Document and Entity Information - USD ($) $ in Millions	12 Months Ended
Document and Entity Information - USD ($) $ in Millions	Dec. 31, 2018	Dec. 02, 2019	Jun. 30, 2018
Document And Entity Information [Abstract]
Entity Registrant Name	POWER SOLUTIONS INTERNATIONAL, INC.
Entity Central Index Key	0001137091
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Document Type	10-K
Document Period End Date	Dec. 31, 2018
Document Fiscal Year Focus	2018
Document Fiscal Period Focus	FY
Amendment Flag	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		22,856,534
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	No
Entity Emerging Growth Company	false
Entity Small Business	true
Entity Public Float			$ 47.5

CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Jan. 01, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2016
Current assets:
Cash and cash equivalents	$ 54	$ 2,014	$ 2	$ 0		$ 0	$ 0	$ 0	$ 342
Accounts receivable, net of allowances of $2,596 and $1,820 for 2018 and 2017, respectively	86,471	71,639	70,324	58,870		68,660	60,811	56,673	64,305
Income tax receivable	973	1,018	1,018	1,018		1,018	841	1,996	6,829
Inventories, net	105,614	112,392	95,957	91,689	$ 81,565	86,724	113,074	103,335	97,286
Prepaid expenses and other current assets	22,917	26,905	26,644	20,555	20,525	14,359	14,536	12,453	15,291
Total current assets	216,029	213,968	193,945	172,132		170,761	189,262	174,457	184,053
Property, plant and equipment, net	24,266	24,536	24,931	18,474		18,960	18,974	19,050	19,230
Intangible assets, net	17,010	20,534	21,854	23,175		21,491	22,401	23,610	24,819
Goodwill	29,835	29,835	29,835	29,835		29,835	29,835	29,835	29,835
Other noncurrent assets	2,742	3,818	3,552	4,957		5,972	6,035	4,518	5,053
TOTAL ASSETS	289,882	292,691	274,117	248,573		247,019	266,507	251,470	262,990
Current liabilities:
Accounts payable	85,218	88,798	64,422	55,221		51,225	54,195	55,610	67,167
Revolving line of credit	54,613	52,491	54,334	36,662		37,055	41,332	25,263	16,887
Warrant liability	35,100	43,900	33,700	0		0
Other accrued liabilities	45,700	44,762	41,884	38,697	33,626	34,332	37,295	30,110	28,809
Total current liabilities	220,631	229,951	194,340	130,580		122,612	132,842	111,012	112,893
Deferred income taxes	647	616	495	427		703	1,210	1,066	933
Warrant liability	0	0	0	27,200		24,700	23,200	21,500	20,700
Long-term debt	54,712	54,781	54,604	54,575		54,439	54,306	54,168	54,046
Other noncurrent liabilities	32,470	16,612	15,753	15,311		12,393	17,410	17,707	19,753
TOTAL LIABILITIES	308,460	301,960	265,192	228,093		214,847	228,968	205,453	208,325
STOCKHOLDERS’ (DEFICIT) EQUITY
Preferred stock – $0.001 par value. Shares authorized: 5,000. No shares issued and outstanding at all dates.	0	0	0	0		0	0	0	0
Common stock – $0.001 par value; 50,000 shares authorized; 19,067 and 19,067 shares issued; 18,638 and 18,433 shares outstanding at December 31, 2018 and 2017, respectively	19	19	19	19		19	14	14	14
Additional paid-in capital	126,412	125,938	125,272	124,981		123,838	91,737	96,543	100,686
Accumulated deficit	(135,160)	(125,262)	(106,443)	(94,638)	$ (80,434)	(82,147)	(76,018)	(66,817)	(59,070)
Treasury stock, at cost, 429 and 634 shares at December 31, 2018 and 2017, respectively	(9,849)	(9,964)	(9,923)	(9,882)		(9,538)	(9,604)	(11,530)	(11,582)
TOTAL STOCKHOLDERS’ (DEFICIT) EQUITY	(18,578)	(9,269)	8,925	20,480		32,172	6,129	18,210	30,048	$ 40,660
TOTAL LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY	$ 289,882	$ 292,691	$ 274,117	$ 248,573		$ 247,019	$ 266,507	$ 251,470	$ 262,990

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Statement of Financial Position [Abstract]
Accounts receivable allowance	$ 2,596	$ 1,820
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, authorized (in shares)	5,000,000	5,000,000
Preferred stock, issued (in shares)	0	0
Preferred stock, outstanding (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, authorized (in shares)	50,000,000	50,000,000
Common stock, issued (in shares)	19,067,000	19,067,000
Common stock, outstanding (in shares)	18,638,000	18,433,000
Treasury stock (in shares)	429,000	634,000

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended								6 Months Ended		9 Months Ended		12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Jun. 30, 2018	Jun. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2018	Dec. 31, 2017
Income Statement [Abstract]
Net sales	$ 138,234	$ 136,318	$ 127,073	$ 94,413	$ 131,476	$ 99,953	$ 100,922	$ 84,265					$ 496,038	$ 416,616
Cost of sales	126,213	117,510	109,006	84,540	115,981	86,702	88,443	74,497					437,269	365,623
Gross profit	12,021	18,808	18,067	9,873	15,495	13,251	12,479	9,768					58,769	50,993
Operating expenses:
Research, development and engineering expenses	7,910	7,708	6,962	6,021	6,459	5,687	3,848	3,950					28,601	19,944
Selling, general and administrative expenses	16,727	16,374	13,276	13,254	11,297	12,062	10,688	10,209					59,631	44,256
Asset impairment charges	2,234	0	0	0	1	0	0	0					2,234	1
Amortization of intangible assets	1,321	1,321	1,321	1,045	1,210	1,210	1,209	1,209					5,008	4,838
Total operating expenses	28,192	25,403	21,559	20,320	18,967	18,959	15,745	15,368					95,474	69,039
Operating loss	(16,171)	(6,595)	(3,492)	(10,447)	(3,472)	(5,708)	(3,266)	(5,600)					(36,705)	(18,046)
Other expense (income):
Interest expense	2,203	1,974	1,828	1,623	1,703	1,654	1,404	6,080					7,628	10,841
Loss from change in fair value of warrants	(8,800)	10,200	6,500	2,500	1,500	1,700	800	0					10,400	4,000
Loss on debt extinguishment and modifications					0	0	0	11,921					0	11,921
Other expense (income), net	81	(68)	(95)	(94)	(226)	(10)	2,142	455					(176)	2,361
Total other expense (income)	(6,516)	12,106	8,233	4,029	2,977	3,344	4,346	18,456					17,852	29,123
Loss before income taxes	(9,655)	(18,701)	(11,725)	(14,476)	(6,449)	(9,052)	(7,612)	(24,056)					(54,557)	(47,169)
Income tax expense	243	118	80	(272)	(320)	149	135	479					169	443
Net loss	$ (9,898)	$ (18,819)	$ (11,805)	$ (14,204)	(6,129)	(9,201)	(7,747)	(24,535)	$ (26,009)	$ (32,282)	$ (44,828)	$ (41,483)	(54,726)	(47,612)
Deemed dividend on Series B convertible preferred stock					(31,067)	(3,603)	(3,190)	0					0	(37,860)
Net loss available to common stockholders					$ (37,196)	$ (12,804)	$ (10,937)	$ (24,535)					$ (54,726)	$ (85,472)
Weighted-average common shares outstanding:
Basic (in shares)	18,638	18,625	18,594	18,483	16,774	13,659	13,697	11,018					18,585	13,787
Diluted (in shares)	22,360	18,625	18,594	18,483	16,774	13,659	13,697	11,018					18,585	13,787
Loss per common share:
Basic (in dollars per share)	$ (0.53)	$ (1.01)	$ (0.63)	$ (0.77)	$ (2.22)	$ (0.94)	$ (0.80)	$ (2.23)					$ (2.94)	$ (6.20)
Diluted (in dollars per share)	$ (0.84)	$ (1.01)	$ (0.63)	$ (0.77)	$ (2.22)	$ (0.94)	$ (0.80)	$ (2.23)					$ (2.94)	$ (6.20)

CONSOLIDATED STATEMENTS OF CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' (DEFICIT) EQUITY - USD ($) $ in Thousands	Total	Series B Convertible Preferred Stock	Common Stock	Additional Paid-in Capital	Treasury Stock	Accumulated Deficit
Beginning balance at Dec. 31, 2016	$ 40,660	$ 0	$ 12	$ 86,764	$ (11,581)	$ (34,535)
Increase (Decrease) in Stockholders' Equity
Net loss	(24,535)					(24,535)
Stock-based compensation expense	(155)			(154)	(1)
Issuance of common stock to Weichai, net of fees	14,078		2	14,076
Issuance of Series B convertible preferred stock, net of fees	0	24,617
Ending balance at Mar. 31, 2017	30,048	24,617	14	100,686	(11,582)	(59,070)
Beginning balance at Dec. 31, 2016	40,660	0	12	86,764	(11,581)	(34,535)
Increase (Decrease) in Stockholders' Equity
Net loss	(32,282)
Ending balance at Jun. 30, 2017	18,210	27,807	14	96,543	(11,530)	(66,817)
Beginning balance at Dec. 31, 2016	40,660	0	12	86,764	(11,581)	(34,535)
Increase (Decrease) in Stockholders' Equity
Net loss	(41,483)
Ending balance at Sep. 30, 2017	6,129	31,410	14	91,737	(9,604)	(76,018)
Beginning balance at Dec. 31, 2016	40,660	0	12	86,764	(11,581)	(34,535)
Increase (Decrease) in Stockholders' Equity
Net loss	(47,612)					(47,612)
Settlement of equity-related acquisition consideration	(712)			(712)
Stock-based compensation expense	1,183			(860)	2,043
Payment of withholding taxes for net settlement of stock-based awards	(42)			(42)
Issuance of common stock to Weichai, net of fees	14,078		2	14,076
Issuance of Series B convertible preferred stock, net of fees	0	24,617
Deemed dividend on Series B convertible preferred stock	(37,860)	37,860		(37,860)
Conversion of Series B convertible preferred stock to common stock	62,477	(62,477)	5	62,472
Ending balance at Dec. 31, 2017	32,172	0	19	123,838	(9,538)	(82,147)
Beginning balance at Mar. 31, 2017	30,048	24,617	14	100,686	(11,582)	(59,070)
Increase (Decrease) in Stockholders' Equity
Net loss	(7,747)					(7,747)
Settlement of equity-related acquisition consideration	(712)			(712)
Stock-based compensation expense	(162)			(214)	52
Deemed dividend on Series B convertible preferred stock	(3,190)	3,190		(3,190)
Ending balance at Jun. 30, 2017	18,210	27,807	14	96,543	(11,530)	(66,817)
Increase (Decrease) in Stockholders' Equity
Net loss	(9,201)					(9,201)
Stock-based compensation expense	731			(1,195)	1,926
Deemed dividend on Series B convertible preferred stock	(3,603)	3,603		(3,603)
Ending balance at Sep. 30, 2017	6,129	31,410	14	91,737	(9,604)	(76,018)
Increase (Decrease) in Stockholders' Equity
Net loss	(6,129)					(6,129)
Stock-based compensation expense	771			705	66
Deemed dividend on Series B convertible preferred stock	(31,067)	31,067		(31,067)
Conversion of Series B convertible preferred stock to common stock	62,477	(62,477)	5	62,472
Ending balance at Dec. 31, 2017	32,172	0	19	123,838	(9,538)	(82,147)
Increase (Decrease) in Stockholders' Equity
Net loss	(14,204)					(14,204)
Stock-based compensation expense	799			1,143	(344)
Ending balance at Mar. 31, 2018	20,480		19	124,981	(9,882)	(94,638)
Beginning balance at Dec. 31, 2017	32,172	0	19	123,838	(9,538)	(82,147)
Increase (Decrease) in Stockholders' Equity
Net loss	(26,009)
Ending balance at Jun. 30, 2018	8,925		19	125,272	(9,923)	(106,443)
Beginning balance at Dec. 31, 2017	32,172	0	19	123,838	(9,538)	(82,147)
Increase (Decrease) in Stockholders' Equity
Net loss	(44,828)
Ending balance at Sep. 30, 2018	(9,269)		19	125,938	(9,964)	(125,262)
Beginning balance at Dec. 31, 2017	32,172	0	19	123,838	(9,538)	(82,147)
Increase (Decrease) in Stockholders' Equity
Net loss	(54,726)					(54,726)
Stock-based compensation expense	2,663			2,974	(311)
Payment of withholding taxes for net settlement of stock-based awards	(400)			(400)
Ending balance at Dec. 31, 2018	(18,578)	0	19	126,412	(9,849)	(135,160)
Beginning balance at Mar. 31, 2018	20,480		19	124,981	(9,882)	(94,638)
Increase (Decrease) in Stockholders' Equity
Net loss	(11,805)					(11,805)
Stock-based compensation expense	619			660	(41)
Ending balance at Jun. 30, 2018	8,925		19	125,272	(9,923)	(106,443)
Increase (Decrease) in Stockholders' Equity
Net loss	(18,819)					(18,819)
Stock-based compensation expense	545			586	(41)
Ending balance at Sep. 30, 2018	(9,269)		19	125,938	(9,964)	(125,262)
Increase (Decrease) in Stockholders' Equity
Net loss	(9,898)					(9,898)
Stock-based compensation expense	700			585	115
Ending balance at Dec. 31, 2018	$ (18,578)	$ 0	$ 19	$ 126,412	$ (9,849)	$ (135,160)

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	3 Months Ended		6 Months Ended		9 Months Ended		12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Jun. 30, 2018	Jun. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2018	Dec. 31, 2017
Cash used in operating activities
Net loss	$ (14,204)	$ (24,535)	$ (26,009)	$ (32,282)	$ (44,828)	$ (41,483)	$ (54,726)	$ (47,612)
Adjustments to reconcile net loss to net cash used in operating activities:
Amortization of intangible assets	1,045	1,209	2,366	2,419	3,687	3,628	5,008	4,838
Depreciation	1,196	1,172	2,524	2,342	3,849	3,502	5,196	4,634
Change in valuation of warrants	2,500	0	9,000	800	19,200	2,500	10,400	4,000
Stock compensation expense	799	(865)	1,418	(1,028)	1,963	(297)	2,662	473
Amortization of financing fees	341	3,109	659	3,441	947	3,778	1,497	4,117
Deferred income taxes	(276)	469	(208)	602	(87)	746	(56)	239
Loss on extinguishment of debt		11,921		11,921		11,921	0	11,921
Asset impairment charges							2,234	1
Other non-cash adjustments, net	(350)	137	325	200	1,661	190	2,086	924
Changes in operating assets and liabilities:
Trade accounts receivable, net	9,710	(4,017)	(1,739)	3,532	(3,058)	(691)	(17,890)	(8,391)
Inventory, net	(9,822)	3,122	(14,825)	(3,326)	(32,657)	(13,408)	(26,202)	13,366
Prepaid expenses and other assets	(76)	(1,624)	(4,815)	1,238	(5,387)	(1,359)	(886)	(2,284)
Trade accounts payable	3,748	15,186	13,200	3,244	37,355	1,879	33,968	(1,198)
Income taxes refundable	8	298	(2)	5,135	7	6,293	125	6,508
Accrued expenses	4,757	1,861	7,914	3,826	10,773	10,622	11,630	7,839
Other noncurrent liabilities	2,902	450	2,000	(1,478)	2,901	(2,576)	18,786	(7,070)
Net cash used in operating activities	2,278	8,097	(8,192)	1,322	(3,674)	(13,542)	(6,168)	(7,695)
Cash used in investing activities
Capital expenditures	(467)	(1,896)	(1,588)	(2,669)	(2,321)	(3,856)	(3,645)	(5,061)
Asset acquisitions	(1,029)		(6,595)		(6,595)		(6,595)	(300)
Other uses, net		0		245		245	1	196
Net cash used in investing activities	(1,496)	(1,896)	(8,183)	(2,424)	(8,916)	(3,611)	(10,239)	(5,165)
Cash provided by financing activities
Repayments of long-term debt		(71,400)		(71,400)		(71,400)	0	(71,400)
Net proceeds from stock offering and warrants		59,396		59,396		59,396	0	59,396
Proceeds from revolving line of credit	106,216	85,945	240,698	209,082	372,557	324,416	516,440	436,228
Repayments of revolving line of credit	(106,608)	(81,833)	(223,419)	(196,593)	(357,121)	(295,859)	(498,881)	(411,948)
Other uses, net	(390)	0	(902)	(738)	(832)	(745)	(1,098)	(1,708)
Net cash provided by financing activities	(782)	(8,151)	16,377	(1,190)	14,604	14,861	16,461	10,568
Net increase (decrease) in cash and restricted cash	0	(1,950)	2	(2,292)	2,014	(2,292)	54	(2,292)
Cash at beginning of the year	0	2,292	0	2,292	0	2,292	0	2,292
Cash at end of the year	$ 0	$ 342	$ 2	$ 0	$ 2,014	$ 0	$ 54	$ 0

Summary of Significant Accounting Policies and Other Information

12 Months Ended

Dec. 31, 2018

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Summary of Significant Accounting Policies and Other Information

Nature of Business Operations

Power Solutions International, Inc. (“Power Solutions,” “PSI” or “the Company”), a Delaware corporation, is a global producer and distributor of a broad range of high-performance, certified low-emission power systems, including alternative-fueled power systems for original equipment manufacturers (“OEMs”) of off-highway industrial equipment and certain on-road vehicles and large custom-engineered integrated electrical power generation systems.

The Company’s customers include large, industry-leading and multinational organizations. The Company’s products and services are sold predominantly to customers throughout North America as well as to customers located throughout the Pacific Rim and Europe. The Company’s power systems are highly engineered, comprehensive systems which, through the Company’s technologically sophisticated development and manufacturing processes, including its in-house design, prototyping, testing and engineering capabilities and its analysis and determination of the specific components to be integrated into a given power system (driven in large part by emission standards and cost considerations), allow the Company to provide its customers with power systems customized to meet specific OEM application requirements, other technical customers’ specifications and requirements imposed by environmental regulatory bodies.

The Company’s power system configurations range from a basic engine integrated with appropriate fuel system components to completely packaged power systems that include any combination of cooling systems, electronic systems, air intake systems, fuel systems, housings, power takeoff systems, exhaust systems, hydraulic systems, enclosures, brackets, hoses, tubes and other assembled componentry. The Company also designs and manufactures large, custom engineered integrated electrical power generation systems for both standby and prime power applications. The Company purchases engines from third-party suppliers and produces internally-designed engines, all of which are then integrated into its power systems.

Of the other components that the Company integrates into its power systems, a substantial portion consist of internally designed components and components for which it coordinates significant design efforts with third-party suppliers, with the remainder consisting largely of parts that are sourced off-the-shelf from third-party suppliers. Some of the key components (including purchased engines) embody proprietary intellectual property of the Company’s suppliers. As a result of its design and manufacturing capabilities, the Company is able to provide its customers with a power system that can be incorporated into a customer’s specified application. In addition to the certified products described above, the Company sells diesel, gasoline and non-certified power systems and aftermarket components.

In March 2017, the Company executed a share purchase agreement (the “SPA”) with Weichai America Corp., a wholly owned subsidiary of Weichai Power Co., Ltd. (HK2338, SZ000338) (herein collectively referred to as “Weichai”). Under the terms of the SPA, Weichai invested $60.0 million in the Company purchasing a combination of newly issued Common and Preferred Stock as well as a stock purchase warrant (the “Weichai Warrant”).

Stock Ownership and Control

With the exercise of the Weichai Warrant in April 2019, Weichai owns a majority of the outstanding shares of the Company's Common Stock. As a result, Weichai is able to exercise control over matters requiring stockholders’ approval, including the election of the Directors, amendment of the Company’s Charter and approval of significant corporate transactions. This control could have the effect of delaying or preventing a change of control of the Company or changes in management and will make the approval of certain transactions impractical without the support of Weichai.

Weichai entered into an Investor Rights Agreement (the “Rights Agreement”) with the Company upon execution of the SPA. The Rights Agreement provides Weichai with representation on the Company’s Board of Directors (the “Board”) and management representation rights. Weichai currently has three representatives on the Board. According to the Rights Agreement, with Weichai exercising the Weichai Warrant and becoming the majority owner of the outstanding shares of the Company's Common Stock calculated on a fully-diluted as-converted basis (excluding certain excepted issuances), the Company is obligated to appoint to the Board an additional individual designated by Weichai, and Weichai thereafter has the right to nominate for election four Directors and any additional number of designees necessary to ensure that its designees constitute the majority of the Directors serving on the Board. According to the Rights Agreement, during any period when the Company is a “controlled company” within the meaning of the NASDAQ Stock Market (“NASDAQ”) Listing Rules, it will take such measures as to avail itself of the “controlled company” exemptions available under Rule 5615 of the NASDAQ Listing Rules of Rules 5605(b), (d) and (e).

Going Concern Considerations

The Company’s management has concluded that, due to uncertainties surrounding the Company’s ability to amend or refinance its current debt agreements and the uncertainty as to whether it will have sufficient liquidity to fund its business activities, substantial doubt exists as to its ability to continue as a going concern within one year after the date that these financial statements are issued. The Company’s plans to alleviate the substantial doubt about its ability to continue as a going concern may not be successful, and it may be forced to limit its business activities or be unable to continue as a going concern, which would have a material adverse effect on its results of operations and financial condition.

The consolidated financial statements included herein have been prepared assuming that the Company will continue as a going concern and contemplating the realization of assets and the satisfaction of liabilities and commitments in the normal course of business. The Company’s ability to continue as a going concern is dependent on generating profitable operating results, having sufficient liquidity, maintaining compliance with the covenants and other requirements under the Wells Fargo Credit Agreement (the “Wells Fargo Credit Agreement”) with Wells Fargo Bank, N.A. (“Wells Fargo”) and the Unsecured Senior Notes (the “Unsecured Senior Notes”), and refinancing or repaying the indebtedness outstanding under those agreements. The current Wells Fargo Credit Agreement maturity date is the earlier of March 31, 2021, or 60 days prior to the final maturity of the Unsecured Senior Notes, which currently mature on June 30, 2020, resulting in a current maturity date of May 1, 2020 for the Wells Fargo Credit Agreement.

Based on the Company’s current forecasts, without additional financing, the Company anticipates that it will not have sufficient cash and cash equivalents to repay the Unsecured Senior Notes by May 1, 2020. Management plans to seek additional liquidity from other lenders before May 1, 2020 to avoid acceleration of the Wells Fargo Credit Agreement. There can be no assurance that the Company’s management will be able to successfully complete a financing on acceptable terms or repay this outstanding indebtedness, when required or if at all. The consolidated financial statements included in this Form 10-K do not include any adjustments that might result from the outcome of the Company’s efforts to address these issues.

Furthermore, if the Company cannot raise capital on acceptable terms, it may not, among other things, be able to:


•	Continue to expand the Company’s research and product investments and sales and marketing organization;


•	Expand operations both organically and through acquisitions; and


•	Respond to competitive pressures or unanticipated working capital requirements.

Basis of Presentation and Consolidation

The Company is filing this Annual Report on Form 10-K for the year ended December 31, 2018, which contains audited consolidated financial statements as of and for the years ended December 31, 2018 and 2017.

The consolidated financial statements include the accounts of Power Solutions International, Inc. and its wholly owned subsidiaries. The Company’s consolidated financial statements were prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) and include the assets, liabilities, sales and expenses of all wholly owned subsidiaries and majority-owned subsidiaries in which the Company exercises control. All intercompany balances and transactions have been eliminated in consolidation.

The Company operates as one business and geographic operating segment. Operating segments are defined as components of a business that can earn revenues and incur expenses for which discrete financial information is available that is evaluated on a regular basis by the chief operating decision maker (“CODM”). The Company’s CODM is its principal executive officer, who decides how to allocate resources and assess performance. A single management team reports to the CODM, who manages the entire business. The Company’s CODM reviews Consolidated Statements of Operations to make decisions, allocate resources and assess performance, and the CODM does not evaluate the profit or loss from any separate geography or product line.

Immaterial Revision to Prior Year Period Financial Statements

Subsequent to the issuance of the 2017 financial statements, a misclassification was identified within the Company's Consolidated Balance Sheet related to the product warranty accrual. The Company previously presented the product warranty accrual within current liabilities as a component of Other accrued liabilities on the Consolidated Balance Sheets. After further evaluation, the Company determined it appropriate to reflect the portion of the Company’s product warranty accrual that is expected to be settled beyond the twelve months following the respective balance sheet date to other noncurrent liabilities. The Company assessed the materiality of the misclassification considering both qualitative and quantitative factors and determined that as of and for the year ended December 31, 2017, the three-month period ended March 31, 2017, the six-month period ended June 30, 2017, and the nine-month period ended September 30, 2017, the adjustments were immaterial. The Company has decided to correct the prior year presentation to also provide comparability to the 2018 financial statements.

The adjustments had no impact to total liabilities, total cash flows from operating activities, the Consolidated Statements of Operations, or the Statements of Convertible Preferred Stock and Stockholders' (Deficit) Equity.

The effects of the adjustments on the line items within the Company’s Consolidated Balance Sheet at December 31, 2017 and Consolidated Statement of Cash Flows for the year ended December 31, 2017, are as follows:

Consolidated Balance Sheet



(in thousands)	December 31, 2017 (As Previously Reported)		Adjustment			December 31, 2017 (As Revised)
Other accrued liabilities	$	38,362	$	(4,042	)	$	34,320
Total current liabilities	126,654		(4,042		)	122,612
Other noncurrent liabilities	8,351		4,042			12,393

Consolidated Statement of Cash Flows



	Year-Ended
(in thousands)	December 31, 2017 (As Previously Reported)			Adjustment			December 31, 2017 (As Revised)
Changes in operating assets and liabilities:
Accrued expenses	$	6,029		$	1,810		$	7,839
Other noncurrent liabilities	(5,260		)	(1,810		)	(7,070		)

The effects of the adjustments on the line items within the Company’s unaudited Consolidated Balance Sheet and Statement of Cash Flows as of and for the three-month period ended March 31, 2017, the six-month period ended June 30, 2017, and the nine-month period ended September 30, 2017, are as follows:

Consolidated Balance Sheet (unaudited)



(in thousands)	March 31, 2017 (As Previously Reported)		Adjustment			March 31, 2017 (As Revised)
Other accrued liabilities	$	35,234	$	(6,425	)	$	28,809
Total current liabilities	119,318		(6,425		)	112,893
Other noncurrent liabilities	13,328		6,425			19,753



(in thousands)	June 30, 2017 (As Previously Reported)		Adjustment			June 30, 2017 (As Revised)
Other accrued liabilities	$	35,379	$	(5,269	)	$	30,110
Total current liabilities	116,281		(5,269		)	111,012
Other noncurrent liabilities	12,438		5,269			17,707



(in thousands)	September 30, 2017 (As Previously Reported)		Adjustment			September 30, 2017 (As Revised)
Other accrued liabilities	$	41,393	$	(4,098	)	$	37,295
Total current liabilities	136,940		(4,098		)	132,842
Other noncurrent liabilities	13,312		4,098			17,410

Consolidated Statement of Cash Flows (unaudited)



	Three Months Ended
(in thousands)	March 31, 2017 (As Previously Reported)			Adjustment			March 31, 2017 (As Revised)
Changes in operating assets and liabilities:
Accrued expenses	$	2,432		$	(571	)	$	1,861
Other noncurrent liabilities	(121		)	571			450



	Six Months Ended
(in thousands)	June 30, 2017 (As Previously Reported)			Adjustment			June 30, 2017 (As Revised)
Changes in operating assets and liabilities:
Accrued expenses	$	3,242		$	584		$	3,826
Other noncurrent liabilities	(894		)	(584		)	(1,478		)



	Nine Months Ended
(in thousands)	September 30, 2017 (As Previously Reported)			Adjustment			September 30, 2017 (As Revised)
Changes in operating assets and liabilities:
Accrued expenses	$	8,867		$	1,755		$	10,622
Other noncurrent liabilities	(821		)	(1,755		)	(2,576		)

Reclassifications

Certain amounts recorded in the prior-period consolidated financial statements presented have been reclassified to conform to the current-period financial statement presentation. These reclassifications had no effect on previously reported results of operations.

Concentrations

The following table presents customers individually accounting for more than 10% of the Company’s net sales:

The following table presents customers individually accounting for more than 10% of the Company’s accounts receivable:



	As of December 31,
	2018		2017
Customer A	15	%	18	%
Customer B	**		13	%
Customer C	25	%	**

The following table presents suppliers individually accounting for more than 10% of the Company’s purchases:


**	Less than 10% of the total

Use of Estimates

The preparation of consolidated financial statements in conformity with U.S. GAAP requires that management 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 consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Significant estimates and assumptions include the valuation of allowances for uncollectible receivables, inventory reserves, warranty reserves, Weichai warrants, stock-based compensation, evaluation of goodwill, other intangibles, plant and equipment for impairment, and determination of useful lives of long-lived assets. Actual results could materially differ from those estimates.

Cash and Cash Equivalents

Cash equivalents consist of short-term, highly liquid investments that mature within three months or less. Such investments are stated at cost, which approximates fair value. The Company’s revolving credit agreement with Wells Fargo currently includes a “lockbox” arrangement that receives all receipts and from which the Company can request increases in the revolver borrowings. See Note 6. Debt for additional information regarding the Wells Fargo Credit Agreement.

Stock-Based Compensation

The Company accounts for stock-based compensation expense based on the grant date fair value of the award with the cost recognized over the requisite service period, which is generally the vesting period of the respective award. See Note 12. Stock-Based Compensation for additional information.

Research and Development

Research and development (“R&D”) expenses are expensed when incurred. R&D expenses consist primarily of wages, materials, testing and consulting related to the development of new engines, parts and applications. These costs were $26.8 million and $18.4 million for 2018 and 2017, respectively.

Income Taxes

The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, deferred tax assets and liabilities are determined based on the differences between the financial statement and tax basis of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to be settled or realized. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date.

The Company records net deferred tax assets to the extent that it believes these assets will more likely than not be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies and results of recent operations. As of December 31, 2018 and 2017, the Company had a valuation allowance of $44.4 million and $32.0 million, respectively.

The Company records uncertain tax positions in accordance with accounting guidance, on the basis of a two-step process whereby (i) it determines whether it is more likely than not that the tax positions will be sustained based on the technical merits of the position and (ii) for those tax positions that meet the more-likely-than-not recognition threshold, the Company recognizes the largest amount of tax benefit that is greater than 50 percent likely to be realized upon ultimate settlement with the related tax authority. Tax benefits related to uncertain tax positions taken or expected to be taken on a tax return are recorded when such benefits meet a more-likely-than-not threshold. Otherwise, these tax benefits are recorded when a tax position has been effectively settled, which means that the appropriate taxing authority has completed its examination even though the statute of limitations remains open, or the statute of limitation has expired. Interest and penalties related to uncertain tax positions are recognized as part of income tax expense and are accrued beginning in the period that such interest and penalties would be applicable under relevant tax law until such time that the related tax benefits are recognized. As of December 31, 2018 and 2017, the Company had an unrecognized tax benefit of $1.4 million and $1.3 million, respectively, for uncertain tax positions excluding interest and penalties.

On December 22, 2017, the President of the United States signed into law the Tax Cuts and Jobs Act (the “Tax Act”). The Tax Act included a number of changes to existing U.S. tax laws that impact the Company, most notably a reduction of the U.S. federal corporate income tax rate from 34 percent to 21 percent for tax years beginning after December 31, 2017. The Tax Act also provides for the acceleration of depreciation for certain assets placed into service after September 27, 2017 as well as prospective changes beginning in 2018, including repeal of the domestic manufacturing deduction and additional limitations on executive compensation. The Company recognized the income tax effects of the Tax Act in its 2017 financial statements. The Company analyzed the Tax Act, and remeasured its U.S. deferred tax balances to reflect the new U.S. corporate income tax rate as of December 31, 2017.

Accounts Receivable and Allowance for Doubtful Accounts

Trade accounts receivable represent amounts billed to customers and not yet collected. Trade accounts receivable are recorded at the invoiced amount, which approximates net recoverable value, and generally do not bear interest. The allowance for doubtful accounts is the Company’s best estimate of the amount of probable credit losses in the existing accounts receivable and is established through a charge to Selling, general and administrative expenses. The allowance is primarily determined based on historical collection experience and reviews of customer creditworthiness. Trade accounts receivable and the allowance for doubtful accounts are reviewed on a regular basis. When necessary, an allowance for the full amount of specific accounts deemed uncollectible is recorded. Accounts receivable losses are deducted from the allowance and the account balance is written off when the customer receivable is deemed uncollectible. Recoveries of previously written off balances are recognized when received. An allowance associated with anticipated future sales returns is also included in the allowance for doubtful accounts.

Insurance Recoveries

The Company records insurance recoveries related to amounts recorded as estimated losses on events covered by the Company’s insurance policies when management determines that the recovery is probable and the amount can be reasonably determined.

Inventories

Inventories are stated at the lower of cost or net realizable value, which approximates current replacement cost. Cost is principally determined using the first-in, first-out method and includes material, labor and manufacturing overhead. It is the Company’s policy to review inventories on a continuing basis for obsolete, excess and slow-moving items and to record valuation adjustments for such items in order to eliminate non-recoverable costs from inventory. Valuation adjustments are recorded in an inventory reserve account and reduce the cost basis of the inventory in the period in which the reduced valuation is determined. Inventory reserves are established based on quantities on hand, usage and sales history, customer orders, projected demand and utilization within a current or future power system. Specific analysis of individual items or groups of items is performed based on these same criteria, as well as on changes in market conditions or any other identified conditions.

Inventories consist of the following:



(in thousands)	As of December 31,
Inventories	2018			2017
Raw materials	$	90,877		$	71,732
Work in process	2,390			4,535
Finished goods	18,077			16,684
Total inventories	111,344			92,951
Inventory allowance	(5,730		)	(6,227		)
Inventories, net	$	105,614		$	86,724

Activity in the Company’s inventory allowance was as follows:



(in thousands)	For the Year Ended December 31,
Inventory Allowance	2018			2017
Balance at beginning of period	$	6,227		$	10,082
Charged to expense	2,153			421
Write-offs	(2,650		)	(4,276		)
Balance at end of year	$	5,730		$	6,227

Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consist of the following:



(in thousands)	As of December 31,
Prepaid Expenses and Other Current Assets	2018		2017
Insurance proceeds receivable	$	15,989	$	10,563
Prepaid expenses	3,260		3,710
Contract assets	2,926		—
Other	742		86
Total	$	22,917	$	14,359

Estimated insurance recoveries related to litigation reserves in Other accrued liabilities are reflected as assets in the Company’s Consolidated Balance Sheets when it is determined that the receipt of such amounts is probable, and the amount can be reasonably determined.

Property, Plant and Equipment

Property, plant and equipment is carried at cost and presented net of accumulated depreciation and impairments. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. Property, plant and equipment is evaluated periodically to determine if an adjustment to depreciable lives is warranted. Such evaluation is based principally on the expected utilization of the long-lived assets.

Repairs and maintenance costs are charged directly to expense as incurred. Major renewals or replacements that substantially extend the useful life of an asset are capitalized and depreciated.

Estimated useful lives by each type of asset category are as follows:



		Years
Buildings		Up to 39
Leasehold improvements		Lesser of (i) expected useful life of improvement or (ii) life of lease (including likely extension thereof)
Machinery and equipment		1 to 10

Intangible Assets

The Company’s intangible assets include customer relationships, developed technology, trade names and trademarks. Intangible assets are amortized on an accelerated basis over a period of time that approximates the pattern over which the Company expects to gain the estimated economic benefits, and such period generally ranges between 3 years and 15 years. The useful life of intangible assets is assessed and assigned based on the facts and circumstances specific to the acquisition.

Impairment of Long-Lived Assets

The Company assesses potential impairments to its long-lived assets or asset groups, excluding goodwill, which is separately tested for impairment, whenever events indicate that the carrying amount of such assets may not be recoverable. Long-lived assets are evaluated for impairment by comparing the carrying value of the asset or asset group with the estimated future net undiscounted cash flows expected to result from the use of the asset or asset group, including cash flows from disposition. If the future net undiscounted cash flows are less than the carrying value, an impairment loss is calculated. An impairment loss is determined by the amount that the asset’s or asset group’s carrying value exceeds its estimated fair value. Estimated fair value is generally measured by discounting estimated future cash flows. If an impairment loss is recognized, the adjusted balance becomes the new cost basis and is depreciated (amortized) over the remaining useful life. The Company also periodically reassesses the useful lives of its long-lived assets due to advances and changes in technologies.

In the fourth quarter of 2018, the Company recognized an impairment charge of $2.2 million related to developed technology.

Goodwill

Goodwill represents the excess of the cost of an acquired business over the amounts assigned to the net acquired assets. Goodwill is not amortized but is tested for impairment at the reporting unit level, on an annual basis or more frequently, if events occur or circumstances change indicating potential impairment. The Company annually tests goodwill for impairment on October 1st.

In evaluating goodwill for impairment, the Company may first assess qualitative factors to determine whether it is more likely than not (i.e., there is a likelihood of more than 50%) that the Company’s fair value is less than its carrying amount. Qualitative factors that the Company considers include, but are not limited to, macroeconomic and industry conditions, overall financial performance and other relevant entity-specific events. If the Company bypasses the qualitative assessment, or if the Company concludes that it is more likely than not that the fair value of a reporting unit is less than its carrying value, then the Company performs a two-step goodwill impairment test to identify potential goodwill impairment and measures the amount of goodwill impairment it will recognize, if any.

In the first step of the two-step goodwill impairment test, the Company compares the estimated fair value of the reporting unit with its related carrying value. The Company has two reporting units: PSI and Professional Power Products, Inc. (“3PI”). If the estimated fair value exceeds the carrying amount, no further analysis is needed. If, however, the reporting unit’s estimated fair value is less than its carrying amount, the Company proceeds to the second step and calculates the implied fair value of goodwill to determine whether any impairment is required.

The Company calculates its estimated fair value using the income and market approaches when feasible, or an asset approach when neither the income nor the market approach has sufficient data. For the income approach, a discounted cash flow method, the Company uses internally developed discounted cash flow models that include the following assumptions, among others: projections of revenues, expenses and related cash flows based on assumed long-term growth rates and demand trends, expected future investments to grow new units, and estimated discount rates. The Company based these assumptions on its historical data and experience, third-party appraisals, industry projections, and micro and macro general economic condition projections and expectations. The market approach, also called the Guideline Public Company Approach, compares the value of an entity to similar publicly traded companies. The asset approach estimates the selling price the unit could achieve under assumed market conditions.

If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is considered not impaired, and the second step of the impairment test is unnecessary. If the carrying amount of a reporting unit exceeds its fair value, the second step of the goodwill impairment test is performed to measure the amount of impairment loss, if any. The second step compares the implied fair value of the reporting unit goodwill with the carrying amount of that goodwill. If the carrying amount of reporting unit goodwill exceeds the implied fair value of that goodwill, an impairment loss is recognized in an amount equal to that excess.

During the years ended December 31, 2018 and 2017, the estimated fair value of the reporting units exceeded the carrying value; as such, no impairment charges were recognized.

Other Accrued Liabilities

Other accrued liabilities consisted of the following:



(in thousands)	As of December 31,
Other Accrued Liabilities	2018		2017 (As Revised)
Accrued product warranty^*	$	9,767	$	8,585
Litigation reserves ^**	16,139		12,137
Contract liabilities (deferred revenue)	4,897		2,822
Accrued compensation and benefits	4,520		2,593
Professional services	27		1,974
Accrued interest expense	1,175		686
Other	9,175		5,535
Total	$	45,700	$	34,332


*	The Company recorded adjustments to reflect a portion of the accrued product warranty liability previously in Other accrued expenses at December 31, 2017 to correct the presentation error and to conform to the current period presentation. See above for additional discussion of the adjustment.

As of December 31, 2018 and 2017, litigation reserves primarily consisted of accruals for the settlement of the Securities Litigation, Federal Derivative Litigation, and the Cohen matter. The Company concluded that insurance recovery was probable related to $14.0 million of the litigation reserves and recognized full recovery of the settlement amounts in Prepaid expenses and other current assets. See Note 9. Commitments and Contingencies for additional information.

Warranty Costs

The Company offers a standard limited warranty on the workmanship of its products that in most cases covers defects for a defined period. Warranties for certified emission products are mandated by the U.S. Environmental Protection Agency (the “EPA”) and/or the California Air Resources Board (the “CARB”) and are longer than the Company’s standard warranty on certain emission-related products. The Company’s products also carry limited warranties from suppliers. The Company warranties generally apply to engines fully manufactured by the Company and to the modifications the Company makes to supplier base products. Costs related to supplier warranty claims are generally borne by the supplier and passed through to the end customer.

Warranty estimates are based on historical experience and represent the projected cost associated with the product. A liability and related expense are recognized at the time products are sold. The Company adjusts estimates when it is determined that actual costs may differ from initial or previous estimates.

The Company records adjustments to pre-existing warranties for changes in its estimate of warranty costs for products sold in prior fiscal years in the period in which new information is received and the information indicates that actual costs may differ from the Company’s initial or previous estimates. Such adjustments typically occur when claims experience deviates from historic and expected trends. During 2018, the Company recognized charges for adjustments to pre-existing warranties of $3.8 million.

When the Company identifies cost effective opportunities to address issues in products sold or corrective actions for safety issues, it initiates product recalls or field campaigns. As a result of the uncertainty surrounding the nature and frequency of product recalls and field campaigns, the liability for such actions is generally recorded when the Company commits to a product recall or field campaign. In each subsequent quarter after a recall or field campaign is initiated, the recorded warranty liability balance is analyzed, reviewed, and adjusted, if necessary, to reflect any changes in the anticipated average cost of repair or number of repairs to be completed prospectively.

When collection is reasonably assured, the Company also estimates the amount of warranty claim recoveries to be received from its suppliers. Warranty costs and recoveries are included in Cost of sales in the Consolidated Statements of Operations.

Accrued product warranty activities are presented below:



(in thousands)	For the Year Ended December 31,
Accrued Product Warranty	2018			2017
Balance at beginning of year	$	12,628		$	10,200
Current year provision	15,840			5,405
Changes in estimates for preexisting warranties ^*	3,842			—
Payments made during the period	(9,208		)	(2,977		)
Balance at end of year	$	23,102		$	12,628
Less: Current portion	9,767			8,585
Noncurrent accrued product warranty	13,335			4,043

Change in estimates for pre-existing warranties reflect changes in the Company’s estimate of warranty costs for products sold in prior periods. Such adjustments typically occur when claims experience deviates from historic and expected trends. The Company’s warranty liability is generally affected by failure rates, repair costs and the timing of failures. Future events and circumstances related to these factors could materially change the estimates and require adjustments to the warranty liability. In addition, new product launches require a greater use of judgment in developing estimates until historical experience becomes available. In the first quarter of 2018, the Company recorded charges for changes in estimates of $3.8 million, or $0.21 per diluted share.

Revenue Recognition

On January 1, 2018, the Company adopted the new revenue recognition guidance, Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers (“ASC 606”), on a modified retrospective basis. The comparative information for 2017 has not been restated and continues to be reported under ASC 605, Revenue Recognition (“ASC 605”). See Note 2. Revenue for additional information regarding the required disclosures related to the impact of adopting ASC 606 and a discussion of the Company’s policy related to revenue recognition.

During 2017, prior to the adoption of ASC 606, the Company recognized revenue upon transfer of title and risk of loss to the customer, typically when products are shipped, provided there is persuasive evidence of an arrangement, the sales price is fixed or determinable, and management believes collectibility is reasonably assured. Customer orders sometimes include multiple products that are delivered at different times. In these situations, revenue associated with the delivered components is recognized based on their relative stand-alone value which is generally considered to be the quoted price in the contract.

The Company classifies shipping and handling charges billed to customers as revenue. Shipping and handling costs paid to others are classified as a component of cost of sales when incurred.

The Company may provide various sales incentives to its customers, including rebate opportunities and price incentives for attaining specified volumes during a particular quarter or year. The Company accrues for the expected amount of these sales incentives as a reduction of revenue at the time of the original sale and updates its accruals as needed based on the best estimate of the volume levels the customer will reach during the measurement period. The Company also from time to time offers incentives with respect to the launch of new products.

Recently Issued Accounting Pronouncements – Adopted

In January 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-01, Financial Instruments – Overall: Recognition and Measurement of Financial Assets and Financial Liabilities. This guidance requires disclosures to compare carrying values to fair values of financial assets and liabilities, with some exceptions. This guidance is effective for annual and interim periods in 2018 but was early adopted by the Company on January 1, 2017. The adoption of this ASU did not have an impact on the Consolidated Balance Sheets or the Consolidated Statements of Operations.

In May 2014, the FASB issued ASU 2014-09, which created ASC 606, Revenue from Contracts with Customers (Topic 606). See Note 2. Revenue, for the impact of adoption of ASC 606.

Recently Issued Accounting Pronouncements – Not Yet Adopted

In August 2018, the FASB issued ASU 2018-15, Intangibles - Goodwill and Other - Internal Use Software: Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That is a Service Contract. This guidance requires the use of existing accounting guidance applicable to software developed for internal use to be applied to cloud computing service contracts’ implementation costs. The costs capitalized would be amortized over the life of the agreement, including renewal option periods likely to be used. This guidance is effective for fiscal 2020, with early adoption permitted. The Company does not plan to early adopt the guidance and plans to implement it upon the effective date. The Company does not anticipate that this guidance will have a material impact on its Consolidated Balance Sheet and Consolidated Statement of Operations.

In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement: Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement, which both reduces and expands selected disclosure requirements. The principal changes expected to impact the Company’s disclosure are requirements to disclose the range and weighted average of each of the significant unobservable items and the way the weighted average of a range is calculated for items in the “table of significant unobservable inputs.” The guidance also requires disclosure of changes in unrealized gains and losses in other comprehensive income and removes requirements regarding, among other items, disclosure of the valuation process for Level 3 measurements. This guidance is effective for all fiscal years and for interim periods within those years, beginning in fiscal 2020. The Company plans to implement the guidance when it becomes effective and does not currently anticipate that this guidance will have a material impact on its Consolidated Balance Sheet and Consolidated Statement of Operations.

In January 2017, the FASB issued ASU 2017-04, Intangibles - Goodwill and Other: Simplifying the Test for Goodwill Impairment, which eliminated the requirement to calculate the implied fair value of goodwill to measure a goodwill impairment charge. Instead, entities will record an impairment charge based on the excess of a reporting unit’s carrying amount over its fair value. The ASU is effective for annual and interim impairment tests performed in periods beginning after December 15, 2019; early adoption is permitted for annual and interim goodwill impairment testing dates after January 1, 2017. The amendments in this ASU are to be applied on a prospective basis. The Company currently plans on adopting the standard on January 1, 2020 when it becomes effective and does not expect the guidance to have a material impact on its financial statements.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses: Measurement of Credit Losses on Financial Instruments, which applies primarily to the Company’s accounts receivable impairment loss allowances. The guidance provides a revised model whereby the current expected credit losses are used to compute impairment of financial instruments. The new model requires evaluation of historical experience and various current and expected factors, which may affect the estimated amount of losses and requires determination of whether the affected financial instruments should be grouped in units of account. The guidance, as originally issued, was effective for fiscal years beginning after December 15, 2019. In November 2019, the FASB issued ASU 2019-10, Financial Instruments - Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842) Effective Dates, which deferred the effective dates of these standards for certain entities. Based on the guidance, the effective date of ASU 2016-13 is deferred for the Company until fiscal year 2023. The Company currently plans to adopt the guidance on January 1, 2023 when it becomes effective. The Company is continuing to assess the impact of the standard on its financial statements.

In February 2016, the FASB issued ASU 2016-02, Leases, which created ASC Topic 842, Leases and superseded the existing guidance in ASC 840, Leases. The core principle of ASU 2016-02 is that an entity should recognize on its balance sheets assets and liabilities arising from a lease. In accordance with that principle, ASU 2016-02 required that a lessee recognize a liability to make lease payments (the lease liability) and a right-of-use asset representing its right to use the underlying leased asset for the lease term. The recognition, measurement and presentation of expenses and cash flows arising from a lease by a lessee will depend on the lease’s classification as a finance or operating lease. This new accounting guidance is effective for fiscal years beginning after December 15, 2018 under a modified retrospective approach, and early adoption is permitted. In July 2018, the FASB issued ASU 2018-11, which modified the transition guidance in ASU 2016-02 to provide preparers the option to adopt the ASU as of the effective date instead of adjusting prior periods under the modified retrospective approach. The Company will adopt the guidance effective January 1, 2019 and expects to elect to adopt the standard as of that date as provided for in ASU 2018-11.

The Company is finalizing its evaluation of the impact the adoption of this guidance will have on its financial statements. The Company completed an assessment of its portfolio of leases and has compiled a central repository of all active leases. It is also in the process of designing the future lease process and drafting a policy to address the new standard requirements. Key lease data elements are being evaluated. The Company has implemented a software solution to track and account for leases under ASU 2016-02 and is finalizing implementation of the solution. While the Company has not yet completed its evaluation of the impact the new lease accounting standard will have on its financial statements, the Company will recognize material right-of-use assets and lease liabilities for its operating leases in the Consolidated Balance Sheet upon the effective date.

Revenue

12 Months Ended

Dec. 31, 2018

Revenue from Contract with Customer [Abstract]

Revenue

On January 1, 2018, the Company adopted ASC 606 using the modified retrospective approach for all contracts that were not completed as of January 1, 2018. Results for reporting periods beginning after January 1, 2018 are presented under ASC 606, while prior period amounts are not adjusted and continue to be reported under the accounting standards in effect for the prior period.

Upon adoption of ASC 606, recognition of revenue and costs of sales for certain power systems used in standby and prime power generation was changed from recognition at the time the power system shipped from the Company’s facilities (or was delivered to the customer depending on shipping terms) to recognition over time as the product was constructed. The cumulative effects of the changes made to the Consolidated Balance Sheet as of January 1, 2018 for the adoption of ASC 606 were as follows:



(in thousands)	As Reported			Adjustments due to ASC 606		As Restated
	December 31, 2017			Adjustments due to ASC 606		January 1, 2018
Assets
Inventories, net	$	86,724		(5,159	)	81,565
Prepaid expenses and other current assets	14,359			6,166		20,525

Liabilities and Stockholders' Equity
Other accrued liabilities^*	$	34,332		(706	)	33,626
Accumulated deficit	(82,147		)	1,713		(80,434	)

The Company recorded adjustments to reflect a portion of the accrued product warranty liability within Other accrued liabilities to Other noncurrent liabilities at December 31, 2017 to conform the presentation to the current period. See Note 1. Summary of Significant Accounting Policies and Other Information for additional discussion of the adjustment. The adjustment had no impact on the adoption of ASC 606.

Impact on Consolidated Financial Statements

The following table summarizes the effects of the adoption of ASC 606 on selected line items within the Consolidated Statement of Operations for the year ended December 31, 2018:



(in thousands)	As Reported ASC 606			Impact of ASC 606			ASC 605
Net sales	$	496,038		$	(1,995	)	$	498,033
Cost of sales	437,269			(573		)	437,842
Gross profit	58,769			(1,422		)	60,191
Operating loss	(36,705		)	(1,422		)	(35,283		)
Loss before income taxes	(54,557		)	(1,422		)	(53,135		)
Net loss	(54,726		)	(1,422		)	(53,304		)
Net loss available to common stockholders	(54,726		)	(1,422		)	(53,304		)
Net loss per common share:
Basic	(2.94		)	(0.08		)	(2.86		)
Diluted	(2.94		)	(0.08		)	(2.86		)

The following table summarizes the effects of the adoption of ASC 606 on selected line items within the Consolidated Balance Sheet as of December 31, 2018:



(in thousands)	As Reported ASC 606			Impact of ASC 606			ASC 605
Assets
Inventories, net	$	105,614		$	(4,586	)	$	110,200
Prepaid expenses and other current assets	22,917			2,926			19,991
Liabilities and Stockholders' Equity
Other accrued liabilities	$	45,700		$	(1,952	)	$	47,652
Accumulated deficit	(135,160		)	292			(135,452		)

The adoption of ASC 606 had no impact on net cash provided by or (used in) operating, financing or investing activities on the Company’s Consolidated Statement of Cash Flows.

Revenue Recognition

The Company determines the amount of revenue to be recognized through the following steps:


•	Identification of the contract, or contracts with a customer;


•	Identification of the performance obligations in the contract;


•	Determination of the transaction price;


•	Allocation of the transaction price to the performance obligations in the contract; and


•	Recognition of revenue when, or as, the Company satisfies the performance obligations.

Revenue for the Company is generated from contracts that may include a single performance obligation (generally, a single type of engine) or multiple performance obligations (which may include an engine with aftermarket parts, different types of engines, etc.). A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of account for revenue recognition. Revenue is measured at the transaction price which is based on the amount of consideration that the Company expects to receive in exchange for transferring the promised goods or services to the customer. The transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. The Company is required to estimate the total consideration expected to be received from contracts with customers. The consideration expected to be received may be variable based on the specific terms of the contract and the Company’s past practices.

For contracts with multiple performance obligations, the Company allocates the total transaction price to distinct performance obligations based on directly observable data, if available, or the Company’s best estimate of stand-alone selling price of each distinct performance obligation. The primary method used to estimate stand-alone selling price is the cost plus a margin approach.

The Company applies significant judgment in order to identify and determine the number of performance obligations, determine the total transaction price, allocate the transaction price to each performance obligation, and determine the appropriate timing of revenue recognition.

Taxes collected from customers and remitted to governmental authorities are presented on a net basis; that is, such taxes are excluded from revenues.

The Company’s payment terms are generally 60 days or less and its sales arrangements do not contain any significant financing components.

Timing of revenue recognition. The Company recognizes revenue related to performance obligations in its contracts with customers when control passes to the customer. Control passes to the customer when the customer has the ability to direct the use of and obtain substantially all of the remaining benefits from the asset. For the majority of the Company’s products, revenue is recognized at a point in time when the products are shipped or delivered to the customer based on the shipping terms as that is the point in time when control passes to the customer. For the year ended December 31, 2018, the Company recognized revenue of $449.8 million related to products shipped or delivered at a point in time.

The Company also recognizes revenue over time primarily when the Company’s performance obligation includes: enhancing a customer-controlled asset (generally when an engine is provided by the customer) or constructing an asset with no alternative future use and the Company has an enforceable right to payment throughout the period as the services are performed. The Company recognizes revenue throughout the manufacturing process in these scenarios based on labor hours incurred because the customer receives the benefit of the asset as the product is constructed. The Company believes labor hours incurred relative to total estimated labor hours at completion faithfully depicts the transfer of control to the customer. For the year ended December 31, 2018, the Company recognized revenue of $46.2 million for products manufactured over time.

Shipping and handling costs. The Company accounts for shipping and handling costs as fulfillment costs which are recorded in Cost of sales in the Consolidated Statements of Operations. This includes shipping and handling costs incurred after control of the asset has transferred to the customer as the Company has elected the practical expedient in ASC 606.

Variable consideration. Variable consideration primarily includes rebates and discounts. The Company estimates the projected amount of rebates and discounts based on current assumptions, customer-specific information and historical experience. Variable consideration is recorded as a reduction of revenue to the extent that it is probable that there will not be significant changes to the Company's estimate of variable consideration when any uncertainties are settled.

Costs to obtain and fulfill a contract. The Company has elected the practical expedient in ASC 606 to recognize incremental costs to obtain a contract (primarily commissions) as expense when incurred since the amortization period of the asset that the Company otherwise would have recognized is one year or less.

Disaggregation of Revenue

The following table summarizes net sales by end market:



	For the Quarter Ended (Unaudited)								For the Year Ended
(in thousands)	March 31,		June 30,		September 30,		December 31,		December 31,
End Market	2018		2018		2018		2018		2018
Industrial	$	45,719	$	48,051	$	52,367	$	55,059	$	201,196
Energy	38,567		52,014		48,481		46,623		185,685
Transportation	10,127		27,008		35,470		36,552		109,157
Total	$	94,413	$	127,073	$	136,318	$	138,234	$	496,038

The following table summarizes net sales by geographic area:



	For the Quarter Ended (Unaudited)								For the Year Ended
(in thousands)	March 31,		June 30,		September 30,		December 31,		December 31,
Geographic Area	2018		2018		2018		2018		2018
North America	$	79,947	$	111,444	$	120,955	$	123,722	$	436,068
Pacific Rim	10,339		11,516		10,913		9,303		42,071
Europe	3,315		3,621		3,012		3,795		13,743
Other	812		492		1,438		1,414		4,156
Total	$	94,413	$	127,073	$	136,318	$	138,234	$	496,038

Contract Balances

The timing of revenue recognition may differ from the time of invoicing to customers and these timing differences result in contract assets, or contract liabilities on the Company’s Consolidated Balance Sheet. Contract assets include amounts related to the contractual right to consideration for completed performance when the right to consideration is conditional. The Company records contract liabilities when cash payments are received or due in advance of performance. Contract assets and contract liabilities are recognized at the contract level.



(in thousands)	December 31, 2018			January 1, 2018
Short-term contract assets (included in Prepaid expenses and other current assets)	$	2,926		$	6,166
Short-term contract liabilities (included in Other accrued liabilities)	(4,897		)	(1,299		)
Long-term contract liabilities (included in Other noncurrent liabilities)	(14,611		)	(2,767		)
Net contract assets (liabilities)	$	(16,582	)	$	2,100

During the year ended December 31, 2018, the Company recognized $1.2 million of revenue upon satisfaction of performance obligations. These amounts were included in the net contract asset (liability) balance as of January 1, 2018.

Remaining Performance Obligations

The Company has elected the practical expedient to not disclose remaining performance obligations that have expected original durations of one year or less. For performance obligations that extend beyond one year, the Company had $13.9 million of remaining performance obligations as of December 31, 2018. The Company expects to recognize revenue related to these remaining performance obligations in 2020.

Weichai Transactions

12 Months Ended

Dec. 31, 2018

Equity [Abstract]

Weichai Transactions

In March 2017, the Company and Weichai executed the SPA in which the Company issued stock and a warrant to Weichai for aggregate proceeds of $60.0 million (the “Weichai Transaction”), comprised of:


•	2,728,752 shares of Common Stock;


•	2,385,624 shares of Series B Redeemable Convertible Preferred Stock (“Series B Convertible Preferred Stock”) convertible on a two-for-one basis into 4,771,248 shares of Common Stock; and


•	The Weichai Warrant as discussed further below.

The Company used proceeds from the sale of the above securities pursuant to the SPA and borrowings under the Wells Fargo Credit Agreement to pay off the outstanding TPG Term Loan (the “TPG Term Loan”) with TPG Specialty Lending, Inc. (“TPG”), discussed in Note 6. Debt.

In August 2017, Gary S. Winemaster, former Chairman of the Board, Chief Executive Officer and President, and nonexecutive Chief Strategy Officer, separately sold 200,000 additional shares of Common Stock to Weichai.

Series B Convertible Preferred Stock

The Series B Convertible Preferred Stock was automatically convertible into Common Stock upon stockholder approval, as defined in the SPA. Commencing on September 30, 2017, Weichai was entitled to cumulative dividends at a stated rate of 10% per share, payable quarterly upon declaration by the Board, or as a liquidation preference for the Series B Convertible Preferred Stock. Any unpaid and deferred cash dividends would be deemed canceled and null upon conversion of the Series B Convertible Preferred Stock.

In the event of liquidation, dissolution or winding-up of the Company, the holders of the Series B Convertible Preferred Stock would have been entitled to receive out of the assets of the Company available for distribution to stockholders of the Company, before any distributions on the Common Stock or any other junior stock, an amount equal to the greater of the liquidation preference ($16.00 per share), plus accrued and unpaid dividends, or the amount that would otherwise be payable on an as-converted basis assuming the conversion of the Series B Convertible Preferred Stock into Common Stock.

The Series B Convertible Preferred Stock also included a $23.1 million contingent beneficial conversion feature (“BCF”) that was considered to be “in the money” and “contingently beneficial” to Weichai, the warrant holder, upon the actual exercise of the Weichai Warrant, at Weichai’s option at the commitment date, March 31, 2017, as the Company’s stock price was greater than the conversion price at the commitment date. The Series B Convertible Preferred Stock and the Common Stock were assigned value based on their relative fair values after reducing the net proceeds from the Weichai Transaction by the fair value of the Weichai Warrant, as required by accounting guidance. The resulting discount on the Series B Convertible Preferred Stock was accreted, with the remaining unaccreted amount included in the deemed dividend discussed below under “Deemed Dividend and Beneficial Conversion Feature.”

In November 2017, the Company entered into a Securities Exchange Agreement (the “Exchange Agreement”) with Weichai that resulted in conversion of the 2,385,624 shares of Series B Convertible Preferred Stock into 4,771,248 shares of Common Stock.

Weichai Warrant

The Weichai Warrant was exercisable for a ninety (90) day period from September 30, 2018 to December 31, 2018 at a price per share of Common Stock equal to 85% of the Volume-Weighted Average Price (“VWAP”) during the 20-day trading period immediately preceding the warrant exercise date or at a price per share of Common Stock equal to 50% of such preceding VWAP if the Company was delisted from NASDAQ as of September 30, 2018. The Weichai Warrant exercise price was subject to further reduction pursuant to a formula that provided for such adjustment in case the Company’s 2017 adjusted earnings before interest expense, income taxes, depreciation and amortization (“EBITDA”) (as defined within the SPA) was less than $22.0 million, or its net book value per share as of December 31, 2016 was less than $8.00, provided that the aggregate amount of such downward adjustments would not exceed $15.0 million.

The Exchange Agreement executed on November 30, 2017 amended the Weichai Warrant (the “Restated Warrant”) in addition to converting the Series B Convertible Preferred Stock to Common Stock as noted above. Under the Exchange Agreement, the Restated Warrant (i) was exercisable for Common Stock without obtaining stockholder approval, (ii) was no longer exercisable for Series B Convertible Preferred Stock and (iii) permitted the Company to accelerate the exercise of the Restated Warrant prior to September 30, 2018, to the extent that the Company required additional financing for any reason.

In September 2018, the Weichai Warrant was amended under the terms of a second amended and restated warrant (“Amended and Restated Warrant”) to defer its exercise date to a 90-day period commencing April 1, 2019, to adjust the exercise price to a price per share of the Company’s Common Stock equal to the lesser of (i) 50% of the VWAP during the 20 consecutive trading day period preceding October 1, 2018 and (ii) 50% of the VWAP during the 20 consecutive trading day period preceding the date of exercise, subject to an adjustment that could reduce the exercise price by up to $15.0 million. In the event that the adjustment exceeded the exercise price, the excess would be due to the warrant holder.

On April 23, 2019, Weichai exercised the Weichai Warrant resulting in the Company issuing 4,049,759 shares of the Company’s Common Stock and Weichai becoming the owner of 51.5% of the outstanding shares of the Company’s Common Stock. The exercise proceeds for the warrants of $1.6 million were based on 50% of the VWAP during the 20 consecutive trading day period preceding April 23, 2019 and $15.0 million reduction in the exercise price described above. The Company recorded expense of $1.4 million related to the Weichai Warrant during 2019 including the impact of the exercise.

Valuation and Accounting for Issuance and Conversion to Common Stock, Series B Convertible Preferred Stock (and Related Beneficial Conversion Feature) and Weichai Warrant

Detachable warrants issued in a bundled transaction with debt and equity offerings should be accounted for separately. If the warrants are classified as a liability recorded at fair value, then the total proceeds from the transaction are first allocated to the warrants based on their fair value, and residual proceeds are allocated to the remaining instruments based on their relative fair value.

The Weichai Warrant is a freestanding derivative financial instrument that is not indexed solely to the Company’s Common Stock due to the Weichai Warrant’s exercise terms. Therefore, the Weichai Warrant is presented at fair value in the Company’s Consolidated Balance Sheets in Warrant liability for $35.1 million and $24.7 million at December 31, 2018 and 2017, respectively. Changes in fair value of a loss of $10.4 million and $4.0 million, respectively, are reported in Loss from change in fair value of warrants in the Company’s 2018 and 2017 Consolidated Statements of Operations. See Note 7. Fair Value of Financial Instruments for additional details and assumptions used in valuing the Weichai Warrant, as well as the 2018 and 2017 fair value adjustments.

The carrying values of the Common Stock and the Series B Convertible Preferred Stock were determined based on their relative fair values to the $39.3 million in aggregate remaining proceeds: $14.3 million was allocated to Common Stock and $25.0 million was allocated to the Series B Convertible Preferred Stock.

Deemed Dividend and Beneficial Conversion Feature

The difference between the stated proceeds related to the Common Stock and the Series B Convertible Preferred Stock of $38.7 million, pursuant to the SPA, and the net proceeds allocated to the Series B Convertible Preferred Stock based on relative fair value of $24.6 million (net of $0.4 million in transaction costs), is a discount of $14.1 million related to the Series B Convertible Preferred Stock, which was fully accreted onto the Consolidated Balance Sheet as part of the deemed dividend of $37.9 million, which was recorded in additional paid-in capital, as the Company had no retained earnings from the issuance date on March 31, 2017 until November 30, 2017, the date the Series B Convertible Preferred Stock was converted into Common Stock. The remaining portion of the deemed dividend was comprised of the $23.1 million BCF, which was recorded on the conversion date.

Additionally, the Company recorded the exercise of the conversion option by reclassifying the $62.5 million carrying value of the Series B Convertible Preferred Stock to Common Stock, par value of $0.001 per share, with the remainder to Additional paid-in capital.

Deemed dividends on Series B Convertible Preferred Stock were considered for calculations of loss per common share on in 2017. See Note 13. Loss Per Share.

The Series B Convertible Preferred Stock also included a nondetachable contingent BCF that was considered to be “in the money” and “contingently beneficial” to Weichai, the warrant holder, upon the actual exercise of the warrant, at Weichai’s option at the commitment date, March 31, 2017, as the Company’s stock price was greater than the conversion price at the commitment date.

The contingent BCF was recognized when the Series B Convertible Preferred Stock was converted into Common Stock. The carrying value for the contingent BCF was determined to be $23.1 million, based on conversion of 4,771,248 shares and a per-share value of $4.85. The contingent BCF was included in Deemed dividend on Series B Convertible Preferred Stock in the Company's Statement of Operations and Statement of Stockholders' Equity when converted in November 2017.

Weichai Collaboration Arrangement

The Company and Weichai executed a strategic collaboration agreement (the “Collaboration Agreement”) on March 20, 2017, in order to achieve their respective strategic objectives and enhance the strategic cooperation alliance to share experiences, expertise and resources. Among other things, the collaboration arrangement established a joint steering committee, permitted Weichai to second a limited number of certain technical, marketing, sales, procurement and finance personnel to work at the Company and established several collaborations, related to stationary natural-gas applications and Weichai diesel engines. The collaboration arrangement provided for the steering committee to create various sub-committees with operating roles and otherwise governs the treatment of intellectual property of parties prior to the collaboration and the intellectual property developed during the collaboration. The collaboration arrangement has a term of three years.

The Company evaluates whether an arrangement is a collaborative arrangement at its inception based on the facts and circumstances specific to the arrangement. The Company also reevaluates whether an arrangement qualifies or continues to qualify as a collaborative arrangement whenever there is a change in either the roles of the participants or the participants’ exposure to significant risks and rewards dependent on the ultimate commercial success of the endeavor. For those collaborative arrangements where it is determined that the Company is the principal participant, costs incurred and revenue generated from third parties are recorded on a gross basis in the financial statements. For the year ended December 31, 2018, sales to Weichai were insignificant. The Company purchased $3.5 million of inventory from Weichai during 2018. Sales and purchases in 2017 were insignificant.

Stockholders’ Equity

Common and Treasury Stock

The changes in shares of Common and Treasury Stock are as follows:



(in thousands)	Common Shares Issued	Treasury Stock Shares		Common Shares Outstanding
Balance as of December 31, 2016	11,567	645		10,922
Net shares issued for stock awards	—	(11	)	11
Shares issued to Weichai ^*	2,729	—		2,729
Shares converted from Series B Convertible Preferred Stock ^*	4,771	—		4,771
Balance as of December 31, 2017	19,067	634		18,433
Net shares issued for Stock awards	—	(205	)	205
Balance as of December 31, 2018	19,067	429		18,638


*	See Note 3. Weichai Transactions for additional information.

Preferred Stock

The Company is authorized to issue 5,000,000 shares of Preferred stock, par value $0.001 per share. The Preferred stock may be designated into one or more series as determined by the Board. As of December 31, 2018, the Board had authorized two series of Preferred stock. At December 31, 2018 and 2017, there were no shares of Preferred stock outstanding.

Series B Convertible Preferred Stock and Weichai Warrant

In March 2017, the Company issued 2,385,624 shares of Series B Convertible Preferred Stock to Weichai that were converted into 4,771,248 shares of the Company’s Common Stock in November 2017. On April 23, 2019, Weichai exercised the Weichai Warrant resulting in the Company issuing 4,049,759 shares of the Company’s Common Stock and Weichai becoming the owner of 51.5% of the outstanding shares of the Company’s Common Stock. See Note 3. Weichai Transactions for additional information.

Property, Plant and Equipment, and Leases

12 Months Ended

Dec. 31, 2018

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment, and Leases

Property, plant and equipment by type were as follows:



(in thousands)	As of December 31,
Property, Plant and Equipment	2018			2017
Leasehold improvements	$	6,405		$	6,320
Machinery and equipment	38,454			27,379
Construction in progress	1,241			2,036
Total property, plant and equipment, at cost	46,100			35,735
Accumulated depreciation	(21,834		)	(16,775		)
Property, plant and equipment, net	$	24,266		$	18,960

In April 2018, the Company finalized the purchase of emissions testing assets and the sublease of an emissions testing facility from Ricardo, Inc., a subsidiary of the strategic engineering and environmental consultancy, Ricardo Plc., for $5.6 million in cash. The Company accounted for the acquisition as an asset acquisition and recorded property, plant and equipment of $6.9 million, included within machinery and equipment in the table above, and an asset retirement obligation of $1.3 million as a result of the transaction. The fair value of the asset retirement obligation was estimated using Level 3 inputs. The asset retirement obligation is recorded in Other non-current liabilities in the Company’s Consolidated Balance Sheet.

Leases

The Company leases certain buildings and equipment under various non-cancelable operating leases and a capital lease. Rent expense under operating leases approximated $5.1 million and $4.7 million for 2018 and 2017, respectively. Rent expense is recorded on a straight-line basis over the period of the lease term. The Company recognized the capital lease obligation of $0.4 million and related leased equipment based on the present value of the minimum lease payments at lease inception.

The future minimum lease payments due under operating and capital leases in effect, as amended and extended, as of December 31, 2018, were as follows:



	Year Ending December 31,
(in thousands)	Operating		Capital
2019	$	5,071	$	80
2020	5,175		63
2021	4,724		67
2022	4,681		50
2023	3,104		13
2024 and beyond	3,694		—
Total	$	26,449	$	273

Goodwill and Other Intangibles

12 Months Ended

Dec. 31, 2018

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangibles

Goodwill

The carrying amount of goodwill at both December 31, 2018 and December 31, 2017 was $29.8 million. Accumulated impairment losses at both December 31, 2018 and December 31, 2017 were $11.6 million.

Other Intangible Assets

In March 2018, the Company acquired intellectual property (“IP”) from AGA Systems, LLC (“AGA”) for the conversion of certain gasoline engines to alternative fuel engines. The Company paid cash of $1.5 million ($1.0 million in 2018 and $0.5 million in 2017) to acquire the IP assets and provided a minimum guaranteed payment of an additional $1.2 million to be paid over a three-year period from the date of acquisition. If certain milestones related to future sales are met, the Company could pay up to an additional $3.3 million to AGA. The acquisition was accounted for as an asset acquisition because the gross assets acquired were concentrated within a group of similar identifiable assets. The Company recorded developed technology of $2.7 million related to the acquired IP and a liability of $1.2 million related to the guaranteed payment. The sales-based milestone payments will be recorded as they are earned and the milestones are probable of being achieved. The developed technology was being depreciated over an estimated useful life of approximately three years. In the fourth quarter of 2018, based on uncertainty of the market for the conversion of certain gasoline engines to alternative fuel engines, the Company concluded that the forecasted future cash flows were not sufficient to recover the carrying value of the assets. As a result, the Company recorded an impairment charge of $2.2 million to write off the remaining book value of the intangible assets.

Components of intangible assets are as follows:



(in thousands)	As of December 31, 2018
	Gross Carrying Value		Accumulated Amortization			Net Book Value
Customer relationships	$	34,940	$	(18,816	)	$	16,124
Developed technology	700		(537		)	163
Trade names and trademarks	1,700		(977		)	723
Total	$	37,340	$	(20,330	)	$	17,010



(in thousands)	As of December 31, 2017
	Gross Carrying Value		Accumulated Amortization			Net Book Value
Customer relationships	$	34,940	$	(14,915	)	$	20,025
Developed technology	1,000		(434		)	566
Trade names and trademarks	1,700		(800		)	900
Total	$	37,640	$	(16,149	)	$	21,491

Estimated future amortization expense for intangible assets as of December 31, 2018 is as follows:



(in thousands)
Year Ending December 31,	Estimated Amortization
2019	$	3,638
2020	3,053
2021	2,535
2022	2,124
2023	1,746
2024 and beyond	3,914
Total	$	17,010

Debt

12 Months Ended

Dec. 31, 2018

Debt Disclosure [Abstract]

Debt

The Company’s outstanding debt consisted of the following:



(in thousands)	As of December 31,
Description of Debt	2018			2017
Short-Term Debt:
Wells Fargo Revolving Credit Facility	$	54,613		$	37,055

Long-Term Debt:
Unsecured Senior Notes	$	55,000		$	55,000
Less Unamortized Debt Issuance Costs ^*	(288		)	(561		)
Total Long-Term Debt	$	54,712		$	54,439


*	Unamortized financing costs and deferred fees on the Wells Fargo Revolving Credit Facility are not presented in the above table as they are classified in Prepaid expenses and other current assets on the Consolidated Balance Sheets. Debt issuance costs incurred, including gross waiver fees (primarily paid to the lenders), were $1.0 million and $0.9 million in 2018 and 2017, respectively.

The Company paid $6.1 million and $7.8 million in cash for interest in 2018 and 2017, respectively.

The Company’s debt includes restrictive covenants that, if not met, could lead to renegotiation of its revolving credit facility, notes and indentures, a requirement to repay the Company’s borrowings and/or a significant increase in the cost of financing. These restrictive covenants may include, among other items, financial covenants pertaining to availability, permitted indebtedness, restrictions on dividends and various events of default.

Certain events of default (including delinquent filing of annual and periodic reports with the Securities and Exchange Commission (“SEC”), failure to maintain EBITDA requirements, material weaknesses in the control environment and failure to disclose litigation) occurred with respect to the Company’s credit agreements. While waivers were obtained or debt was renegotiated with the respective lenders, in particular after March 31, 2017, absent such waivers, the debt would have been in breach of covenants. The Company and its subsidiaries pledged substantially all of their tangible and intangible assets, including inventory, receivables and fixed assets, as collateral under the Wells Fargo Credit Agreement.

The schedule of remaining principal maturities of long-term debt is as follows:



(in thousands)
Year Ending December 31,	Maturities of Long-Term Debt
2019	$	—
2020	55,000
Total	$	55,000

Wells Fargo Credit Agreement

In June 2013, the Company entered into the Wells Fargo Credit Agreement. The Wells Fargo Credit Agreement enabled the Company to borrow under a revolving credit facility secured by substantially all of the Company’s tangible and intangible assets, including inventory, receivables and fixed assets. The Wells Fargo Credit Agreement has been amended several times since June 28, 2013, including in June 2016 when the agreement was amended and restated. Below are some of the current key terms of the Wells Fargo Credit Agreement:


•	Matures on the earlier of March 31, 2021 or 60 days prior to the final maturity of the Unsecured Senior Notes (which currently mature on June 30, 2020 resulting in a current maturity date of May 1, 2020 for the Wells Fargo Credit Agreement);


•	Includes a maximum $75.0 million revolving line of credit to the Company less a reserve of $9.0 million;


•	Bears interest at Wells Fargo’s prime rate plus a margin ranging from 1.25% to 1.75% per annum or at the London Interbank Offered Rate (“LIBOR”) plus a margin ranging from 2.75% to 3.25% per annum at the Company’s option;


•	Interest rate margin will decrease by 1% per annum upon the Company completing all filings required to be made with the SEC;


•	Has an unused line fee of 0.25%;


•	Contains restrictive covenants that, among other things, limit the ability of the Company and its subsidiaries to incur additional debt, prepay subordinated indebtedness, or make certain distributions on capital stock;


•	Limits borrowings to the lesser of the maximum revolving line of credit and the borrowing base, which is defined as a percentage of the Company’s eligible accounts receivable and inventory.

Information regarding amounts borrowed under the Wells Fargo Credit Agreement includes the following:



(in thousands, except interest rate)	Year ended December 31,
Description	2018			2017
Average borrowings under Wells Fargo Revolving Credit Facility	$	47,031		$	26,662
Average Interest Cost on Wells Fargo Revolving Credit Facility	6.51		%	6.85		%



(in thousands, except interest rate)	As of December 31,
Description	2018			2017
Accrued and unpaid interest	$	174		$	90
LIBOR loan interest rate	5.97		%	4.51		%
Wells Fargo Prime Rate (Base Rate) loan interest rate	7.25		%	6.00		%

As of December 31, 2018 and 2017, the Company had adjusted available borrowing capacity under the revolving line of credit of approximately $8.9 million and $13.0 million, respectively.

The most significant changes to the Wells Fargo Credit Agreement since January 1, 2017 are summarized in the table below:



Amendment Date and Title	Reason for Amendment	Significant Changes to the Wells Fargo Credit Agreement
February 10, 2017, effective as of February 6, 2017. Limited Waiver Agreement to the June 28, 2016 Agreement (“Limited Waiver”)	To consider implications of various events of default	• Provided waiver for various events of default including identified material weaknesses in internal control through February 28, 2017; • Wells Fargo reserved the right to increase the interest rate by 200 basis points (2%) effective January 27, 2017, though the interest rate was not increased; • Provided Wells Fargo with access to additional financial information including cash flow forecasts and budgets.
February 28, 2017, effective as of February 6, 2017. First Amendment to Limited Waiver	To refine provisions of Limited Waiver to June 28, 2016 Agreement	• Established minimum financial metrics related to liquidity and cash which were required to be maintained through March 3, 2017; • Extended the Limited Waiver to March 3, 2017.
March 9, 2017, effective as of February 6, 2017. Second Amendment to Limited Waiver	To refine provisions of Limited Waiver to June 28, 2016 Agreement	• Extended the Limited Waiver to March 10, 2017.
March 31, 2017, effective as of February 7, 2017. Third Amendment to Limited Waiver	To facilitate changes necessary due to Weichai SPA	• Modified certain changes in control and other definitions to permit issuance of securities to Weichai and pay off TPG Term Loan; • Increased the interest rate by 200 basis points (2%) effective April 1, 2017 until the Company’s restated 2016 audited financial statements are filed; • Reduced available borrowing under the revolving credit facility to $40.0 million (maximum borrowing amount of $65.0 million less a reserve of $25.0 million); • Deferred loan maturity date to March 31, 2018 (or February 15, 2018 if Series B Convertible Preferred Stock issued to Weichai has not converted into Common Stock); • Made certain adjustments to the borrowing base provisions to the assets against which borrowings may be made; • Permanently waived certain representations, required information and other defaults; • Extended the deadline for the Company to file delinquent SEC periodic and annual reports; • Required the Company to retain third-party adviser to assist with developing and providing certain financial data; • The Company paid an amendment fee of $0.7 million.
July 17, 2017. Fourth Amendment to the June 28, 2016 Agreement	To facilitate changes to availability, commitment fee and interest rate terms	• Increases available borrowing under the revolving credit facility to $52.5 million (maximum borrowing amount of $65.0 million less a reserve of $12.5 million); • Reduced the incremental interest rate by 100 basis points (1%) from 200 basis points (2%) until the Company’s 2016 audited financial statements have been provided.
October 3, 2017. Consent and Fifth Amendment to the June 28, 2016 Agreement	To facilitate an acquisition	• Increased available borrowing under the revolving credit facility to $58.75 million (maximum borrowing amount of $65.0 million less a reserve of $6.25 million).
March 29, 2018. Sixth Amendment and Waiver to the June 28, 2016 Agreement	To consider implications of various events of default	• Increased the maximum borrowing under the revolving credit facility to $75.0 million from $65.0 million; • Modified the reserve against the maximum borrowing under the revolving credit facility to the greater of $6.5 million and 10% of borrowing base, but no more than $7.5 million on or prior to September 30, 2018 and thereafter equal to $9.0 million; • Extended the maturity date of the facility to the earlier of March 31, 2021 or 60 days prior to the final maturity of the Unsecured Senior Notes, which were extended to January 1, 2020, resulting in a maturity date of November 2, 2019 on the Wells Fargo revolving credit facility. • The revolving credit facility will continue to bear interest at a per annum rate equal to 100 basis points (1%) above the per annum rate otherwise applicable under the credit agreement until the Company has completed all filings required to be made with the SEC; • The Company paid an amendment fee of $0.8 million.
May 16, 2019. Waiver to the June 28, 2016 Agreement	To consider implications of various events of default	• Waived any defaults that would arise from the failure to timely deliver annual audited financial statements for the fiscal year ended December 31, 2018 and the associated compliance certificate and the information required with it; provided that the financial statements and compliance certificate are delivered on or before December 31, 2019.

The aforementioned amendments, consents and waivers related to the Wells Fargo Credit Agreement in 2017 and 2018 were accounted for as debt modifications. As a result of the debt modifications, the Company accelerated the recognition of previously deferred debt issuance costs and third-party fees totaling $0.1 million in 2017. There was no accelerated recognition of deferred debt issuance costs and no third-party costs incurred in 2018. In addition, the Company incurred fees of $0.8 million and $0.7 million in 2018 and 2017, respectively, to Wells Fargo which were deferred and amortized through the anticipated maturity date of the Wells Fargo Credit Agreement.

The Wells Fargo revolving credit facility is presented as a “current liability” on the Consolidated Balance Sheets as of December 31, 2018 and 2017 because of a subjective acceleration clause and a “lockbox” arrangement that sweeps cash receipts to pay down the revolver balance, without requiring the Company’s specific consent, and provides advances up to current limits to cover outlays.

Unsecured Senior Notes

In April 2015, the Company entered into an agreement with certain institutional investors for a private sale of its Unsecured Senior Notes for the aggregate amount of $55.0 million with an interest rate of 5.50% per annum. Concurrently, in connection with the issuance of the Unsecured Senior Notes, the Company entered into an indenture agreement (“Indenture”), by and among the Company and its subsidiaries as guarantors and the Bank of New York Mellon, as Trustee. The Company received net proceeds of $53.5 million after financing costs of $1.5 million. As discussed previously in Note 1. Summary of Significant Accounting Policies and Other Information, the Company has presented issuance costs associated with its Unsecured Senior Notes as a direct deduction from the carrying value of the obligation on its Consolidated Balance Sheets.

The Unsecured Senior Notes are unsecured debt of the Company and are effectively subordinated to its existing and future secured debt, including the debt in connection with the Wells Fargo Credit Agreement. The following are some of the current key provisions of the Unsecured Senior Notes:


•	Matures on June 30, 2020;


•	Accrues interest at 8.50% per annum, payable semiannually in arrears on May 1 and November 1 of each year with a reduction in the annual interest rate to 7.50% per annum upon filing the 2017 Form 10-K (which occurred in May 2019);


•	Redeemable at the Company’s option, in whole or in part, at any time on or after May 1, 2016, together with accrued and unpaid interest to the date of redemption (expressed as percentages of the principal amount), at 101% plus a “make whole” premium as further defined in the Unsecured Senior Notes;


•	Redeemable by the holders in whole or in part upon a change in control at a purchase price of 101% of the principal amount, plus accrued and unpaid interest;


•	Contains restrictive covenants that, among other things, limit the ability of the Company and its subsidiaries to incur additional debt, prepay subordinated indebtedness, pay dividends or make other distributions on capital stock; and


•	Provides for customary events of default (subject in certain cases to customary grace and cure periods).

The most significant amendments to the Unsecured Senior Notes since January 1, 2017 are included in the table below:



Amendment Date and Title	Reason for Amendment	Significant Changes to the Unsecured Senior Notes
March 31, 2017. Third Supplemental Indenture	To facilitate the changes necessary due to the Weichai SPA	• Extended maturity date to January 1, 2019; • Amended certain provisions to permit the issuance of the securities to Weichai under the SPA, and provisions to permit ongoing transactions with an affiliate of Weichai under the Collaboration Arrangement; • Waived any defaults occurring prior to March 31, 2017 with respect to the failure to file periodic and annual reports; • Extended the deadline for the Company to file its delinquent SEC periodic and annual reports; • The Company paid a consent fee of $0.2 million and legal fees of $0.1 million.
April 19, 2018. Fourth Supplemental Indenture	To amend certain covenants and waive certain events of default	• Extended the maturity date to January 1, 2020; • Waived defaults with respect to the failure to file with the Trustee and the SEC for 2015 through 2019; • Increased the interest rate from 6.50% to 8.50% per annum effective October 1, 2018. The interest rate decreased to 7.50% per annum upon filing the 2017 Form 10-K with the SEC; • The Company paid a consent fee of $0.3 million.
October 30, 2019. Fifth Supplemental Indenture	To extend the maturity date	• Extended maturity date to June 30, 2020; • The Company paid a fee of $0.3 million.

As a result of the supplemental indenture amendments, charges of $0.1 million were incurred in 2017 related to legal fees and other third-party costs, which were expensed to Loss on debt extinguishment and modifications in the Consolidated Statement of Operations. Additional debt issuance costs of $0.3 million and $0.2 million incurred in 2018 and 2017, respectively, were deferred and amortized to interest expense through the anticipated maturity date of the Unsecured Senior Notes.

The interest rate on the Unsecured Senior Notes decreased to 7.50% per annum upon filing the 2017 Form 10-K with the SEC in May 2019. In addition, on October 30, 2019, the maturity date of the Unsecured Senior Notes was extended to June 30, 2020. By extending the maturity date of the Unsecured Senior Notes, the maturity date of the Wells Fargo Credit Agreement is extended to May 1, 2020.

The Unsecured Senior Notes are presented as a non-current liability on the Consolidated Balance Sheets. As of December 31, 2018 and 2017, the accrued, but unpaid, interest on the Unsecured Senior Notes was $0.8 million and $0.6 million, respectively.

TPG Term Loan

In June 2016, the Company entered into a $135.0 million senior secured credit facility, which consisted of a $60.0 million TPG Term Loan and a $75.0 million revolving credit facility with Wells Fargo, as discussed in the Wells Fargo Credit Agreement section above. A related “Side Letter” was also executed at the time, in which the Company agreed to meet certain borrowing limit calculations.

In February 2017, the TPG Term Loan was amended to facilitate the waiver of various events of default triggered by the resignation of the Company’s auditor and removal of the audit opinion on the Company’s 2015 and 2014 consolidated financial statements. In addition, the amendment provided TPG with the right to charge additional interest of 2.00% per annum even though the events of default had been waived and the parties agreed that the outstanding principal of the TPG Term Loan was $71.4 million which was comprised of the original principal amount of $60.0 million and $11.4 million in fees associated with amendments to the loan made in 2016. Third-party fees of $0.4 million were incurred in 2017. These costs were expensed to Loss on debt extinguishment and modifications in the Consolidated Statement of Operations.

In March 2017, the Company repaid the TPG Term Loan using the proceeds of the Weichai investment as discussed in Note 3. Weichai Transactions. In conjunction with this repayment, the Company recorded an $11.9 million (including third-party fees of $0.4 million mentioned above) loss on debt extinguishment based on the difference between the amount repaid to the lender and the net carrying value of the TPG Term Loan immediately preceding repayment, including accrued and unpaid interest. This item is reflected within Loss on debt extinguishment and modifications in the Company’s 2017 Consolidated Statement of Operations.

Fair Value of Financial Instruments

12 Months Ended

Dec. 31, 2018

Fair Value Disclosures [Abstract]

Fair Value of Financial Instruments

For assets and liabilities measured at fair value on a recurring and nonrecurring basis, a three-level hierarchy of measurements based upon observable and unobservable inputs is used to arrive at fair value. Observable inputs are developed based on market data obtained from independent sources, while unobservable inputs reflect the Company’s assumptions about valuation based on the best information available in the circumstances. Depending on the inputs, the Company classifies each fair-value measurement as follows:


•	Level 1 — based on quoted prices in active markets for identical assets or liabilities;


•	Level 2 — based on other significant observable inputs for the assets or liabilities through corroborations with market data at the measurement date; and


•	Level 3 — based on significant unobservable inputs that reflect management’s best estimate of what market participants would use to price the assets or liabilities at the measurement date.

Financial Instruments Measured at Carrying Value

Current Assets

Cash and cash equivalents are measured at carrying value, which approximates fair value because of the short-term maturities of these instruments.

Debt

The Company measures its Wells Fargo revolving credit facility and the Unsecured Senior Notes at original carrying value including accrued interest, net of unamortized deferred financing costs and fees. The fair value of the revolving credit facility approximates carrying value, as it consists of short-term variable rate loans.

The Unsecured Senior Notes were issued on April 29, 2015, and the fair-value measurement of these financial liabilities subsequent to issuance was defined as Level 3 in the three-level fair value hierarchy, as the inputs to their valuation are not all market observable.



(in thousands)	As of December 31, 2018
	Carrying Value		Fair Value
	Carrying Value		Level 1		Level 2		Level 3
Wells Fargo revolving credit facility	$	54,613	$	—	$	54,613	$	—
Unsecured Senior Notes	55,000		—		—		52,700



(in thousands)	As of December 31, 2017
	Carrying Value		Fair Value
	Carrying Value		Level 1		Level 2		Level 3
Wells Fargo revolving credit facility	$	37,055	$	—	$	37,055	$	—
Unsecured Senior Notes	55,000		—		—		50,000

Other Financial Assets and Liabilities

In addition to the methods and assumptions used for the financial instruments discussed above, accounts receivable, net, income tax receivable and accounts payable are measured at carrying value, which approximates fair value because of the short-term maturities of these instruments.

Financial Instruments Measured at Fair Value

The Company’s warrant liability was measured at fair value based on unobservable inputs and was, thus, considered a Level 3 financial instrument in the three-level valuation hierarchy.



(in thousands)	As of December 31, 2018
	Carrying Value		Fair Value
	Carrying Value		Level 1		Level 2		Level 3
Weichai Warrant liability	$	35,100	$	—	$	—	$	35,100



(in thousands)	As of December 31, 2017
	Carrying Value		Fair Value
	Carrying Value		Level 1		Level 2		Level 3
Weichai Warrant liability	$	24,700	$	—	$	—	$	24,700

Warrants

The following table summarizes changes in the estimated fair value of the Company’s warrant liability:



(in thousands)	As of December 31,
	2018		2017
Balance at beginning of year	$	24,700	$	—
Issuance of warrants	—		20,700
Increase in value^*	10,400		4,000
Balance at end of year	$	35,100	$	24,700


*	Loss related to the change in fair value of the warrant liability for each year is presented in Loss from change in fair value of warrants in the Company’s Consolidated Statements of Operations.

Weichai Warrant Liability

The Company estimated the fair value of the Weichai Warrant financial instrument using a publicly traded stock pricing approach with a Black-Scholes option pricing model and a Monte Carlo simulation. Given the unobservable nature of the inputs to the pricing models, the Weichai Warrant was classified as a Level 3 instrument.

The inputs of the Black-Scholes option pricing model were as follows:



Assumptions	As of December 31,
Assumptions	2018			2017
Market value of the Common Stock	$	9.25		$	7.50
Exercise price	varies			varies
Risk-free interest rate	2.6		%	1.8		%
Estimated price volatility	55.0		%	95.0		%
Contractual term	0.5 years			1.0 year
Dividend yield	—			—

The estimated price volatility represents the upper end of the range of implied volatility of publicly traded call options of benchmark companies.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Defined Contribution Plans	12 Months Ended
Defined Contribution Plans	Dec. 31, 2018
Retirement Benefits [Abstract]
Defined Contribution Plans	Defined Contribution Plans During 2017, the Company had two defined contribution plans for the benefit of its employees meeting certain eligibility requirements. Under the plans, participants could choose from various investment options and could contribute an amount of their eligible compensation annually as defined by the applicable plan documents, subject to Internal Revenue Service (“IRS”) limitations. The Company contributed $0.1 million to these plans in 2017. Subsequent to December 31, 2017, the Company merged its defined contribution plans into a single plan, sponsored by the Company, with the final merger effective December 1, 2018. As of December 31, 2018, the Company had not contributed to the plans and recorded a liability of $0.7 million for 2018 contributions.

Commitments and Contingencies

12 Months Ended

Dec. 31, 2018

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Legal Contingencies

The legal matters discussed below and others could result in losses, including damages, fines, civil penalties and criminal charges, which could be substantial. The Company records accruals for these contingencies to the extent the Company concludes that a loss is both probable and reasonably estimable. The Company also records an accrual for legal fees related to these contingencies. Regarding the matters disclosed below, unless otherwise disclosed, the Company has determined that liabilities associated with these legal matters are reasonably possible; however, unless otherwise stated, the liabilities cannot be reasonably estimated. Given the nature of the litigation and investigations and the complexities involved, the Company is unable to reasonably estimate a possible loss for all such matters until the Company knows, among other factors:


•	What claims, if any, will survive dispositive motion practice;


•	The extent of the claims, particularly when damages are not specified or are indeterminate;


•	How the discovery process will affect the litigation;


•	The settlement posture of the other parties to the litigation; and


•	Any other factors that may have a material effect on the litigation or investigation.

However, the Company could incur judgments, enter into settlements or revise its expectations regarding the outcome of certain matters, and such developments could have a material adverse effect on the Company’s results of operations in the period in which the amounts are accrued and/or liquidity in the period in which the amounts are paid.

Carl Trent, Kenneth Trent, and CKT Holdings, Inc. vs. 3PI and the Company

In October 2014, Carl Trent and Kenneth Trent (the “Trents”) filed a complaint in Circuit Court in Walworth County, Wisconsin against the Company and its subsidiary, 3PI, asserting that the Company breached their employment contracts and seeking declaratory judgment with regard to the stock purchase agreement entered into by and between the Company and the Trents in April 2014 relating to the Company’s acquisition of 3PI. As part of the Trents’ claim for breach of their employment agreements, they sought damages of between $0.5 million and $1.0 million. As part of the Trents’ claim for declaratory judgment, the Trents sought judgment against the Company obligating the Company to calculate and issue certain accelerated payments and an earnout described in the stock purchase agreement.

In April 2015, together with 3PI, the Company filed an amended answer and affirmative defenses to the complaint, along with a counterclaim against the Trents alleging that they had breached their employment contracts, fraudulently induced the Company to enter into the employment agreements, breached their fiduciary duties, converted 3PI property and confidential business information, conspired to interfere with and steal 3PI’s confidential and proprietary business information and misappropriated trade secrets belonging to 3PI. By way of the counterclaim, the Company and 3PI sought compensatory damages in the amount of $20.0 million, consequential damages, punitive damages in excess of $20.0 million and also an injunction prohibiting the Trents from continuing to retain 3PI’s confidential business information and other equitable relief.

In June 2016, the Trents amended their complaint to additionally allege that the Company and 3PI breached the stock purchase agreement by failing to maintain the assets and properties of 3PI in good working order and condition, failed to operate 3PI in good faith, took actions to reduce 3PI’s EBITDA used in connection with determining the number of shares issuable to the Trents as part of the earn-out described in the stock purchase agreement, and failed to make a tax gross-up payment to the Trents as mandated by the stock purchase agreement. The Trents sought additional damages for these alleged breaches in the amount of $0.35 million for the tax gross-up payment and $9.3 million for the equity payment under the stock purchase agreement.

In June 2017, the Company settled this matter for $3.0 million in return for full and final mutual releases of all claims, predicated on the Company making a payment of $1.75 million on June 30, 2017 and the remaining $1.25 million in 12 equal monthly installment payments with the final payment being made in June 2018.

Securities and Exchange Commission and United States Attorney’s Office for the Northern District of Illinois Investigations

The Chicago Regional Office of the SEC has been conducting an investigation focused on, among other things, the Company’s financial reporting, misapplication of U.S. GAAP, revenue recognition practices and related conduct, which resulted in the accounting errors giving rise to the financial restatements reported in prior SEC filings. The United States Attorney's Office for the Northern District of Illinois (the “USAO”) also is conducting a parallel investigation regarding these matters. The Company is fully cooperating with the SEC and the USAO in their investigations. The Company is engaged in ongoing discussions with the SEC and the USAO regarding resolutions of these matters, however, at this time the Company is unable to predict the ultimate outcome of these matters. If the SEC or the USAO determines that the Company violated federal securities or other laws and institutes civil enforcement or criminal proceedings, the Company may become subject to civil or criminal sanctions, including, but not limited to, criminal or civil charges, fines, other monetary penalties, injunctive relief and compliance conditions imposed by a court or agreement, which may have a material adverse effect on the financial condition, results of operations or cash flows of the Company.

Securities Litigation

In August 2016, Sumit Gupta filed a putative stockholder class-action complaint against the Company, Gary S. Winemaster, Michael P. Lewis and Daniel P. Gorey in the U.S. District Court for the Northern District of Illinois (the “Gupta Action”). The complaint alleged violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, arising from public filings made between May 2015 and August 2016. In October 2016, Peter Stout initiated a second suit, asserting similar claims against the same defendants (the “Stout Action”).

In January 2017, the Court consolidated the Gupta Action and the Stout Action and appointed Richard Giunta as lead plaintiff. The consolidated case is captioned Giunta v. Power Solutions International, Inc., No. 1:16-cv-09599 (N.D. Ill.) (the “Giunta Action”). The plaintiffs then filed an Amended Class Action Complaint (the “Amended Complaint”) against the Company and certain current and former officers and directors. The Amended Complaint alleges violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 arising from public filings, press releases and conference calls between February 2014 and February 2017. In January 2019, the parties executed a Stipulation and Agreement of Settlement (the “Settlement”) to resolve the Giunta Action. Under the terms of the Settlement, a payment of $8.5 million would be made by the Company and/or its insurers in exchange for the release of claims against the defendants and other released parties by the lead plaintiff and all settlement class members and for the dismissal of the Giunta Action with prejudice. The payment of the $8.5 million was made by the Company’s insurers in February 2019. In May 2019, the court granted final approval of the settlement. The Company accrued for the settlement in Other accrued liabilities and for the full insurance recovery of the settlement amount in Prepaid expenses and other current assets as of December 31, 2018. See Note 1. Summary of Significant Accounting Policies and Other Information for additional information related to the Company’s insurance proceeds receivable and litigation reserves. No further action or impact to the Company’s results of operations, financial condition or cash flows is expected.

Federal Derivative Litigation

In February 2017, Travis Dorvit filed a putative stockholder derivative action in the U.S. District Court for the Northern District of Illinois, captioned Dorvit v. Winemaster, et al., No. 1:17-cv-01097 (N.D. Ill.) (the “Dorvit Action”), against certain of the Company’s current and former officers and directors. The complaint asserted claims for breach of fiduciary duty and unjust enrichment arising from the same matters at issue in the Giunta Action. In April 2018, Michael Martin filed a second putative stockholder derivative action, captioned Martin v. Winemaster, et al., No. 18-CV-2386 (N.D. Ill.) (the “Martin Action”), in the same court against certain of the Company’s current and former officers and directors. In July 2018, the court consolidated the Martin Action and the Dorvit Action.

In July 2018, the plaintiffs in the consolidated Dorvit and Martin Actions filed an amended consolidated complaint (the “Second Amended Complaint”) against certain of the Company’s current and former officers and directors, who are indemnified by the Company as to their legal fees and defense costs. The Second Amended Complaint asserts claims for breach of fiduciary duty, unjust enrichment, corporate waste and failure to hold an annual stockholders’ meeting, and it seeks an unspecified amount of damages, an order compelling the Company to hold an annual stockholders’ meeting and an award of costs, including reasonable attorneys’ fees and expenses. In April 2019, the parties reached an agreement in principle to settle the litigation for approximately $1.9 million (“Settlement Amount”), half of which will be used to pay certain defense costs on behalf of the Company, and the remaining half of which the plaintiffs sought as an award of their attorney’s fees and expenses in connection with the benefit conferred by the settlement. The settlement was approved by the court in August 2019 over two objections, including from the plaintiffs in the McClenney Action (defined below). Plaintiffs in the McClenney Action have appealed the court’s order approving the settlement and their opening brief was filed in November 2019. The Company’s response brief was filed on December 19, 2019. The Plaintiff's reply brief is currently due on January 9, 2020. The Company’s insurers made a payment of half of the Settlement Amount in September 2019 toward the fulfillment of the plaintiff’s award of attorney’s fees and expenses, and the insurers have allocated the remaining half of the Settlement Amount toward the payment of certain defense costs consistent with the terms of the settlement. The Company had accrued for the settlement in Other accrued liabilities and for the full insurance recovery of the Settlement Amount in Prepaid expenses and other current assets as of December 31, 2018. If the order approving the settlement is affirmed on appeal, the settlement would not have a material impact on the Company’s results of operations, financial condition or cash flows.

State Derivative Litigation

In May 2017, Lewis McClenney filed a putative stockholder derivative action in the Chancery Division of the Circuit Court of Cook County, Illinois, captioned McClenney v. Winemaster, et al., No. 2017-CH-06481 (the “McClenney Action”), against certain of the Company’s current and former officers and directors. The McClenney Action asserted claims for breach of fiduciary duty, unjust enrichment, abuse of control, gross mismanagement and corporate waste arising from the same matters at issue in the Giunta Action. On the same day that the McClenney Action was filed, Sara Rebscher also filed a putative stockholder derivative action in the same court, captioned Rebscher v. Winemaster, et al., No. 2017-CH-06517 (the “Rebscher Action”). The Rebscher Action asserts claims for breach of fiduciary duty and unjust enrichment against certain of the Company’s current and former officers and directors, arising from the same matters at issue in the Giunta Action. Additionally, the complaint in the Rebscher Action asserts a claim for professional negligence and accounting malpractice against the Company’s former auditor, RSM U.S. LLP (“RSM”). In July 2017, the court consolidated the McClenney Action and the Rebscher Action. Subsequently, the court appointed Rebscher as lead plaintiff and designated the Rebscher Action as the operative complaint. In November 2018, the court granted the Company’s motion to dismiss the consolidated case with prejudice on the grounds that it is duplicative of the Dorvit and Martin Actions. Plaintiffs moved for reconsideration of the Court’s decision, which the Court denied in January 2019. In February 2019, plaintiffs filed a notice of appeal from the Court’s order dismissing the case. On December 20, 2019, the Illinois Appellate Court affirmed the dismissal of the McClenney Action. Plaintiffs have until January 10, 2020 to seek rehearing in the Illinois Appellate Court and, assuming Plaintiffs do not seek rehearing, until January 24, 2020 to petition for leave to appeal to the Illinois Supreme Court. If the settlement of the consolidated Dorvit and Martin Actions is affirmed on appeal by the federal appellate court, the settlement will release the claims alleged by Rebscher against the Company and its current and former officers and directors.

Eric Cohen vs. The Company

In May 2016, the Company announced that Eric A. Cohen would no longer serve as its Chief Operating Officer effective as of the close of business May 16, 2016, and that he had left the Company. In November 2016, Mr. Cohen filed an administrative charge with the U.S. Department of Labor, and in June 2017, Mr. Cohen filed a complaint against the Company in the U.S. District Court for the Northern District of Illinois alleging statutory violations of the Sarbanes-Oxley Act of 2002, the Dodd-Frank Wall Street Reform and Consumer Protection Act (“DFA”), and the Illinois Whistleblower Act, common-law claims of retaliatory discharge and fraudulent inducement and a claim for breach of his employment agreement and Stock Appreciation Rights agreements. Due to Mr. Cohen electing to proceed with his case in federal court rather than before the Secretary of Labor, his administrative charge with the U.S. Department of Labor was dismissed in July 2017.

In November 2017, the Company filed a motion for partial judgment on the pleadings seeking to dismiss Mr. Cohen’s DFA claim and his retaliatory-discharge claim. After the parties fully briefed this motion, the U.S. Supreme Court issued a conclusive decision regarding the DFA in Digital Realty Trust, Inc. v. Somers. As a result, Cohen withdrew his opposition to the Company’s motion regarding the DFA claim (Count II), and the court granted judgment in favor of the Company regarding Count II. In April 2018, the court also granted judgment on the pleadings in the Company’s favor with regard to Cohen’s common-law claim for retaliatory discharge (Count IV). In September 2019, the Company settled the remaining claims for $3.0 million which was paid by the Company’s insurers. The Company accrued for the settlement in Other accrued liabilities and for the full insurance recovery of the settlement amount in Prepaid expenses and other current assets as of December 31, 2018.

Jerome Treadwell v. The Company

In October 2018, a putative class-action complaint was filed against the Company and NOVAtime Technology, Inc. (“NOVAtime”) in the Circuit Court of Cook County, Illinois. In December 2018, NOVAtime removed the case to the U.S. District Court for the Northern District of Illinois, Eastern Division under the Class Action Fairness Act. Plaintiff has since voluntarily dismissed NOVAtime from the lawsuit without prejudice and filed an amended complaint in April 2019. The operative, amended complaint asserts violations of the Illinois Biometric Information Privacy Act (“BIPA”) in connection with employees’ use of the time clock to clock in and clock out using a finger scan and seeks statutory damages, attorneys’ fees, and injunctive and equitable relief. An aggrieved party under BIPA may recover (i) $1,000 per violation if the Company is found to have negligently violated BIPA or (ii) $5,000 per violation if the Company is found to have intentionally or recklessly violated BIPA plus reasonable attorneys’ fees. In May 2019, the Company filed its motion to dismiss the Plaintiff’s amended complaint. On December 16, 2019, the court denied the Company’s motion to dismiss. The Company intends to vigorously defend against this action. At this time, the Company is unable to predict the outcome of this matter or meaningfully quantify how the final resolution of this matter may impact its results of operations, financial condition or cash flows.

Other Commitments

Letters of Credit

At December 31, 2018, the Company had five outstanding letters of credit totaling $1.6 million.

Guaranteed Minimum Commission Payment

As a result of the AGA asset acquisition discussed in Note 5. Goodwill and Other Intangibles, the Company agreed to make quarterly commission payments to the former owners with a guaranteed minimum commission payment of $1.2 million. At December 31, 2018, $1.0 million remained outstanding related to the guaranteed minimum commission payment.

Income Taxes

12 Months Ended

Dec. 31, 2018

Income Tax Disclosure [Abstract]

Income Taxes

Income tax expense was as follows:



(in thousands)	For the Year Ended December 31,
	2018			2017
Current tax expense
Federal	$	198		$	127
State	27			77
Total current tax expense	$	225		$	204

Deferred tax (benefit) expense
Federal	(149		)	$	100
State	93			139
Total deferred tax (benefit) expense	(56		)	239
Total tax expense	$	169		$	443

The Company received net cash refunds for income taxes of $0.2 million and $6.3 million in 2018 and 2017, respectively.

A reconciliation between the Company’s effective tax rate on loss before income taxes and the statutory tax rate is as follows:



(in thousands)	For the Year Ended December 31,
	2018					2017
	Amount			Percent		Amount			Percent
Income tax benefit at federal statutory rate	$	(11,457	)	21.0	%	$	(16,037	)	34.0	%
State income tax benefit, net of federal tax effect	(1,762		)	3.2	%	(2,283		)	4.8	%
Non-deductible warrants expense	2,184			(4.0	)%	1,360			(2.9	)%
Other permanent differences	70			(0.1	)%	106			(0.2	)%
Research and development tax credits	(1,058		)	1.9	%	(426		)	0.9	%
Other tax credits	(934		)	1.7	%	(419		)	0.9	%
Tax reserve reassessment	196			(0.4	)%	104			(0.2	)%
Federal tax rate change	—			—	%	10,899			(23.1	)%
Change in valuation allowance	12,856			(23.5	)%	4,956			(10.4	)%
3PI Settlement	—			—	%	1,976			(4.2	)%
Other, net	74			(0.1	)%	207			(0.5	)%
Income tax expense	$	169		(0.3	)%	$	443		(0.9	)%

For the year ended December 31, 2018, the Company recognized a pretax loss of $54.6 million, which included $10.4 million of permanently excludable loss associated with the change in the valuation of the Weichai Warrant. For the year ended December 31, 2017, the Company recognized a pretax loss of $47.2 million, which included $4.0 million of permanently excludable loss associated with the change in the valuation of the Weichai Warrant.

On December 22, 2017, the President of the United States signed the Tax Act, which made broad and complex changes to the U.S. Tax Code, including, but not limited to, (i) reducing the U.S. federal corporate income tax rate from 34 percent to 21 percent, (ii) requiring companies to pay a one-time transitional tax on certain un-repatriated earnings of foreign subsidiaries, (iii) generally eliminating U.S. federal income tax on dividends from foreign subsidiaries of U.S. corporations, (iv) repealing the domestic production activity deduction, (v) providing for the full expensing of qualified property, (vi) adding a new provision designed to tax global intangible low-taxed income (“GILTI”), (vii) revising the limitation imposed on deductions for executive compensation paid by publicly traded companies, (viii) eliminating the corporate alternative minimum tax (“AMT”) and changing how existing AMT credits can be utilized, (ix) creating a base erosion-anti-abuse tax (“BEAT”), a new minimum tax on payments made by certain U.S. corporations to related foreign parties, (x) imposing a new limitation on the deductibility of interest expense, (xi) allowing for a deduction related to foreign-derived intangible income (“FDII”) and (xii) changing the rules related to the uses and limitations of net operating loss carryforwards generated in tax years beginning after December 31, 2017.

The Company calculated the impact of the Tax Act in accordance with its understanding of the act and guidance available as of December 31, 2017, and, as a result, recorded $10.9 million as additional income tax expense, offset with an $11.3 million tax benefit from the change in the valuation allowance in the fourth quarter of 2017, the period in which the legislation was enacted.

The Company generates R&D tax credits as a result of its R&D activities, which reduce the Company’s effective income tax rate. In general, these credits are general business credits and may be carried forward up to 20 years to be offset against future taxable income.

Significant components of deferred income tax assets and liabilities consisted of the following:



(in thousands)	As of December 31,
	2018			2017
Deferred tax assets:
Net operating loss carryforwards	$	19,006		$	15,399
Research and development credits	3,858			2,806
Other state credits	1,923			989
Inventory	2,203			2,560
Allowances and bad debts	840			596
Accrued warranty	5,732			3,387
Accrued wages and benefits	413			351
Other accrued expenses	5,281			2,906
Stock-based compensation	649			645
Capitalized research and development costs	770			1,090
Intangible amortization	2,240			1,734
Contract liabilities (deferred revenue)	495			339
Other	2,490			152
Total deferred tax assets	45,900			32,954
Valuation allowance	(44,405		)	(31,992		)
Total deferred tax assets, net of valuation allowance	$	1,495		$	962

Deferred tax liabilities:
Tax depreciation in excess of book depreciation on property, plant and equipment	(2,142		)	(1,665		)
Total deferred tax liabilities	$	(2,142	)	$	(1,665	)

Net deferred tax liability	$	(647	)	$	(703	)

The Company’s net deferred tax liability is presented as a separate line item in the Consolidated Balance Sheets.

In preparing the Consolidated Statements of Operations, the Company has assessed the likelihood that its deferred income tax assets will be realized from future taxable income. In evaluating the ability to recover its deferred income tax assets, the Company considers all available evidence, positive and negative, including the Company’s operating results, ongoing tax planning and forecasts of future taxable income on a jurisdiction-by-jurisdiction basis. A valuation allowance is established if it is determined that it is more likely than not that some portion or all of the net deferred income tax assets will not be realized. The Company exercises significant judgment in determining its income tax expense, its deferred income tax assets and liabilities, and its future taxable income for purposes of assessing its ability to utilize any future tax benefit from its deferred income tax assets.

Although the Company believes that its tax estimates are reasonable, the ultimate tax determination involves significant judgments that could become subject to audit by tax authorities in the ordinary course of business. As of each reporting date, the Company considers new evidence, both positive and negative, that could impact the Company’s view with regard to future realization of deferred tax assets.

During the second quarter of 2016, the Company considered both the positive and the negative evidence available in order to assess the realizability of its deferred tax assets. As a result of this evaluation, the Company concluded that the negative evidence outweighed the positive evidence and recorded a full valuation allowance of $17.8 million against its net deferred tax assets. The Company continues to maintain a full valuation allowance of $44.4 million and $32.0 million on its deferred tax assets as of December 31, 2018 and 2017, respectively. The Company’s net deferred tax liability of $0.6 million and $0.7 million as of December 31, 2018 and 2017, respectively, represents the deferred tax liability related to indefinite-lived assets which cannot serve as a source of income for the realization of deferred tax assets.

As of December 31, 2018, the Company has, on a tax-effected basis, $5.8 million in R&D and state tax credit carryforwards which begin to expire in 2020. The Company has $13.6 million and $5.4 million of federal and state (tax effected, net of federal tax benefit) that are available to offset taxable income in the future. The federal and state net operating loss carryforwards begin to expire in 2037 and 2026, respectively. As of December 31, 2018, there was no annual limitation on the Company’s ability to use U.S. federal net operating losses to reduce future income taxes. However, the Company may be subject to substantial annual limitations provided by the Internal Revenue Code (the “IRC”) if an “ownership change,” as defined in Section 382 of the IRC, occurs with respect to the Company’s capital stock. On April 23, 2019, Weichai exercised the Weichai Warrant resulting in the Company issuing 4.0 million shares of the Company’s Common Stock and Weichai becoming the owner of 51.5% of the outstanding shares of the Company's Common Stock. The Company believes that this will constitute an “ownership change” as defined in Section 382 of the IRC and is currently quantifying the potential impact.

The change in unrecognized tax benefits excluding interest and penalties were as follows:



(in thousands)	For the Year Ended December 31,
	2018			2017
Balance at beginning of year	$	1,307		$	1,202
Additions based on tax positions related to the current year	193			105
Reductions for tax positions of prior years	(79		)	—
Balance at end of year	$	1,421		$	1,307

The Company recognizes interest and penalties related to unrecognized tax benefits in Income tax expense. As of December 31, 2018 and 2017, the amount accrued for interest and penalties was not material. The Company reflects the liability for unrecognized tax benefits as Other noncurrent liabilities in its Consolidated Balance Sheets. The amounts included in "reductions for tax positions of prior years" represent decreases in the unrecognized tax benefits relating to settlements reached with taxing authorities during each year shown.

As of December 31, 2018, the Company believes the liability for unrecognized tax benefits, excluding interest and penalties, could decrease by $0.1 million in 2019 due to lapses in the statute of limitations. Due to the various jurisdictions in which the Company files tax returns, it is possible that there could be other significant changes in the amount of unrecognized tax benefits in 2019, but the amount cannot be estimated.

With few exceptions, the major jurisdictions subject to examination by the relevant tax authorities and open tax years, stated as the Company’s fiscal years, are as follows:



Jurisdiction	Open Tax Years
U.S. Federal	2014	-	2018
U.S. States	2013	-	2018

The Company is currently under federal income tax audit for tax years 2014, 2015 and 2016. The Company is currently under Illinois income tax audit for tax years 2013 and 2014.

Stockholders' Equity

12 Months Ended

Dec. 31, 2018

Equity [Abstract]

Stockholders' Equity

Weichai Transactions


•	2,728,752 shares of Common Stock;


•	2,385,624 shares of Series B Redeemable Convertible Preferred Stock (“Series B Convertible Preferred Stock”) convertible on a two-for-one basis into 4,771,248 shares of Common Stock; and


•	The Weichai Warrant as discussed further below.

Series B Convertible Preferred Stock

Weichai Warrant

Valuation and Accounting for Issuance and Conversion to Common Stock, Series B Convertible Preferred Stock (and Related Beneficial Conversion Feature) and Weichai Warrant

Deemed Dividend and Beneficial Conversion Feature

Deemed dividends on Series B Convertible Preferred Stock were considered for calculations of loss per common share on in 2017. See Note 13. Loss Per Share.

Weichai Collaboration Arrangement

Stockholders’ Equity

Common and Treasury Stock

The changes in shares of Common and Treasury Stock are as follows:



(in thousands)	Common Shares Issued	Treasury Stock Shares		Common Shares Outstanding
Balance as of December 31, 2016	11,567	645		10,922
Net shares issued for stock awards	—	(11	)	11
Shares issued to Weichai ^*	2,729	—		2,729
Shares converted from Series B Convertible Preferred Stock ^*	4,771	—		4,771
Balance as of December 31, 2017	19,067	634		18,433
Net shares issued for Stock awards	—	(205	)	205
Balance as of December 31, 2018	19,067	429		18,638


*	See Note 3. Weichai Transactions for additional information.

Preferred Stock

Series B Convertible Preferred Stock and Weichai Warrant

Stock-Based Compensation

12 Months Ended

Dec. 31, 2018

Share-based Payment Arrangement [Abstract]

Stock-Based Compensation

The Company has an incentive compensation plan (the “2012 Plan”), which authorizes the granting of a variety of different types of awards including, but not limited to, non-qualified stock options, incentive stock options, Stock Appreciation Rights (“SARs”), Restricted Stock Awards (“RSAs”), deferred stock and performance units to its executive officers, employees, consultants and Directors. The 2012 Plan is administered by the Compensation Committee of the Board.

Under the 2012 Plan, 830,925 shares were initially made available for awards, with 700,000 additional shares added to the 2012 Plan in 2013. Forfeited shares are added back to the pool of shares available for future awards.

As of December 31, 2018, the Company had 495,558 shares available for issuance of future awards.

SAR Award Agreements

SAR awards entitle the recipients to receive, upon exercise, a number of shares of Common Stock equal to (i) the number of shares for which the SAR is being exercised multiplied by the value of one share of Common Stock on the date of exercise (determined as provided in the SAR award agreement), less (ii) the number of shares for which the SAR is being exercised multiplied by the applicable exercise price, divided by (iii) the value of one share of Common Stock on the date of exercise (determined as provided in the SAR award agreement). The exercised SAR is to be settled only in whole shares of Common Stock, and the value of any fractional share of Common Stock is forfeited.

For all SAR award assumptions, the Company used rates on the grant date of zero-coupon government bonds with maturities over periods covering the term of the awards. The Company considered the historical volatility of its stock price over a term similar to the expected life of the awards in determining expected volatility. The expected term is the period that the awards granted are expected to remain outstanding. The Company has never declared or paid a cash dividend on its Common Stock and has no plans to pay cash dividends in the foreseeable future.

SAR Awards

In 2017, the Company granted 5,000 SAR awards. The assumptions used for valuing the 2017 SARs included the following:



Assumptions	2017 SARs
Market closing price of the Common Stock	$	7.37
Exercise price	$	7.37
Risk-free interest rate	2.1		%
Estimated price volatility	58.5		%
Expected term	6.00 years
Dividend yield	—		%

The resulting fair value was $4.10 per underlying share. The SAR awards vest ratably over 2 years, with half of the shares becoming exercisable on each of the first two anniversaries of the grant. In 2018 and 2017, the Company recognized an immaterial amount of compensation expense related to the 2017 SAR awards.

In 2018, the Company granted 60,000 SAR awards. The assumptions used for valuing the 2018 SARs included the following:



Assumptions	2018 SARs
Market closing price of the Common Stock	$	7.92
Exercise price	$	7.92
Risk-free interest rate	2.6		%
Estimated price volatility	78.5		%
Expected term	6.58 years
Dividend yield	—		%

The resulting fair value was $5.63 per underlying share. The SAR awards vest over 3.17 years. In 2018, the Company recognized $0.1 million of compensation expense related to the 2018 SAR awards.

SAR activity consisted of the following:



Number of Shares under SARs	Shares		Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Term (years)	Aggregate Intrinsic Value (in thousands)
Outstanding at December 31, 2016	152,600		$	16.55	9.02	$	—
Granted	5,000		7.37			—
Exercised	—		—			—
Forfeited	(67,130	)	23.16			—
Expired	(6,750	)	12.68			—
Outstanding at December 31, 2017	83,720		11.02		8.21	1
Exercisable at December 31, 2017	39,360		$	11.25	8.15	$	—



Number of Shares under SARs	Shares		Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Term (years)	Aggregate Intrinsic Value (in thousands)
Outstanding at December 31, 2017	83,720		$	11.02	8.21	$	1
Granted	60,000		7.92			—
Exercised	—		—			—
Forfeited	(1,000	)	11.25			—
Expired	(4,700	)	11.25			—
Outstanding at December 31, 2018	138,020		9.66		8.05	89
Exercisable at December 31, 2018	87,370		$	11.14	6.21	$	5

Restricted Stock Awards

RSA grants represent Common Stock issued subject to forfeiture or other restrictions that will lapse upon satisfaction of specified conditions. RSAs are valued based on the fair value of the Common stock at grant date, with compensation expense for recipients recognized over the vesting period based on the date of the award, primarily recognized in Selling, general and administrative expenses.

Restricted stock activity consisted of the following:



	Shares		Weighted-Average Grant Date Fair Value
December 31, 2016	104,340		$	41.61
Granted	437,472		8.13
Forfeited	(29,144	)	38.33
Vested	(16,395	)	44.19
December 31, 2017	496,273		$	12.20
Granted	50,000		10.92
Forfeited	(32,547	)	25.95
Vested	(254,440	)	10.14
Balance as of December 31, 2018	259,286		$	12.25

In 2018 and 2017, the Company recognized $2.5 million and $1.4 million, respectively, of compensation expense, net of forfeitures, in connection with the RSAs. The original grant date fair value of restricted stock that vested during 2018 and 2017 was $2.6 million and $0.7 million, respectively. Unrecognized compensation expense related to RSAs as of December 31, 2018 and 2017 was $1.7 million and $4.6 million, respectively. As of December 31, 2018, the weighted-average period over which the unrecognized compensation cost is expected to be recognized was approximately two years.

2017 Retention Program

The RSA information above includes retention awards granted in July 2017. As part of the Company’s efforts to retain certain employees, 379,472 RSAs with a total value of $2.9 million were granted along with $3.3 million of cash awards. Half of the shares granted vested in March 2018, and the second half vested in March 2019. Half of the cash awards were paid in quarterly installments commencing in July 2017, with the remaining half paid in 2019.

Other Equity Award

In 2012, the Company entered into an employment agreement that included an award of $0.5 million of restricted stock with a put option for the recipient to have the Company repurchase the related restricted stock for $2.0 million upon vesting at December 31, 2020. In the first quarter of 2017, the award was forfeited, and $1.0 million of previously recognized expense was reversed.

Loss Per Share

12 Months Ended

Dec. 31, 2018

Earnings Per Share [Abstract]

Loss Per Share

The Company computes basic loss per share by dividing Net loss available to common stockholders by the weighted-average common shares outstanding during the year. Diluted loss per share is calculated to give effect to all potentially dilutive common shares that were outstanding during the year. Weighted-average diluted common shares outstanding primarily reflect the additional shares that would be issued upon the assumed exercise of stock options and the assumed vesting of unvested share awards. The treasury stock method has been used to compute diluted EPS for 2018 and 2017. For 2017, the Company recognized deemed dividends on the Series B Convertible Preferred Stock issued to Weichai and subsequently converted to Common Stock.

The Company issued warrants that represent the right to purchase shares of Common Stock, SARs and RSAs, all of which have been evaluated for their potentially dilutive effect under the treasury stock method. See Note 3. Weichai Transactions for additional information on the Weichai Warrants and Note 12. Stock-Based Compensation for additional information on the SARs and the RSAs.

The computations of basic and diluted loss per share are as follows:



(in thousands, except per share basis)	For the Year Ended December 31,
	2018			2017
Numerator:
Net loss	$	(54,726	)	$	(47,612	)
Less: Deemed dividend on Series B convertible preferred stock	—			(37,860		)
Net loss available to common stockholders - basic and diluted	$	(54,726	)	$	(85,472	)

Denominator:
Shares used in computing net loss per share:
Weighted-average basic shares outstanding	18,585			13,787
Effect of dilutive securities	—			—
Weighted-average common shares outstanding — diluted	18,585			13,787

Loss per common share:
Loss per share of common stock - basic	$	(2.94	)	$	(6.20	)
Loss per share of common stock - diluted	$	(2.94	)	$	(6.20	)

For 2018 and 2017, SAR and RSA grants were not included in the diluted loss per share calculation, as they would have been anti-dilutive due to the losses reported in the Consolidated Statements of Operations. Additionally, for all periods, certain SAR grants were excluded from the diluted loss per share calculation, as the Company’s average stock price was less than their respective exercise prices.

For 2018 and 2017, the Weichai Warrant and, for 2017, the Series B Convertible Preferred Stock were excluded from the diluted loss per share calculation, as they would have been anti-dilutive.

The aggregate shares excluded from the diluted loss per share calculations, as they would have been anti-dilutive, were 3.9 million and 6.3 million shares in 2018 and 2017, respectively.

Related Party Transactions	12 Months Ended
Related Party Transactions	Dec. 31, 2018
Related Party Transactions [Abstract]
Related Party Transactions	Related Party Transactions Weichai Transactions See Note 3. Weichai Transactions for information regarding the Weichai SPA and Collaboration Agreement. Transactions with Joint Ventures MAT-PSI Holdings, LLC In December 2012, the Company and MAT Holdings, Inc. (“MAT”) entered into an agreement to create MAT-PSI Holdings, LLC (“MAT-PSI”), which was intended to be a holding company of its 100% Chinese wholly-owned foreign entity, referred to as Green Power. The Company invested $0.9 million for its 50% share of MAT-PSI, which was formed to manufacture, assemble and supply natural gas, gas and alternative-fueled power systems to Chinese and Asian forklift customers. The venture established a production facility in Dalian and also sourced base engines from a local Chinese factory. As MAT-PSI was not profitable, the venture was closed in 2017. The Company’s investment was accounted for under the equity method of accounting. Doosan-PSI, LLC In 2015, the Company and Doosan Infracore Co., Ltd. (“Doosan”), a subsidiary of Doosan Group, entered into an agreement to form Doosan-PSI, LLC. The Company invested $1.0 million to acquire 50% of the venture, which was formed to operate in the field of developing, designing, testing, manufacturing, assembling, branding, marketing, selling, distributing and providing support for industrial gas engines and all components and materials required for assembly of the gas engines to the global power generation market outside of North America and South Korea. Sterling and Wilson Cogen Solutions, LLC On April 13, 2016, the Company and Sterling and Wilson Power Systems Inc. (“SW”) entered into an agreement for the formation and operation of Sterling and Wilson Cogen Solutions, LLC. The Company invested $0.2 million for its 49% share of the venture. Effective May 31, 2017, the Company sold its 49% membership interest in the venture to SW for $0.2 million pursuant to the agreement. Joint Venture Operating Results The Company’s investments in joint ventures are accounted for under the equity method of accounting. The Company's Consolidated Statement of Operations included a gain from these investments of $0.2 million in 2018. In 2017, the gain was immaterial. The joint venture operating results are presented in Other expense (income), net in the Company’s Consolidated Statements of Operations. Transactions with Related Individuals William D. Winemaster William D. Winemaster, the father of Gary S. Winemaster, former Chairman of the Board, Chief Executive Officer and President and nonexecutive Chief Strategy Officer, and Kenneth J. Winemaster, Executive Vice President, served as an employee performing consulting and advisory-type services, for which he was paid a salary, an amount for automobiles and related insurance premiums, mobile-telephone services and a bonus. The Company paid to William D. Winemaster $0.2 million in 2017. Additionally, in 2018, William D. Winemaster retired and for his service was awarded a $0.1 million founders award. Industrial Electronic Controls The Company purchased $0.4 million of products in 2018 from Industrial Electronic Controls, a supplier of custom throttles, sensors, and custom electronics. Gary S. Winemaster, former Chairman of the Board, Chief Executive Officer and President and non-executive Chief Strategy Officer owned 50% of Industrial Electronic Controls during 2018.

Selected Quarterly Financial Data (Unaudited)

12 Months Ended

Dec. 31, 2018

Quarterly Financial Information Disclosure [Abstract]

Selected Quarterly Financial Data (Unaudited)

Selected Quarterly Financial Data (unaudited)

Set forth below is unaudited quarterly financial data for 2018 and 2017.

POWER SOLUTIONS INTERNATIONAL, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS



(in thousands)	As of
	March 31,			June 30,			September 30,
	2018			2018			2018
ASSETS
Current assets:
Cash and cash equivalents	$	—		$	2		$	2,014
Accounts receivable, net	58,870			70,324			71,639
Income tax receivable	1,018			1,018			1,018
Inventories, net	91,689			95,957			112,392
Prepaid expenses and other current assets	20,555			26,644			26,905
Total current assets	172,132			193,945			213,968
Property, plant and equipment, net	18,474			24,931			24,536
Intangible assets, net	23,175			21,854			20,534
Goodwill	29,835			29,835			29,835
Other noncurrent assets	4,957			3,552			3,818
TOTAL ASSETS	$	248,573		$	274,117		$	292,691

LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Current liabilities:
Accounts payable	$	55,221		$	64,422		$	88,798
Revolving line of credit	36,662			54,334			52,491
Warrant liability	—			33,700			43,900
Other accrued liabilities	38,697			41,884			44,762
Total current liabilities	130,580			194,340			229,951
Deferred income taxes	427			495			616
Warrant liability	27,200			—			—
Long-term debt, net	54,575			54,604			54,781
Other noncurrent liabilities	15,311			15,753			16,612
TOTAL LIABILITIES	$	228,093		$	265,192		$	301,960

STOCKHOLDERS’ EQUITY (DEFICIT)
Preferred stock	$	—		$	—		$	—
Common stock	19			19			19
Additional paid-in capital	124,981			125,272			125,938
Accumulated deficit	(94,638		)	(106,443		)	(125,262		)
Treasury stock	(9,882		)	(9,923		)	(9,964		)
TOTAL STOCKHOLDERS’ EQUITY (DEFICIT)	20,480			8,925			(9,269		)
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)	$	248,573		$	274,117		$	292,691

POWER SOLUTIONS INTERNATIONAL, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(As Revised)



(in thousands)	As of
	March 31,			June 30,			September 30,
	2017			2017			2017
ASSETS
Current assets:
Cash and cash equivalents	$	342		$	—		$	—
Accounts receivable, net	64,305			56,673			60,811
Income tax receivable	6,829			1,996			841
Inventories, net	97,286			103,335			113,074
Prepaid expenses and other current assets	15,291			12,453			14,536
Total current assets	184,053			174,457			189,262
Property, plant and equipment, net	19,230			19,050			18,974
Intangible assets, net	24,819			23,610			22,401
Goodwill	29,835			29,835			29,835
Other noncurrent assets	5,053			4,518			6,035
TOTAL ASSETS	$	262,990		$	251,470		$	266,507

LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	67,167		$	55,610		$	54,195
Contingent consideration	30			29			20
Revolving line of credit	16,887			25,263			41,332
Other accrued liabilities*	28,809			30,110			37,295
Total current liabilities	112,893			111,012			132,842
Deferred income taxes	933			1,066			1,210
Warrant liability	20,700			21,500			23,200
Long-term debt, net	54,046			54,168			54,306
Other noncurrent liabilities*	19,753			17,707			17,410
TOTAL LIABILITIES	$	208,325		$	205,453		$	228,968

MEZZANINE EQUITY
Series B convertible preferred stock, net	$	24,617		$	27,807		$	31,410
STOCKHOLDERS’ EQUITY
Preferred stock	$	—		$	—		$	—
Common stock	14			14			14
Additional paid-in capital	100,686			96,543			91,737
Accumulated deficit	(59,070		)	(66,817		)	(76,018		)
Treasury stock	(11,582		)	(11,530		)	(9,604		)
TOTAL STOCKHOLDERS’ EQUITY	30,048			18,210			6,129
TOTAL LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS’ EQUITY	$	262,990		$	251,470		$	266,507


*	The Company recorded adjustments to reflect a portion of the accrued product warranty liability previously in Other accrued expenses at March 31, June 30 and September 30 to correct the presentation error and to conform to the current period presentation. See Note 1. Summary of Significant Accounting Policies and Other Information for additional discussion of the adjustment.

POWER SOLUTIONS INTERNATIONAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS



(in thousands, except per share amounts)	For the Quarter Ended
	March 31,			June 30,			September 30,			December 31,
	2018			2018			2018			2018
Net sales	$	94,413		$	127,073		$	136,318		$	138,234
Cost of sales	84,540			109,006			117,510			126,213
Gross profit	9,873			18,067			18,808			12,021
Operating expenses:
Research, development and engineering expenses	6,021			6,962			7,708			7,910
Selling, general and administrative expenses	13,254			13,276			16,374			16,727
Asset impairment charges	—			—			—			2,234
Amortization of intangible assets	1,045			1,321			1,321			1,321
Total operating expenses	20,320			21,559			25,403			28,192
Operating loss	(10,447		)	(3,492		)	(6,595		)	(16,171		)
Other expense (income):
Interest expense	1,623			1,828			1,974			2,203
Loss (gain) from change in fair value of warrants	2,500			6,500			10,200			(8,800		)
Other expense (income), net	(94		)	(95		)	(68		)	81
Total other expense (income)	4,029			8,233			12,106			(6,516		)
Loss before income taxes	(14,476		)	(11,725		)	(18,701		)	(9,655		)
Income tax (benefit) expense	(272		)	80			118			243
Net loss	$	(14,204	)	$	(11,805	)	$	(18,819	)	$	(9,898	)

Weighted-average common shares outstanding:
Basic	18,483			18,594			18,625			18,638
Diluted	18,483			18,594			18,625			22,360
Loss per common share:
Basic	$	(0.77	)	$	(0.63	)	$	(1.01	)	$	(0.53	)
Diluted	$	(0.77	)	$	(0.63	)	$	(1.01	)	$	(0.84	)

POWER SOLUTIONS INTERNATIONAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS



(in thousands, except per share amounts)	For the Quarter Ended
	March 31,			June 30,			September 30,			December 31,
	2017			2017			2017			2017
Net sales	$	84,265		$	100,922		$	99,953		$	131,476
Cost of sales	74,497			88,443			86,702			115,981
Gross profit	9,768			12,479			13,251			15,495
Operating expenses:
Research, development and engineering expenses	3,950			3,848			5,687			6,459
Selling, general and administrative expenses	10,209			10,688			12,062			11,297
Asset impairment charges	—			—			—			1
Amortization of intangible assets	1,209			1,209			1,210			1,210
Total operating expenses	15,368			15,745			18,959			18,967
Operating loss	(5,600		)	(3,266		)	(5,708		)	(3,472		)
Other expense (income):
Interest expense	6,080			1,404			1,654			1,703
Loss from change in fair value of warrants	—			800			1,700			1,500
Loss on debt extinguishment and modifications	11,921			—			—			—
Other expense (income), net	455			2,142			(10		)	(226		)
Total other expense	18,456			4,346			3,344			2,977
Loss before income taxes	(24,056		)	(7,612		)	(9,052		)	(6,449		)
Income tax expense (benefit)	479			135			149			(320		)
Net loss	(24,535		)	(7,747		)	(9,201		)	(6,129		)
Deemed dividend on Series B convertible preferred stock	—			(3,190		)	(3,603		)	(31,067		)
Net loss available to common stockholders	$	(24,535	)	$	(10,937	)	$	(12,804	)	$	(37,196	)

Weighted-average common shares outstanding:
Basic	11,018			13,697			13,659			16,774
Diluted	11,018			13,697			13,659			16,774
Loss per common share:
Basic	$	(2.23	)	$	(0.80	)	$	(0.94	)	$	(2.22	)
Diluted	$	(2.23	)	$	(0.80	)	$	(0.94	)	$	(2.22	)

POWER SOLUTIONS INTERNATIONAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)



(in thousands)	Common Stock		Additional Paid-in Capital			Treasury Stock			Accumulated Deficit			Total Stockholders’ Equity (Deficit)
Balance at December 31, 2017	$	19	$	123,838		$	(9,538	)	$	(82,147	)	$	32,172
Net loss	—		—			—			(14,204		)	(14,204		)
Stock-based compensation expense	—		1,143			(344		)	—			799
Cumulative Impact of ASC 606	—		—			—			1,713			1,713
Balance at March 31, 2018	$	19	$	124,981		$	(9,882	)	$	(94,638	)	$	20,480
Net loss	—		—			—			(11,805		)	(11,805		)
Stock-based compensation expense	—		660			(41		)	—			619
Payment of withholding taxes for net settlement of stock-based awards	—		(369		)	—			—			(369		)
Balance at June 30, 2018	$	19	$	125,272		$	(9,923	)	$	(106,443	)	$	8,925
Net loss	—		—			—			(18,819		)	(18,819		)
Stock-based compensation expense	—		586			(41		)	—			545
Payment of withholding taxes for net settlement of stock-based awards	—		80			—			—			80
Balance at September 30, 2018	$	19	$	125,938		$	(9,964	)	$	(125,262	)	$	(9,269	)
Net loss	—		—			—			(9,898		)	(9,898		)
Stock-based compensation expense	—		585			115			—			700
Payment of withholding taxes for net settlement of stock-based awards	—		(111		)	—			—			(111		)
Balance at December 31, 2018	$	19	$	126,412		$	(9,849	)	$	(135,160	)	$	(18,578	)

POWER SOLUTIONS INTERNATIONAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY



(in thousands)	Preferred Stock			Common Stock		Additional Paid-in Capital			Treasury Stock			Accumulated Deficit			Total Stockholders’ Equity
Balance at December 31, 2016	$	—		$	12	$	86,764		$	(11,581	)	$	(34,535	)	$	40,660
Net loss	—			—		—			—			(24,535		)	(24,535		)
Stock-based compensation expense	—			—		(154		)	(1		)	—			(155		)
Issuance of common stock to Weichai, net of fees	—			2		14,076			—			—			14,078
Issuance of Series B convertible preferred stock, net of fees	24,617			—		—			—			—			—
Balance at March 31, 2017	$	24,617		$	14	$	100,686		$	(11,582	)	$	(59,070	)	$	30,048
Net loss	—			—		—			—			(7,747		)	(7,747		)
Settlement of equity-related acquisition consideration	—			—		(712		)	—			—			(712		)
Stock-based compensation expense	—			—		(214		)	52			—			(162		)
Payment of withholding taxes for net settlement of stock-based awards	—			—		(27		)	—			—			(27		)
Deemed dividend on Series B convertible preferred stock	3,190			—		(3,190		)	—			—			(3,190		)
Balance at June 30, 2017	$	27,807		$	14	$	96,543		$	(11,530	)	$	(66,817	)	$	18,210
Net loss	—			—		—			—			(9,201		)	(9,201		)
Stock-based compensation expense	—			—		(1,195		)	1,926			—			731
Payment of withholding taxes for net settlement of stock-based awards	—			—		(8		)	—			—			(8		)
Deemed dividend on Series B convertible preferred stock	3,603			—		(3,603		)	—			—			(3,603		)
Balance at September 30, 2017	$	31,410		$	14	$	91,737		$	(9,604	)	$	(76,018	)	$	6,129
Net loss	—			—		—			—			(6,129		)	(6,129		)
Stock-based compensation expense	—			—		705			66			—			771
Payment of withholding taxes for net settlement of stock-based awards	—			—		(9		)	—			—			(9		)
Deemed dividend on Series B convertible preferred stock	31,067			—		(31,067		)	—			—			(31,067		)
Conversion of Series B convertible preferred stock to common stock	(62,477		)	5		62,472			—			—			62,477
Balance at December 31, 2017	$	—		$	19	$	123,838		$	(9,538	)	$	(82,147	)	$	32,172

POWER SOLUTIONS INTERNATIONAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS



(in thousands)	For the Year to Date Period Ended
	March 31, 2018			June 30, 2018			September 30, 2018
Cash provided by (used in) operating activities
Net loss	$	(14,204	)	$	(26,009	)	$	(44,828	)
Adjustments to reconcile net loss to net cash used in operating activities:
Amortization of intangible assets	1,045			2,366			3,687
Depreciation	1,196			2,524			3,849
Change in valuation of warrants	2,500			9,000			19,200
Stock compensation expense	799			1,418			1,963
Amortization of financing fees	341			659			947
Deferred income taxes	(276		)	(208		)	(87		)
Other non-cash adjustments, net	(350		)	325			1,661
Changes in operating assets and liabilities:
Trade accounts receivable, net	9,710			(1,739		)	(3,058		)
Inventories, net	(9,822		)	(14,825		)	(32,657		)
Prepaid expenses and other assets	(76		)	(4,815		)	(5,387		)
Trade accounts payable	3,748			13,200			37,355
Income taxes refundable	8			(2		)	7
Accrued expenses	4,757			7,914			10,773
Other noncurrent liabilities	2,902			2,000			2,901
Net cash provided by (used in) operating activities	2,278			(8,192		)	(3,674		)
Cash used in investing activities
Capital expenditures	(467		)	(1,588		)	(2,321		)
Asset acquisitions	(1,029		)	(6,595		)	(6,595		)
Net cash used in investing activities	(1,496		)	(8,183		)	(8,916		)
Cash (used in) provided by financing activities
Proceeds from revolving line of credit	106,216			240,698			372,557
Repayments of revolving line of credit	(106,608		)	(223,419		)	(357,121		)
Other uses, net	(390		)	(902		)	(832		)
Net cash (used in) provided by financing activities	(782		)	16,377			14,604
Net increase in cash and restricted cash	—			2			2,014
Cash at beginning of the year	—			—			—
Cash at end of the period	$	—		$	2		$	2,014

POWER SOLUTIONS INTERNATIONAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(As Revised)



(in thousands)	For the Year to Date Period Ended
	March 31, 2017			June 30, 2017			September 30, 2017
Cash provided by (used in) operating activities
Net loss	$	(24,535	)	$	(32,282	)	$	(41,483	)
Adjustments to reconcile net loss to net cash used in operating activities:
Amortization of intangible assets	1,209			2,419			3,628
Depreciation	1,172			2,342			3,502
Change in valuation of warrants	—			800			2,500
Stock compensation expense	(865		)	(1,028		)	(297		)
Amortization of financing fees	3,109			3,441			3,778
Deferred income taxes	469			602			746
Loss on extinguishment of debt	11,921			11,921			11,921
Provision for doubtful accounts	48			131			216
Provision for inventory obsolescence	146			539			882
Loss on disposal of fixed assets	10			66			115
Other non-cash adjustments, net	137			200			190
Changes in operating assets and liabilities:
Trade accounts receivable, net	(4,017		)	3,532			(691		)
Inventories, net	3,122			(3,326		)	(13,408		)
Prepaid expenses and other assets	(1,624		)	1,238			(1,359		)
Trade accounts payable	15,186			3,244			1,879
Income taxes refundable	298			5,135			6,293
Accrued expenses*	1,861			3,826			10,622
Other noncurrent liabilities*	450			(1,478		)	(2,576		)
Net cash provided by (used in) operating activities	8,097			1,322			(13,542		)
Cash used in investing activities
Capital expenditures	(1,896		)	(2,669		)	(3,856		)
Other sources, net	—			245			245
Net cash used in investing activities	(1,896		)	(2,424		)	(3,611		)
Cash (used in) provided by financing activities
Repayments of long-term debt	(71,400		)	(71,400		)	(71,400		)
Financing fees	(253		)	(928		)	(928		)
Net proceeds from stock offering and warrants	59,396			59,396			59,396
Proceeds from revolving line of credit	85,945			209,082			324,416
Repayments of revolving line of credit	(81,833		)	(196,593		)	(295,859		)
Acquisition of business contingent consideration payments	(6		)	(9		)	(19		)
Other uses, net	—			(738		)	(745		)
Net cash (used in) provided by financing activities	(8,151		)	(1,190		)	14,861
Net (decrease) in cash and restricted cash	(1,950		)	(2,292		)	(2,292		)
Cash at beginning of the year	2,292			2,292			2,292
Cash at end of the period	$	342		$	—		$	—

The Company recorded adjustments to reflect a portion of the accrued product warranty liability previously in Other accrued expenses for the three-month period ended March 31, six-month period ended June 30, and nine-month period ended September 30 to correct the presentation error and to conform to the current period presentation. See Note 1. Summary of Significant Accounting Policies and Other Information for additional discussion of the adjustment.

Subsequent Events	12 Months Ended
Subsequent Events	Dec. 31, 2018
Subsequent Events [Abstract]
Subsequent Events	In October 2019, the Company entered into an addendum (the “Addendum”) to a supply agreement (the “Supply Agreement”), dated December 11, 2007, with a key supplier. The Addendum extends the Supply Agreement to December 31, 2023 with automatic annual extensions thereafter unless notice of termination is provided. The Addendum extends the Company’s exclusivity for the prescribed territory but carves out of the restriction the competing engine products supplied by General Motors Company and Weichai. The Company committed to maximize sales and service opportunities on both the key supplier and Weichai engine products, recognizing their different value proposition and target markets. The Addendum also updates the minimum product purchase commitments for the period 2019 through 2023 to $40.0 million per year, subject to reductions based on market declines in oil prices and defined prescribed payments to the key supplier triggered by shortfalls in purchases made by the Company during each annual calendar period. The Company made product purchases of $44.9 million and $15.0 million in 2018 and 2017, respectively.

Summary of Significant Accounting Policies and Other Information (Policies)

12 Months Ended

Dec. 31, 2018

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation and Consolidation

Immaterial Revision to Prior Year Period Financial Statements

Consolidated Balance Sheet



(in thousands)	December 31, 2017 (As Previously Reported)		Adjustment			December 31, 2017 (As Revised)
Other accrued liabilities	$	38,362	$	(4,042	)	$	34,320
Total current liabilities	126,654		(4,042		)	122,612
Other noncurrent liabilities	8,351		4,042			12,393

Consolidated Statement of Cash Flows



	Year-Ended
(in thousands)	December 31, 2017 (As Previously Reported)			Adjustment			December 31, 2017 (As Revised)
Changes in operating assets and liabilities:
Accrued expenses	$	6,029		$	1,810		$	7,839
Other noncurrent liabilities	(5,260		)	(1,810		)	(7,070		)

Consolidated Balance Sheet (unaudited)



(in thousands)	March 31, 2017 (As Previously Reported)		Adjustment			March 31, 2017 (As Revised)
Other accrued liabilities	$	35,234	$	(6,425	)	$	28,809
Total current liabilities	119,318		(6,425		)	112,893
Other noncurrent liabilities	13,328		6,425			19,753



(in thousands)	June 30, 2017 (As Previously Reported)		Adjustment			June 30, 2017 (As Revised)
Other accrued liabilities	$	35,379	$	(5,269	)	$	30,110
Total current liabilities	116,281		(5,269		)	111,012
Other noncurrent liabilities	12,438		5,269			17,707



(in thousands)	September 30, 2017 (As Previously Reported)		Adjustment			September 30, 2017 (As Revised)
Other accrued liabilities	$	41,393	$	(4,098	)	$	37,295
Total current liabilities	136,940		(4,098		)	132,842
Other noncurrent liabilities	13,312		4,098			17,410

Consolidated Statement of Cash Flows (unaudited)



	Three Months Ended
(in thousands)	March 31, 2017 (As Previously Reported)			Adjustment			March 31, 2017 (As Revised)
Changes in operating assets and liabilities:
Accrued expenses	$	2,432		$	(571	)	$	1,861
Other noncurrent liabilities	(121		)	571			450



	Six Months Ended
(in thousands)	June 30, 2017 (As Previously Reported)			Adjustment			June 30, 2017 (As Revised)
Changes in operating assets and liabilities:
Accrued expenses	$	3,242		$	584		$	3,826
Other noncurrent liabilities	(894		)	(584		)	(1,478		)



	Nine Months Ended
(in thousands)	September 30, 2017 (As Previously Reported)			Adjustment			September 30, 2017 (As Revised)
Changes in operating assets and liabilities:
Accrued expenses	$	8,867		$	1,755		$	10,622
Other noncurrent liabilities	(821		)	(1,755		)	(2,576		)

Reclassifications

Use of Estimates

Cash and Cash Equivalents

Stock-Based Compensation

Research and Development

Income Taxes

Accounts Receivable and Allowance for Doubtful Accounts

Insurance Recoveries

Inventories

Property, Plant and Equipment

Repairs and maintenance costs are charged directly to expense as incurred. Major renewals or replacements that substantially extend the useful life of an asset are capitalized and depreciated.

Estimated useful lives by each type of asset category are as follows:



		Years
Buildings		Up to 39
Leasehold improvements		Lesser of (i) expected useful life of improvement or (ii) life of lease (including likely extension thereof)
Machinery and equipment		1 to 10

Intangible Assets

Impairment of Long-Lived assets

Impairment of Long-Lived Assets

Goodwill

Warranty Costs

Revenue Recognition

The Company classifies shipping and handling charges billed to customers as revenue. Shipping and handling costs paid to others are classified as a component of cost of sales when incurred.

Recently Issued Accounting Pronouncements - Adopted and Not Yet Adopted

Recently Issued Accounting Pronouncements – Adopted

In May 2014, the FASB issued ASU 2014-09, which created ASC 606, Revenue from Contracts with Customers (Topic 606). See Note 2. Revenue, for the impact of adoption of ASC 606.

Recently Issued Accounting Pronouncements – Not Yet Adopted

Summary of Significant Accounting Policies and Other Information (Tables)

12 Months Ended

Dec. 31, 2018

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of Adjustment Effects within Consolidated Balance Sheet and Cash Flows

Consolidated Balance Sheet



(in thousands)	December 31, 2017 (As Previously Reported)		Adjustment			December 31, 2017 (As Revised)
Other accrued liabilities	$	38,362	$	(4,042	)	$	34,320
Total current liabilities	126,654		(4,042		)	122,612
Other noncurrent liabilities	8,351		4,042			12,393

Consolidated Statement of Cash Flows



	Year-Ended
(in thousands)	December 31, 2017 (As Previously Reported)			Adjustment			December 31, 2017 (As Revised)
Changes in operating assets and liabilities:
Accrued expenses	$	6,029		$	1,810		$	7,839
Other noncurrent liabilities	(5,260		)	(1,810		)	(7,070		)

Consolidated Balance Sheet (unaudited)



(in thousands)	March 31, 2017 (As Previously Reported)		Adjustment			March 31, 2017 (As Revised)
Other accrued liabilities	$	35,234	$	(6,425	)	$	28,809
Total current liabilities	119,318		(6,425		)	112,893
Other noncurrent liabilities	13,328		6,425			19,753



(in thousands)	June 30, 2017 (As Previously Reported)		Adjustment			June 30, 2017 (As Revised)
Other accrued liabilities	$	35,379	$	(5,269	)	$	30,110
Total current liabilities	116,281		(5,269		)	111,012
Other noncurrent liabilities	12,438		5,269			17,707



(in thousands)	September 30, 2017 (As Previously Reported)		Adjustment			September 30, 2017 (As Revised)
Other accrued liabilities	$	41,393	$	(4,098	)	$	37,295
Total current liabilities	136,940		(4,098		)	132,842
Other noncurrent liabilities	13,312		4,098			17,410

Consolidated Statement of Cash Flows (unaudited)



	Three Months Ended
(in thousands)	March 31, 2017 (As Previously Reported)			Adjustment			March 31, 2017 (As Revised)
Changes in operating assets and liabilities:
Accrued expenses	$	2,432		$	(571	)	$	1,861
Other noncurrent liabilities	(121		)	571			450



	Six Months Ended
(in thousands)	June 30, 2017 (As Previously Reported)			Adjustment			June 30, 2017 (As Revised)
Changes in operating assets and liabilities:
Accrued expenses	$	3,242		$	584		$	3,826
Other noncurrent liabilities	(894		)	(584		)	(1,478		)



	Nine Months Ended
(in thousands)	September 30, 2017 (As Previously Reported)			Adjustment			September 30, 2017 (As Revised)
Changes in operating assets and liabilities:
Accrued expenses	$	8,867		$	1,755		$	10,622
Other noncurrent liabilities	(821		)	(1,755		)	(2,576		)

Schedules of Concentration of Risk, by Risk Factor

The following table presents customers individually accounting for more than 10% of the Company’s net sales:

The following table presents customers individually accounting for more than 10% of the Company’s accounts receivable:



	As of December 31,
	2018		2017
Customer A	15	%	18	%
Customer B	**		13	%
Customer C	25	%	**

The following table presents suppliers individually accounting for more than 10% of the Company’s purchases:


**	Less than 10% of the total

Schedule of Inventory, Current

Inventories consist of the following:



(in thousands)	As of December 31,
Inventories	2018			2017
Raw materials	$	90,877		$	71,732
Work in process	2,390			4,535
Finished goods	18,077			16,684
Total inventories	111,344			92,951
Inventory allowance	(5,730		)	(6,227		)
Inventories, net	$	105,614		$	86,724

Activity in the Company’s inventory allowance was as follows:



(in thousands)	For the Year Ended December 31,
Inventory Allowance	2018			2017
Balance at beginning of period	$	6,227		$	10,082
Charged to expense	2,153			421
Write-offs	(2,650		)	(4,276		)
Balance at end of year	$	5,730		$	6,227

Schedule of Other Current Assets

Prepaid expenses and other current assets consist of the following:



(in thousands)	As of December 31,
Prepaid Expenses and Other Current Assets	2018		2017
Insurance proceeds receivable	$	15,989	$	10,563
Prepaid expenses	3,260		3,710
Contract assets	2,926		—
Other	742		86
Total	$	22,917	$	14,359

Property, Plant and Equipment

Estimated useful lives by each type of asset category are as follows:



		Years
Buildings		Up to 39
Leasehold improvements		Lesser of (i) expected useful life of improvement or (ii) life of lease (including likely extension thereof)
Machinery and equipment		1 to 10

Property, plant and equipment by type were as follows:



(in thousands)	As of December 31,
Property, Plant and Equipment	2018			2017
Leasehold improvements	$	6,405		$	6,320
Machinery and equipment	38,454			27,379
Construction in progress	1,241			2,036
Total property, plant and equipment, at cost	46,100			35,735
Accumulated depreciation	(21,834		)	(16,775		)
Property, plant and equipment, net	$	24,266		$	18,960

Schedule of Other Accrued Liabilities

Other accrued liabilities consisted of the following:



(in thousands)	As of December 31,
Other Accrued Liabilities	2018		2017 (As Revised)
Accrued product warranty^*	$	9,767	$	8,585
Litigation reserves ^**	16,139		12,137
Contract liabilities (deferred revenue)	4,897		2,822
Accrued compensation and benefits	4,520		2,593
Professional services	27		1,974
Accrued interest expense	1,175		686
Other	9,175		5,535
Total	$	45,700	$	34,332


*	The Company recorded adjustments to reflect a portion of the accrued product warranty liability previously in Other accrued expenses at December 31, 2017 to correct the presentation error and to conform to the current period presentation. See above for additional discussion of the adjustment.

Schedule of Product Warranty Liability

Accrued product warranty activities are presented below:



(in thousands)	For the Year Ended December 31,
Accrued Product Warranty	2018			2017
Balance at beginning of year	$	12,628		$	10,200
Current year provision	15,840			5,405
Changes in estimates for preexisting warranties ^*	3,842			—
Payments made during the period	(9,208		)	(2,977		)
Balance at end of year	$	23,102		$	12,628
Less: Current portion	9,767			8,585
Noncurrent accrued product warranty	13,335			4,043

Revenue (Tables)

12 Months Ended

Dec. 31, 2018

Revenue from Contract with Customer [Abstract]

Cumulative Effects Made to the Balance Sheet for ASC 606 Adoption

The cumulative effects of the changes made to the Consolidated Balance Sheet as of January 1, 2018 for the adoption of ASC 606 were as follows:



(in thousands)	As Reported			Adjustments due to ASC 606		As Restated
	December 31, 2017			Adjustments due to ASC 606		January 1, 2018
Assets
Inventories, net	$	86,724		(5,159	)	81,565
Prepaid expenses and other current assets	14,359			6,166		20,525

Liabilities and Stockholders' Equity
Other accrued liabilities^*	$	34,332		(706	)	33,626
Accumulated deficit	(82,147		)	1,713		(80,434	)

Impact on Consolidated Financial Statements

The following table summarizes the effects of the adoption of ASC 606 on selected line items within the Consolidated Statement of Operations for the year ended December 31, 2018:



(in thousands)	As Reported ASC 606			Impact of ASC 606			ASC 605
Net sales	$	496,038		$	(1,995	)	$	498,033
Cost of sales	437,269			(573		)	437,842
Gross profit	58,769			(1,422		)	60,191
Operating loss	(36,705		)	(1,422		)	(35,283		)
Loss before income taxes	(54,557		)	(1,422		)	(53,135		)
Net loss	(54,726		)	(1,422		)	(53,304		)
Net loss available to common stockholders	(54,726		)	(1,422		)	(53,304		)
Net loss per common share:
Basic	(2.94		)	(0.08		)	(2.86		)
Diluted	(2.94		)	(0.08		)	(2.86		)

The following table summarizes the effects of the adoption of ASC 606 on selected line items within the Consolidated Balance Sheet as of December 31, 2018:



(in thousands)	As Reported ASC 606			Impact of ASC 606			ASC 605
Assets
Inventories, net	$	105,614		$	(4,586	)	$	110,200
Prepaid expenses and other current assets	22,917			2,926			19,991
Liabilities and Stockholders' Equity
Other accrued liabilities	$	45,700		$	(1,952	)	$	47,652
Accumulated deficit	(135,160		)	292			(135,452		)

Revenue from External Customers by Geographic Areas

The following table summarizes net sales by end market:



	For the Quarter Ended (Unaudited)								For the Year Ended
(in thousands)	March 31,		June 30,		September 30,		December 31,		December 31,
End Market	2018		2018		2018		2018		2018
Industrial	$	45,719	$	48,051	$	52,367	$	55,059	$	201,196
Energy	38,567		52,014		48,481		46,623		185,685
Transportation	10,127		27,008		35,470		36,552		109,157
Total	$	94,413	$	127,073	$	136,318	$	138,234	$	496,038

The following table summarizes net sales by geographic area:



	For the Quarter Ended (Unaudited)								For the Year Ended
(in thousands)	March 31,		June 30,		September 30,		December 31,		December 31,
Geographic Area	2018		2018		2018		2018		2018
North America	$	79,947	$	111,444	$	120,955	$	123,722	$	436,068
Pacific Rim	10,339		11,516		10,913		9,303		42,071
Europe	3,315		3,621		3,012		3,795		13,743
Other	812		492		1,438		1,414		4,156
Total	$	94,413	$	127,073	$	136,318	$	138,234	$	496,038

Schedule of Contract Balances



(in thousands)	December 31, 2018			January 1, 2018
Short-term contract assets (included in Prepaid expenses and other current assets)	$	2,926		$	6,166
Short-term contract liabilities (included in Other accrued liabilities)	(4,897		)	(1,299		)
Long-term contract liabilities (included in Other noncurrent liabilities)	(14,611		)	(2,767		)
Net contract assets (liabilities)	$	(16,582	)	$	2,100

Property, Plant and Equipment, and Leases (Tables)

12 Months Ended

Dec. 31, 2018

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment

Estimated useful lives by each type of asset category are as follows:



		Years
Buildings		Up to 39
Leasehold improvements		Lesser of (i) expected useful life of improvement or (ii) life of lease (including likely extension thereof)
Machinery and equipment		1 to 10

Property, plant and equipment by type were as follows:



(in thousands)	As of December 31,
Property, Plant and Equipment	2018			2017
Leasehold improvements	$	6,405		$	6,320
Machinery and equipment	38,454			27,379
Construction in progress	1,241			2,036
Total property, plant and equipment, at cost	46,100			35,735
Accumulated depreciation	(21,834		)	(16,775		)
Property, plant and equipment, net	$	24,266		$	18,960

Schedule of Future Minimum Lease Payments

The future minimum lease payments due under operating and capital leases in effect, as amended and extended, as of December 31, 2018, were as follows:



	Year Ending December 31,
(in thousands)	Operating		Capital
2019	$	5,071	$	80
2020	5,175		63
2021	4,724		67
2022	4,681		50
2023	3,104		13
2024 and beyond	3,694		—
Total	$	26,449	$	273

Goodwill and Other Intangibles (Tables)

12 Months Ended

Dec. 31, 2018

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Finite-Lived Intangible Assets

Components of intangible assets are as follows:



(in thousands)	As of December 31, 2018
	Gross Carrying Value		Accumulated Amortization			Net Book Value
Customer relationships	$	34,940	$	(18,816	)	$	16,124
Developed technology	700		(537		)	163
Trade names and trademarks	1,700		(977		)	723
Total	$	37,340	$	(20,330	)	$	17,010



(in thousands)	As of December 31, 2017
	Gross Carrying Value		Accumulated Amortization			Net Book Value
Customer relationships	$	34,940	$	(14,915	)	$	20,025
Developed technology	1,000		(434		)	566
Trade names and trademarks	1,700		(800		)	900
Total	$	37,640	$	(16,149	)	$	21,491

Schedule of Future Amortization Expense

Estimated future amortization expense for intangible assets as of December 31, 2018 is as follows:



(in thousands)
Year Ending December 31,	Estimated Amortization
2019	$	3,638
2020	3,053
2021	2,535
2022	2,124
2023	1,746
2024 and beyond	3,914
Total	$	17,010

Debt (Tables)

12 Months Ended

Dec. 31, 2018

Debt Disclosure [Abstract]

Schedule of Debt

The Company’s outstanding debt consisted of the following:



(in thousands)	As of December 31,
Description of Debt	2018			2017
Short-Term Debt:
Wells Fargo Revolving Credit Facility	$	54,613		$	37,055

Long-Term Debt:
Unsecured Senior Notes	$	55,000		$	55,000
Less Unamortized Debt Issuance Costs ^*	(288		)	(561		)
Total Long-Term Debt	$	54,712		$	54,439


*	Unamortized financing costs and deferred fees on the Wells Fargo Revolving Credit Facility are not presented in the above table as they are classified in Prepaid expenses and other current assets on the Consolidated Balance Sheets. Debt issuance costs incurred, including gross waiver fees (primarily paid to the lenders), were $1.0 million and $0.9 million in 2018 and 2017, respectively.

The most significant amendments to the Unsecured Senior Notes since January 1, 2017 are included in the table below:



Amendment Date and Title	Reason for Amendment	Significant Changes to the Unsecured Senior Notes
March 31, 2017. Third Supplemental Indenture	To facilitate the changes necessary due to the Weichai SPA	• Extended maturity date to January 1, 2019; • Amended certain provisions to permit the issuance of the securities to Weichai under the SPA, and provisions to permit ongoing transactions with an affiliate of Weichai under the Collaboration Arrangement; • Waived any defaults occurring prior to March 31, 2017 with respect to the failure to file periodic and annual reports; • Extended the deadline for the Company to file its delinquent SEC periodic and annual reports; • The Company paid a consent fee of $0.2 million and legal fees of $0.1 million.
April 19, 2018. Fourth Supplemental Indenture	To amend certain covenants and waive certain events of default	• Extended the maturity date to January 1, 2020; • Waived defaults with respect to the failure to file with the Trustee and the SEC for 2015 through 2019; • Increased the interest rate from 6.50% to 8.50% per annum effective October 1, 2018. The interest rate decreased to 7.50% per annum upon filing the 2017 Form 10-K with the SEC; • The Company paid a consent fee of $0.3 million.
October 30, 2019. Fifth Supplemental Indenture	To extend the maturity date	• Extended maturity date to June 30, 2020; • The Company paid a fee of $0.3 million.

Schedule of Maturities of Long-term Debt

The schedule of remaining principal maturities of long-term debt is as follows:



(in thousands)
Year Ending December 31,	Maturities of Long-Term Debt
2019	$	—
2020	55,000
Total	$	55,000

Schedule of Line of Credit Facilities

The most significant changes to the Wells Fargo Credit Agreement since January 1, 2017 are summarized in the table below:



Amendment Date and Title	Reason for Amendment	Significant Changes to the Wells Fargo Credit Agreement
February 10, 2017, effective as of February 6, 2017. Limited Waiver Agreement to the June 28, 2016 Agreement (“Limited Waiver”)	To consider implications of various events of default	• Provided waiver for various events of default including identified material weaknesses in internal control through February 28, 2017; • Wells Fargo reserved the right to increase the interest rate by 200 basis points (2%) effective January 27, 2017, though the interest rate was not increased; • Provided Wells Fargo with access to additional financial information including cash flow forecasts and budgets.
February 28, 2017, effective as of February 6, 2017. First Amendment to Limited Waiver	To refine provisions of Limited Waiver to June 28, 2016 Agreement	• Established minimum financial metrics related to liquidity and cash which were required to be maintained through March 3, 2017; • Extended the Limited Waiver to March 3, 2017.
March 9, 2017, effective as of February 6, 2017. Second Amendment to Limited Waiver	To refine provisions of Limited Waiver to June 28, 2016 Agreement	• Extended the Limited Waiver to March 10, 2017.
March 31, 2017, effective as of February 7, 2017. Third Amendment to Limited Waiver	To facilitate changes necessary due to Weichai SPA	• Modified certain changes in control and other definitions to permit issuance of securities to Weichai and pay off TPG Term Loan; • Increased the interest rate by 200 basis points (2%) effective April 1, 2017 until the Company’s restated 2016 audited financial statements are filed; • Reduced available borrowing under the revolving credit facility to $40.0 million (maximum borrowing amount of $65.0 million less a reserve of $25.0 million); • Deferred loan maturity date to March 31, 2018 (or February 15, 2018 if Series B Convertible Preferred Stock issued to Weichai has not converted into Common Stock); • Made certain adjustments to the borrowing base provisions to the assets against which borrowings may be made; • Permanently waived certain representations, required information and other defaults; • Extended the deadline for the Company to file delinquent SEC periodic and annual reports; • Required the Company to retain third-party adviser to assist with developing and providing certain financial data; • The Company paid an amendment fee of $0.7 million.
July 17, 2017. Fourth Amendment to the June 28, 2016 Agreement	To facilitate changes to availability, commitment fee and interest rate terms	• Increases available borrowing under the revolving credit facility to $52.5 million (maximum borrowing amount of $65.0 million less a reserve of $12.5 million); • Reduced the incremental interest rate by 100 basis points (1%) from 200 basis points (2%) until the Company’s 2016 audited financial statements have been provided.
October 3, 2017. Consent and Fifth Amendment to the June 28, 2016 Agreement	To facilitate an acquisition	• Increased available borrowing under the revolving credit facility to $58.75 million (maximum borrowing amount of $65.0 million less a reserve of $6.25 million).
March 29, 2018. Sixth Amendment and Waiver to the June 28, 2016 Agreement	To consider implications of various events of default	• Increased the maximum borrowing under the revolving credit facility to $75.0 million from $65.0 million; • Modified the reserve against the maximum borrowing under the revolving credit facility to the greater of $6.5 million and 10% of borrowing base, but no more than $7.5 million on or prior to September 30, 2018 and thereafter equal to $9.0 million; • Extended the maturity date of the facility to the earlier of March 31, 2021 or 60 days prior to the final maturity of the Unsecured Senior Notes, which were extended to January 1, 2020, resulting in a maturity date of November 2, 2019 on the Wells Fargo revolving credit facility. • The revolving credit facility will continue to bear interest at a per annum rate equal to 100 basis points (1%) above the per annum rate otherwise applicable under the credit agreement until the Company has completed all filings required to be made with the SEC; • The Company paid an amendment fee of $0.8 million.
May 16, 2019. Waiver to the June 28, 2016 Agreement	To consider implications of various events of default	• Waived any defaults that would arise from the failure to timely deliver annual audited financial statements for the fiscal year ended December 31, 2018 and the associated compliance certificate and the information required with it; provided that the financial statements and compliance certificate are delivered on or before December 31, 2019.

Information regarding amounts borrowed under the Wells Fargo Credit Agreement includes the following:



(in thousands, except interest rate)	Year ended December 31,
Description	2018			2017
Average borrowings under Wells Fargo Revolving Credit Facility	$	47,031		$	26,662
Average Interest Cost on Wells Fargo Revolving Credit Facility	6.51		%	6.85		%



(in thousands, except interest rate)	As of December 31,
Description	2018			2017
Accrued and unpaid interest	$	174		$	90
LIBOR loan interest rate	5.97		%	4.51		%
Wells Fargo Prime Rate (Base Rate) loan interest rate	7.25		%	6.00		%

Fair Value of Financial Instruments (Tables)

12 Months Ended

Dec. 31, 2018

Fair Value Disclosures [Abstract]

Schedule of Fair Value Measurements at Reporting Date



(in thousands)	As of December 31, 2018
	Carrying Value		Fair Value
	Carrying Value		Level 1		Level 2		Level 3
Wells Fargo revolving credit facility	$	54,613	$	—	$	54,613	$	—
Unsecured Senior Notes	55,000		—		—		52,700



(in thousands)	As of December 31, 2017
	Carrying Value		Fair Value
	Carrying Value		Level 1		Level 2		Level 3
Wells Fargo revolving credit facility	$	37,055	$	—	$	37,055	$	—
Unsecured Senior Notes	55,000		—		—		50,000



(in thousands)	As of December 31, 2018
	Carrying Value		Fair Value
	Carrying Value		Level 1		Level 2		Level 3
Weichai Warrant liability	$	35,100	$	—	$	—	$	35,100



(in thousands)	As of December 31, 2017
	Carrying Value		Fair Value
	Carrying Value		Level 1		Level 2		Level 3
Weichai Warrant liability	$	24,700	$	—	$	—	$	24,700

Summary of Change in the Estimated Fair Value of Private Placement Warrants

The following table summarizes changes in the estimated fair value of the Company’s warrant liability:



(in thousands)	As of December 31,
	2018		2017
Balance at beginning of year	$	24,700	$	—
Issuance of warrants	—		20,700
Increase in value^*	10,400		4,000
Balance at end of year	$	35,100	$	24,700


*	Loss related to the change in fair value of the warrant liability for each year is presented in Loss from change in fair value of warrants in the Company’s Consolidated Statements of Operations.

Schedule of Inputs of the Black-Scholes Option Pricing Model

The inputs of the Black-Scholes option pricing model were as follows:



Assumptions	As of December 31,
Assumptions	2018			2017
Market value of the Common Stock	$	9.25		$	7.50
Exercise price	varies			varies
Risk-free interest rate	2.6		%	1.8		%
Estimated price volatility	55.0		%	95.0		%
Contractual term	0.5 years			1.0 year
Dividend yield	—			—

- Definition

Tabular disclosure of financial instruments measured at fair value, including those classified in shareholders' equity measured on a recurring or nonrecurring basis. Disclosures include, but are not limited to, fair value measurements recorded and the reasons for the measurements, level within the fair value hierarchy in which the fair value measurements are categorized and transfers between levels 1 and 2. Nonrecurring fair value measurements are those that are required or permitted in the statement of financial position in particular circumstances.

+ References + Details

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2018

Income Tax Disclosure [Abstract]

Schedule of Expense (Benefit) for Income Taxes

Income tax expense was as follows:



(in thousands)	For the Year Ended December 31,
	2018			2017
Current tax expense
Federal	$	198		$	127
State	27			77
Total current tax expense	$	225		$	204

Deferred tax (benefit) expense
Federal	(149		)	$	100
State	93			139
Total deferred tax (benefit) expense	(56		)	239
Total tax expense	$	169		$	443

Reconciliation of Effective Tax Rate to the Statutory Rate

The Company received net cash refunds for income taxes of $0.2 million and $6.3 million in 2018 and 2017, respectively.

A reconciliation between the Company’s

Schedule of Significant Components of the Deferred Income Tax Assets and Liabilities

Significant components of deferred income tax assets and liabilities consisted of the following:



(in thousands)	As of December 31,
	2018			2017
Deferred tax assets:
Net operating loss carryforwards	$	19,006		$	15,399
Research and development credits	3,858			2,806
Other state credits	1,923			989
Inventory	2,203			2,560
Allowances and bad debts	840			596
Accrued warranty	5,732			3,387
Accrued wages and benefits	413			351
Other accrued expenses	5,281			2,906
Stock-based compensation	649			645
Capitalized research and development costs	770			1,090
Intangible amortization	2,240			1,734
Contract liabilities (deferred revenue)	495			339
Other	2,490			152
Total deferred tax assets	45,900			32,954
Valuation allowance	(44,405		)	(31,992		)
Total deferred tax assets, net of valuation allowance	$	1,495		$	962

Deferred tax liabilities:
Tax depreciation in excess of book depreciation on property, plant and equipment	(2,142		)	(1,665		)
Total deferred tax liabilities	$	(2,142	)	$	(1,665	)

Net deferred tax liability	$	(647	)	$	(703	)

Schedule of the Change in Unrecognized Tax Benefits

The change in unrecognized tax benefits excluding interest and penalties were as follows:



(in thousands)	For the Year Ended December 31,
	2018			2017
Balance at beginning of year	$	1,307		$	1,202
Additions based on tax positions related to the current year	193			105
Reductions for tax positions of prior years	(79		)	—
Balance at end of year	$	1,421		$	1,307

Summary of Income Tax Examinations

With few exceptions, the major jurisdictions subject to examination by the relevant tax authorities and open tax years, stated as the Company’s fiscal years, are as follows:



Jurisdiction	Open Tax Years
U.S. Federal	2014	-	2018
U.S. States	2013	-	2018

Stock-Based Compensation (Tables)

12 Months Ended

Dec. 31, 2018

Share-based Payment Arrangement [Abstract]

Schedule of Fair Value Assumptions

The assumptions used for valuing the 2017 SARs included the following:



Assumptions	2017 SARs
Market closing price of the Common Stock	$	7.37
Exercise price	$	7.37
Risk-free interest rate	2.1		%
Estimated price volatility	58.5		%
Expected term	6.00 years
Dividend yield	—		%

The assumptions used for valuing the 2018 SARs included the following:



Assumptions	2018 SARs
Market closing price of the Common Stock	$	7.92
Exercise price	$	7.92
Risk-free interest rate	2.6		%
Estimated price volatility	78.5		%
Expected term	6.58 years
Dividend yield	—		%

Schedule of SAR Activity

activity consisted of the following:



Number of Shares under SARs	Shares		Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Term (years)	Aggregate Intrinsic Value (in thousands)
Outstanding at December 31, 2016	152,600		$	16.55	9.02	$	—
Granted	5,000		7.37			—
Exercised	—		—			—
Forfeited	(67,130	)	23.16			—
Expired	(6,750	)	12.68			—
Outstanding at December 31, 2017	83,720		11.02		8.21	1
Exercisable at December 31, 2017	39,360		$	11.25	8.15	$	—



Number of Shares under SARs	Shares		Weighted-Average Exercise Price		Weighted-Average Remaining Contractual Term (years)	Aggregate Intrinsic Value (in thousands)
Outstanding at December 31, 2017	83,720		$	11.02	8.21	$	1
Granted	60,000		7.92			—
Exercised	—		—			—
Forfeited	(1,000	)	11.25			—
Expired	(4,700	)	11.25			—
Outstanding at December 31, 2018	138,020		9.66		8.05	89
Exercisable at December 31, 2018	87,370		$	11.14	6.21	$	5

Schedule of Restricted Stock Activity

Restricted stock activity consisted of the following:



	Shares		Weighted-Average Grant Date Fair Value
December 31, 2016	104,340		$	41.61
Granted	437,472		8.13
Forfeited	(29,144	)	38.33
Vested	(16,395	)	44.19
December 31, 2017	496,273		$	12.20
Granted	50,000		10.92
Forfeited	(32,547	)	25.95
Vested	(254,440	)	10.14
Balance as of December 31, 2018	259,286		$	12.25

Selected Quarterly Financial Data (Unaudited) (Tables)

12 Months Ended

Dec. 31, 2018

Quarterly Financial Information Disclosure [Abstract]

Quarterly Financial Information

CONSOLIDATED BALANCE SHEETS



(in thousands)	As of
	March 31,			June 30,			September 30,
	2018			2018			2018
ASSETS
Current assets:
Cash and cash equivalents	$	—		$	2		$	2,014
Accounts receivable, net	58,870			70,324			71,639
Income tax receivable	1,018			1,018			1,018
Inventories, net	91,689			95,957			112,392
Prepaid expenses and other current assets	20,555			26,644			26,905
Total current assets	172,132			193,945			213,968
Property, plant and equipment, net	18,474			24,931			24,536
Intangible assets, net	23,175			21,854			20,534
Goodwill	29,835			29,835			29,835
Other noncurrent assets	4,957			3,552			3,818
TOTAL ASSETS	$	248,573		$	274,117		$	292,691

LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Current liabilities:
Accounts payable	$	55,221		$	64,422		$	88,798
Revolving line of credit	36,662			54,334			52,491
Warrant liability	—			33,700			43,900
Other accrued liabilities	38,697			41,884			44,762
Total current liabilities	130,580			194,340			229,951
Deferred income taxes	427			495			616
Warrant liability	27,200			—			—
Long-term debt, net	54,575			54,604			54,781
Other noncurrent liabilities	15,311			15,753			16,612
TOTAL LIABILITIES	$	228,093		$	265,192		$	301,960

STOCKHOLDERS’ EQUITY (DEFICIT)
Preferred stock	$	—		$	—		$	—
Common stock	19			19			19
Additional paid-in capital	124,981			125,272			125,938
Accumulated deficit	(94,638		)	(106,443		)	(125,262		)
Treasury stock	(9,882		)	(9,923		)	(9,964		)
TOTAL STOCKHOLDERS’ EQUITY (DEFICIT)	20,480			8,925			(9,269		)
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)	$	248,573		$	274,117		$	292,691

POWER SOLUTIONS INTERNATIONAL, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(As Revised)



(in thousands)	As of
	March 31,			June 30,			September 30,
	2017			2017			2017
ASSETS
Current assets:
Cash and cash equivalents	$	342		$	—		$	—
Accounts receivable, net	64,305			56,673			60,811
Income tax receivable	6,829			1,996			841
Inventories, net	97,286			103,335			113,074
Prepaid expenses and other current assets	15,291			12,453			14,536
Total current assets	184,053			174,457			189,262
Property, plant and equipment, net	19,230			19,050			18,974
Intangible assets, net	24,819			23,610			22,401
Goodwill	29,835			29,835			29,835
Other noncurrent assets	5,053			4,518			6,035
TOTAL ASSETS	$	262,990		$	251,470		$	266,507

LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	67,167		$	55,610		$	54,195
Contingent consideration	30			29			20
Revolving line of credit	16,887			25,263			41,332
Other accrued liabilities*	28,809			30,110			37,295
Total current liabilities	112,893			111,012			132,842
Deferred income taxes	933			1,066			1,210
Warrant liability	20,700			21,500			23,200
Long-term debt, net	54,046			54,168			54,306
Other noncurrent liabilities*	19,753			17,707			17,410
TOTAL LIABILITIES	$	208,325		$	205,453		$	228,968

MEZZANINE EQUITY
Series B convertible preferred stock, net	$	24,617		$	27,807		$	31,410
STOCKHOLDERS’ EQUITY
Preferred stock	$	—		$	—		$	—
Common stock	14			14			14
Additional paid-in capital	100,686			96,543			91,737
Accumulated deficit	(59,070		)	(66,817		)	(76,018		)
Treasury stock	(11,582		)	(11,530		)	(9,604		)
TOTAL STOCKHOLDERS’ EQUITY	30,048			18,210			6,129
TOTAL LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS’ EQUITY	$	262,990		$	251,470		$	266,507


*	The Company recorded adjustments to reflect a portion of the accrued product warranty liability previously in Other accrued expenses at March 31, June 30 and September 30 to correct the presentation error and to conform to the current period presentation. See Note 1. Summary of Significant Accounting Policies and Other Information for additional discussion of the adjustment.

CONSOLIDATED STATEMENTS OF OPERATIONS



(in thousands, except per share amounts)	For the Quarter Ended
	March 31,			June 30,			September 30,			December 31,
	2018			2018			2018			2018
Net sales	$	94,413		$	127,073		$	136,318		$	138,234
Cost of sales	84,540			109,006			117,510			126,213
Gross profit	9,873			18,067			18,808			12,021
Operating expenses:
Research, development and engineering expenses	6,021			6,962			7,708			7,910
Selling, general and administrative expenses	13,254			13,276			16,374			16,727
Asset impairment charges	—			—			—			2,234
Amortization of intangible assets	1,045			1,321			1,321			1,321
Total operating expenses	20,320			21,559			25,403			28,192
Operating loss	(10,447		)	(3,492		)	(6,595		)	(16,171		)
Other expense (income):
Interest expense	1,623			1,828			1,974			2,203
Loss (gain) from change in fair value of warrants	2,500			6,500			10,200			(8,800		)
Other expense (income), net	(94		)	(95		)	(68		)	81
Total other expense (income)	4,029			8,233			12,106			(6,516		)
Loss before income taxes	(14,476		)	(11,725		)	(18,701		)	(9,655		)
Income tax (benefit) expense	(272		)	80			118			243
Net loss	$	(14,204	)	$	(11,805	)	$	(18,819	)	$	(9,898	)

Weighted-average common shares outstanding:
Basic	18,483			18,594			18,625			18,638
Diluted	18,483			18,594			18,625			22,360
Loss per common share:
Basic	$	(0.77	)	$	(0.63	)	$	(1.01	)	$	(0.53	)
Diluted	$	(0.77	)	$	(0.63	)	$	(1.01	)	$	(0.84	)

POWER SOLUTIONS INTERNATIONAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS



(in thousands, except per share amounts)	For the Quarter Ended
	March 31,			June 30,			September 30,			December 31,
	2017			2017			2017			2017
Net sales	$	84,265		$	100,922		$	99,953		$	131,476
Cost of sales	74,497			88,443			86,702			115,981
Gross profit	9,768			12,479			13,251			15,495
Operating expenses:
Research, development and engineering expenses	3,950			3,848			5,687			6,459
Selling, general and administrative expenses	10,209			10,688			12,062			11,297
Asset impairment charges	—			—			—			1
Amortization of intangible assets	1,209			1,209			1,210			1,210
Total operating expenses	15,368			15,745			18,959			18,967
Operating loss	(5,600		)	(3,266		)	(5,708		)	(3,472		)
Other expense (income):
Interest expense	6,080			1,404			1,654			1,703
Loss from change in fair value of warrants	—			800			1,700			1,500
Loss on debt extinguishment and modifications	11,921			—			—			—
Other expense (income), net	455			2,142			(10		)	(226		)
Total other expense	18,456			4,346			3,344			2,977
Loss before income taxes	(24,056		)	(7,612		)	(9,052		)	(6,449		)
Income tax expense (benefit)	479			135			149			(320		)
Net loss	(24,535		)	(7,747		)	(9,201		)	(6,129		)
Deemed dividend on Series B convertible preferred stock	—			(3,190		)	(3,603		)	(31,067		)
Net loss available to common stockholders	$	(24,535	)	$	(10,937	)	$	(12,804	)	$	(37,196	)

Weighted-average common shares outstanding:
Basic	11,018			13,697			13,659			16,774
Diluted	11,018			13,697			13,659			16,774
Loss per common share:
Basic	$	(2.23	)	$	(0.80	)	$	(0.94	)	$	(2.22	)
Diluted	$	(2.23	)	$	(0.80	)	$	(0.94	)	$	(2.22	)

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)



(in thousands)	Common Stock		Additional Paid-in Capital			Treasury Stock			Accumulated Deficit			Total Stockholders’ Equity (Deficit)
Balance at December 31, 2017	$	19	$	123,838		$	(9,538	)	$	(82,147	)	$	32,172
Net loss	—		—			—			(14,204		)	(14,204		)
Stock-based compensation expense	—		1,143			(344		)	—			799
Cumulative Impact of ASC 606	—		—			—			1,713			1,713
Balance at March 31, 2018	$	19	$	124,981		$	(9,882	)	$	(94,638	)	$	20,480
Net loss	—		—			—			(11,805		)	(11,805		)
Stock-based compensation expense	—		660			(41		)	—			619
Payment of withholding taxes for net settlement of stock-based awards	—		(369		)	—			—			(369		)
Balance at June 30, 2018	$	19	$	125,272		$	(9,923	)	$	(106,443	)	$	8,925
Net loss	—		—			—			(18,819		)	(18,819		)
Stock-based compensation expense	—		586			(41		)	—			545
Payment of withholding taxes for net settlement of stock-based awards	—		80			—			—			80
Balance at September 30, 2018	$	19	$	125,938		$	(9,964	)	$	(125,262	)	$	(9,269	)
Net loss	—		—			—			(9,898		)	(9,898		)
Stock-based compensation expense	—		585			115			—			700
Payment of withholding taxes for net settlement of stock-based awards	—		(111		)	—			—			(111		)
Balance at December 31, 2018	$	19	$	126,412		$	(9,849	)	$	(135,160	)	$	(18,578	)

POWER SOLUTIONS INTERNATIONAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY



(in thousands)	Preferred Stock			Common Stock		Additional Paid-in Capital			Treasury Stock			Accumulated Deficit			Total Stockholders’ Equity
Balance at December 31, 2016	$	—		$	12	$	86,764		$	(11,581	)	$	(34,535	)	$	40,660
Net loss	—			—		—			—			(24,535		)	(24,535		)
Stock-based compensation expense	—			—		(154		)	(1		)	—			(155		)
Issuance of common stock to Weichai, net of fees	—			2		14,076			—			—			14,078
Issuance of Series B convertible preferred stock, net of fees	24,617			—		—			—			—			—
Balance at March 31, 2017	$	24,617		$	14	$	100,686		$	(11,582	)	$	(59,070	)	$	30,048
Net loss	—			—		—			—			(7,747		)	(7,747		)
Settlement of equity-related acquisition consideration	—			—		(712		)	—			—			(712		)
Stock-based compensation expense	—			—		(214		)	52			—			(162		)
Payment of withholding taxes for net settlement of stock-based awards	—			—		(27		)	—			—			(27		)
Deemed dividend on Series B convertible preferred stock	3,190			—		(3,190		)	—			—			(3,190		)
Balance at June 30, 2017	$	27,807		$	14	$	96,543		$	(11,530	)	$	(66,817	)	$	18,210
Net loss	—			—		—			—			(9,201		)	(9,201		)
Stock-based compensation expense	—			—		(1,195		)	1,926			—			731
Payment of withholding taxes for net settlement of stock-based awards	—			—		(8		)	—			—			(8		)
Deemed dividend on Series B convertible preferred stock	3,603			—		(3,603		)	—			—			(3,603		)
Balance at September 30, 2017	$	31,410		$	14	$	91,737		$	(9,604	)	$	(76,018	)	$	6,129
Net loss	—			—		—			—			(6,129		)	(6,129		)
Stock-based compensation expense	—			—		705			66			—			771
Payment of withholding taxes for net settlement of stock-based awards	—			—		(9		)	—			—			(9		)
Deemed dividend on Series B convertible preferred stock	31,067			—		(31,067		)	—			—			(31,067		)
Conversion of Series B convertible preferred stock to common stock	(62,477		)	5		62,472			—			—			62,477
Balance at December 31, 2017	$	—		$	19	$	123,838		$	(9,538	)	$	(82,147	)	$	32,172

CONSOLIDATED STATEMENTS OF CASH FLOWS



(in thousands)	For the Year to Date Period Ended
	March 31, 2018			June 30, 2018			September 30, 2018
Cash provided by (used in) operating activities
Net loss	$	(14,204	)	$	(26,009	)	$	(44,828	)
Adjustments to reconcile net loss to net cash used in operating activities:
Amortization of intangible assets	1,045			2,366			3,687
Depreciation	1,196			2,524			3,849
Change in valuation of warrants	2,500			9,000			19,200
Stock compensation expense	799			1,418			1,963
Amortization of financing fees	341			659			947
Deferred income taxes	(276		)	(208		)	(87		)
Other non-cash adjustments, net	(350		)	325			1,661
Changes in operating assets and liabilities:
Trade accounts receivable, net	9,710			(1,739		)	(3,058		)
Inventories, net	(9,822		)	(14,825		)	(32,657		)
Prepaid expenses and other assets	(76		)	(4,815		)	(5,387		)
Trade accounts payable	3,748			13,200			37,355
Income taxes refundable	8			(2		)	7
Accrued expenses	4,757			7,914			10,773
Other noncurrent liabilities	2,902			2,000			2,901
Net cash provided by (used in) operating activities	2,278			(8,192		)	(3,674		)
Cash used in investing activities
Capital expenditures	(467		)	(1,588		)	(2,321		)
Asset acquisitions	(1,029		)	(6,595		)	(6,595		)
Net cash used in investing activities	(1,496		)	(8,183		)	(8,916		)
Cash (used in) provided by financing activities
Proceeds from revolving line of credit	106,216			240,698			372,557
Repayments of revolving line of credit	(106,608		)	(223,419		)	(357,121		)
Other uses, net	(390		)	(902		)	(832		)
Net cash (used in) provided by financing activities	(782		)	16,377			14,604
Net increase in cash and restricted cash	—			2			2,014
Cash at beginning of the year	—			—			—
Cash at end of the period	$	—		$	2		$	2,014

POWER SOLUTIONS INTERNATIONAL, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(As Revised)



(in thousands)	For the Year to Date Period Ended
	March 31, 2017			June 30, 2017			September 30, 2017
Cash provided by (used in) operating activities
Net loss	$	(24,535	)	$	(32,282	)	$	(41,483	)
Adjustments to reconcile net loss to net cash used in operating activities:
Amortization of intangible assets	1,209			2,419			3,628
Depreciation	1,172			2,342			3,502
Change in valuation of warrants	—			800			2,500
Stock compensation expense	(865		)	(1,028		)	(297		)
Amortization of financing fees	3,109			3,441			3,778
Deferred income taxes	469			602			746
Loss on extinguishment of debt	11,921			11,921			11,921
Provision for doubtful accounts	48			131			216
Provision for inventory obsolescence	146			539			882
Loss on disposal of fixed assets	10			66			115
Other non-cash adjustments, net	137			200			190
Changes in operating assets and liabilities:
Trade accounts receivable, net	(4,017		)	3,532			(691		)
Inventories, net	3,122			(3,326		)	(13,408		)
Prepaid expenses and other assets	(1,624		)	1,238			(1,359		)
Trade accounts payable	15,186			3,244			1,879
Income taxes refundable	298			5,135			6,293
Accrued expenses*	1,861			3,826			10,622
Other noncurrent liabilities*	450			(1,478		)	(2,576		)
Net cash provided by (used in) operating activities	8,097			1,322			(13,542		)
Cash used in investing activities
Capital expenditures	(1,896		)	(2,669		)	(3,856		)
Other sources, net	—			245			245
Net cash used in investing activities	(1,896		)	(2,424		)	(3,611		)
Cash (used in) provided by financing activities
Repayments of long-term debt	(71,400		)	(71,400		)	(71,400		)
Financing fees	(253		)	(928		)	(928		)
Net proceeds from stock offering and warrants	59,396			59,396			59,396
Proceeds from revolving line of credit	85,945			209,082			324,416
Repayments of revolving line of credit	(81,833		)	(196,593		)	(295,859		)
Acquisition of business contingent consideration payments	(6		)	(9		)	(19		)
Other uses, net	—			(738		)	(745		)
Net cash (used in) provided by financing activities	(8,151		)	(1,190		)	14,861
Net (decrease) in cash and restricted cash	(1,950		)	(2,292		)	(2,292		)
Cash at beginning of the year	2,292			2,292			2,292
Cash at end of the period	$	342		$	—		$	—

Summary of Significant Accounting Policies and Other Information - Narrative (Details)	1 Months Ended	3 Months Ended								12 Months Ended
	Mar. 31, 2017 USD ($)	Dec. 31, 2018 USD ($) board_member	Sep. 30, 2018 USD ($)	Jun. 30, 2018 USD ($)	Mar. 31, 2018 USD ($)	Dec. 31, 2017 USD ($)	Sep. 30, 2017 USD ($)	Jun. 30, 2017 USD ($)	Mar. 31, 2017 USD ($)	Dec. 31, 2018 USD ($) board_member reporting_unit segment	Dec. 31, 2017 USD ($)	Dec. 31, 2016 USD ($)	Jun. 30, 2016 USD ($)
Concentration Risk [Line Items]
Number of board members \| board_member		3								3
Number of board members eligible for election \| board_member										4
Number of operating segments \| segment										1
Research and development and engineering expenses										$ 26,800,000	$ 18,400,000
Valuation allowance against net deferred tax assets		$ 44,405,000				$ 31,992,000				44,405,000	31,992,000		$ 17,800,000
Deferred tax valuation allowance										9,208,000	2,977,000
Unrecognized tax benefits		1,421,000				1,307,000				1,421,000	1,307,000	$ 1,202,000
Asset impairment charges		$ 2,234,000	$ 0	$ 0	$ 0	$ 1,000	$ 0	$ 0	$ 0	$ 2,234,000	1,000
Number of reporting units \| reporting_unit										2
Impairment losses										$ 0	0
Changes in estimates for preexisting warranties					$ 3,800,000					$ 3,842,000	$ 0
Minimum
Concentration Risk [Line Items]
Amortization period										3 years
Maximum
Concentration Risk [Line Items]
Amortization period										15 years
Wells Fargo Revolving Credit Facility
Concentration Risk [Line Items]
Maturity period prior to the final maturity of unsecured senior notes										60 days
Share Purchase Agreement, Weichai Transaction
Concentration Risk [Line Items]
Consideration received on transaction	$ 60,000,000

Summary of Significant Accounting Policies and Other Information - Schedule of Prior Period Adjustment (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended		9 Months Ended		12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Jun. 30, 2018	Jun. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2018	Dec. 31, 2017	Jan. 01, 2018
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Other accrued liabilities	$ 38,697	$ 28,809	$ 41,884	$ 30,110	$ 44,762	$ 37,295	$ 45,700	$ 34,332	$ 33,626
Total current liabilities	130,580	112,893	194,340	111,012	229,951	132,842	220,631	122,612
Other noncurrent liabilities	15,311	19,753	15,753	17,707	16,612	17,410	32,470	12,393
Accrued expenses	4,757	1,861	7,914	3,826	10,773	10,622	11,630	7,839
Other noncurrent liabilities	$ 2,902	450	$ 2,000	(1,478)	$ 2,901	(2,576)	$ 18,786	(7,070)
Previously Reported
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Other accrued liabilities		35,234		35,379		41,393		38,362
Total current liabilities		119,318		116,281		136,940		126,654
Other noncurrent liabilities		13,328		12,438		13,312		8,351
Accrued expenses		2,432		3,242		8,867		6,029
Other noncurrent liabilities		(121)		(894)		(821)		(5,260)
Adjustment
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Other accrued liabilities		(6,425)		(5,269)		(4,098)		(4,042)
Total current liabilities		(6,425)		(5,269)		(4,098)		(4,042)
Other noncurrent liabilities		6,425		5,269		4,098		4,042
Accrued expenses		(571)		584		1,755		1,810
Other noncurrent liabilities		571		(584)		(1,755)		(1,810)
As Revised
Error Corrections and Prior Period Adjustments Restatement [Line Items]
Other accrued liabilities		28,809		30,110		37,295		34,320
Total current liabilities		112,893		111,012		132,842		122,612
Other noncurrent liabilities		$ 19,753		$ 17,707		$ 17,410		$ 12,393

Summary of Significant Accounting Policies and Other Information - Schedules of Concentration of Risk, by Risk Factor (Details)	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Purchases \| Supplier Concentration Risk \| Supplier A
Concentration Risk [Line Items]
Concentration risk, percentage	19.00%	21.00%
Purchases \| Supplier Concentration Risk \| Supplier B
Concentration Risk [Line Items]
Concentration risk, percentage	13.00%
Customer A \| Net sales \| Customer Concentration Risk
Concentration Risk [Line Items]
Concentration risk, percentage	15.00%	16.00%
Customer A \| Accounts Receivable \| Customer Concentration Risk
Concentration Risk [Line Items]
Concentration risk, percentage	15.00%	18.00%
Customer B \| Net sales \| Customer Concentration Risk
Concentration Risk [Line Items]
Concentration risk, percentage	11.00%	10.00%
Customer B \| Accounts Receivable \| Customer Concentration Risk
Concentration Risk [Line Items]
Concentration risk, percentage		13.00%
Customer C \| Accounts Receivable \| Customer Concentration Risk
Concentration Risk [Line Items]
Concentration risk, percentage	25.00%

Summary of Significant Accounting Policies and Other Information - Schedule of Inventory, Current (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Jan. 01, 2018	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017
Inventories
Raw materials	$ 90,877	$ 71,732
Work in process	2,390	4,535
Finished goods	18,077	16,684
Total inventories	111,344	92,951
Inventory allowance	(5,730)	(6,227)
Inventories, net	105,614	86,724	$ 112,392	$ 95,957	$ 91,689	$ 81,565	$ 113,074	$ 103,335	$ 97,286
Inventory Allowance
Balance at beginning of period	6,227	10,082
Charged to expense	2,153	421
Write-offs	(2,650)	(4,276)
Balance at end of year	$ 5,730	$ 6,227

Summary of Significant Accounting Policies and Other Information - Schedule of Prepaid Expense and Other Current Assets (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Jan. 01, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Insurance proceeds receivable	$ 15,989					$ 10,563
Prepaid expenses	3,260					3,710
Contract assets	2,926
Other	742					86
Total	$ 22,917	$ 26,905	$ 26,644	$ 20,555	$ 20,525	$ 14,359	$ 14,536	$ 12,453	$ 15,291

Summary of Significant Accounting Policies and Other Information - Property, Plant and Equipment (Details)	12 Months Ended
	Dec. 31, 2018
Buildings \| Maximum
Property, Plant and Equipment [Line Items]
Useful life	39 years
Leasehold improvements
Property, Plant and Equipment [Line Items]
Useful life
Machinery and equipment \| Maximum
Property, Plant and Equipment [Line Items]
Useful life	10 years
Machinery and equipment \| Minimum
Property, Plant and Equipment [Line Items]
Useful life	1 year

Summary of Significant Accounting Policies and Other Information - Schedule of Other Accrued Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Accrued product warranty	$ 9,767	$ 8,585
Litigation reserves	16,139	12,137
Contract liabilities (deferred revenue)	4,897	2,822
Accrued compensation and benefits	4,520	2,593
Professional services	27	1,974
Accrued interest expense	1,175	686
Other	9,175	5,535
Total	45,700	$ 34,332
Litigation reserves	$ 14,000

Summary of Significant Accounting Policies and Other Information - Schedule of Accrued Product Warranty (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2018	Dec. 31, 2018	Dec. 31, 2017
Accrued Product Warranty
Balance at beginning of year	$ 12,628	$ 12,628	$ 10,200
Current year provision		15,840	5,405
Changes in estimates for preexisting warranties	$ 3,800	3,842	0
Payments made during the period		(9,208)	(2,977)
Balance at end of year		23,102	12,628
Less: Current portion		9,767	8,585
Noncurrent accrued product warranty		$ 13,335	$ 4,043
Diluted share (in dollars per share)	$ 0.21

Revenue - Cumulative Effects Made to the Balance Sheet for ASC 606 Adoption (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Jan. 01, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017
Assets
Inventories, net	$ 105,614	$ 112,392	$ 95,957	$ 91,689	$ 81,565	$ 86,724	$ 113,074	$ 103,335	$ 97,286
Prepaid expenses and other current assets	22,917	26,905	26,644	20,555	20,525	14,359	14,536	12,453	15,291
Liabilities and Stockholders' Equity
Other accrued liabilities	45,700	44,762	41,884	38,697	33,626	34,332	37,295	30,110	28,809
Accumulated deficit	(135,160)	$ (125,262)	$ (106,443)	$ (94,638)	(80,434)	(82,147)	$ (76,018)	$ (66,817)	$ (59,070)
Adjustments due to ASC 606 \| ASC 606
Assets
Inventories, net	(4,586)				(5,159)
Prepaid expenses and other current assets	2,926				6,166
Liabilities and Stockholders' Equity
Other accrued liabilities	(1,952)				(706)
Accumulated deficit	292				$ 1,713
ASC 605
Assets
Inventories, net	110,200					86,724
Prepaid expenses and other current assets	19,991					14,359
Liabilities and Stockholders' Equity
Other accrued liabilities	47,652					34,332
Accumulated deficit	$ (135,452)					$ (82,147)

Revenue - Effects of ASC 606 Within Consolidated Statement of Operations (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended								6 Months Ended		9 Months Ended		12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Jun. 30, 2018	Jun. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2018	Dec. 31, 2017
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Net sales	$ 138,234	$ 136,318	$ 127,073	$ 94,413	$ 131,476	$ 99,953	$ 100,922	$ 84,265					$ 496,038	$ 416,616
Cost of sales	126,213	117,510	109,006	84,540	115,981	86,702	88,443	74,497					437,269	365,623
Gross profit	12,021	18,808	18,067	9,873	15,495	13,251	12,479	9,768					58,769	50,993
Operating loss	(16,171)	(6,595)	(3,492)	(10,447)	(3,472)	(5,708)	(3,266)	(5,600)					(36,705)	(18,046)
(Loss) income before taxes	(9,655)	(18,701)	(11,725)	(14,476)	(6,449)	(9,052)	(7,612)	(24,056)					(54,557)	(47,169)
Net loss	$ (9,898)	$ (18,819)	$ (11,805)	$ (14,204)	(6,129)	(9,201)	(7,747)	(24,535)	$ (26,009)	$ (32,282)	$ (44,828)	$ (41,483)	(54,726)	(47,612)
Net loss available to common stockholders					$ (37,196)	$ (12,804)	$ (10,937)	$ (24,535)					$ (54,726)	$ (85,472)
Net loss per common share:
Basic (in dollars per share)	$ (0.53)	$ (1.01)	$ (0.63)	$ (0.77)	$ (2.22)	$ (0.94)	$ (0.80)	$ (2.23)					$ (2.94)	$ (6.20)
Diluted (in dollars per share)	$ (0.84)	$ (1.01)	$ (0.63)	$ (0.77)	$ (2.22)	$ (0.94)	$ (0.80)	$ (2.23)					$ (2.94)	$ (6.20)
Impact of ASC 606 \| ASC 606
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Net sales													$ (1,995)
Cost of sales													(573)
Gross profit													(1,422)
Operating loss													(1,422)
(Loss) income before taxes													(1,422)
Net loss													(1,422)
Net loss available to common stockholders													$ (1,422)
Net loss per common share:
Basic (in dollars per share)													$ (0.08)
Diluted (in dollars per share)													$ (0.08)
ASC 605
Revenue, Initial Application Period Cumulative Effect Transition [Line Items]
Net sales													$ 498,033
Cost of sales													437,842
Gross profit													60,191
Operating loss													(35,283)
(Loss) income before taxes													(53,135)
Net loss													(53,304)
Net loss available to common stockholders													$ (53,304)
Net loss per common share:
Basic (in dollars per share)													$ (2.86)
Diluted (in dollars per share)													$ (2.86)

Revenue - Narrative (Details) $ in Millions	12 Months Ended
Revenue - Narrative (Details) $ in Millions	Dec. 31, 2018 USD ($)
Revenue from Contract with Customer [Abstract]
Revenue recognized at a point in time	$ 449.8
Revenue recognized over time	46.2
Revenue recognized upon satisfaction of performance obligations	1.2
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2019-01-01
Revenue from Contract with Customer [Abstract]
Revenue, remaining performance obligation, amount	$ 13.9
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, remaining performance obligation, percent	1 year

Revenue - Revenue from External Customers by Geographic Areas (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017
Disaggregation of Revenue [Line Items]
Net sales	$ 138,234	$ 136,318	$ 127,073	$ 94,413	$ 131,476	$ 99,953	$ 100,922	$ 84,265	$ 496,038	$ 416,616
North America
Disaggregation of Revenue [Line Items]
Net sales	123,722	120,955	111,444	79,947					436,068
Pacific Rim
Disaggregation of Revenue [Line Items]
Net sales	9,303	10,913	11,516	10,339					42,071
Europe
Disaggregation of Revenue [Line Items]
Net sales	3,795	3,012	3,621	3,315					13,743
Other
Disaggregation of Revenue [Line Items]
Net sales	1,414	1,438	492	812					4,156
Industrial
Disaggregation of Revenue [Line Items]
Net sales	55,059	52,367	48,051	45,719					201,196
Energy
Disaggregation of Revenue [Line Items]
Net sales	46,623	48,481	52,014	38,567					185,685
Transportation
Disaggregation of Revenue [Line Items]
Net sales	$ 36,552	$ 35,470	$ 27,008	$ 10,127					$ 109,157

Revenue - Schedule of Contract Balances (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Jan. 01, 2018
Revenue from Contract with Customer [Abstract]
Short-term contract assets (included in Prepaid expenses and other current assets)	$ 2,926	$ 6,166
Short-term contract liabilities (included in Other accrued liabilities)	(4,897)	(1,299)
Long-term contract liabilities (included in Other noncurrent liabilities)	(14,611)	(2,767)
Net contract assets (liabilities)	$ (16,582)	$ 2,100

Weichai Transactions (Details) - Share Purchase Agreement, Weichai Transaction	1 Months Ended			12 Months Ended
	Nov. 30, 2017 shares	Aug. 31, 2017 shares	Mar. 31, 2017 USD ($) shares	Dec. 31, 2017 shares
Subsidiary, Sale of Stock [Line Items]
Consideration received on transaction \| $			$ 60,000,000
Common Stock
Subsidiary, Sale of Stock [Line Items]
Number of shares issued in transaction (in shares)			2,728,752	2,729,000
Common Stock \| Chief Strategy Officer
Subsidiary, Sale of Stock [Line Items]
Number of shares issued in transaction (in shares)		200,000
Redeemable Convertible Series B Preferred Stock
Subsidiary, Sale of Stock [Line Items]
Number of shares issued in transaction (in shares)			2,385,624
Debt instrument, convertible, conversion ratio			2
Issuance of redeemable convertible Series B Preferred Stock, net of fees (in shares)	4,771,248			4,771,000

Weichai Transactions - Series B Convertible Preferred Stock (Details) - Share Purchase Agreement, Weichai Transaction - USD ($) $ / shares in Units, $ in Millions		1 Months Ended		12 Months Ended
	Sep. 30, 2017	Nov. 30, 2017	Mar. 31, 2017	Dec. 31, 2017	Dec. 31, 2018
Class of Stock [Line Items]
Preferred stock, dividend rate, percentage	10.00%
Redeemable Convertible Series B Preferred Stock
Class of Stock [Line Items]
Exercise price of warrants or rights (in dollars per share)					$ 16
Beneficial conversion feature		$ 23.1
Number of shares issued in transaction (in shares)			2,385,624
Issuance of redeemable convertible Series B Preferred Stock, net of fees (in shares)		4,771,248		4,771,000

Weichai Transactions - Weichai Warrant (Details) - USD ($) $ / shares in Units, $ in Millions			3 Months Ended
	May 03, 2019	Apr. 23, 2019	Dec. 31, 2018	Sep. 30, 2018	Dec. 31, 2016
Share Purchase Agreement, Weichai Transaction
Class of Warrant or Right [Line Items]
Exercisable (term)			90 days
Volume weighted average share price percentage			85.00%	50.00%
Trading period			20 days
EBITDA, minimum (less than)					$ 22.0
Net book value per share, minimum (less than) (in dollars per share)					$ 8
Aggregate amount					$ 15.0
Subsequent Event \| Share Purchase Agreement, Weichai Transaction
Class of Warrant or Right [Line Items]
Expense as a result of the exercise		$ 1.4
Subsequent Event \| Share Purchase Agreement, Second Amended And Restated Warrant \| Series B Convertible Preferred Stock
Class of Warrant or Right [Line Items]
Exercise of private placement warrants (in shares)		4,049,759
Percent ownership of outstanding common stock	51.50%
Exercise proceeds for the warrants		$ 1.6

Weichai Transactions - Valuation and Accounting for Issuance and Conversion of Common Stock, Preferred Stock (and Related Beneficial Conversion Feature) and Warrants (Details) - USD ($) $ / shares in Units, $ in Thousands	1 Months Ended	3 Months Ended								12 Months Ended
	Nov. 30, 2017	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017
Subsidiary, Sale of Stock [Line Items]
Warrant, current		$ 35,100	$ 43,900	$ 33,700	$ 0	$ 0				$ 35,100	$ 0
Loss from change in fair value of warrants		(8,800)	$ 10,200	$ 6,500	$ 2,500	1,500	$ 1,700	$ 800	$ 0	10,400	4,000
Carrying value of the common stock and series b preferred stock		39,300								39,300
Aggregate remaining proceeds										38,700
Proceeds allocated based on related fair value, net of transaction costs										24,600
Transaction costs										400
Deemed dividend recorded in additional paid in capital										37,900
Carrying value of preferred stock		$ 62,500					$ 31,410	$ 27,807	$ 24,617	$ 62,500
Par value (in dollars per share)		$ 0.001								$ 0.001
Conversion price (in dollars per share)	$ 4.85
Common stock
Subsidiary, Sale of Stock [Line Items]
Proceeds allocated to common stock										$ 14,300
Redeemable Convertible Series B Preferred Stock
Subsidiary, Sale of Stock [Line Items]
Proceeds allocated to Series B Preferred Stock										25,000
Fully accreted discount										14,100
Share Purchase Agreement, Weichai Transaction
Subsidiary, Sale of Stock [Line Items]
Weichai Warrant liability		$ 35,100								$ 35,100
Warrant, current						$ 24,700					$ 24,700
Share Purchase Agreement, Weichai Transaction \| Redeemable Convertible Series B Preferred Stock
Subsidiary, Sale of Stock [Line Items]
Beneficial conversion feature	$ 23,100
Issuance of redeemable convertible Series B Preferred Stock, net of fees (in shares)	4,771,248										4,771,000

Property, Plant and Equipment, and Leases - Property, Plant and Equipment (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Apr. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017
Property, Plant and Equipment [Line Items]
Total property, plant and equipment, at cost	$ 46,100					$ 35,735
Accumulated depreciation	(21,834)					(16,775)
Property, plant and equipment, net	24,266	$ 24,536	$ 24,931		$ 18,474	18,960	$ 18,974	$ 19,050	$ 19,230
Leasehold improvements
Property, Plant and Equipment [Line Items]
Total property, plant and equipment, at cost	6,405					6,320
Machinery and equipment
Property, Plant and Equipment [Line Items]
Total property, plant and equipment, at cost	38,454			$ 6,900		27,379
Construction in progress
Property, Plant and Equipment [Line Items]
Total property, plant and equipment, at cost	$ 1,241					$ 2,036

Property, Plant and Equipment, and Leases - Narrative (Details) - USD ($) $ in Thousands	1 Months Ended	12 Months Ended
	Apr. 30, 2018	Dec. 31, 2018	Dec. 31, 2017
Property, Plant and Equipment [Line Items]
Property, plant and equipment		$ 46,100	$ 35,735
Asset retirement obligation	$ 1,300
Rent expense under operating leases		5,100	4,700
Capital lease obligation		400
Machinery and equipment
Property, Plant and Equipment [Line Items]
Purchase price	5,600
Property, plant and equipment	$ 6,900	$ 38,454	$ 27,379

Property, Plant and Equipment, and Leases - Schedule of Future Minimum Lease Payments (Details) $ in Thousands	Dec. 31, 2018 USD ($)
Operating
2019	$ 5,071
2020	5,175
2021	4,724
2022	4,681
2023	3,104
2024 and beyond	3,694
Total	26,449
Capital
2019	80
2020	63
2021	67
2022	50
2023	13
2024 and beyond	0
Total	$ 273

Goodwill and Other Intangibles - Narrative (Details) - USD ($) $ in Thousands	1 Months Ended		3 Months Ended								12 Months Ended
	Mar. 31, 2018	Sep. 30, 2017	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017
Finite-Lived Intangible Assets [Line Items]
Accumulated impairment losses			$ 11,600				$ 11,600				$ 11,600	$ 11,600
Goodwill	$ 29,835	$ 29,835	29,835	$ 29,835	$ 29,835	$ 29,835	29,835	$ 29,835	$ 29,835	$ 29,835	29,835	29,835
Asset impairment charges			$ 2,234	$ 0	$ 0	$ 0	$ 1	$ 0	$ 0	$ 0	2,234	1
Asset Purchase Agreement - Alternative Fuel Supply Technology
Finite-Lived Intangible Assets [Line Items]
Guaranteed payment	1,200	$ 1,200									1,000
Additional payment for future sales milestones	3,300
Asset Purchase Agreement - Alternative Fuel Supply Technology \| Intellectual Property
Finite-Lived Intangible Assets [Line Items]
Intangible assets acquired	1,500										$ 1,000	$ 500
Asset Purchase Agreement - Alternative Fuel Supply Technology \| Developed technology
Finite-Lived Intangible Assets [Line Items]
Intangible assets acquired	$ 2,700
Useful life	3 years

Goodwill and Other Intangibles - Schedule of Finite-Lived Intangible Assets (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Value	$ 37,340	$ 37,640
Accumulated Amortization	(20,330)	(16,149)
Net Book Value	17,010	21,491
Customer relationships
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Value	34,940	34,940
Accumulated Amortization	(18,816)	(14,915)
Net Book Value	16,124	20,025
Developed technology
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Value	700	1,000
Accumulated Amortization	(537)	(434)
Net Book Value	163	566
Trade names and trademarks
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Value	1,700	1,700
Accumulated Amortization	(977)	(800)
Net Book Value	$ 723	$ 900

Goodwill and Other Intangibles - Schedule of Future Amortization Expense (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Year Ending December 31,
2019	$ 3,638
2020	3,053
2021	2,535
2022	2,124
2023	1,746
2024 and beyond	3,914
Net Book Value	$ 17,010	$ 21,491

Debt - Schedule of Debt (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Schedule Of Long Term Debt And Short Term Debt Instruments [Line Items]
Long-Term Debt	$ 55,000
Less Unamortized Debt Issuance Costs	(288)	$ (561)
Total Long-Term Debt	54,712	54,439
Debt issuance costs	1,000	900
Unsecured Senior Notes
Schedule Of Long Term Debt And Short Term Debt Instruments [Line Items]
Long-Term Debt	55,000	55,000
Wells Fargo Revolving Credit Facility
Schedule Of Long Term Debt And Short Term Debt Instruments [Line Items]
Total Short-Term Debt	$ 54,613	$ 37,055

Debt - Schedule of Maturities of Long-Term Debt (Details) $ in Thousands	Dec. 31, 2018 USD ($)
Debt Disclosure [Abstract]
2019	$ 0
2020	55,000
Total	$ 55,000

Debt - Wells Fargo Credit Agreement - Narrative (Details) - USD ($)	12 Months Ended
	Dec. 31, 2018	Mar. 29, 2018	Dec. 31, 2017	Oct. 03, 2017	Jul. 17, 2017	Mar. 31, 2017	Jun. 28, 2016
Line of Credit Facility [Line Items]
Debt issuance costs	$ 1,000,000		$ 900,000
Wells Fargo Credit Agreement
Line of Credit Facility [Line Items]
Lender fees		$ 800,000				$ 700,000
Revolving Credit Facility \| Wells Fargo Credit Agreement
Line of Credit Facility [Line Items]
Maximum borrowing capacity	75,000,000	$ 75,000,000		$ 58,750,000.00	$ 52,500,000.0	65,000,000	$ 75,000,000
Reserve against borrowing base availability	$ 9,000,000
Unused line fee percentage	0.25%
Available revolving line of credit balance	$ 8,900,000		13,000,000			$ 40,000,000.0
Debt issuance costs	0		100,000
Lender fees	$ 800,000		$ 700,000
Revolving Credit Facility \| Wells Fargo Credit Agreement \| Minimum \| Prime Rate
Line of Credit Facility [Line Items]
Basis spread on variable rate	1.25%
Revolving Credit Facility \| Wells Fargo Credit Agreement \| Minimum \| LIBOR
Line of Credit Facility [Line Items]
Basis spread on variable rate	2.75%
Revolving Credit Facility \| Wells Fargo Credit Agreement \| Maximum \| Prime Rate
Line of Credit Facility [Line Items]
Basis spread on variable rate	1.75%
Revolving Credit Facility \| Wells Fargo Credit Agreement \| Maximum \| LIBOR
Line of Credit Facility [Line Items]
Basis spread on variable rate	3.25%
Revolving Credit Facility
Line of Credit Facility [Line Items]
Maturity period prior to the final maturity of unsecured senior notes	60 days
Debt instrument, interest rate	1.00%

Debt - Schedule of Amounts Borrowed Under Wells Fargo Revolving Credit Agreement (Details) - Wells Fargo Credit Agreement - Wells Fargo Revolving Credit Facility - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Line of Credit Facility [Line Items]
Average borrowings under Wells Fargo Revolving Credit Facility	$ 47,031	$ 26,662
Average Interest Cost on Wells Fargo Revolving Credit Facility	6.51%	6.85%
Accrued and unpaid interest	$ 174	$ 90
LIBOR
Line of Credit Facility [Line Items]
LIBOR loan interest rate	5.97%	4.51%
Prime Rate
Line of Credit Facility [Line Items]
Wells Fargo Prime Rate (Base Rate) loan interest rate	7.25%	6.00%

Debt - Wells Fargo Credit Agreement - Amendments (Details) - Wells Fargo Credit Agreement - USD ($)	Mar. 29, 2018	Jul. 17, 2017	Apr. 01, 2017	Jan. 27, 2017	Jun. 28, 2016	Dec. 31, 2018	Oct. 01, 2018	Dec. 31, 2017	Oct. 03, 2017	Mar. 31, 2017
Line of Credit Facility [Line Items]
Lender fees	$ 800,000									$ 700,000
Revolving Credit Facility
Line of Credit Facility [Line Items]
Commitment fee percentage	1.00%	1.00%		2.00%	2.00%
Lender fees						$ 800,000		$ 700,000
Interest rate increase			2.00%
Line of credit facility, decrease limit										25,000,000.0
Available revolving line of credit balance						8,900,000		$ 13,000,000		40,000,000.0
Maximum borrowing capacity	$ 75,000,000	$ 52,500,000.0			$ 75,000,000	$ 75,000,000			$ 58,750,000.00	$ 65,000,000
Line of credit facility, increase limit		$ 12,500,000.0					$ 9,000,000.0
Decrease in interest rate margin		(1.00%)
Maturity, period prior to senior notes maturity	60 days
Percentage of borrowing base	10.00%
Revolving Credit Facility \| Minimum
Line of Credit Facility [Line Items]
Line of credit facility, increase limit	$ 6,500,000.0								$ 6,250,000.00
Revolving Credit Facility \| Maximum
Line of Credit Facility [Line Items]
Line of credit facility, increase limit	$ 7,500,000.0

Debt - Unsecured Senior Notes - Narrative (Details) - USD ($)		1 Months Ended	12 Months Ended
	Mar. 31, 2017	Apr. 30, 2015	Dec. 31, 2018	Oct. 30, 2019	May 31, 2019	Apr. 19, 2018	Dec. 31, 2017	Apr. 01, 2016
Debt Instrument [Line Items]
Debt financing costs			$ 1,000,000				$ 900,000
Revolving Credit Facility and Senior Notes \| Subsequent Event
Debt Instrument [Line Items]
Debt instrument, interest rate					7.50%
Unsecured Senior Notes
Debt Instrument [Line Items]
Debt instrument, interest rate								6.50%
Legal fees	$ 100,000
Consent fee	$ 200,000		$ 300,000			$ 300,000	200,000
Unsecured Senior Notes \| Subsequent Event
Debt Instrument [Line Items]
Consent fee				$ 300,000
Unsecured Senior Notes \| 5.50% Senior Notes
Debt Instrument [Line Items]
Debt instrument, face amount		$ 55,000,000
Debt instrument, interest rate		5.50%	8.50%
Proceeds from issuance of long-term debt		$ 53,500,000
Debt financing costs		$ 1,500,000
Accrued unpaid interest			$ 800,000				$ 600,000
Unsecured Senior Notes \| 5.50% Senior Notes \| Before May 1, 2016
Debt Instrument [Line Items]
Redemption price, percentage			101.00%

Debt - Senior Notes - Amendments (Details) - Unsecured Senior Notes - USD ($) $ in Millions	Mar. 31, 2017	Oct. 30, 2019	Dec. 31, 2018	Apr. 19, 2018	Dec. 31, 2017	Apr. 01, 2016
Debt Instrument [Line Items]
Consent fee	$ 0.2		$ 0.3	$ 0.3	$ 0.2
Legal fees	$ 0.1
Debt instrument, interest rate						6.50%
Interest rate if Form 10-K is filed on or before September 30, 2018				7.50%
Interest rate if Form 10-K has not been filed on or before September 30, 2018				8.50%
Interest rate subsequent to Form 10-K filing				7.50%
Subsequent Event
Debt Instrument [Line Items]
Consent fee		$ 0.3

Debt - TPG Term Loan - Narrative (Details) - USD ($)	1 Months Ended			3 Months Ended	6 Months Ended	9 Months Ended	12 Months Ended
Debt - TPG Term Loan - Narrative (Details) - USD ($)	Mar. 31, 2017	Feb. 28, 2017	Jun. 30, 2016	Mar. 31, 2017	Jun. 30, 2017	Sep. 30, 2017	Dec. 31, 2018	Dec. 31, 2017	Mar. 29, 2018	Oct. 03, 2017	Jul. 17, 2017	Jun. 28, 2016
Debt Instrument [Line Items]
Debt issuance costs							$ 1,000,000	$ 900,000
Loss on debt extinguishment and modifications				$ 11,921,000	$ 11,921,000	$ 11,921,000	0	11,921,000
Term Loan \| TPG Term Loan
Debt Instrument [Line Items]
Debt instrument, face amount												$ 60,000,000
Debt default, basis spread on interest rate		2.00%
Principal amount of loan with amendment fees		$ 71,400,000
Amendment fee			$ 11,400,000
Debt issuance costs								400,000
Loss on debt extinguishment and modifications	$ 11,900,000
Secured Debt
Debt Instrument [Line Items]
Maximum borrowing capacity												135,000,000
Revolving Credit Facility \| Wells Fargo Credit Agreement
Debt Instrument [Line Items]
Maximum borrowing capacity	$ 65,000,000			$ 65,000,000			75,000,000		$ 75,000,000	$ 58,750,000.00	$ 52,500,000.0	$ 75,000,000
Debt issuance costs							$ 0	$ 100,000

Fair Value of Financial Instruments - Schedule of Debt Instruments Measured at Fair Value (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Long-term Debt, Gross	$ 55,000
Unsecured Senior Notes \| Fair Value, Measurements, Recurring \| Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Unsecured Senior Notes	0	$ 0
Unsecured Senior Notes \| Fair Value, Measurements, Recurring \| Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Unsecured Senior Notes	0	0
Unsecured Senior Notes \| Fair Value, Measurements, Recurring \| Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Unsecured Senior Notes	52,700	50,000
Unsecured Senior Notes
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Long-term Debt, Gross	55,000	55,000
Unsecured Senior Notes \| Unsecured Senior Notes \| Fair Value, Measurements, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Long-term Debt, Gross	55,000	55,000
Wells Fargo Revolving Credit Facility \| Fair Value, Measurements, Recurring \| Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Wells Fargo revolving credit facility	0	0
Wells Fargo Revolving Credit Facility \| Fair Value, Measurements, Recurring \| Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Wells Fargo revolving credit facility	0	0
Wells Fargo Revolving Credit Facility
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total Short-Term Debt	54,613	37,055
Wells Fargo Revolving Credit Facility \| Wells Fargo Revolving Credit Facility \| Fair Value, Measurements, Recurring \| Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total Short-Term Debt	$ 54,613	$ 37,055

Fair Value of Financial Instruments - Schedule of Financial Instruments Measured at Fair Value (Details) - Weichai Warrant liability - Fair Value, Measurements, Recurring - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017
Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Weichai Warrant liability	$ 0	$ 0
Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Weichai Warrant liability	0	0
Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Weichai Warrant liability	$ 35,100	$ 24,700

Fair Value of Financial Instruments - Summary of Change in the Estimated Fair Value of Private Placement Warrants (Details) - Warrants - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation
Balance at beginning of year	$ 24,700	$ 0
Issuance of warrants	0	20,700
Increase (decrease) in value	10,400	4,000
Balance at end of year	$ 35,100	$ 24,700

Fair Value of Financial Instruments - Schedule of Inputs of the Black-Scholes Option Pricing Model (Details) - Black-Scholes option pricing model - Weichai Warrant liability - Level 3	Dec. 31, 2018 $ / shares	Dec. 31, 2017 $ / shares
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Contractual term	6 months	1 year
Market value of the Common Stock
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Option pricing model input	9.25	7.5
Risk-free interest rate
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Option pricing model input	0.026	0.018
Estimated price volatility
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Option pricing model input	0.55	0.95
Dividend yield
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Option pricing model input	0	0

Commitments and Contingencies (Details)		1 Months Ended							12 Months Ended	13 Months Ended
Commitments and Contingencies (Details)	Jun. 30, 2017 USD ($)	Sep. 30, 2019 USD ($)	Feb. 28, 2019 USD ($)	Jan. 31, 2019 USD ($)	Oct. 31, 2018 USD ($)	Mar. 31, 2018 USD ($)	Sep. 30, 2017 USD ($)	Jun. 30, 2016 USD ($)	Dec. 31, 2018 USD ($) letter_of_credit	Jun. 30, 2018 USD ($) installment_payment	Apr. 30, 2019 USD ($)	Apr. 30, 2015 USD ($)	Oct. 31, 2014 USD ($)
Loss Contingencies [Line Items]
Number of outstanding letters of credit \| letter_of_credit									5
Outstanding letters of credit amount									$ 1,600,000
Asset Purchase Agreement - Alternative Fuel Supply Technology
Loss Contingencies [Line Items]
Payments for commissions						$ 1,200,000	$ 1,200,000		$ 1,000,000
Guinta v. Power Solutions International, Inc. \| Subsequent Event
Loss Contingencies [Line Items]
Litigation amount paid			$ 8,500,000
Guinta v. Power Solutions International, Inc. \| Forecast
Loss Contingencies [Line Items]
Litigation settlement payment				$ 8,500,000
Eric Cohen vs. The Company \| Subsequent Event
Loss Contingencies [Line Items]
Litigation amount paid		$ 3,000,000
Jerome Treadwell v. The Company
Loss Contingencies [Line Items]
Recovery per negligent violation					$ 1,000
Recovery per intentional or reckless violation					$ 5,000
Settled Litigation \| Carl Trent, Kenneth Trent, and CKT Holdings, Inc. vs. 3PI and PSI
Loss Contingencies [Line Items]
Range of damages sought	$ 3,000,000
Settlement payments	$ 1,750,000									$ 1,250,000
Number of settlement payments \| installment_payment										12
Settled Litigation \| Carl Trent, Kenneth Trent, and CKT Holdings, Inc. vs. 3PI and PSI \| Compensatory damages \| Compensatory damages
Loss Contingencies [Line Items]
Counterclaim damages sought												$ 20,000,000
Settled Litigation \| Carl Trent, Kenneth Trent, and CKT Holdings, Inc. vs. 3PI and PSI \| Consequential and punitive damages, in excess of \| Consequential and punitive damages, in excess of
Loss Contingencies [Line Items]
Counterclaim damages sought												$ 20,000,000
Settled Litigation \| Carl Trent, Kenneth Trent, and CKT Holdings, Inc. vs. 3PI and PSI \| Tax gross-up payment under the SPA
Loss Contingencies [Line Items]
Damages sought								$ 350,000
Settled Litigation \| Carl Trent, Kenneth Trent, and CKT Holdings, Inc. vs. 3PI and PSI \| Equity payment due under the SPA
Loss Contingencies [Line Items]
Damages sought								$ 9,300,000
Settled Litigation \| Dorvit v. Winemaster \| Subsequent Event
Loss Contingencies [Line Items]
Range of damages sought											$ 1,900,000
Minimum \| Settled Litigation \| Carl Trent, Kenneth Trent, and CKT Holdings, Inc. vs. 3PI and PSI
Loss Contingencies [Line Items]
Range of damages sought													$ 500,000
Maximum \| Settled Litigation \| Carl Trent, Kenneth Trent, and CKT Holdings, Inc. vs. 3PI and PSI
Loss Contingencies [Line Items]
Range of damages sought													$ 1,000,000

Income Taxes - Schedule of Expense (Benefit) for Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended								6 Months Ended		9 Months Ended		12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Jun. 30, 2018	Jun. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2018	Dec. 31, 2017
Current tax expense
Federal													$ 198	$ 127
State													27	77
Total current tax expense													225	204
Deferred tax (benefit) expense
Federal													(149)	100
State													93	139
Total deferred tax (benefit) expense				$ (276)				$ 469	$ (208)	$ 602	$ (87)	$ 746	(56)	239
Total tax expense	$ 243	$ 118	$ 80	$ (272)	$ (320)	$ 149	$ 135	$ 479					$ 169	$ 443

Income Taxes - Narrative (Details) - USD ($) $ in Thousands			3 Months Ended	12 Months Ended
Income Taxes - Narrative (Details) - USD ($) $ in Thousands	May 03, 2019	Apr. 23, 2019	Dec. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Jun. 30, 2016
Income Tax Contingency [Line Items]
Income tax refunds				$ 200	$ 6,300
Pretax income (loss) including permanently excludable loss				(54,600)	(47,200)
Provisional adjustment to decrease net deferred tax assets			$ 10,900		$ 10,900
Corresponding net adjustment to deferred tax expense			11,300
Period to carry forward general business credits					20 years
Valuation allowance against net deferred tax assets			31,992	44,405	$ 31,992	$ 17,800
Deferred tax liability			$ 703	647	$ 703
Tax credit carryforwards				5,800
Federal net operating loss carryforwards				13,600
State net operating loss carryforwards				$ 5,400
Effective income tax rate if the impact of the change in valuation of warrants had been excluded				(0.30%)	(0.90%)
Possible decrease in liability for unrecognized tax benefits, excluding interest and penalties				$ 100
Series B Convertible Preferred Stock \| Subsequent Event \| Share Purchase Agreement, Second Amended And Restated Warrant
Income Tax Contingency [Line Items]
Exercise of private placement warrants (in shares)		4,049,759
Percent ownership of outstanding common stock	51.50%
Private placement warranty liability
Income Tax Contingency [Line Items]
Permanently excludable loss associated with change in valuation of warrants				$ 10,400	$ 4,000

Income Taxes - Reconciliation of Effective Tax Rate to the Statutory Rate (Details) - USD ($) $ in Thousands	3 Months Ended								12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017
Amount
Income tax benefit at federal statutory rate									$ (11,457)	$ (16,037)
State income tax benefit, net of federal tax effect									(1,762)	(2,283)
Non-deductible warrants expense									2,184	1,360
Other permanent differences									70	106
Research and development tax credits									(1,058)	(426)
Other tax credits									(934)	(419)
Tax reserve reassessment									196	104
Federal tax rate change									0	10,899
Change in valuation allowance									12,856	4,956
3PI Settlement									0	1,976
Other, net									74	207
Total tax expense	$ 243	$ 118	$ 80	$ (272)	$ (320)	$ 149	$ 135	$ 479	$ 169	$ 443
Percent
Income tax benefit at federal statutory rate									21.00%	34.00%
State income tax benefit, net of federal tax effect									3.20%	4.80%
Non-deductible warrants expense									(4.00%)	(2.90%)
Other permanent differences									(0.10%)	(0.20%)
Research and development tax credits									1.90%	0.90%
Other tax credits									1.70%	0.90%
Tax reserve reassessment									(0.40%)	(0.20%)
Federal tax rate change									0.00%	(23.10%)
Change in valuation allowance									(23.50%)	(10.40%)
3PI Settlement									0.00%	(4.20%)
Other, net									(0.10%)	(0.50%)
Income tax expense									(0.30%)	(0.90%)

Income Taxes - Schedule of Significant Components of the Deferred Income Tax Assets and Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Dec. 31, 2017	Jun. 30, 2016
Deferred tax assets:
Net operating loss carryforwards	$ 19,006	$ 15,399
Research and development credits	3,858	2,806
Other state credits	1,923	989
Inventory	2,203	2,560
Allowances and bad debts	840	596
Accrued warranty	5,732	3,387
Accrued wages and benefits	413	351
Other accrued expenses	5,281	2,906
Stock-based compensation	649	645
Capitalized research and development costs	770	1,090
Intangible amortization	2,240	1,734
Contract liabilities (deferred revenue)	495	339
Other	2,490	152
Total deferred tax assets	45,900	32,954
Valuation allowance	(44,405)	(31,992)	$ (17,800)
Total deferred tax assets, net of valuation allowance	1,495	962
Deferred tax liabilities:
Tax depreciation in excess of book depreciation on property, plant and equipment	(2,142)	(1,665)
Total deferred tax liabilities	(2,142)	(1,665)
Net deferred tax liability	$ (647)	$ (703)

Income Taxes - Schedule of the Change in Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns
Balance at beginning of year	$ 1,307	$ 1,202
Additions based on tax positions related to the current year	193	105
Reductions for tax positions of prior years	(79)	0
Balance at end of year	$ 1,421	$ 1,307

Stockholders' Equity - Common and Treasury Stock and Series B Convertible Preferred Stock (Details)			1 Months Ended		12 Months Ended
	May 03, 2019	Apr. 23, 2019 shares	Nov. 30, 2017 shares	Mar. 31, 2017 shares	Dec. 31, 2018 series_of_preferred $ / shares shares	Dec. 31, 2017 $ / shares shares
Common Shares Issued
Common stock, issued, beginning balance (in shares)					19,067,000	11,567,000
Common stock, issued, ending balance (in shares)					19,067,000	19,067,000
Treasury Stock Shares
Treasury stock shares, beginning balance (in shares)					634,000	645,000
Treasury stock shares issued (in shares)					(205,000)	(11,000)
Treasury stock shares, ending balance (in shares)					429,000	634,000
Common Shares Outstanding
Common stock, outstanding, beginning balance (in shares)					18,433,000	10,922,000
Common stock, outstanding, ending balance (in shares)					18,638,000	18,433,000
Series B convertible preferred stock, authorized (in shares)					5,000,000	5,000,000
Series B convertible preferred stock, par value (in dollars per share) \| $ / shares					$ 0.001	$ 0.001
Preferred stock, outstanding (in shares)					0	0
Series B Convertible Preferred Stock
Common Shares Outstanding
Series B convertible preferred stock, authorized (in shares)					5,000,000
Series B convertible preferred stock, par value (in dollars per share) \| $ / shares					$ 0.001
Number of authorized series of preferred stock \| series_of_preferred					2
Common Stock
Common Shares Outstanding
Conversion of outstanding stock (in shares)					205,000	11,000
Share Purchase Agreement, Weichai Transaction \| Redeemable Convertible Series B Preferred Stock
Common Shares Outstanding
Shares issued to Weichai (in shares)				2,385,624
Issuance of redeemable convertible Series B Preferred Stock, net of fees (in shares)			4,771,248			4,771,000
Share Purchase Agreement, Weichai Transaction \| Common Stock
Common Shares Outstanding
Shares issued to Weichai (in shares)				2,728,752		2,729,000
Subsequent Event \| Share Purchase Agreement, Second Amended And Restated Warrant \| Series B Convertible Preferred Stock
Common Shares Outstanding
Warrants exercised (in shares)		4,049,759
Percent ownership of outstanding common stock	51.50%

Stock-Based Compensation - Narrative (Details) - SARs - shares	12 Months Ended
	Dec. 31, 2013	Dec. 31, 2018	Dec. 31, 2012
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share initially made available for awards (in shares)			830,925
Additional shares added to the plan (in shares)	700,000
Share available for issuance of future awards (in shares)		495,558

Stock-Based Compensation - SAR Awards Narrative (Details) - SARs - USD ($) $ / shares in Units, $ in Millions	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award (in shares)	60,000	5,000
2017 SARs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award (in shares)		5,000
Resulting fair value per share (in dollars per share)		$ 4.10
Vesting period		2 years
2018 SARs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award (in shares)	60,000
Resulting fair value per share (in dollars per share)	$ 5.63
Vesting period	3 years 2 months 1 day
Share-based compensation expense	$ 0.1

Stock-Based Compensation - Schedule of Fair Value Assumptions (Details) - SARs - $ / shares	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
2017 SARs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Market value closing price of the Common Stock (in dollars per share)		$ 7.37
Exercise price (in dollars per share)		$ 7.37
Risk-free interest rate		2.10%
Expected volatility		58.50%
Expected term		6 years
Dividend yield		0.00%
2018 SARs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Market value closing price of the Common Stock (in dollars per share)	$ 7.92
Exercise price (in dollars per share)	$ 7.92
Risk-free interest rate	2.60%
Expected volatility	78.50%
Expected term	6 years 6 months 29 days
Dividend yield	0.00%

Stock-Based Compensation - Schedule of SAR Activity (Details) - SARs - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016
Shares
Outstanding, beginning balance (in shares)	83,720	152,600
Granted (in shares)	60,000	5,000
Exercised (in shares)	0	0
Forfeited (in shares)	(1,000)	(67,130)
Expired (in shares)	(4,700)	(6,750)
Outstanding, ending balance (in shares)	138,020	83,720	152,600
Exercisable (in shares)	87,370	39,360
Weighted-Average Exercise Price
Outstanding, beginning balance (in dollars per share)	$ 11.02	$ 16.55
Granted (in dollars per share)	7.92	7.37
Exercised (in dollars per share)	0.00	0.00
Forfeited (in dollars per share)	11.25	23.16
Expired (in dollars per share)	11.25	12.68
Outstanding, ending balance (in dollars per share)	9.66	11.02	$ 16.55
Exercisable (in dollars per share)	$ 11.14	$ 11.25
Weighted-Average Remaining Contractual Term (years)
Outstanding (term)	8 years 20 days	8 years 2 months 16 days	9 years 7 days
Exercisable (term)	6 years 2 months 15 days	8 years 1 month 24 days
Aggregate Intrinsic Value (in thousands)
Outstanding	$ 89	$ 1
Exercisable	$ 5	$ 0

Stock-Based Compensation - Schedule of Restricted Stock Activity (Details) - Restricted Stock Awards - $ / shares	1 Months Ended	12 Months Ended
	Jul. 31, 2017	Dec. 31, 2018	Dec. 31, 2017
Shares
Outstanding, beginning balance (in shares)		496,273	104,340
Granted (in shares)	379,472	50,000	437,472
Forfeited (in shares)		(32,547)	(29,144)
Vested (in shares)		(254,440)	(16,395)
Outstanding, ending balance (in shares)		259,286	496,273
Weighted-Average Grant Date Fair Value
Outstanding, beginning balance (in dollars per share)		$ 12.20	$ 41.61
Granted (in dollars per share)		10.92	8.13
Forfeited (in dollars per share)		25.95	38.33
Vested (in dollars per share)		10.14	44.19
Outstanding, ending balance (in dollars per share)		$ 12.25	$ 12.20

Stock-Based Compensation - Restricted Stock Awards - Narrative (Details) - Restricted Stock Awards - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation expense	$ 2.5	$ 1.4
Fair value of restricted stock vested	2.6	0.7
Unrecognized compensation expense	$ 1.7	$ 4.6
Weighted-average period the unrecognized compensation cost is expected to be recognized	2 years

Stock-Based Compensation - 2017 Retention Program Narrative (Details) - Restricted Stock Awards - USD ($) $ in Millions	1 Months Ended	12 Months Ended
	Jul. 31, 2017	Dec. 31, 2018	Dec. 31, 2017
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Granted (in shares)	379,472	50,000	437,472
Outstanding	$ 2.9
Cash awards	$ 3.3

Stock-Based Compensation - Other Equity Award (Details) - Restricted Stock Awards - USD ($) $ in Millions	3 Months Ended		12 Months Ended
	Mar. 31, 2020	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2012
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation expense			$ 2.5	$ 1.4
RSA 2012
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock awarded					$ 0.5
Share-based compensation expense		$ 1.0
RSA 2012 \| Forecast
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock upon vesting	$ 2.0

Loss Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended								6 Months Ended		9 Months Ended		12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Jun. 30, 2018	Jun. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2018	Dec. 31, 2017
Numerator:
Net loss	$ (9,898)	$ (18,819)	$ (11,805)	$ (14,204)	$ (6,129)	$ (9,201)	$ (7,747)	$ (24,535)	$ (26,009)	$ (32,282)	$ (44,828)	$ (41,483)	$ (54,726)	$ (47,612)
Less: Deemed dividend on Series B convertible preferred stock													0	(37,860)
Net loss available to common stockholders - basic and diluted													$ (54,726)	$ (85,472)
Shares used in computing net loss per share:
Weighted average basic shares outstanding (in shares)	18,638	18,625	18,594	18,483	16,774	13,659	13,697	11,018					18,585	13,787
Effect of dilutive securities (in shares)													0	0
Weighted average common shares outstanding-diluted (in shares)	22,360	18,625	18,594	18,483	16,774	13,659	13,697	11,018					18,585	13,787
Loss per common share:
Loss per share — basic (in dollars per share)	$ (0.53)	$ (1.01)	$ (0.63)	$ (0.77)	$ (2.22)	$ (0.94)	$ (0.80)	$ (2.23)					$ (2.94)	$ (6.20)
Loss per share — diluted (in dollars per share)	$ (0.84)	$ (1.01)	$ (0.63)	$ (0.77)	$ (2.22)	$ (0.94)	$ (0.80)	$ (2.23)					$ (2.94)	$ (6.20)
Antidilutive shares (in shares)													3,900	6,300

Related Party Transactions - Transactions with Joint Ventures (Details) - USD ($) $ in Thousands				3 Months Ended								12 Months Ended
	May 31, 2017	Apr. 13, 2016	Dec. 07, 2012	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2015
Related Party Transaction [Line Items]
Other (income) expense, net				$ 81	$ (68)	$ (95)	$ (94)	$ (226)	$ (10)	$ 2,142	$ 455	$ (176)	$ 2,361
Green Power \| MAT-PSI Holdings, LLC \| Corporate Joint Venture
Related Party Transaction [Line Items]
Ownership percentage			100.00%
Investment amount with related party			$ 900
Percent of noncontrolling interest			50.00%
Doosan-PSI, LLC \| Corporate Joint Venture
Related Party Transaction [Line Items]
Investment amount with related party														$ 1,000
Percent of noncontrolling interest														50.00%
Sterling And Wilson Cogen Solutions, LLC \| SW \| Corporate Joint Venture
Related Party Transaction [Line Items]
Investment amount with related party	$ 200	$ 200
Percent of noncontrolling interest	49.00%	49.00%

Related Party Transactions - Transactions with Related Individuals (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Father of Management
Related Party Transaction [Line Items]
Paid to individual	$ 0.1	$ 0.2
Former Chairman Of The Board, Chief Executive Officer And President And Non-Executive Chief Strategy Officer
Related Party Transaction [Line Items]
Purchases from related party	$ 0.4
Industrial Electronic Controls \| Former Chairman Of The Board, Chief Executive Officer And President And Non-Executive Chief Strategy Officer
Related Party Transaction [Line Items]
Percent of noncontrolling interest	50.00%

Selected Quarterly Financial Data (Unaudited) - CONDENSED CONSOLIDATED BALANCE SHEETS (Details) - USD ($) $ in Thousands	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Jan. 01, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2016
Current assets:
Cash and cash equivalents	$ 54	$ 2,014	$ 2	$ 0		$ 0	$ 0	$ 0	$ 342
Accounts receivable, net	86,471	71,639	70,324	58,870		68,660	60,811	56,673	64,305
Income tax receivable	973	1,018	1,018	1,018		1,018	841	1,996	6,829
Inventories, net	105,614	112,392	95,957	91,689	$ 81,565	86,724	113,074	103,335	97,286
Prepaid expenses and other current assets	22,917	26,905	26,644	20,555	20,525	14,359	14,536	12,453	15,291
Total current assets	216,029	213,968	193,945	172,132		170,761	189,262	174,457	184,053
Property, plant and equipment, net	24,266	24,536	24,931	18,474		18,960	18,974	19,050	19,230
Intangible assets, net	17,010	20,534	21,854	23,175		21,491	22,401	23,610	24,819
Goodwill	29,835	29,835	29,835	29,835		29,835	29,835	29,835	29,835
Other noncurrent assets	2,742	3,818	3,552	4,957		5,972	6,035	4,518	5,053
TOTAL ASSETS	289,882	292,691	274,117	248,573		247,019	266,507	251,470	262,990
Current liabilities:
Accounts payable	85,218	88,798	64,422	55,221		51,225	54,195	55,610	67,167
Contingent consideration							20	29	30
Revolving line of credit	54,613	52,491	54,334	36,662		37,055	41,332	25,263	16,887
Warrant liability	35,100	43,900	33,700	0		0
Other accrued liabilities	45,700	44,762	41,884	38,697	33,626	34,332	37,295	30,110	28,809
Total current liabilities	220,631	229,951	194,340	130,580		122,612	132,842	111,012	112,893
Deferred income taxes	647	616	495	427		703	1,210	1,066	933
Warrant liability	0	0	0	27,200		24,700	23,200	21,500	20,700
Long-term debt	54,712	54,781	54,604	54,575		54,439	54,306	54,168	54,046
Other noncurrent liabilities	32,470	16,612	15,753	15,311		12,393	17,410	17,707	19,753
TOTAL LIABILITIES	308,460	301,960	265,192	228,093		214,847	228,968	205,453	208,325
MEZZANINE EQUITY / STOCKHOLDERS’ EQUITY
Series B convertible preferred stock, net of issuance costs	62,500						31,410	27,807	24,617
Preferred stock	0	0	0	0		0	0	0	0
Common stock	19	19	19	19		19	14	14	14
Additional paid-in capital	126,412	125,938	125,272	124,981		123,838	91,737	96,543	100,686
Accumulated deficit	(135,160)	(125,262)	(106,443)	(94,638)	$ (80,434)	(82,147)	(76,018)	(66,817)	(59,070)
Treasury stock, at cost	(9,849)	(9,964)	(9,923)	(9,882)		(9,538)	(9,604)	(11,530)	(11,582)
TOTAL STOCKHOLDERS’ (DEFICIT) EQUITY	(18,578)	(9,269)	8,925	20,480		32,172	6,129	18,210	30,048	$ 40,660
TOTAL LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY	$ 289,882	$ 292,691	$ 274,117	$ 248,573		$ 247,019	$ 266,507	$ 251,470	$ 262,990

Selected Quarterly Financial Data (Unaudited) - CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended								6 Months Ended		9 Months Ended		12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Jun. 30, 2018	Jun. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2018	Dec. 31, 2017
Quarterly Financial Information Disclosure [Abstract]
Net sales	$ 138,234	$ 136,318	$ 127,073	$ 94,413	$ 131,476	$ 99,953	$ 100,922	$ 84,265					$ 496,038	$ 416,616
Cost of sales	126,213	117,510	109,006	84,540	115,981	86,702	88,443	74,497					437,269	365,623
Gross profit	12,021	18,808	18,067	9,873	15,495	13,251	12,479	9,768					58,769	50,993
Operating expenses:
Research, development and engineering expenses	7,910	7,708	6,962	6,021	6,459	5,687	3,848	3,950					28,601	19,944
Selling, general and administrative expenses	16,727	16,374	13,276	13,254	11,297	12,062	10,688	10,209					59,631	44,256
Asset impairment charges	2,234	0	0	0	1	0	0	0					2,234	1
Amortization of intangible assets	1,321	1,321	1,321	1,045	1,210	1,210	1,209	1,209					5,008	4,838
Total operating expenses	28,192	25,403	21,559	20,320	18,967	18,959	15,745	15,368					95,474	69,039
Operating loss	(16,171)	(6,595)	(3,492)	(10,447)	(3,472)	(5,708)	(3,266)	(5,600)					(36,705)	(18,046)
Other expense (income):
Interest expense	2,203	1,974	1,828	1,623	1,703	1,654	1,404	6,080					7,628	10,841
Gain from change in fair value of warrants	(8,800)	10,200	6,500	2,500	1,500	1,700	800	0					10,400	4,000
Loss on debt extinguishment and modifications					0	0	0	11,921					0	11,921
Other expense (income), net	81	(68)	(95)	(94)	(226)	(10)	2,142	455					(176)	2,361
Total other expense (income)	(6,516)	12,106	8,233	4,029	2,977	3,344	4,346	18,456					17,852	29,123
Loss before income taxes	(9,655)	(18,701)	(11,725)	(14,476)	(6,449)	(9,052)	(7,612)	(24,056)					(54,557)	(47,169)
Income tax expense	243	118	80	(272)	(320)	149	135	479					169	443
Net loss	$ (9,898)	$ (18,819)	$ (11,805)	$ (14,204)	(6,129)	(9,201)	(7,747)	(24,535)	$ (26,009)	$ (32,282)	$ (44,828)	$ (41,483)	(54,726)	(47,612)
Deemed dividend on Series B convertible preferred stock					(31,067)	(3,603)	(3,190)	0					0	(37,860)
Net loss available to common stockholders					$ (37,196)	$ (12,804)	$ (10,937)	$ (24,535)					$ (54,726)	$ (85,472)
Weighted-average common shares outstanding:
Basic (in shares)	18,638	18,625	18,594	18,483	16,774	13,659	13,697	11,018					18,585	13,787
Diluted (in shares)	22,360	18,625	18,594	18,483	16,774	13,659	13,697	11,018					18,585	13,787
Loss per common share:
Basic (in dollars per share)	$ (0.53)	$ (1.01)	$ (0.63)	$ (0.77)	$ (2.22)	$ (0.94)	$ (0.80)	$ (2.23)					$ (2.94)	$ (6.20)
Diluted (in dollars per share)	$ (0.84)	$ (1.01)	$ (0.63)	$ (0.77)	$ (2.22)	$ (0.94)	$ (0.80)	$ (2.23)					$ (2.94)	$ (6.20)

Selected Quarterly Financial Data (Unaudited) - CONDENSED CONSOLIDATED STATEMENTS OF CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS' EQUITY (Details) - USD ($) $ in Thousands	3 Months Ended								6 Months Ended		9 Months Ended		12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Jun. 30, 2018	Jun. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2018	Dec. 31, 2017	Jan. 01, 2018
Increase (Decrease) in Stockholders' Equity
Beginning balance	$ (9,269)	$ 8,925	$ 20,480	$ 32,172	$ 6,129	$ 18,210	$ 30,048	$ 40,660	$ 32,172	$ 40,660	$ 32,172	$ 40,660	$ 32,172	$ 40,660
Net loss	(9,898)	(18,819)	(11,805)	(14,204)	(6,129)	(9,201)	(7,747)	(24,535)	(26,009)	(32,282)	(44,828)	(41,483)	(54,726)	(47,612)
Stock-based compensation expense	700	545	619	799	771	731	(162)	(155)					2,663	1,183
Payment of withholding taxes for net settlement of stock-based awards	(111)	80	(369)		(9)	(8)	(27)
Issuance of common stock to Weichai, net of fees								14,078						14,078
Issuance of Series B convertible preferred stock, net of fees								0						0
Settlement of equity-related acquisition consideration							(712)							(712)
Deemed dividend on Series B convertible preferred stock					(31,067)	(3,603)	(3,190)							(37,860)
Conversion of Series B convertible preferred stock to common stock					62,477									62,477
Ending balance	(18,578)	(9,269)	8,925	20,480	32,172	6,129	18,210	30,048	8,925	18,210	(9,269)	6,129	(18,578)	32,172
ASC 606
Increase (Decrease) in Stockholders' Equity
Cumulative effect of adoption of ASC 606															$ 1,713
Series B Convertible Preferred Stock
Increase (Decrease) in Stockholders' Equity
Beginning balance				0	31,410	27,807	24,617	0	0	0	0	0	0	0
Issuance of Series B convertible preferred stock, net of fees								24,617						24,617
Deemed dividend on Series B convertible preferred stock					31,067	3,603	3,190							37,860
Conversion of Series B convertible preferred stock to common stock					(62,477)									(62,477)
Ending balance	0				0	31,410	27,807	24,617		27,807		31,410	0	0
Common Stock
Increase (Decrease) in Stockholders' Equity
Beginning balance	19	19	19	19	14	14	14	12	19	12	19	12	19	12
Issuance of common stock to Weichai, net of fees								2						2
Conversion of Series B convertible preferred stock to common stock					5									5
Ending balance	19	19	19	19	19	14	14	14	19	14	19	14	19	19
Additional Paid-in Capital
Increase (Decrease) in Stockholders' Equity
Beginning balance	125,938	125,272	124,981	123,838	91,737	96,543	100,686	86,764	123,838	86,764	123,838	86,764	123,838	86,764
Stock-based compensation expense	585	586	660	1,143	705	(1,195)	(214)	(154)					2,974	(860)
Payment of withholding taxes for net settlement of stock-based awards	(111)	80	(369)		(9)	(8)	(27)
Issuance of common stock to Weichai, net of fees								14,076						14,076
Settlement of equity-related acquisition consideration							(712)							(712)
Deemed dividend on Series B convertible preferred stock					(31,067)	(3,603)	(3,190)							(37,860)
Conversion of Series B convertible preferred stock to common stock					62,472									62,472
Ending balance	126,412	125,938	125,272	124,981	123,838	91,737	96,543	100,686	125,272	96,543	125,938	91,737	126,412	123,838
Treasury Stock
Increase (Decrease) in Stockholders' Equity
Beginning balance	(9,964)	(9,923)	(9,882)	(9,538)	(9,604)	(11,530)	(11,582)	(11,581)	(9,538)	(11,581)	(9,538)	(11,581)	(9,538)	(11,581)
Stock-based compensation expense	115	(41)	(41)	(344)	66	1,926	52	(1)					(311)	2,043
Ending balance	(9,849)	(9,964)	(9,923)	(9,882)	(9,538)	(9,604)	(11,530)	(11,582)	(9,923)	(11,530)	(9,964)	(9,604)	(9,849)	(9,538)
Accumulated Deficit
Increase (Decrease) in Stockholders' Equity
Beginning balance	(125,262)	(106,443)	(94,638)	(82,147)	(76,018)	(66,817)	(59,070)	(34,535)	(82,147)	(34,535)	(82,147)	(34,535)	(82,147)	(34,535)
Net loss	(9,898)	(18,819)	(11,805)	(14,204)	(6,129)	(9,201)	(7,747)	(24,535)					(54,726)	(47,612)
Ending balance	$ (135,160)	$ (125,262)	$ (106,443)	$ (94,638)	$ (82,147)	$ (76,018)	$ (66,817)	$ (59,070)	$ (106,443)	$ (66,817)	$ (125,262)	$ (76,018)	$ (135,160)	$ (82,147)
Accumulated Deficit \| ASC 606
Increase (Decrease) in Stockholders' Equity
Cumulative effect of adoption of ASC 606															$ 1,713

Selected Quarterly Financial Data (Unaudited) - CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Details) - USD ($) $ in Thousands	3 Months Ended								6 Months Ended		9 Months Ended		12 Months Ended
	Dec. 31, 2018	Sep. 30, 2018	Jun. 30, 2018	Mar. 31, 2018	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Jun. 30, 2018	Jun. 30, 2017	Sep. 30, 2018	Sep. 30, 2017	Dec. 31, 2018	Dec. 31, 2017
Cash provided by (used in) operating activities
Net loss	$ (9,898)	$ (18,819)	$ (11,805)	$ (14,204)	$ (6,129)	$ (9,201)	$ (7,747)	$ (24,535)	$ (26,009)	$ (32,282)	$ (44,828)	$ (41,483)	$ (54,726)	$ (47,612)
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Amortization of intangible assets				1,045				1,209	2,366	2,419	3,687	3,628	5,008	4,838
Depreciation				1,196				1,172	2,524	2,342	3,849	3,502	5,196	4,634
Change in valuation of warrants				2,500				0	9,000	800	19,200	2,500	10,400	4,000
Stock compensation expense				799				(865)	1,418	(1,028)	1,963	(297)	2,662	473
Amortization of financing fees				341				3,109	659	3,441	947	3,778	1,497	4,117
Deferred income taxes				(276)				469	(208)	602	(87)	746	(56)	239
Loss on debt extinguishment and modifications								11,921		11,921		11,921	0	11,921
Asset impairment charges													2,234	1
(Decrease) increase in allowance for doubtful accounts								48		131		216
Provision for inventory obsolescence								146		539		882
Loss (gain) on disposal of fixed assets								10		66		115
Other non-cash adjustments, net				(350)				137	325	200	1,661	190	2,086	924
Changes in operating assets and liabilities:
Trade accounts receivable, net				9,710				(4,017)	(1,739)	3,532	(3,058)	(691)	(17,890)	(8,391)
Inventory, net				(9,822)				3,122	(14,825)	(3,326)	(32,657)	(13,408)	(26,202)	13,366
Prepaid expenses and other assets				(76)				(1,624)	(4,815)	1,238	(5,387)	(1,359)	(886)	(2,284)
Trade accounts payable				3,748				15,186	13,200	3,244	37,355	1,879	33,968	(1,198)
Income taxes refundable				8				298	(2)	5,135	7	6,293	125	6,508
Accrued expenses				4,757				1,861	7,914	3,826	10,773	10,622	11,630	7,839
Other noncurrent liabilities				2,902				450	2,000	(1,478)	2,901	(2,576)	18,786	(7,070)
Net cash used in operating activities				2,278				8,097	(8,192)	1,322	(3,674)	(13,542)	(6,168)	(7,695)
Cash used in investing activities
Capital expenditures				(467)				(1,896)	(1,588)	(2,669)	(2,321)	(3,856)	(3,645)	(5,061)
Asset acquisitions				(1,029)					(6,595)		(6,595)		(6,595)	(300)
Other sources, net								0		245		245	1	196
Net cash used in investing activities				(1,496)				(1,896)	(8,183)	(2,424)	(8,916)	(3,611)	(10,239)	(5,165)
Cash provided by financing activities
Repayments of long-term debt								(71,400)		(71,400)		(71,400)	0	(71,400)
Financing fees								(253)		(928)		(928)
Net proceeds from stock offering and warrants								59,396		59,396		59,396	0	59,396
Proceeds from revolving line of credit				106,216				85,945	240,698	209,082	372,557	324,416	516,440	436,228
Repayments of revolving line of credit				(106,608)				(81,833)	(223,419)	(196,593)	(357,121)	(295,859)	(498,881)	(411,948)
Acquisition of businesses contingent consideration payments								(6)		(9)		(19)
Other uses, net				(390)				0	(902)	(738)	(832)	(745)	(1,098)	(1,708)
Net cash provided by financing activities				(782)				(8,151)	16,377	(1,190)	14,604	14,861	16,461	10,568
Net (decrease) increase in cash and restricted cash				0				(1,950)	2	(2,292)	2,014	(2,292)	54	(2,292)
Cash at beginning of the year	2,014	2	0	0	0	0	342	2,292	0	2,292	0	2,292	0	2,292
Cash at end of the year	$ 54	$ 2,014	$ 2	$ 0	$ 0	$ 0	$ 0	$ 342	$ 2	$ 0	$ 2,014	$ 0	$ 54	$ 0

Weichai Transactions - Weichai Collaboration Arrangement (Details) - USD ($) $ in Millions		12 Months Ended
	Mar. 20, 2017	Dec. 31, 2018
Equity [Abstract]
Term of collaborative arrangement	3 years
Purchased inventory		$ 3.5

Debt - Debt Narrative (Details) - USD ($) $ in Millions	12 Months Ended
Debt - Debt Narrative (Details) - USD ($) $ in Millions	Dec. 31, 2018	Dec. 31, 2017
Debt Disclosure [Abstract]
Interest paid	$ 6.1	$ 7.8

Defined Contribution Plans (Details)	12 Months Ended
Defined Contribution Plans (Details)	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($) plan
Retirement Benefits [Abstract]
Number of defined contribution plans \| plan		2
Employer contributions	$ 0	$ 100,000
Employer contributions recorded as a liability	$ 700,000

Subsequent Events (Details) - Supply Agreement - USD ($) $ in Millions	1 Months Ended	12 Months Ended
	Oct. 31, 2019	Dec. 31, 2018	Dec. 31, 2017
Subsequent Event [Line Items]
Product purchases		$ 44.9	$ 15.0
Subsequent Event
Subsequent Event [Line Items]
Minimum product purchase commitment	$ 40.0

For the Year Ended December 31,

Customer A

Customer B