit (loss) before income tax expense	40,000			4,908,000			266,000	11,053,000
Income tax expense (benefit)	(376,000)			1,597,000			(1,373,000)	2,224,000
Net income (loss)	416,000	$ 1,640,000	$ (417,000)	3,311,000	$ 3,315,000	$ 2,203,000	1,639,000	8,829,000
Segment assets(1)	362,612,000			140,609,000			362,612,000	140,609,000	$ 300,911,000
Energy
Segment reconciliation
Contract revenue							257,962,000
Engineering and Consulting
Segment reconciliation
Contract revenue							55,721,000
Reporting Segments \| Energy
Segment reconciliation
Contract revenue	97,934,000			50,085,000			257,910,000	129,143,000
Depreciation and amortization	5,425,000			926,000			10,353,000	2,693,000
Interest expense, net	20,000			18,000			20,000	65,000
Segment profit (loss) before income tax expense	1,669,000			4,349,000			2,316,000	7,483,000
Income tax expense (benefit)	461,000			1,415,000			640,000	1,506,000
Net income (loss)	1,208,000			2,934,000			1,676,000	5,977,000
Segment assets(1)	246,675,000			103,752,000			246,675,000	103,752,000
Reporting Segments \| Engineering and Consulting
Segment reconciliation
Contract revenue	19,560,000			21,301,000			55,773,000	56,671,000
Depreciation and amortization	363,000			191,000			955,000	599,000
Interest expense, net				4,000				10,000
Segment profit (loss) before income tax expense	2,586,000			2,395,000			6,603,000	5,801,000
Income tax expense (benefit)	715,000			779,000			1,825,000	1,167,000
Net income (loss)	1,871,000			1,616,000			4,779,000	4,634,000
Segment assets(1)	23,366,000			20,057,000			23,366,000	20,057,000
Unallocated Corporate
Segment reconciliation
Interest expense, net	1,237,000						3,579,000
Segment profit (loss) before income tax expense	(4,215,000)			(1,836,000)			(8,653,000)	(2,231,000)
Income tax expense (benefit)	(1,552,000)			(597,000)			(3,838,000)	(449,000)
Net income (loss)	(2,663,000)			(1,239,000)			(4,816,000)	(1,782,000)
Segment assets(1)	115,701,000			39,930,000			115,701,000	39,930,000
Intersegment
Segment reconciliation
Contract revenue	0			0
Segment assets(1)	$ (23,130,000)			$ (23,130,000)			$ (23,130,000)	$ (23,130,000)

DERIVATIVE FINANCIAL INSTRUMENTS (Details) - Interest swap agreement - USD ($) $ in Millions	9 Months Ended	12 Months Ended
	Sep. 27, 2019	Jan. 01, 2021	Jan. 31, 2019
Derivative [Line Items]
Notional amount			$ 35.0
Cash flow hedge
Derivative [Line Items]
Notional amount			$ 35.0
Fixed rate (in percent)			2.47%
Effective portion of interest rate swap designated as cash flow hedge before tax effect	$ 0.7
Accumulated other comprehensive income to interest expense	$ 0.0
Cash flow hedge \| Forecast
Derivative [Line Items]
Accumulated other comprehensive income to interest expense		$ 0.3

DERIVATIVE FINANCIAL INSTRUMENTS - Fair Values (Details) - Designated as hedging instruments - Interest swap agreement $ in Thousands	Sep. 27, 2019 USD ($)
Accrued liabilities.
Derivatives, Fair Value [Line Items]
Fair value of Derivative Instruments	$ (228)
Other noncurrent (liabilities) assets
Derivatives, Fair Value [Line Items]
Fair value of Derivative Instruments	$ (436)

DERIVATIVE FINANCIAL INSTRUMENTS -Accumulated balances and reporting period activities (Details) - USD ($) $ in Thousands	3 Months Ended
	Sep. 27, 2019	Jun. 28, 2019	Mar. 29, 2019
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Balances	$ 147,525	$ 143,994	$ 144,289
Balances	155,031	147,525	143,994
Accumulated Other Comprehensive Loss/Gain
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Balances	(438)	(219)
Other comprehensive loss before reclassifications	(42)	(219)	(219)
Net current-period other comprehensive loss	(42)	(219)	(219)
Balances	(480)	(438)	(219)
(Loss) on Derivative Instruments
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Balances	(438)	(219)
Other comprehensive loss before reclassifications	(42)	(219)	(219)
Net current-period other comprehensive loss	(42)	(219)	(219)
Balances	$ (480)	$ (438)	$ (219)

SUBSEQUENT EVENTS (Details) - USD ($)	Oct. 28, 2019	Sep. 28, 2019	Jul. 02, 2019	Jun. 26, 2019
Delayed Draw Term Loan Facility
Subsequent Event [Line Items]
Maximum borrowing capacity				$ 50,000,000
Onsite Energy Corporation
Subsequent Event [Line Items]
Aggregate Purchase price			$ 24,273,000
Onsite Energy Corporation \| Maximum \| Willdan Energy Solutions
Subsequent Event [Line Items]
Aggregate Purchase price			$ 26,400,000
Subsequent Event \| Delayed Draw Term Loan Facility
Subsequent Event [Line Items]
Proceeds from borrowings		$ 27,000,000
Maximum borrowing capacity	$ 23.0	$ 23,000,000
Subsequent Event \| E3, Inc.
Subsequent Event [Line Items]
Cash paid	27,000,000
Value of shares issued and issuable	$ 5,000,000
Number of trading days considered for calculation of weighted average price per share prior to closing date	10 days
Period over which financial targets must be met	3 years
Maximum Payout	$ 12,000,000
Subsequent Event \| E3, Inc. \| Delayed Draw Term Loan Facility
Subsequent Event [Line Items]
Proceeds from borrowings	27,000,000
Subsequent Event \| E3, Inc. \| Maximum
Subsequent Event [Line Items]
Aggregate Purchase price	44,000,000
Earn-Out Payments	$ 12,000,000

BASIS OF PRESENTATION, ORGANIZATION AND OPERATIONS OF THE COMPANY - Fiscal Years (Details)	9 Months Ended
	Sep. 27, 2019 entity
BASIS OF PRESENTATION, ORGANIZATION AND OPERATIONS OF THE COMPANY
Number of VIE	1