10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 FORM 10-Q

 

☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 For the quarterly period ended June 29, 2019

 OR

 

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number: 1-32383

	BlueLinx Holdings Inc.
	(Exact name of registrant as specified in its charter)

 

Delaware		77-0627356
(State of Incorporation)		(I.R.S. Employer Identification No.)
1950 Spectrum Circle, Suite 300
Marietta	GA	30067
(Address of principal executive offices)		(Zip Code)

(770) 953-7000

(Registrant’s telephone number, including area code)

 Not applicable

(Former name or former address, if changed since last report.)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01 per share	BXC	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No  ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer	☐	Accelerated Filer	☑	Non-accelerated Filer	☐	Smaller Reporting Company	☐
Emerging Growth Company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

As of August 5, 2019 there were 9,364,959 shares of BlueLinx Holdings Inc. common stock, par value $0.01, outstanding.

BLUELINX HOLDINGS INC.

Form 10-Q

For the Quarterly Period Ended June 29, 2019

INDEX

	PAGE
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements — BlueLinx Holdings Inc. (Unaudited)	1
Condensed Consolidated Statements of Operations and Comprehensive Loss	1
Condensed Consolidated Balance Sheets	2
Condensed Consolidated Statements of Cash Flows	3
Consolidated Statements of Stockholders (Deficit) Equity	4
Notes to Condensed Consolidated Financial Statements	6
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	19
Item 3. Quantitative and Qualitative Disclosures About Market Risk	27
Item 4. Controls and Procedures	27
PART II. OTHER INFORMATION
Item 1. Legal Proceedings	28
Item 1A. Risk Factors	28
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	28
Item 3. Defaults Upon Senior Securities	28
Item 4. Mine Safety Disclosures	28
Item 5. Other Information	28
Item 6. Exhibits	29
Signatures	30

i

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

BLUELINX HOLDINGS INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND

COMPREHENSIVE INCOME (LOSS)

(In thousands, except per share data)

(Unaudited)

	Three Months Ended						Six Months Ended
	June 29, 2019			June 30, 2018			June 29, 2019			June 30, 2018
Net sales	$	706,448		$	892,952		$	1,345,149		$	1,330,439
Cost of sales	612,281			789,301			1,164,937			1,171,463
Gross profit	94,167			103,651			180,212			158,976
Operating expenses:
Selling, general, and administrative	74,101			91,723			148,511			150,963
Gains from sales of property	(9,760		)	—			(9,760		)	—
Depreciation and amortization	7,503			7,444			14,831			10,109
Total operating expenses	71,844			99,167			153,582			161,072
Operating income (loss)	22,323			4,484			26,630			(2,096		)
Non-operating expenses (income):
Interest expense	13,717			12,194			27,118			20,674
Other (income) expense, net	(45		)	(94		)	105			(188		)
Income (loss) before provision for (benefit from) income taxes	8,651			(7,616		)	(593		)	(22,582		)
Provision for (benefit from) income taxes	2,350			942			(175		)	(597		)
Net income (loss)	$	6,301		$	(8,558	)	$	(418	)	$	(21,985	)
Basic earnings (loss) per share	$	0.67		$	(0.93	)	$	(0.04	)	$	(2.40	)
Diluted earnings (loss) per share	$	0.67		$	(0.93	)	$	(0.04	)	$	(2.40	)
Comprehensive income (loss):
Net income (loss)	$	6,301		$	(8,558	)	$	(418	)	$	(21,985	)
Other comprehensive income (loss):
Foreign currency translation, net of tax	—			(9		)	7			(3		)
Amortization of unrecognized pension loss, net of tax	208			201			431			404
Pension curtailment, net of tax	(1,486		)	—			(632		)	—
Other	1			—			16			—
Total other comprehensive income	(1,277		)	192			(178		)	401
Comprehensive income (loss)	$	5,024		$	(8,366	)	$	(596	)	$	(21,584	)

See accompanying Notes.

1

BLUELINX HOLDINGS INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share data)

(Unaudited)

	June 29, 2019			December 29, 2018
ASSETS
Current assets:
Cash	$	12,662		$	8,939
Receivables, less allowances of $3,811 and $3,656, respectively	262,042			208,434
Inventories, net	358,652			341,851
Other current assets	44,066			40,629
Total current assets	677,422			599,853
Property and equipment, at cost	310,751			308,398
Accumulated depreciation	(111,853		)	(103,285		)
Property and equipment, net	198,898			205,113
Operating lease right-of-use assets	55,240			—
Goodwill	47,772			47,772
Intangible assets, net	30,324			35,222
Deferred tax assets	52,193			52,645
Other non-current assets	19,305			19,284
Total assets	$	1,081,154		$	959,889
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current liabilities:
Accounts payable	$	174,860		$	149,188
Accrued compensation	7,712			7,974
Current maturities of long-term debt, net of discount and debt issuance costs of $64	1,427			1,736
Finance leases - short-term	8,166			7,555
Real estate deferred gains - short-term	3,935			5,330
Operating lease liabilities - short-term	6,690			—
Other current liabilities	18,625			24,985
Total current liabilities	221,415			196,768
Non-current liabilities:
Long-term debt, net of discount and debt issuance costs of $12,941 and $12,665, respectively	501,909			497,939
Finance leases - long-term	144,116			143,486
Real estate financing obligation	44,822			—
Real estate deferred gains - long-term	83,788			86,011
Operating lease liabilities - long-term	48,672			—
Pension benefit obligation	26,089			26,668
Other non-current liabilities	23,178			23,680
Total liabilities	1,093,989			974,552
Commitments and Contingencies
STOCKHOLDERS’ DEFICIT:
Common Stock, $0.01 par value, Authorized - 20,000,000 shares, Issued and Outstanding - 9,364,959 and 9,293,794, respectively	94			92
Additional paid-in capital	259,727			258,596
Accumulated other comprehensive loss	(37,307		)	(37,129		)
Accumulated stockholders’ deficit	(235,349		)	(236,222		)
Total stockholders’ deficit	(12,835		)	(14,663		)
Total liabilities and stockholders’ deficit	$	1,081,154		$	959,889

See accompanying Notes.

2

BLUELINX HOLDINGS INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

	Six Months Ended
	June 29, 2019			June 30, 2018
Net cash used in operating activities	$	(67,688	)	$	(98,470	)
Cash flows from investing activities:
Proceeds from sale of assets	10,758			107,960
Acquisition of business, net of cash acquired - see Note 2	—			(353,094		)
Property and equipment investments	(1,784		)	(577		)
Net cash provided by (used in) investing activities	8,974			(245,711		)
Cash flows from financing activities:
Borrowings on revolving credit facilities	365,519			534,380
Repayments on revolving credit facilities	(329,683		)	(267,449		)
Borrowings on term loan	—			180,000
Repayments on term loan	(31,899		)	(450		)
Principal payments on mortgage	—			(97,847		)
Proceeds from real estate transactions	44,822			—
Change in outstanding payments	19,706			10,919
Debt issuance costs	(1,588		)	(9,775		)
Payments on finance lease obligations	(4,232		)	(3,262		)
Repurchase of shares to satisfy employee tax withholdings	(208		)	(1,821		)
Net cash provided by financing activities	62,437			344,695
Net change in cash	3,723			514
Cash at beginning of period	8,939			4,696
Cash at end of period	$	12,662		$	5,210

See accompanying Notes.

3

BLUELINX HOLDINGS INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ (DEFICIT) EQUITY

(In thousands)

(Unaudited)

	Common Stock				Additional Paid-In Capital			Accumulated Other Comprehensive Loss			Accumulated Deficit			Stockholders’ (Deficit) Equity Total
	Shares		Amount
	(In thousands)
Balance, December 29, 2018	9,294		$	92	$	258,596		$	(37,129	)	$	(236,222	)	$	(14,663	)
Net loss	—		—		—			—			(6,719		)	(6,719		)
Adoption of ASC 842, net of tax	—		—		—			—			1,291			1,291
Foreign currency translation, net of tax	—		—		—			7			—			7
Unrealized gain from pension plan, net of tax	—		—		—			1,077			—			1,077
Vesting of restricted stock units	49		1		—			—			—			1
Compensation related to share-based grants	—		—		706			—			—			706
Repurchase of shares to satisfy employee tax withholdings	—		—		—			—			—			—
Other	—		—		—			15						15
Balance, March 30, 2019	9,343		93		259,302			(36,030		)	(241,650		)	(18,285		)
Net income	—		—		—			—			6,301			6,301
Foreign currency translation, net of tax	—		—		—			—			—			—
Unrealized gain from pension plan, net of tax	—		—		—			(1,278		)	—			(1,278		)
Vesting of restricted stock units	32		1		—			—			—			1
Compensation related to share-based grants	—		—		635			—			—			635
Repurchase of shares to satisfy employee tax withholdings	(10	)	—		(208		)	—			—			(208		)
Other	—		—		(2		)	1			—			(1		)
Balance, June 29, 2019	9,365		$	94	$	259,727		$	(37,307	)	$	(235,349	)	$	(12,835	)

4

	Common Stock				Additional Paid-In Capital			Accumulated Other Comprehensive Loss			Accumulated Deficit			Stockholders’ (Deficit) Equity Total
	Shares		Amount
	(In thousands)
Balance, December 30, 2017	9,101		$	91	$	259,588		$	(36,507	)	$	(188,170	)	$	35,002
Net loss	—		—		—			—			(13,427		)	(13,427		)
Foreign currency translation, net of tax	—		—		—			6			—			6
Unrealized gain from pension plan, net of tax	—		—		—			203			—			203
Vesting of restricted stock units	—		—		—			—			—			—
Vesting of performance shares	109		1		—			—			—			1
Compensation related to share-based grants	—		—		319			—			—			319
Repurchase of shares to satisfy employee tax withholdings	—		—		(1		)	—			—			(1		)
Other	—		—		—			—			(7		)	(7		)
Balance, March 31, 2018	9,210		92		259,906			(36,298		)	(201,604		)	22,096
Net loss	—		—		—			—			(8,558		)	(8,558		)
Foreign currency translation, net of tax	—		—		—			(9		)	—			(9		)
Unrealized gain from pension plan, net of tax	—		—		—			201			—			201
Vesting of restricted stock units	11		—		—			—			—			—
Vesting of performance shares	—		—		—			—			—			—
Compensation related to share-based grants	—		—		338			—			—			338
Repurchase of shares to satisfy employee tax withholdings	(2	)	—		(1,719		)	—			—			(1,719		)
Other	—		—		—			—			7			7
Balance, June 30, 2018	9,219		$	92	$	258,525		$	(36,106	)	$	(210,155	)	$	12,356

See accompanying Notes.

5

BLUELINX HOLDINGS INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

June 29, 2019

(Unaudited)

1. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying unaudited Condensed Consolidated Financial Statements include the accounts of BlueLinx Holdings Inc. and its wholly owned subsidiaries (the “Company”). These financial statements have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and footnotes required by accounting principles generally accepted (“GAAP”) in the United States (“U.S.”) for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. These statements should be read in conjunction with the Consolidated Financial Statements and notes thereto included in the Company’s Annual Report on Form 10-K (the “Annual Report on Form 10-K”) for the year ended December 29, 2018, as filed with the Securities and Exchange Commission on March 13, 2019.

Our financial condition as of, and our operating results for, the three and six-month periods ended June 29, 2019, are not necessarily indicative of the financial condition and results that may be expected for the full year ending December 28, 2019, or any other interim period. Certain prior period amounts have been reclassified to conform to the current period's presentation. These reclassifications did not impact the Company's operating income (loss) or consolidated net income (loss).

Outstanding Payments

Outstanding payments represent outstanding checks and electronic payments that have not been presented for payment as of the end of the period. These amounts are typically funded within 24 hours. As of June 29, 2019 and December 29, 2018 outstanding payments of $37.1 million and $17.4 million, respectively, were included in accounts payable on our condensed consolidated balance sheets.

Recently Adopted Accounting Standards

Leases.  In 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-02, “Leases (Topic 842).” Topic 842 establishes a new lease accounting model. The most significant changes include the clarification of the definition of a lease, the requirement for lessees to recognize, for all leases, a right-of-use asset and a lease liability in the consolidated balance sheet, and additional quantitative and qualitative disclosures which are designed to give financial statement users information on the amount, timing, and uncertainty of cash flows arising from leases. Lease expenses will continue to be recognized in the consolidated statement of income in a manner similar to prior accounting guidance. Lessor accounting under the new standard is substantially unchanged. We adopted this standard, and all related amendments thereto, effective December 30, 2018, the first day of our fiscal 2019 year, using a modified retrospective approach, which applies the provisions of the new guidance at the effective date without adjusting the comparative periods presented. We have elected the package of practical expedients permitted under the transition guidance within the new standard, which among other things, allows us to carry forward the historical accounting relating to lease identification and classification for existing leases upon adoption. We have made an accounting policy election to keep leases with an initial term of 12 months or less off of the consolidated balance sheet. We implemented internal controls and a lease accounting information system to enable the preparation of financial information required by the new standard. The adoption of Topic 842 had a material impact on our condensed consolidated balance sheets but did not have an impact on our condensed consolidated statements of operations and comprehensive loss. The most significant impact was the recognition of right-of-use assets and lease liabilities of $57.5 million in the consolidated balance sheet. Additionally, $1.7 million of deferred gains associated with sale-leaseback transactions was recorded as a cumulative-effect adjustment to accumulated deficit. See Note 9 “Leases” for additional disclosures regarding our lease commitments.

Comprehensive Income. In February 2018, the FASB issued ASU No. 2018-02, “Income Statement-Reporting Comprehensive Income (Topic 220).” This standard provides an option to reclassify stranded tax effects within accumulated other comprehensive income (loss) to retained earnings due to the U.S. federal corporate income tax rate change in the Tax Cuts and Jobs Act of 2017. This standard was effective for interim and annual reporting periods beginning after December 15, 2018. We did not exercise the option to make this reclassification.

6

Accounting Standards Effective in Future Years

Goodwill. In January 2017, the FASB issued ASU No. 2017-04, “Intangibles—Goodwill and Other (Topic 350).” This standard is intended to simplify the test for goodwill impairments by removing Step 2 of the goodwill impairment test, which requires a hypothetical purchase price allocation. Under the new ASU, a goodwill impairment will now be the amount by which a reporting unit's carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. The accounting standard will be effective for reporting periods beginning after December 15, 2019, and early adoption is permitted. We do not expect the adoption of the standard to have a material impact on the Company's consolidated financial position, results of operations or cash flows.

Fair Value Measurement. In August 2018, the FASB issued ASU No. 2018-13, “Fair Value (“FV”) Measurement (Topic 820).” Among other modifications, the standard removes the requirements to disclose: (i) the amount of and reasons for transfers between Level 1 and Level 2 of the FV hierarchy; (ii) the policy for timing transfers between levels; and (iii) the valuation process for Level 3 FV measurements. The standard will require public entities to disclose: (a) the changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 FV measurements held at the end of the reporting period; and (b) the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. For certain unobservable inputs, an entity may disclose other quantitative information in lieu of the weighted average if the entity determines that other quantitative information would be a more reasonable and rational method to reflect the distribution of unobservable inputs used to develop Level 3 FV measurements. The additional disclosure requirements should be applied prospectively for the most recent interim or annual period presented in the fiscal year of adoption. All other amendments should be applied retrospectively to all periods presented. The amendments in this standard are effective for fiscal years ending after December 15, 2019. Early adoption is permitted, and an entity may adopt the removed or modified disclosures and delay the adoption of new disclosures until the effective date. We have not completed our assessment of the standard but we do not expect the adoption to have a material impact on the Company's consolidated financial position, results of operations or cash flows.

Defined Benefit Pension Plan. In August 2018, the FASB issued ASU No. 2018-14, “Compensation-Retirement-Benefits-Defined Benefit Plans-General (Subtopic 715-20).” The amendments in this update modify the disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans by removing six previously required disclosures and adding two. The amendments also clarify certain other disclosure requirements. The amendments in this standard are effective for fiscal years ending after December 15, 2020. Early adoption is permitted. We have not completed our assessment of the standard but we do not expect the adoption to have a material impact on the Company's consolidated financial position, results of operations or cash flows.

2. Acquisition

On April 13, 2018, we completed the acquisition of Cedar Creek Holdings, Inc. (“Cedar Creek”) for a purchase price of approximately $361.8 million. The acquisition was completed pursuant to the terms of an Agreement and Plan of Merger (the "Merger Agreement"), dated as of March 9, 2018, by and among BlueLinx Corporation, one of our wholly owned subsidiaries, Panther Merger Sub, Inc., a wholly-owned subsidiary of BlueLinx Corporation ("Merger Sub"), Cedar Creek, and CharlesBank Equity Fund VII, Limited Partnership. Upon closing the transactions contemplated by the Merger Agreement, among other things, Merger Sub was merged with and into Cedar Creek, with Cedar Creek surviving the merger as one of our indirect wholly-owned subsidiaries. The merger allowed us to expand our product offerings, while maintaining our existing geographical footprint.

Cedar Creek was established in 1977 as a wholesale building materials distribution company that distributes wood products across the United States. Its products include specialty lumber, oriented strand board, siding, cedar, spruce, engineered wood products and other building products.

The acquisition was accounted for under the acquisition method of accounting. The assets acquired, liabilities assumed and results of operations of the acquired business have been included in our consolidated results since April 13, 2018.

The following unaudited consolidated pro forma information presents consolidated information as if the acquisition had occurred on January 1, 2017:

7

	Pro forma
	Three Months Ended				Six Months Ended
(In thousands, except per share data)	June 29, 2019		June 30, 2018		June 29, 2019		June 30, 2018
Net sales	$	706,448	$	948,555	$	1,345,149	$	1,732,822
Net income (loss)	9,425		9,180		6,118		(1,439		)
Earnings (loss) per common share:
Basic	$	1.01	$	1.00	$	0.65	$	(0.16	)
Diluted	1.00		0.98		0.65		(0.16		)

The pro forma amounts above have been calculated in accordance with GAAP after applying the Company's accounting policies and adjusting the three and six months ended June 29, 2019 for $4.2 million and $8.8 million, and the three and six months ended June 30, 2018 for $30.4 million and $34.0 million, respectively, for transaction related costs, net of tax. Due to the net loss for the six-month period ended June 30, 2018, 164,550 incremental shares from share-based compensation arrangements were excluded from the computation of diluted weighted average shares outstanding because their effect would be anti-dilutive. The pro forma amounts do not include any potential synergies, cost savings or other expected benefits of the acquisition, are presented for illustrative purposes only, and are not necessarily indicative of results that would have been achieved had the acquisition occurred as of January 1, 2017, or of future operating performance.

The purchase price of Cedar Creek consisted of the following items:

	(In thousands)
Consideration paid to shareholders and amounts paid to creditors:
Payments to Cedar Creek shareholders[1]	$	166,447
Subordinated unsecured note (due to shareholder)[2]		13,743
Seller’s transaction costs paid by Company		7,349
Add: pay off of Cedar Creek debt[3]		174,213
Total cash purchase price	$	361,752

_____________

[1] Payments to Cedar Creek’s shareholders include the purchase of common stock and certain escrow adjustments.

[2] The Cedar Creek note payable to a shareholder of $13.7 million was paid in full upon the acquisition of Cedar Creek and included $10 million in subordinated debt and $3.7 million in accrued interest.

[3] To finance the acquisition of Cedar Creek, the Company amended and restated its Revolving Credit Facility to increase the capacity thereunder to $600.0 million and also entered into a new $180.0 million senior secured Term Loan Facility (See Note 6).

The excess of total purchase price, which includes the aggregate cash consideration paid in excess of the fair value of the tangible and intangible assets acquired, was recorded as goodwill. The goodwill recognized is attributable to the expected operating synergies and growth potential that the Company expects to realize from the acquisition. None of the goodwill generated from the acquisition is deductible for tax purposes.

8

The following table summarizes the values of the assets acquired and liabilities assumed at the date of the acquisition:

(In thousands)	Allocation as of December 29, 2018
Cash and net working capital assets (excluding inventory)	$	88,318
Inventory		159,227
Property and equipment		71,203
Other, net		(1,395	)
Intangible assets and goodwill:
Customer relationships		25,500
Non-compete agreements		8,254
Trade names		6,826
Favorable leasehold interests		800
Goodwill		47,772
Finance leases and other liabilities		(44,753	)
Cash purchase price	$	361,752

3. Goodwill and Other Intangible Assets

In connection with the acquisition of Cedar Creek, we acquired certain intangible assets. As of June 29, 2019, our intangible assets consist of goodwill and other intangible assets including customer relationships, noncompete agreements, and trade names.

Goodwill

Goodwill is the excess of the cost of an acquired entity over the fair value of tangible and intangible assets (including customer relationships, noncompete agreements and trade names) acquired, and liabilities assumed, under acquisition accounting for business combinations.

As of June 29, 2019, goodwill was $47.8 million.

Goodwill is not subject to amortization but must be tested for impairment at least annually. This test requires us to assign goodwill to a reporting unit and to determine if the implied fair value of the reporting unit’s goodwill is less than its carrying amount. We evaluate goodwill for impairment during the fourth quarter of each fiscal year. In addition, we will evaluate the carrying values of these assets for impairment between annual impairment tests if an event occurs or circumstances change that would indicate the carrying amounts may be impaired. Such events and indicators may include, without limitation, significant declines in the industries in which our products are used, significant changes in capital market conditions, and significant changes in our market capitalization.

Definite-Lived Intangible Assets.

At June 29, 2019, in connection with the acquisition of Cedar Creek, we had definite-lived intangible assets that related to customer relationships, noncompete agreements, and trade names.

9

At June 29, 2019, the gross carrying amounts, the accumulated amortization and the net carrying amounts of our definite-lived intangible assets were as follows (in thousands):

	Gross carrying amounts		Accumulated Amortization			[1]	Net carrying amounts
Customer relationships	$	25,500	$	(4,999	)		$	20,501
Noncompete agreements	8,254		(2,500		)		5,754
Trade names	6,826		(2,757		)		4,069
Total	$	40,580	$	(10,256	)		$	30,324

____________________

^[1] Intangible assets except customer relationships are amortized on straight line basis. Customer relationships are amortized on a double declining balance method.

Amortization Expense

The weighted average estimated useful life remaining for customer relationships, noncompete agreements and trade names is approximately 11 years, 3 years, and 2 years, respectively. Amortization expense for the definite-lived intangible assets was $2.0 million and $4.1 million for the three and six month periods ended June 29, 2019, respectively. For the three and six month periods ended June 30, 2018, amortization expense was $1.9 million.

Estimated annual amortization expense for definite-lived intangible assets over the next five fiscal years is as follows (in thousands):

	Estimated Amortization
2019	$	8,085
2020	7,461
2021	4,973
2022	3,111
2023	1,807

4. Revenue Recognition

We recognize revenue when control of promised goods or services is transferred to the Company’s customers in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services.

Contracts with our customers are generally in the form of standard terms and conditions of sale. From time to time, we may enter into specific contracts with some of our larger customers, which may affect delivery terms. Performance obligations in our contracts generally consist solely of delivery of goods. For all sales channel types, consisting of warehouse, direct, and reload sales, we typically satisfy our performance obligations upon shipment. Our customer payment terms are typical for our industry, and may vary by the type and location of our customer and the products or services offered. The term between invoicing and when payment is due is not deemed to be significant by us. For certain sales channels and/or products, our standard terms of payment may be as early as ten days.

In addition, we provide inventory to certain customers through pre-arranged agreements on a consignment basis. Customer consigned inventory is maintained and stored by certain customers; however, ownership and risk of loss remains with us. When the consigned inventory is sold by the customer, we recognize revenue, net of trade allowances.

All revenues recognized are net of trade allowances (i.e., rebates), cash discounts and sales returns. Cash discounts and sales returns are estimated using historical experience. Trade allowances are based on the estimated obligations and historical experience. Adjustments to earnings resulting from revisions to estimates on discounts and returns have been insignificant for each of the reported periods. Certain customers may receive cash-based incentives or credits (rebates), which are accounted for

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as variable consideration. We estimate these amounts based on the expected amount to be provided to customers and reduce revenues recognized. We believe that there will not be significant changes to our estimates of variable consideration.

With the acquisition and integration of Cedar Creek, we changed our internal product hierarchy. The following table presents our revenues disaggregated by revenue source (in thousands). Certain prior year amounts have been reclassified to conform to the current year product mix of structural and specialty products. Sales and usage-based taxes are excluded from revenues.

	Three Months Ended				Six Months Ended
	June 29, 2019		June 30, 2018		June 29, 2019		June 30, 2018
Structural products	$	225,056	$	345,878	$	422,551	$	522,359
Specialty products and other	481,392		547,074		922,598		808,080
Total net sales	$	706,448	$	892,952	$	1,345,149	$	1,330,439

The following table presents our revenues disaggregated by sales channel (in thousands). Sales and usage-based taxes are excluded from revenues.

	Three Months Ended						Six Months Ended
	June 29, 2019			June 30, 2018			June 29, 2019			June 30, 2018
Warehouse	$	577,000		$	704,328		$	1,081,274		$	1,037,634
Direct	122,262			165,630			245,667			248,573
Reload and service revenue	16,617			34,914			35,522			63,184
Customer discounts and rebates	(9,431		)	(11,920		)	(17,314		)	(18,952		)
Total net sales	$	706,448		$	892,952		$	1,345,149		$	1,330,439

Practical Expedients and Exemptions

We generally expense sales commissions when incurred because the amortization period would have been one year or less. These costs are recorded within selling, general, and administrative expense.

We have made an accounting policy election to treat any common carrier shipping and handling activities as a fulfillment cost, rather than as a separate obligation or separate promised service.

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5. Assets Held for Sale and Net Gain on Disposition

In fiscal 2018, we designated certain non-operating properties as held for sale due to strategic realignments of our business. At the time of designation, we ceased recognizing depreciation expense on these assets. As of December 29, 2018, six properties were designated as held for sale, with an additional property designated during the first quarter of 2019. During the six months ended June 29, 2019, two properties were sold, as further described below. As of June 29, 2019 and December 29, 2018, the net book value of total assets held for sale was $3.3 million and $3.1 million, respectively, and was included in “Other current assets” in our Condensed Consolidated Balance Sheets. Properties held for sale as of June 29, 2019, consisted of land in Connecticut, and five warehouses located in the Midwest and South. We plan to sell these properties within the next 12 months. We continue to actively market all properties that are designated as held for sale.

During the six months ended June 29, 2019, we sold two non-operating distribution facilities previously designated as “held for sale”. We recognized a gain of $9.8 million in the Condensed Consolidated Statements of Operations as a result of these sales.

6. Long-Term Debt

As of June 29, 2019, and December 29, 2018, long-term debt consisted of the following:

		June 29,			December 29,
(In thousands)	Maturity Date	2019			2018
Revolving Credit Facility (net of discounts and debt issuance costs of $5.2 million and $6.0 million at June 29, 2019 and December 29, 2018, respectively)	October 10, 2022	$	363,898		$	327,319
Term Loan Facility (net of discounts and debt issuance costs of $7.7 million and $6.7 million at June 29, 2019 and December 29, 2018, respectively)	October 13, 2023		139,438			172,356
Total debt			503,336			499,675
Less: current portion of long-term debt			(1,427	)		(1,736	)
Long-term debt, net		$	501,909		$	497,939

Revolving Credit Facility

On April 13, 2018, we entered into an Amended and Restated Credit Agreement with certain of our subsidiaries as borrowers (together with us, the “Borrowers”) or guarantors thereunder, Wells Fargo Bank, National Association, in its capacity as administrative agent, and certain other financial institutions party thereto (the “Revolving Credit Agreement”). The Revolving Credit Agreement provides for a senior secured asset-based revolving loan and letter of credit facility (the “Revolving Credit Facility”) of up to $600 million and an uncommitted accordion feature that permits the Borrowers to increase the facility by an aggregate additional principal amount of up to $150 million, which would allow borrowings of up to $750 million under the Revolving Credit Facility. Letters of credit in an aggregate amount of up to $30 million are also available under the Revolving Credit Agreement, which would reduce the amount of the revolving loans available under the Revolving Credit Facility. The maturity date of the Revolving Credit Agreement is October 10, 2022. The Borrowers’ obligations under the Revolving Credit Agreement are secured by a security interest in substantially all of our and our subsidiaries’ assets (other than real property), including inventories, accounts receivable, and proceeds from those items.

Borrowings under the Revolving Credit Agreement are subject to availability under the Borrowing Base (as that term is defined in the Revolving Credit Agreement). The Borrowers are required to repay revolving loans thereunder to the extent that such revolving loans exceed the Borrowing Base then in effect. The Revolving Credit Facility may be prepaid in whole or in part from time to time without penalty or premium, but including all breakage costs incurred by any lender thereunder.

The Revolving Credit Agreement provides for interest on the loans at a rate per annum equal to (i) LIBOR plus a margin ranging from 1.75 percent to 2.25 percent, with the amount of such margin determined based upon the average of the Borrowers’ excess availability for the immediately preceding fiscal quarter as calculated by the administrative agent, for loans based on LIBOR, or (ii) the administrative agent’s base rate plus a margin ranging from 0.75 percent to 1.25 percent, with the amount of such margin determined based upon the average of the Borrowers’ excess availability for the immediately preceding fiscal quarter as calculated by the administrative agent, for loans based on the base rate.

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In the event excess availability falls below the greater of (i) $50 million and (ii) 10 percent of the lesser of (a) the Borrowing Base and (b) the maximum permitted credit at such time, the Revolving Credit Agreement requires maintenance of a fixed charge coverage ratio of 1.0 to 1.0 until such time as the Borrowers’ excess availability has been at least the greater of (i) $50 million and (ii) 10 percent of the lesser of (a) the Borrowing Base and (b) the maximum permitted credit at such time for a period of 30 consecutive days.

The Revolving Credit Agreement also contains representations and warranties and affirmative and negative covenants customary for financings of this type, as well as customary events of default.

As of June 29, 2019, we had outstanding borrowings of $369.1 million, excess availability of $100.8 million, and a weighted average interest rate of 4.5 percent under our Revolving Credit Facility. As of December 29, 2018, our principal balance was $333.3 million, excess availability was $91.7 million, and our weighted average interest rate was 4.2 percent under our Revolving Credit Facility.

We were in compliance with all covenants under the Revolving Credit Agreement as of June 29, 2019.

Term Loan Facility

On April 13, 2018, in connection with the acquisition of Cedar Creek, we entered into a credit and guaranty agreement with HPS Investment Partners, LLC, as administrative agent and collateral agent (“HPS”) and certain other financial institutions as party thereto. On February 28, 2019, the credit and guaranty agreement was amended to, among other things, permit certain real estate sale leaseback transactions and modify the total net leverage ratio beginning in the first quarter of 2019 (as amended, the “Term Loan Agreement”). The Term Loan Agreement provides for a senior secured first lien loan facility in an aggregate principal amount of $180 million (the “Term Loan Facility”). The maturity date of the Term Loan Agreement is October 13, 2023. The proceeds from the Term Loan Facility were used to fund a portion of the cash consideration payable in connection with the acquisition of Cedar Creek and to fund transaction costs in connection with the acquisition and the Term Loan Facility.

The obligations under the Term Loan Agreement are secured by a security interest in substantially all of our and our subsidiaries’ assets, including inventories, accounts receivable, real property, and proceeds from those items.

The Term Loan Agreement requires monthly interest payments, and quarterly principal payments of $450,000, in arrears. The Term Loan Agreement also requires certain mandatory prepayments of outstanding loans, subject to certain exceptions, including prepayments commencing with the fiscal year ending December 28, 2019, based on a percentage of excess cash flow (as defined in the Term Loan Agreement for such fiscal year). The remaining balance is due on the loan maturity date of October 13, 2023.

The Term Loan Facility may be prepaid in whole or in part from time to time, subject to payment of the “Prepayment Premium” (as such term is defined in the Term Loan Agreement) if such voluntary prepayment does not otherwise constitute an exception to the Prepayment Premium under the Term Loan Agreement and is made on or prior to February 28, 2023, and all breakage costs incurred by any lender thereunder. We used approximately $30 million of the proceeds from the sale-leaseback transactions described in Note 9, Leases, to prepay the Term Loan Facility, resulting in adjusted quarterly principal payments of $372,661.

Borrowings under the Term Loan Agreement may be made as Base Rate Loans or Eurodollar Rate Loans. The Base Rate Loans will bear interest at the rate per annum equal to (i) the greatest of the (a) U.S. prime lending rate published in The Wall Street Journal, (b) the Federal Funds Effective Rate plus 0.50 percent, and (c) the sum of the Adjusted Eurodollar Rate of one month plus 1.00 percent, provided that the Base Rate shall at no time be less than 2.00 percent per annum; and (ii) plus the Applicable Margin, as described below. Eurodollar Rate Loans will bear interest at the rate per annum equal to (i) the ICE Benchmark Administration LIBOR Rate, provided that the Adjusted Eurodollar Rate shall at no time be less than 1.00 percent per annum; plus (ii) the Applicable Margin. The Applicable Margin will be 6.00 percent with respect to Base Rate Loans and 7.00 percent with respect to Eurodollar Rate Loans.

The Term Loan Agreement required maintenance of a total net leverage ratio of 8.25 to 1.00 for the fiscal quarter ending June 29, 2019, and such required covenant level generally reduces over the term of the Term Loan Facility as set forth in the Term Loan Agreement. As of June 29, 2019, we were in compliance with the total net leverage ratio.

The Term Loan Agreement also contains representations, warranties, affirmative and negative covenants customary for financing transactions of this type, and customary events of default.

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As of June 29, 2019, we had outstanding borrowings of $147.2 million under our Term Loan Credit Facility and an interest rate of 9.4 percent per annum. At December 29, 2018, our principal balance was $179.1 million with an interest rate of 9.3 percent per annum.

We were in compliance with all covenants under the Term Loan Agreement as of June 29, 2019.

Our remaining principal payment schedule for each of the next four years and thereafter is as follows:

(In thousands)
2019	$	373
2020		1,863
2021		1,491
2022		1,491
Thereafter		141,984

7. Net Periodic Pension Cost

The following table shows the components of our net periodic pension cost:

	Three Months Ended						Six Months Ended
(In thousands)	June 29, 2019			June 30, 2018			June 29, 2019			June 30, 2018
Service cost	$	48		$	133		$	161		$	266
Interest cost on projected benefit obligation	973			963			2,018			1,926
Expected return on plan assets	(1,295		)	(1,327		)	(2,489		)	(2,654		)
Amortization of unrecognized loss	279			271			580			542
Net periodic pension cost	$	5		$	40		$	270		$	80

During the first six months of fiscal 2019, we renegotiated our collective bargaining agreement with 3 unionized locations. This collective bargaining agreement covers a number of specific items such as wages, medical coverage, and certain other benefit programs, including pension plan participation. As a result of these renegotiations, 38 of the participants in the plan are no longer accruing future years of service under the applicable pension plan, which triggered a curtailment. As a result of the curtailment, we performed a revaluation of plan assets and liabilities. The related pension benefit obligation decreased $0.3 million for the six months ended June 29, 2019, as a result of changes in valuation assumptions. An overall increase in plan asset valuation was accompanied by a decrease to accumulated other comprehensive income of $0.2 million, which was recorded in other comprehensive loss on the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). No intraperiod income tax effect was required to be recorded as a result of the curtailment.

8. Stock Compensation

Cash-Settled Stock Appreciation Rights (“SARs”)

During fiscal 2016, we granted certain executives and employees cash-settled SARs. The cash-settled SARs vested on July 16, 2018. On the vesting date, half of the vested value of the cash-settled SARs became payable within thirty days of the vesting date, and the remainder payable within one year of the vesting date. The exercise price for the cash-settled SARs was amended so that it was based on a 20 day trading average of the Company’s common stock through the vesting date, in excess of the $7.00 grant date valuation.

On June 29, 2019, the total liability was approximately $7.2 million, which reflected the remaining payable balance.

Stock Compensation Expense

During the three months ended June 29, 2019 and June 30, 2018, we incurred stock compensation expense of $0.6 million and $3.8 million, respectively. During the six months ended June 29, 2019 and June 30, 2018, we incurred stock compensation expense of $1.3 million and $13.0 million, respectively. The decrease in our stock compensation expense for the three and six-month periods of fiscal 2019 is attributable to cash-settled SARs expense in the prior year.

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9. Leases

Effective December 30, 2018, we adopted ASU No. 2016-02, “Leases (Topic 842)” using the modified retrospective method, which applies the provisions of the new guidance at the effective date without adjusting the comparative periods presented. We have elected the package of practical expedients permitted under the transition guidance within the new standard. This election allowed us to carry forward our historical lease classification. The adoption of this standard resulted in the recording of operating lease right-of-use (“ROU”) assets and corresponding operating lease liabilities of $57.5 million on the condensed consolidated balance sheet as of December 30, 2018, which amortizes over the lease term.

Our operating and finance (formerly capital) lease portfolio includes leases for real estate, certain logistics equipment and vehicles. The majority of our leases have remaining lease terms of 1 year to 15 years, some of which include one or more options to extend the leases for 5 years. Operating lease ROU assets and liabilities are presented separately on the condensed consolidated balance sheets. Finance lease assets are included in property and equipment and the finance lease obligations are presented separately in the condensed consolidated balance sheet.

A portion of our real estate lease cost is generally subject to annual changes in the Consumer Price Index (“CPI”). The changes to the CPI are treated as variable lease payments and recognized in the period in which the obligation for those payments was incurred. In addition, a subset of our vehicle lease cost is considered variable.

The components of lease expense were as follows:

(In thousands)	Three Months Ended June 29, 2019		Six Months Ended June 29, 2019
Operating lease cost	$	2,991	$	6,135
Finance lease cost:
Amortization of right-of-use assets	$	2,995	5,892
Interest on lease liabilities	4,049		7,297
Total finance lease costs	$	7,044	$	13,189

Supplemental cash flow information related to leases was as follows:

(In thousands)	Three Months Ended June 29, 2019		Six Months Ended June 29, 2019
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases	$	3,064	$	5,967
Operating cash flows from finance leases	3,155		6,403
Financing cash flows from finance leases	2,045		4,232
Right-of-use assets obtained in exchange for lease obligations
Operating leases	$	—	$	—
Finance leases	3,462		4,250

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Supplemental balance sheet information related to leases was as follows:

(In thousands)	June 29, 2019
Finance leases
Property and equipment	$	156,050
Accumulated depreciation	(19,835		)
Property and equipment, net	$	136,215
Weighted Average Remaining Lease Term (in years)
Operating leases	12.17
Finance leases	20.34
Weighted Average Discount Rate
Operating leases	9.41		%
Finance leases	10.91		%

As of June 29, 2019, maturities of lease liabilities were as follows:

(In thousands)	Operating leases			Finance leases
2019	$	9,519		$	10,849
2020	8,790			20,814
2021	6,930			18,140
2022	6,243			17,153
2023	5,276			16,625
Thereafter	50,716			298,650
Total lease payments	$	87,474		$	382,231
Less: imputed interest	(32,112		)	(229,949		)
Total	$	55,362		$	152,282

At December 29, 2018, our total operating lease commitments were as follows:

	(In thousands)
2019	$	11,980
2020	9,928
2021	8,435
2022	8,066
2023	7,539
Thereafter	60,847
Total	$	106,795

Real Estate Transactions

During the three months ended June 29, 2019 we completed sale-leaseback transactions on two distribution centers. The aggregate gross proceeds for these real estate transactions were $45 million. We determined that the transactions did not qualify as sales in accordance with ASC Topic 842 and, for accounting purposes, the transactions were not accounted for as sale-leaseback transactions. When this occurs, the real estate transaction is accounted for as a financing transaction whereby the cash received is recorded as a financing obligation in our condensed consolidated balance sheets.

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At June 29, 2019, our future minimum payments related to the financing obligations under these real estate transactions were as follows:

	(In thousands)
2019	$	1,833
2020	3,711
2021	3,794
2022	3,880
2023	3,997
Thereafter	47,187
Total	$	64,402

10. Commitments and Contingencies

Environmental and Legal Matters

From time to time, we are involved in various proceedings incidental to our businesses, and we are subject to a variety of environmental and pollution control laws and regulations in all jurisdictions in which we operate. Although the ultimate outcome of these proceedings cannot be determined with certainty, based on presently available information management believes that adequate reserves have been established for probable losses with respect thereto. Management further believes that, while the ultimate outcome of one or more of these matters could be material to operating results in any given quarter, it will not have a materially adverse effect on our long-term financial condition, our results of operations, or our cash flows.

Collective Bargaining Agreements

As of June 29, 2019, we had over 2,200 employees on a full-time basis, and approximately 20 percent of our employees were represented by various local labor union Collective Bargaining Agreements (“CBAs”). As of June 29, 2019, approximately 4 percent of our employees are covered by CBAs that are up for renewal in fiscal 2019 or are currently expired and under negotiation.

11. Accumulated Other Comprehensive Loss

Comprehensive income (loss) is a measure of income (loss) which includes both net income (loss) and other comprehensive income (loss). Other comprehensive income (loss) results from items deferred from recognition into our Condensed Consolidated Statements of Operations and Comprehensive Loss. Accumulated other comprehensive loss is separately presented on our Condensed Consolidated Balance Sheets as part of stockholders’ deficit.

The changes in balances for each component of accumulated other comprehensive loss for the six months ended June 29, 2019, were as follows:

(In thousands)	Foreign currency, net of tax		Defined benefit pension plan, net of tax			Other, net of tax		Total Accumulated Other Comprehensive Loss
December 29, 2018, beginning balance	$	660	$	(38,001	)	$	212	$	(37,129	)
Other comprehensive income, net of tax [1]	7		(201		)	16		(178		)
June 29, 2019, ending balance, net of tax	$	667	$	(38,202	)	$	228	$	(37,307	)

^{________________________________} 

^[1] For the six months ended June 29, 2019, the actuarial loss recognized in the Condensed Consolidated Statements of Operations and Comprehensive Loss as a component of net periodic pension cost was $0.3 million, net of tax of $0.1 million. Please see Note 7, Net Periodic Pension Cost, for further information.

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12. Earnings (Loss) per Share

We calculate basic earnings (loss) per share by dividing net income (loss) by the weighted average number of common shares outstanding. We calculate diluted earnings per share by dividing net income by the weighted average number of common shares outstanding plus the dilutive effect of outstanding share-based awards, including restricted stock units, and performance units. Due to the financial results for six month period ended June 29, 2019, and the three and six month periods ended June 30, 2018, 0.1 million and 0.2 million, respectively, of incremental shares from share-based compensation arrangements were excluded from the computation of diluted weighted average shares outstanding, because their effect would be anti-dilutive.

The reconciliation of basic loss and diluted loss per common share for the six-month periods of fiscal 2019 and 2018 were as follows:

	Three Months Ended					Six Months Ended
(in thousands, except per share data)	June 29, 2019		June 30, 2018			June 29, 2019			June 30, 2018
Net income (loss)	$	6,301	$	(8,558	)	$	(418	)	$	(21,985	)
Weighted-average shares outstanding - basic	9,351		9,215			9,344			9,176
Dilutive effect of share-based awards	8		—			—			—
Weighted-average shares outstanding - diluted	9,359		9,215			$	9,344		$	9,176
Basic earnings (loss) per share	$	0.67	$	(0.93	)	$	(0.04	)	$	(2.40	)
Diluted earnings (loss) per share	$	0.67	$	(0.93	)	$	(0.04	)	$	(2.40	)

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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Overview

We are a leading distributor of building and industrial products in the U.S. With a combination of market position and geographic coverage, the buying power of certain centralized procurement, and the strength of a locally-focused sales force, BlueLinx is able to provide a wide range of value-added services and solutions to our customers and suppliers. We are headquartered in Georgia, with executive offices located at 1950 Spectrum Circle, Suite 300, Marietta, Georgia, and we operate our distribution business through a broad network of distribution centers. We serve many major metropolitan areas in the U.S. and deliver building and industrial products to a variety of wholesale and retail customers. We distribute products in two principal categories: structural products and specialty products. Structural products include primarily plywood, oriented strand board, rebar and remesh, lumber, spruce and other wood products primarily used for structural support, walls, and flooring in construction projects. Structural products represented approximately 32% of our second quarter 2019 net sales. Specialty products include primarily engineered wood products, moulding, siding and trim, cedar, metal products (excluding rebar and remesh) and insulation. Specialty products accounted for approximately 68% of our second quarter 2019 net sales.

Recent Developments

During the second quarter of 2019 we completed four real estate transactions. We sold two non-operating distribution facilities previously designated as “held for sale” for a gain of $9.8 million. We also completed sale-leaseback transactions on two distribution centers. Please see Note 9, Leases for further information regarding our sale-leaseback transactions.

Industry Conditions

Many of the factors that cause our operations to fluctuate are seasonal or cyclical in nature. Our operating results have historically been correlated with the level of single-family residential housing starts in the U.S. At any time, the demand for new homes is dependent on a variety of factors, including job growth, changes in population and demographics, the availability and cost of mortgage financing, the supply of new and existing homes, and consumer confidence. Since 2011, the U.S. housing market has generally shown improvement. However, single family housing starts continued a recent trend of unexpected softness, declining 6.2% in the second quarter of 2019, but the builders confidence index remains high, and we continue to believe the housing market improvement trend will continue in the long term, and that we are well-positioned to support our customers.

Our operating results are also affected by commodity pricing, and during the third and fourth quarters of 2018, the industry experienced a significant decline in wood based commodity prices, which included panels and framing lumber.  After a modest recovery during the first quarter of 2019, prices trended downward during the second quarter, impacting gross margins for structural products.  Pricing remains low relative to historical averages, creating sales realizations significantly below the prior year levels and resulting in revenue declines compared to the second  quarter of 2018. We continue to closely monitor these pricing trends, and work to manage our business, inventory levels, and costs, accordingly.

Factors That Affect Our Operating Results

Our results of operations and financial performance are influenced by a variety of factors, including the following: the integration of the Cedar Creek business with ours and the potential for disruption in distribution relationships, operational performance and sales resulting therefrom; changes in the prices, supply and/or demand for products that we distribute; inventory management and commodities pricing; new housing starts; repair and remodeling activity; general economic and business conditions in the U.S.; disintermediation by our customers and suppliers; acceptance by our customers of our branded and privately branded products; financial condition and credit worthiness of our customers; supply from key vendors; reliability of the technologies we utilize; activities of competitors; changes in significant operating expenses; fuel costs; risk of losses associated with accidents; exposure to product liability claims and other legal proceedings; changes in the availability of capital and interest rates; adverse weather patterns or conditions; acts of cyber intrusion or other disruptions to our information technology systems; and variations in the performance of the financial markets, including the credit markets.

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Results of Operations

The following table sets forth our results of operations for the second quarter of fiscal 2019 and fiscal 2018:

(Dollars in thousands)	Second Quarter of Fiscal 2019			% of Net Sales	Second Quarter of Fiscal 2018			% of Net Sales
Net sales	$	706,448		100.0%	$	892,952		100.0%
Gross profit	94,167			13.3%	103,651			11.6%
Selling, general, and administrative	74,101			10.5%	91,723			10.3%
Gains from sales of property	(9,760		)	(1.4)%	—			—%
Depreciation and amortization	7,503			1.1%	7,444			0.8%
Operating income (loss)	22,323			3.2%	4,484			0.5%
Interest expense	13,717			1.9%	12,194			1.4%
Other income, net	(45		)	—%	(94		)	—%
Income (loss) before provision for (benefit from) income taxes	8,651			1.2%	(7,616		)	(0.9)%
Provision for (benefit from) income taxes	2,350			0.3%	942			0.1%
Net income (loss)	$	6,301		0.9%	$	(8,558	)	(1.0)%

The following table sets forth our results of operations for the six-month periods of fiscal 2019 and fiscal 2018:

(Dollars in thousands)	First Six Months of Fiscal 2019			% of Net Sales	First Six Months of Fiscal 2018			% of Net Sales
Net sales	$	1,345,149		100.0%	$	1,330,439		100.0%
Gross profit	180,212			13.4%	158,976			11.9%
Selling, general, and administrative	148,511			11.0%	150,963			11.3%
Gains from sales of property	(9,760		)	(0.7)%	—			—%
Depreciation and amortization	14,831			1.1%	10,109			0.8%
Operating income (loss)	26,630			2.0%	(2,096		)	(0.2)%
Interest expense	27,118			2.0%	20,674			1.6%
Other expense (income), net	105			—%	(188		)	—%
Income (loss) before provision for (benefit from) income taxes	(593		)	0.0%	(22,582		)	(1.7)%
Provision for (benefit from) income taxes	(175		)	—%	(597		)	—%
Net income (loss)	$	(418	)	0.0%	$	(21,985	)	(1.7)%

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The following table sets forth net sales by product category for the three and six-month periods of fiscal 2019 and 2018 (in thousands):

	Three Months Ended				Six Months Ended
	June 29, 2019		June 30, 2018		June 29, 2019		June 30, 2018
Structural products	$	225,056	$	345,878	$	422,551	$	522,359
Specialty products and other	481,392		547,074		922,598		808,080
Net sales	$	706,448	$	892,952	$	1,345,149	$	1,330,439

The following table sets forth gross profit and gross margin percentages by product category for the three and six-month periods of fiscal 2019 and 2018 (dollars in thousands):

	Three Months Ended						Six Months Ended
	June 29, 2019			June 30, 2018			June 29, 2019			June 30, 2018
Structural products	$	17,419		$	32,785		$	36,193		$	50,039
Specialty products and other	76,748			81,784			144,019			119,855
Inventory step-up adjustment	—			(10,918		)	—			(10,918		)
Gross profit	$	94,167		$	103,651		$	180,212		$	158,976
Gross margin percentage by category
Structural products	7.7		%	9.5		%	8.6		%	9.6		%
Specialty products	15.9		%	14.9		%	15.6		%	14.8		%
Total gross margin percentage	13.3		%	11.6		%	13.4		%	11.9		%

Second Quarter of Fiscal 2019 Compared to Second Quarter of Fiscal 2018

Net sales.  For the second quarter of fiscal 2019, net sales decreased 20.9 percent, or $186.5 million, compared to the second quarter of fiscal 2018. The sales decrease was driven by declines in wood-based commodity prices, reduced levels of single-family housing starts and sales and supplier disruption in connection with our integration activities.

Gross profit and gross margin.  For the second quarter of fiscal 2019, gross profit decreased by $9.5 million, or 9.1 percent, compared to the second quarter of fiscal 2018, primarily due to the decrease in sales. During the same period, gross margin was 13.3 percent, an increase compared to 11.6 percent in the second quarter of fiscal 2018, driven by synergies from the acquisition of Cedar Creek. Gross margin was also negatively impacted in the prior year by the acquisition related inventory step-up charge of $10.9 million.

Selling, general, and administrative expenses.  The decrease in selling, general, and administrative expenses of 19.2 percent, or $17.6 million, for the second quarter of fiscal 2019, compared to the second quarter of fiscal 2018, is primarily due to acquisition synergies, a $3.1 million decrease in stock compensation expense and cost controls for the lower rate of sales.

Gains from sales of property. Sales of property with no leaseback in the second quarter of fiscal 2019 resulted in gains recognized of $9.8 million. Gains from the sale and leaseback of property in the second quarter of fiscal 2018 were deferred, due to the rules of accounting for sale and leaseback transactions, and are amortized as a credit to selling, general, and administrative expenses in the amount of approximately $1.3 million per fiscal quarter.

Depreciation and amortization expense. For the second quarter of fiscal 2019, depreciation and amortization expense increased by $0.1 million to $7.5 million due to increased capital expenditures in the current year.

Interest expense. Interest expense increased by $1.5 million for the second quarter of fiscal 2019, compared to the second quarter of fiscal 2018. The increase was largely attributable to the increase in finance leases and increased interest rates on our debt.

Provision for income taxes. Our effective tax rate was 27.2 percent and (12.4) percent for the second quarter of fiscal 2019 and 2018, respectively. Our effective tax rate for the second quarter of fiscal 2019 was impacted by the permanent addback of certain nondeductible expenses including meals and entertainment and executive compensation and the effect of the valuation allowance for separate company state income tax losses.  In addition, during the second quarter of fiscal 2019, we recorded discrete tax expense of $0.2 million for a shortfall on stock vesting which was offset by a $0.2 million discrete tax benefit for claiming state

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tax credits.  Our effective tax rate for the second quarter of fiscal 2018 was impacted by: (i) the inclusion of Cedar Creek’s operations from April 13, 2018, to June 30, 2018; (ii) the permanent addback of certain nondeductible expenses including transaction costs related to the Cedar Creek acquisition; and (iii) the effect of the valuation allowance for separate company state income tax losses generated during the second quarter of fiscal 2018.

Net income (loss). Our net income (loss) improved over the prior year due to gain on sale of properties and reduced costs associated with the acquisition of Cedar Creek, partially offset by the following: (i) lower gross profit due to the decrease in net sales; and (ii) increased interest expense due to higher average interest rates and the increase in finance leases.

First Six Months of Fiscal 2019 Compared to First Six Months of Fiscal 2018

Net sales.  For the first six months of fiscal 2019, net sales increased 1.1 percent, or $14.7 million, compared to the first six months of fiscal 2018. Sales growth was largely driven by the acquisition of Cedar Creek and the inclusion of Cedar Creek’s sales revenue for the full six months in 2019, as opposed to only during the period of April 13, 2018, to June 30, 2018, in the prior year period.

Gross profit and gross margin.  For the first six months of fiscal 2019, gross profit increased by $21.2 million, or 13.4 percent, with gross margin of 13.4 percent, compared to 11.9 percent for the first six months of fiscal 2018. Gross margin was negatively impacted in the prior year by the acquisition related inventory step-up charge of $10.9 million.

Selling, general, and administrative expenses. For the first six months of fiscal 2019, selling, general, and administrative expenses decreased $2.5 million, or 1.6 percent, compared to the first six months of fiscal 2018. The inclusion of the Cedar Creek business for the full six months in 2019 as opposed to the period of April 13, 2018, to June 30, 2018, in the prior year period increased expenses on a year-over-year basis. This was more than offset by an $11.7 million decrease in stock compensation expense, synergies from the acquisition of Cedar Creek and cost decreases related to the year-over-year sales decline.

Gains from sales of property. Sales of property with no leaseback in the first six months of fiscal 2019 resulted in gains recognized of $9.8 million. Gains from the sale and leaseback of property in the first six months of fiscal 2018 were deferred, due to the rules of accounting for sale and leaseback transactions, and are amortized as a credit to selling, general, and administrative expenses in the amount of approximately $1.3 million per fiscal quarter.

Depreciation and amortization expense. For the first six months of fiscal 2019, depreciation and amortization expense increased by $4.7 million to $14.8 million due to the acquisition of Cedar Creek, which resulted in a higher depreciable asset base and the addition of depreciable intangible assets.

Interest expense. Interest expense increased by $6.4 million for the first six months of fiscal 2019, compared to the first six months of fiscal 2018. The increase was largely attributable to a higher average debt balance over the period, coupled with a higher average interest rate on outstanding debt. We increased our outstanding debt to finance the acquisition of Cedar Creek in the prior year and incurred transaction costs that are amortized as interest expense.

Provision for income taxes. Our effective tax rate was 29.5 percent and 2.6 percent for the first six months of fiscal 2019 and 2018, respectively. Our effective tax rate for the first six months of fiscal 2019 was impacted by the permanent addback of certain nondeductible expenses including meals and entertainment and executive compensation and the effect of the valuation allowance for separate company state income tax losses. In addition, during the first six months of fiscal 2019, we recorded discrete tax expense of $0.2 million for a shortfall on stock vesting which was offset by a $0.2 million discrete tax benefit for claiming state tax credits. The effective tax rate for the first six months of fiscal 2018 was impacted by: (i) the inclusion of Cedar Creek’s operations from April 13, 2018, to June 30, 2018; (ii) the permanent addback of certain nondeductible expenses including transaction costs related to the Cedar Creek acquisition; (iii) the effect of the valuation allowance for separate company state losses; and (iv) the impact of discrete tax expense of $0.4 million for stock options that expired unexercised during the first quarter of fiscal 2018.

Net income (loss). Net income (loss) was substantially impacted by the factors described above including: (i) gain on sale in fiscal 2019 of $9.8 million, (ii) higher selling, general and administrative expenses in fiscal 2018 resulting from the acquisition of Cedar Creek and related transaction fees totaling $15.2 million, along with an inventory valuation step-up of $10.9 million; (iii) increased interest expense due to higher interest rates on outstanding debt; and (iv) $13.0 million of additional expense recognized for cash-settled stock appreciation rights and other share based compensation in fiscal 2018.

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Seasonality

We are exposed to fluctuations in quarterly sales volumes and expenses due to seasonal factors common in the building products distribution industry. The first and fourth fiscal quarters are typically our lower volume quarters, due to the impact of poor weather on the construction market. Our second and third fiscal quarters are typically our higher volume quarters, reflecting an increase in construction, due to more favorable weather conditions. Assuming no change in underlying inventory costs, our working capital generally increases in the fiscal second and third quarters, reflecting increased seasonal demand.

Liquidity and Capital Resources

We expect our primary sources of liquidity to be cash flows from sales in the normal course of our operations and borrowings under our Revolving Credit Facility. We expect that these sources will fund our ongoing cash requirements for the foreseeable future. We believe that sales in the normal course of our operations, and amounts currently available from our Revolving Credit Facility and other sources, will be sufficient to fund our routine operations, including working capital requirements, for at least the next 12 months.

Long-Term Debt

As of June 29, 2019, and December 29, 2018, long-term debt consisted of the following:

		June 29,			December 29,
(In thousands)	Maturity Date	2019			2018
Revolving Credit Facility (net of discounts and debt issuance costs of $5.2 million and $6.0 million at June 29, 2019 and December 29, 2018, respectively)	October 10, 2022	$	363,898		$	327,319
Term Loan Facility (net of discounts and debt issuance costs of $7.7 million and $6.7 million at June 29, 2019 and December 29, 2018, respectively)	October 13, 2023		139,438			172,356
Total debt			503,336			499,675
Less: current portion of long-term debt			(1,427	)		(1,736	)
Long-term debt, net		$	501,909		$	497,939

Revolving Credit Facility

On April 13, 2018, we amended and restated our Revolving Credit Facility to provide for a senior secured revolving loan and letter of credit facility of up to $600 million and an uncommitted accordion feature that permits us to increase the facility by an aggregate additional principal amount of up to $150 million. If we obtain the full amount of the additional increases in commitments, the Revolving Credit Facility will allow borrowings of up to $750 million. Borrowings under the Revolving Credit Facility are subject to availability under the Borrowing Base (as that term is defined in the Revolving Credit Agreement). Letters of credit in an aggregate amount of up to $30 million are also available under the Revolving Credit Agreement, which would reduce the amount of the revolving loans available under the Revolving Credit Facility. The Revolving Credit Agreement provides for interest at a rate per annum equal to (i) LIBOR plus a margin ranging from 1.75 percent to 2.25 percent, with the margin determined based upon average excess availability for the immediately preceding fiscal quarter for loans based on LIBOR, or (ii) the administrative agent’s base rate plus a margin ranging from 0.75 percent to 1.25 percent, with the margin based upon average excess availability for the immediately preceding fiscal quarter for loans based on the base rate.

If excess availability falls below the greater of (i) $50 million and (ii) 10 percent of the lesser of (a) the borrowing base and (b) the maximum permitted credit at such time, the Revolving Credit Agreement requires maintenance of a fixed charge coverage ratio of 1.0 to 1.0 until excess availability has been at least the greater of (i) $50 million and (ii) 10 percent of the lesser of (a) the borrowing base and (b) the maximum permitted credit at such time for a period of 30 consecutive days.

As of June 29, 2019, we had outstanding borrowings of $369.1 million and excess availability of $100.8 million under our Revolving Credit Facility with a weighted average interest rate of 4.5 percent. As of December 29, 2018 our principal balance was $333.3 million, excess availability was $91.7 million and our stated interest rate was 4.2 percent under our Revolving Credit Facility.

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Term Loan Facility

On April 13, 2018, we entered into the Term Loan Agreement with HPS and certain other financial institutions as party thereto, and on February 28, 2019, we amended the Term Loan Agreement. The Term Loan Agreement provides for a Term Loan Facility of $180 million secured by substantially all of our assets. Borrowings under the Term Loan Agreement may be made as Base Rate Loans or Eurodollar Rate Loans. The Base Rate Loans will bear interest at the rate per annum equal to (i) the greatest of the (a) U.S. prime lending rate published in The Wall Street Journal, (b) the Federal Funds Effective Rate plus 0.50 percent, and (c) the sum of the Adjusted Eurodollar Rate of one month plus 1.00 percent, provided that the Base Rate shall at no time be less than 2.00 percent per annum; and (ii) plus the Applicable Margin, as described below. Eurodollar Rate Loans will bear interest at the rate per annum equal to (i) the ICE Benchmark Administration LIBOR Rate, provided that the Adjusted Eurodollar Rate shall at no time be less than 1.00 percent per annum; plus (ii) the Applicable Margin. The Applicable Margin will be 6.00 percent with respect to Base Rate Loans and 7.00 percent with respect to Eurodollar Rate Loans.

The Term Loan Agreement required maintenance of a total net leverage ratio of 8.25 to 1.00 for the fiscal quarter ending June 29, 2019, and such required covenant level generally reduces over the term of the Term Loan Facility as set forth in the Term Loan Agreement.

Under the Term Loan Agreement, we are permitted to enter into up to $50 million in certain real estate sale leaseback transactions prior to December 2019, with the first $30 million in net proceeds therefrom to be used for repayment of indebtedness under the Term Loan Facility, subject to payment of the Prepayment Premium and breakage costs, and the remaining net proceeds to be used to repay indebtedness under the Revolving Credit Facility. During the second quarter of 2019, we used approximately $30 million of proceeds from real estate transactions to prepay the Term Loan Facility.

As of June 29, 2019, we had outstanding borrowings of $147.2 million under our Term Loan Facility and a stated interest rate of 9.4 percent per annum. At December 29, 2018, our principal balance was $179.1 million, with a stated interest rate of 9.3 percent per annum under our Term Loan Facility.

Mortgage Payoff and Finance Lease Commitments

On January 10, 2018, we completed sale-leaseback transactions on four distribution centers. We sold these properties for gross proceeds of $110.0 million. As a result of the transactions, we recognized finance lease assets and obligations totaling $95.1 million on these properties, and a total deferred gain of $83.9 million, which will be amortized over the lives of the applicable leases, in accordance with U.S. GAAP. The net proceeds received from the transactions were used to pay the remaining balance of our mortgage of $97.8 million, in its entirety, in the first quarter of fiscal 2018.

Our total finance lease commitments, which substantially relate to leases of property, totaled $152.3 million as of June 29, 2019.

Interest Rates

Our Revolving Credit Facility and our Term Loan Facility include available interest rate options based on the London Inter-bank Offered Rate (LIBOR). It is widely expected that LIBOR will be discontinued after 2021, and the U.S. and other countries are currently working to replace LIBOR with alternative reference rates. The consequences of these developments with respect to LIBOR cannot be entirely predicted; however we do not believe that the discontinuation of LIBOR as a reference rate in our loan agreements will have a material adverse effect on our financial position or materially affect our interest expense.

Sources and Uses of Cash

Operating Activities

Net cash used in operating activities for the first six months of fiscal 2019 was $67.7 million, compared to net cash used in operating activities of $98.5 million in the first six months of fiscal 2018. During the first six months of fiscal 2019, cash used in operating activities decreased primarily from the decrease in working capital from the prior year.

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Investing Activities

Net cash provided by investing activities for the first six months of fiscal 2019 was $9.0 million compared to net cash used in investing activities of $245.7 million in the first six months of fiscal 2018. The net cash provided in the current year primarily related to the proceeds from the sale of assets of $10.8 million. Net cash used in the prior year primarily related to the $353.1 million of net cash paid for the acquisition of Cedar Creek during the second quarter of 2018, offset by the proceeds from the sale-leaseback transactions in the first quarter of 2018.

Financing Activities

Net cash provided by financing activities totaled $62.4 million for the first six months of fiscal 2019, compared to $344.7 million for the first six months of fiscal 2018. The decrease in net cash provided by financing activities is due to the decrease in borrowings in the current year relative to borrowings in the prior year, which included borrowings for the acquisition of Cedar Creek.

Operating Working Capital ^[1] 

Selected financial information (in thousands)
	June 29, 2019		December 29, 2018		June 30, 2018
Current assets:
Cash	$	12,662	$	8,939	$	5,210
Receivables, less allowance for doubtful accounts	262,042		208,434		329,980
Inventories, net	358,652		341,851		409,713
Other current assets	44,066		40,629		43,734
Total current assets	$	677,422	$	599,853	$	788,637
Current liabilities:
Accounts payable	$	174,860	$	149,188	$	188,580
Accrued compensation	7,712		7,974		11,502
Current maturities of long-term debt, net of discount	1,427		1,736		1,736
Finance leases - short-term	8,166		7,555		8,239
Real estate deferred gains - short-term	3,935		5,330		5,330
Operating lease liabilities - short-term	6,690		—		—
Other current liabilities	18,625		24,985		21,905
Total current liabilities	$	221,415	$	196,768	$	237,292
Operating working capital	$	457,434	$	404,821	$	553,081

^{___________________________} 

^[1] Operating working capital is defined as current assets less current liabilities plus the current portion of long-term debt.

Operating working capital is an important measurement we use to determine the efficiencies of our operations and our ability to readily convert assets into cash. Management of operating working capital helps us monitor our progress in meeting our goals to enhance our return on working capital assets.

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Operating working capital of $457.4 million at June 29, 2019, compared to $404.8 million as of December 29, 2018, increased on a net basis by approximately $52.6 million. The increase in operating working capital is primarily driven by seasonal increases in accounts receivable and inventory to support expected increases in sales activity during the summer building season, offset by increases in accounts payable.

Operating working capital decreased from June 30, 2018, to June 29, 2019, by $95.6 million, primarily driven by the decrease in sales.

Critical Accounting Policies

The preparation of our consolidated financial statements and related disclosures in conformity with GAAP requires our management to make judgments and estimates that affect the amounts reported in our condensed consolidated financial statements and accompanying notes. There have been no material changes to our critical accounting policies from the information provided in Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 29, 2018.

Forward-Looking Statements

This report contains forward-looking statements. Forward-looking statements include, without limitation, any statement that predicts, forecasts, indicates or implies future results, performance, liquidity levels or achievements, and may contain the words “believe,” “anticipate,” “expect,” “estimate,” “intend,” “project,” “plan,” “will be,” “will likely continue,” “will likely result” or words or phrases of similar meaning. The forward-looking statements in this report include statements about the anticipated effects of adopting certain accounting standards; estimated future annual amortization expense; potential changes to estimates made in connection with revenue recognition; the expected outcome of legal proceedings; industry conditions; seasonality; and liquidity and capital resources.

Forward-looking statements are based on estimates and assumptions made by our management that, although believed by us to be reasonable, are inherently uncertain. Forward-looking statements involve risks and uncertainties that may cause our business, strategy, or actual results to differ materially from the forward-looking statements. These risks and uncertainties include those discussed under the heading “Risk Factors” in Item 1A of our Annual Report on Form 10-K for the year ended December 29, 2018, and those discussed elsewhere in this report and in future reports that we file with the SEC. We operate in a changing environment in which new risks can emerge from time to time. It is not possible for management to predict all of these risks, nor can it assess the extent to which any factor, or a combination of factors, may cause our business, strategy, or actual results to differ materially from those contained in forward-looking statements. Factors that may cause these differences include, among other things: our ability to integrate and realize anticipated synergies from acquisitions; loss of material customers, suppliers, or product lines in connection with acquisitions; our indebtedness and its related limitations; sufficiency of cash flows and capital resources; changes in interest rates; fluctuations in commodity prices; adverse housing market conditions; disintermediation by customers and suppliers; changes in prices, supply and/or demand for our products; inventory management; competitive industry pressures; industry consolidation; product shortages; loss of and dependence on key suppliers and manufacturers; new tariffs; our ability to monetize real estate assets; our ability to successfully implement our strategic initiatives; fluctuations in operating results; sale-leaseback transactions and their effects; real estate leases; exposure to product liability claims; changes in our product mix; petroleum prices; information technology security and business interruption risks; litigation and legal proceedings; natural disasters and unexpected events; activities of activist stockholders; labor and union matters; limits on net operating loss carryovers; pension plan assumptions and liabilities; risks related to our internal controls; retention of associates and key personnel; federal, state, local and other regulations, including environmental laws and retulations; and changes in accounting principles. Given these risks and uncertainties, we caution you not to place undue reliance on forward-looking statements. We expressly disclaim any obligation to update or revise any forward-looking statement as a result of new information, future events or otherwise, except as required by law.

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ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Not applicable.

ITEM 4. CONTROLS AND PROCEDURES

Our management performed an evaluation, as of the end of the period covered by this report on Form 10-Q, under the supervision of our chief executive officer and chief financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) of the Securities and Exchange Act of 1934, as amended (the “Exchange Act”)). Based on that evaluation, our chief executive officer and chief financial officer have concluded that our disclosure controls and procedures are effective to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms, and is accumulated and communicated to our management including our chief executive officer and chief financial officer, to allow timely decisions regarding required disclosure.

During the period covered by this report, other than described below, there have been no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

On April 13, 2018, we acquired Cedar Creek Holdings, Inc. in a business combination. The Company is in the process of integrating the policies, processes, information technology systems and other components of internal controls over financial reporting of the combined business. Management’s assessment of the Company’s internal control over financial reporting for the fiscal year 2019 will include the internal controls over financial reporting of Cedar Creek.

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PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

During the second quarter of fiscal 2019, there were no material changes to our legal proceedings as disclosed in our Annual Report on Form 10-K for the year ended December 29, 2018. Additionally, we are, and from time to time may be, a party to routine legal proceedings incidental to the operation of our business. The outcome of any pending or threatened proceedings is not expected to have a material adverse effect on our financial condition, operating results, or cash flows, based on our current understanding of the relevant facts. Legal expenses incurred related to these contingencies are generally expensed as incurred.

ITEM 1A. RISK FACTORS

There have been no material changes to the risk factors disclosed in Item 1A, “Risk Factors,” of the Company’s Annual Report on Form 10-K for the year ended December 29, 2018.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

The following table summarizes the Company’s common stock repurchase activity for each month of the quarter ended June 29, 2019:

		Total Number
		Shares	Average Price
Period		Purchased[1]	Paid Per Share
March 31 - May 4, 2019		5,420	$	25.19
May 5 - June 1, 2019		—	$	—
June 2 - June 29, 2019		26,868	$	19.44
Total		32,288
[1]	The Company did not repurchase any of its equity securities during the period covered by this report pursuant to any publicly announced plan or program, and no such plan or program is presently in effect. All purchases reflected in the table above pertain to purchases of common stock by the Company in connection with tax withholding obligations of the Company’s employees upon the vesting of such employees’ restricted stock awards.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

None.

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ITEM 6. EXHIBITS

Exhibit Number		Description
10.1		Form of Purchase and Sale Agreement for Sale-Leaseback Transactions with Big Acquisitions LLC
10.2		Third Amendment to Purchase and Sale Agreement, dated as of May 1, 2019, by and between ABP FL (Yulee) LLC and Big Acquisitions LLC
10.3		Third Amendment to Purchase and Sale Agreement, dated as of May 1, 2019, by and between ABP IL (University Park) and Big Acquisitions LLC
31.1	*	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	*	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	**	Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	**	Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.Def		Definition Linkbase Document.
101.Pre		Presentation Linkbase Document.
101.Lab		Labels Linkbase Document.
101.Cal		Calculation Linkbase Document.
101.Sch		Schema Document.
101.Ins		Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
	*	Filed herewith.
	**	Exhibit is being furnished and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section, nor shall it be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended.

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SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

		BlueLinx Holdings Inc.
		(Registrant)
Date: August 7, 2019	By:	/s/ Susan C. O’Farrell
		Susan C. O’Farrell
		Senior Vice President, Chief Financial Officer, Treasurer, and Principal Accounting Officer

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EX-10.1

EXHIBIT 10.1 PURCHASE AND SALE AGREEMENT THIS PURCHASE AND SALE AGREEMENT (this “Agreement”) is made and entered into as of the Effective Date (as hereinafter defined), by and between ABP [__] LLC, a Delaware limited liability company (“Seller”), and BIG ACQUISITIONS LLC, an Illinois limited liability company (“Buyer”). RECITALS: A. Seller is the fee simple owner of the Land. B. Buyer desires to acquire said land, together with the improvements located thereon and certain other property interests related thereto, from Seller for the purchase price of [__] Dollars ($[__]) (the “Purchase Price”). C. Seller is willing to convey said property to Buyer for the Purchase Price, but only upon the terms and conditions hereinafter set forth. OPERATIVE TERMS: NOW, THEREFORE, for and in consideration of the foregoing recitals and the promises, covenants, representations and warranties hereinafter set forth, the sum of One Hundred Dollars ($100.00) and other good and valuable consideration in hand paid by Seller to Buyer and by Buyer to Seller upon the execution of this Agreement, the receipt and sufficiency of which are hereby acknowledged by each of the parties hereto, the parties hereto hereby agree as follows: 1. Recitals; Definitions. The foregoing recitals are true and correct in all material respects. Capitalized terms and phrases used but not otherwise defined in the body of this Agreement shall have the meanings ascribed to such terms and phrases in Schedule A attached hereto. 2. Purchase and Sale. Seller agrees to convey, transfer and assign, and Buyer agrees to acquire, accept and assume, the Property, on the terms, conditions and provisions set forth in this Agreement. 3. Purchase Price. The Purchase Price shall be due and payable as follows: 3.1 Deposit. Buyer shall make the Initial Deposit with Escrow Agent within three (3) Business Days after the Effective Date. In addition, no later than the Due Diligence Deadline (provided that this Agreement is not sooner Terminated in accordance with the terms hereof), Buyer shall also make the Secondary Deposit. Notwithstanding any provision in this Agreement to the contrary, if Buyer fails to timely make the Initial Deposit or the Secondary Deposit as provided herein, Seller may Terminate this Agreement by notice to Buyer given no later than five (5) days following the due date of the Initial Deposit or the Secondary Deposit, as the case may be, and any Deposit previously paid by Buyer shall be promptly returned to Buyer. Except as expressly otherwise set forth herein, the Deposit shall be applied against the Purchase Price on the Closing Date and shall otherwise be held and delivered by Escrow Agent in accordance with the provisions of Paragraph 15.

3.2 Remainder of Purchase Price. At Closing, Buyer shall pay to Seller an amount equal to the difference between (a) the Purchase Price and (b) the Deposit previously or simultaneously paid to Seller, subject to the adjustments set forth herein, in cash by wire transfer to such account and bank as Seller shall designate in writing, to be confirmed received in Seller’s account on or before 3:00 p.m. Eastern time on the Closing Date. 4. Buyer’s Due Diligence and Inspection Rights; Termination Right. 4.1 Inspection of Property. Until Closing, and subject to the terms of Paragraph 4.2, Seller shall provide Buyer and Buyer’s Representatives access to the Real Property, upon reasonable prior notice at reasonable times during business hours, with the right and license to conduct Due Diligence with respect to the Property. 4.2 Inspection Requirements. Buyer’s rights to conduct Due Diligence shall be subject to the following further requirements: (a) Due Diligence inspections of the Property may only be performed during normal business hours and Buyer must provide Seller with at least 48 hours’ prior notice of its intent to perform Due Diligence inspections of the Property; (b) Seller shall have the right to have a representative of Seller present during any entry upon the Property by Buyer or Buyer’s Representatives; (c) there shall be no physical testing of the Property whatsoever, including, without limitation, any invasive sampling, boring, testing, or analysis of soils, surface water or groundwater at the Property; (d) Buyer shall immediately return the Property to the condition existing prior to any inspection. Prior to any entry upon the Land, Buyer shall provide to Seller, and shall cause any of Buyer’s Representatives entering upon the Land to provide to Seller, evidence of insurance which complies with the requirements of Schedule B attached hereto. Notwithstanding any provision in this Agreement to the contrary, except in connection with the issuance of a standard “zoning letter” with respect to the Property or the preparation of a third-party zoning report, neither Buyer nor any Buyer’s Representative shall contact any governmental official or representative regarding hazardous materials on, or the environmental condition of, the Property, or the status of compliance of the Property with zoning, building code or similar Laws, without Seller’s prior written consent thereto, which consent Seller may withhold in its sole and absolute discretion. In addition, Seller shall be entitled to at least two (2) Business Days’ prior notice of the intended contact and to have a representative present when Buyer or any Buyer’s Representative has any such contact with any governmental official or representative. 4.3 Title Examination. A. Title Objections. Seller shall order the Title Commitment within five (5) Business Days after the Effective Date. Buyer shall have until 10 days after delivery of the Title Commitment to notify Seller of any Title Objections. If Buyer fails to notify Seller of any Title Objections on or before the day that is 10 days after delivery of the Title Commitment then, notwithstanding any other provisions set forth herein, such failure to notify Seller shall constitute a waiver of such right to object to such matters existing as of the Effective Date. Any such Title Objection so waived (or deemed waived) by Buyer shall be deemed to constitute a Permitted Title Exception and the Closing shall occur as herein provided without any reduction of or credit against the Purchase Price. B. Cure of Title Matters. At Closing, Seller shall Remove or cause to be Removed any Title Objections to the extent (and only to the extent) that the same constitute Required 2

Removal Items. In addition, Seller may elect (but shall not be obligated) to Remove or cause to be Removed any other Title Objections, and, with respect thereto, Seller may notify Buyer on or before the Title Cure Deadline whether Seller elects to Remove the same (and the failure to provide such notice on or before the Title Cure Deadline shall be deemed to constitute an election of Seller not to effect any such cure). C. Buyer’s Right To Terminate. If any such Title Objection is not so cured on or before the Title Cure Deadline, then Buyer may Terminate this Agreement by notice to Seller within five (5) Business Days after the Title Cure Deadline. Failure of Buyer to respond within such period shall be deemed an election by Buyer to waive such Title Objections and proceed to Closing. Any such Title Objection so waived (or deemed waived) by Buyer shall be deemed to constitute a Permitted Title Exception and the Closing shall occur as herein provided without any reduction of or credit against the Purchase Price. D. Pre-Closing “Gap” Defects. Whether or not Buyer shall have furnished to Seller any notice of Title Objections before the Due Diligence Deadline, Buyer may at or prior to Closing notify Seller of any defects in title arising between the Due Diligence Deadline and the Closing Date. With respect to any Title Objections set forth in such notice, Buyer shall have the same rights as those which apply to any notice of defects in title resulting from a notice of title defects by Buyer on or before the Due Diligence Deadline and Seller shall have the same rights and obligations to cure the same at or prior to Closing. If necessary, the date for Closing shall be automatically extended (by not more than 15 days) to allow Seller to cure such pre-closing “gap” defects. 4.4 As-Is, Where-Is, With All Faults Sale. Buyer shall conduct such Due Diligence as Buyer deems necessary or appropriate prior to the Due Diligence Deadline, and shall independently confirm to its satisfaction all information that it considers material to its purchase of the Property or the Transaction. Accordingly, the Property shall be sold, and Buyer shall accept possession of the Property on the Closing Date, “AS IS, WHERE IS, WITH ALL FAULTS”, with no right of setoff or reduction in the Purchase Price. Without limiting the foregoing, except for Seller’s Warranties, none of the Seller Parties have or shall be deemed to have made any verbal or written representations, warranties, promises or guarantees (whether express, implied, statutory or otherwise) to Buyer with respect to the Property; any matter set forth, contained or addressed in the Documents (including, but not limited to, the accuracy and completeness thereof); or the results of Buyer’s Due Diligence. In addition, Buyer expressly understands and acknowledges that any documents made available to Buyer may not be complete in all respects and that Seller may not have complete information concerning the Property in Seller’s possession or control. Buyer acknowledges that all such information must be verified independently during Due Diligence. In addition, Buyer expressly understands and acknowledges that it is possible that unknown Liabilities may exist with respect to the Property and that Buyer explicitly took that possibility into account in determining and agreeing to the Purchase Price, and that a portion of such consideration, having been bargained for between the parties with the knowledge of the possibility of such unknown Liabilities shall be given in exchange for the existence of any and all such Liabilities. In furtherance of the foregoing commitments, Buyer shall execute and deliver to Seller at the Closing, an As Is Agreement as required by Paragraph 6.3. 4.5 Termination Right. Buyer may, at any time prior to the Due Diligence Deadline, Terminate this Agreement by notice to Seller if Buyer, in its sole and absolute discretion, determines not to proceed with the Transaction or is not satisfied with any matters relating to the Property. If, at or prior to the Due Diligence Deadline, Buyer has not given Seller a termination notice 3

as aforesaid, then Buyer shall be deemed to have accepted the condition of the Property (subject to Seller’s compliance with the representations, warranties and covenants of this Agreement, and the conditions set forth in Paragraph 10) and shall thereafter have no right to Terminate this Agreement on account of such Due Diligence termination right under this Paragraph 4 and, except as set forth in Article 9 or Paragraphs 10.1.C. and 12.2 hereinbelow, Buyer shall not be entitled to the return of the Deposit. If after the Due Diligence Deadline Buyer conducts further Due Diligence, Buyer acknowledges and agrees that Buyer shall have no further right to terminate this Agreement with respect to such further Due Diligence or otherwise in accordance with this Paragraph 4 after the Due Diligence Deadline. 4.6 Underground Storage Tank. Seller has informed Buyer, and Buyer acknowledges, that the Property includes [__] operational [__] gallon underground tank[s] used for the storage of diesel fuel. Buyer acknowledges, subject to Buyer’s right to perform Due Diligence pursuant to this Agreement and to terminate this Agreement pursuant to the foregoing paragraph, that it is a material factor in Seller’s acceptance of the Purchase Price that Buyer agree to accept said tank with the Property. 4.7 Seller’s Termination of Related Contract. Notwithstanding anything in this Agreement to the contrary, (a) should Buyer elect to Terminate this Agreement pursuant to Paragraph 4.5 above, Seller shall have the right to terminate the Related Contract, at Seller’s option, by notice to Buyer given in accordance with the Related Contract no later than five (5) days following receipt of Buyer’s termination notice under this Agreement. If Buyer elects to Terminate the Related Contract pursuant to Section 4.5 thereof, Seller shall have the right to terminate this Agreement by notice to Buyer given no later than five (5) days following receipt of Buyer’s termination notice under the Related Contract and any Deposit previously paid by Buyer hereunder shall be promptly returned to Buyer and neither party shall have any further obligation to the other under this Agreement (except for those obligations which expressly survive the termination hereof). 5. Seller’s Covenants. Between the Effective Date and the Closing Date: 5.1 No Alteration of Title. Seller shall not transfer or further alter or encumber (which shall include entering into any new lease of all or part of the Real Property; permitting any new sublease of all or part of the Real Property or consenting to any modification of any existing sublease of all or part of the Real Property) in any way Seller’s title to the Property as it exists as of the Effective Date without written notice to, and the prior written consent of, Buyer. If Buyer fails to object in writing to any such proposed instrument within three (3) Business Days after receipt of the aforementioned notice, Buyer shall be deemed to have approved the proposed instrument. Buyer’s consent shall not be unreasonably withheld or delayed with respect to any such instrument that is proposed prior to the Due Diligence Deadline. 5.2 Status of Property. Seller shall maintain and keep the Property in a manner consistent with Seller’s past practices with respect to the Property, and shall maintain in force the insurance coverage consistent with Seller’s insurance coverage practices as of the Effective Date. 6. Closing. The actual day of Closing shall be mutually agreed to by the parties. If no such selection is timely made, the Closing shall be held on the Closing Deadline. 4

6.1 Closing Mechanics. Buyer and Seller shall conduct an escrow-style closing through the Escrow Agent so that it will not be necessary for any party to attend the Closing. 6.2 Seller’s Deliveries. At Closing, Seller shall deliver or cause to be delivered the following items: A. Deed. The Deed. B. Withholding and Tax Certificate. A certificate with respect to Section 1445 of the Internal Revenue Code stating whether or not Seller is a foreign person as defined in said Section 1445 and applicable regulations thereunder. C. Affidavit of Title. An Affidavit of Title with respect to liens and title matters in substantially the form of Exhibit B. D. Closing Statement. A Closing Statement Agreement in the form of Exhibit C attached hereto and incorporated herein by this reference. Seller and Buyer shall authorize and instruct the Escrow Agent to file, as the “reporting person,” Internal Revenue Service Form 1099- B (“Proceeds from Real Estate, Broker, and Barter Exchange Transactions”), if and as required by Section 6045(d) of the Code. E. Evidence of Authority. If requested by the Title Company, evidence that Seller has the requisite power and authority to execute and deliver, and perform under, this Agreement and all Closing Documents. F. Transfer Tax Declarations. To the extent applicable, duly completed real estate state, county and local transfer tax declarations. G. Lease. Tenant’s counterpart of the Lease. H. Assignment. Seller’s counterpart of the Assignment. I. SNDA. Tenant’s counterpart to the SNDA. J. Non-Disturbance Agreement. Tenant’s counterpart to the Non- Disturbance Agreement. K. Bring-Down Certificate. A reaffirmation of Seller’s Warranties in the form of Exhibit G attached hereto, to which shall be attached a current representation exception schedule identifying all exceptions to Seller’s Warranties then applicable. L. Other Instruments. Such other instruments or documents as may be necessary to effect or carry out the purposes of this Agreement, subject to Seller’s prior approval thereof, which approval shall not be unreasonably withheld or delayed. M. Certificate. The Certificate signed by Tenant. N. Memorandum of Lease. Tenant’s counterpart of the Memorandum of Lease. 5

6.3 Buyer’s Deliveries. At the Closing, Buyer shall deliver or cause to be delivered to Seller the following: A. Net Purchase Price. The net Purchase Price due at Closing under this Agreement. B. As Is Agreement. The As Is Agreement of Buyer in the form of Exhibit D attached hereto. C. Bring-Down Certificate. A reaffirmation of the representations, warranties and covenants set forth in Paragraph 8.5 hereof in the form of Exhibit H attached hereto. D. Closing Document Counterparts. Executed counterparts of any of the Closing Documents described in Paragraph 6.2 which are also to be signed by Buyer. E. SNDA. Buyer’s, Master Tenant’s, Landlord’s and Lender’s counterparts to the SNDA. F. Non-Disturbance Agreement. Buyer’s, Master Tenant’s, Landlord’s and Lender’s counterparts to the Non-Disturbance Agreement. G. Landlord Agreement. The Landlord Agreement, executed by Buyer, Master Tenant and Landlord. H. Other Instruments. Such other funds, instruments or documents as may be necessary to effect or carry out the purposes of this Agreement, subject to Buyer’s prior approval thereof, which approval shall not be unreasonably withheld or delayed. I. Lease. Landlord’s counterpart of the Lease. J. Memorandum of Lease. Landlord’s counterpart of the Memorandum of Lease. K. Leasehold Policy Requirements. Such instruments or documents as the Title Company may reasonably require of Titleholder, Master Tenant or Landlord in order to issue a leasehold policy insuring Tenant’s interest under the Lease including, but not limited to, copies of the lease agreements evidencing the interest of Master Tenant and Landlord in the Property and documents evidencing the legal existence and organizational power and authority or Title Holder Master Tenant and Landlord to enter into such agreements. 6.4 Buyer’s Ability to Close. Buyer covenants to Seller that Buyer shall, as of the Closing Date, have sufficient immediately available funds (through financing sources or otherwise) to pay the balance of the net Purchase Price required pursuant to the foregoing subparagraph 6.3(A). 7. Prorations and Closing Costs. 7.1 Prorations. The parties acknowledge that there shall be no prorations of any expense items with respect to the Property at Closing, all such items being addressed in the Lease. 6

7.2 Seller’s Closing Costs. Seller shall pay the following: (a) the fees and expenses of Seller’s attorneys; (b) the costs (including recording costs) of any cure of title defects required of Seller hereunder; and (c) all transfer, documentary, excise, recording or other taxes or assessments imposed by virtue of the Transaction. 7.3 Buyer’s Closing Costs. Buyer shall pay the following: (a) all costs of Buyer’s Due Diligence, (b) the fees and expenses of Buyer’s attorneys, (c) all costs related to any financing to be obtained by Buyer; (d) all recording charges due on recordation of any Closing Documents, (e) all escrow agent fees (if any are charged in connection with this Transaction), and (f) the costs, expenses and premiums for the Title Commitment and the Title Policy (including all examinations and reports in connection therewith) and for any endorsements to the Title Policy, any reinsurance required by Buyer, and any loan policy of title insurance. 8. Representations and Warranties. 8.1 Seller’s Representations and Warranties. Seller represents and warrants to Buyer as follows: A. Organization, Power and Authority. Seller is duly organized, validly existing and in good standing under the Laws of the State of Delaware; is, to the extent required by Law, duly qualified to do business in the State in which the Land is located; and has all necessary power to execute and deliver this Agreement and perform all its obligations hereunder. Seller has the full power and authority to enter into and perform this Agreement and the execution, delivery and performance of this Agreement by Seller (i) has been duly and validly authorized by all necessary action on the part of Seller, (ii) does not conflict with or result in a violation of the organizational documents of Seller, or any judgment, order or decree of any court or arbiter in any proceeding to which Seller is a party, and, (iii) does not conflict with or constitute a material breach of, or constitute a material default under, any contract, agreement or other instrument by which Seller is bound or to which it is a party. B. No Other Agreements. Seller has not entered into any currently effective agreement (other than this Agreement) to sell or dispose of all or any portion of its interest in and to the Property. Except as set forth in the Sublease or disclosed in the Record Exceptions, Seller has not entered into any options, puts, calls, rights of first offer, opportunity or refusal, or other preemptive rights to purchase or occupy the Property which are in effect as of the Effective Date. C. Possession. As of the Effective Date, no party other than Seller, Tenant and Subtenant is in possession or occupancy of the Real Property or any part thereof. D. Foreign Entity. Seller is not a “foreign person” as such phrase is defined in Section 1445 of the United States Internal Revenue Code. E. Notice of Violations. To Seller’s knowledge, Seller has received no written notice (i) from any governmental authority that the Property is not in material compliance with all applicable laws, except for such failures to comply, if any, which have been remedied; or (ii) from any insurance company or underwriter of any defect that would adversely affect the insurability of the Property or cause an increase in insurance premiums with respect to the Property. 7

F. Condemnation. To Seller’s knowledge, Seller has not received any written notice of any (i) pending, contemplated, threatened or anticipated condemnation of any part of the Real Property, or (ii) widening, change of grade or limitation on the use of streets abutting the Land. G. No Bankruptcy. Seller has not (A) commenced a voluntary case, or, to Seller’s knowledge, had entered against it a petition, for relief under any federal bankruptcy act or any similar petition, order or decree under any federal or state Law relative to bankruptcy, insolvency or other relief for debtors, (B) caused, suffered or consented to the appointment of a receiver, trustee, administrator, conservator, liquidator or similar official in any federal, state or foreign judicial or non-judicial proceeding, to hold, administer and/or liquidate all or substantially all of its assets, or (C) made an assignment for the benefit of creditors. H. Pending Actions or Proceedings. There are no actions or proceedings pending or, to Seller’s knowledge, threatened against Seller or relating to the Property which, if decided adversely, would impair Seller’s ability to perform its obligations under this Agreement or prevent the use of the Land for the purposes for which Tenant currently uses it. I. Other Prohibitions. Neither Seller nor, to Seller’s knowledge, any person owning a direct interest in Seller (i) is included on any Government List; (ii) has been determined by competent authority to be subject to the prohibitions contained in Presidential Executive Order No. 133224 (September 23, 2001) or in any enabling or implementing legislation or other Presidential Executive Orders in respect thereof; (iii) has been previously indicted for or convicted of any felony involving a crime or crimes of moral turpitude or for any offense under the criminal laws against terrorists, the criminal laws against money laundering, the Bank Secrecy Act, as amended, the Money Laundering Control Act of 1986, as amended, or the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorists (USA PATRIOT ACT) Act of 2001, Public Law 107-56 (October 26, 2001), as amended; or (iv) to Seller’s knowledge, is currently under investigation by any governmental authority for alleged criminal activity. 8.2 Seller’s Warranties Deemed Modified. Because Buyer’s primary reliance on the status of the matters addressed by Seller’s Warranties is Buyer’s own Due Diligence, to the extent that Buyer knows prior to the Due Diligence Deadline that Seller’s Warranties are inaccurate, untrue or incorrect in any way, such Seller’s Warranties shall be deemed modified to reflect Buyer’s knowledge. As used herein, “knows,” “knew” or “knowledge” means with respect to any statement following such phrase that to the date hereof no information has come to the attention of any such person or such person’s agents, which would cause such person or its agents to believe that such statement is not true and correct. 8.3 Claims of Breach Prior To Closing. If at or prior to the Closing, Seller obtains actual knowledge that any Seller’s Warranty is untrue, inaccurate or incorrect in any material respect, Seller shall give Buyer notice thereof within five (5) Business Days of obtaining such knowledge (but, in any event, prior to the Closing). If at or prior to the Closing Buyer or any Buyer’s Representative obtains actual knowledge that any Seller’s Warranty is untrue, inaccurate or incorrect in any material respect, Buyer shall give Seller notice thereof within five (5) Business Days of obtaining such knowledge (but, in any event, prior to the Closing). In either such event, Seller shall have the right to cure such misrepresentation or breach and shall be entitled to a reasonable adjournment of the Closing (not to exceed 15 days) to attempt such cure. If any Seller’s Warranty is untrue, inaccurate or incorrect in any material respect as of the date made, and Seller is unable to so cure such 8

misrepresentation or breach, then Buyer, as its sole remedy, shall elect either (a) to waive such misrepresentation or breach and consummate the Transaction without any reduction of or credit against the Purchase Price, or (b) to Terminate this Agreement by notice given to Seller no later than five (5) days after the end of such cure period, in which event the Deposit shall be returned to Buyer and Seller shall reimburse to Buyer, within twenty (20) days after Seller’s receipt of documentation thereof, the Buyer’s Transaction Costs. 8.4 Survival and Limits on Buyer’s Claims. Seller’s Warranties shall survive the Closing and not be merged therein for the Survival Period and Seller shall only be liable to Buyer hereunder for a breach of Seller’s Warranties made herein or in any of the documents executed by Seller at the Closing with respect to which a claim is made by Buyer against Seller in writing, specifying in reasonable detail the circumstances giving rise to the alleged breach, within the Survival Period. Anything in this Agreement to the contrary notwithstanding, the maximum aggregate liability of Seller for breaches of Seller’s Warranties shall be subject to Seller’s Liability Limit. Notwithstanding the foregoing, however, if the Closing occurs, Buyer hereby expressly waives, relinquishes and releases any right or remedy available to it at law, in equity, under this Agreement or otherwise to make a claim against Seller for damages that Buyer may incur, or to rescind this Agreement and the Transaction, as the result of any of Seller’s Warranties being untrue, inaccurate or incorrect if (a) Buyer knew that such representation or warranty was untrue, inaccurate or incorrect at the time of the Closing (Buyer’s remedy being as set forth in Paragraph 8.3), or (b) Buyer’s damages as a result of such representations or warranties being untrue, inaccurate or incorrect are reasonably estimated to aggregate less than $37,500.00. 8.5 Buyer’s Representations and Warranties. Buyer represents and warrants to Seller as follows: A. Organization, Power and Authority. Buyer is duly organized, validly existing and in good standing under the Laws of the State of Delaware; is, to the extent required by Law, duly qualified to do business in the State in which the Land is located; and has all necessary power to execute and deliver this Agreement and perform all its obligations hereunder. Buyer has the full power and authority to enter into and perform this Agreement and the execution, delivery and performance of this Agreement by Buyer (i) has been duly and validly authorized by all necessary action on the part of Buyer, (ii) does not conflict with or result in a violation of the organizational documents of Buyer, or any judgment, order or decree of any court or arbiter in any proceeding to which Buyer is a party, and (iii) does not conflict with or constitute a material breach of, or constitute a material default under, any contract, agreement or other instrument by which Buyer is bound or to which it is a party. There are no lawsuits pending against Buyer or, to Buyer’s knowledge, threatened, the outcome of which could adversely affect Buyer’s ability to purchase the Property or otherwise perform its obligations under this Agreement. B. Sophisticated Buyer. Buyer is experienced in the ownership and operation of properties like and in the locale of the Property, and has experience in the acquisition, ownership and operation of properties similar to the Property. Buyer warrants and represents that it has the ability through its own employees, or through agents, independent contractors, consultants or other experts with whom it has a relationship, to evaluate fully the material characteristics of the Property and to assess fully all issues pertaining to title to the Real Property, the value of the Property, the rights and liabilities of Buyer as the successor to Seller, the structural integrity and soundness of all improvements and structures located on the Real Property, the environmental condition of the 9

Property, and the compliance of the Property with all Laws. Accordingly, Buyer acknowledges that, except for Seller’s Warranties, Buyer has not and will not rely upon any warranty, representation, statement of fact, or other information made by or furnished by or on behalf of Seller or any of its affiliates. C. Funds. Buyer has sufficient funds in immediately available cash to pay the Deposit. D. No Bankruptcy. Buyer has not (A) commenced a voluntary case, or had entered against it a petition, for relief under any federal bankruptcy act or any similar petition, order or decree under any federal or state Law relative to bankruptcy, insolvency or other relief for debtors, (B) caused, suffered or consented to the appointment of a receiver, trustee, administrator, conservator, liquidator or similar official in any federal, state or foreign judicial or non-judicial proceeding, to hold, administer and/or liquidate all or substantially all of its assets, or (C) made an assignment for the benefit of creditors. E. Other Prohibitions. Neither Buyer nor any person controlling Buyer (i) is included on any Government List; (ii) has been determined by competent authority to be subject to the prohibitions contained in Presidential Executive Order No. 133224 (September 23, 2001) or in any enabling or implementing legislation or other Presidential Executive Orders in respect thereof; (iii) has been previously indicted for or convicted of any felony involving a crime or crimes of moral turpitude or for any offense under the criminal laws against terrorists, the criminal laws against money laundering, the Bank Secrecy Act, as amended, the Money Laundering Control Act of 1986, as amended, or the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorists (USA PATRIOT ACT) Act of 2001, Public Law 107-56 (October 26, 2001), as amended; or (iv) to Buyer’s knowledge, is currently under investigation by any governmental authority for alleged criminal activity. 9. Casualty and Condemnation. 9.1. Minor Damage. In the event of loss or damage to the Property or any portion thereof which is not “major” (as hereinafter defined), then Seller shall have the following option: A. Purchase Price Reduction. If the loss or damage is a fire or other casualty event, but not a condemnation event, reduce the Purchase Price by an amount equal to the cost (the “Restoration Cost”) of restoring the Property to a condition substantially identical to that of the Property prior to the event of damage, as determined by a general contractor licensed by the State of [__] selected by Seller and reasonably approved by Buyer; or B. Assignment. If the loss or damage is a fire or other casualty event or a condemnation event, assign to Buyer all of Seller’s right to any claims and proceeds Seller may have with respect to any casualty related insurance policies (including, without limitation, rental loss proceeds applicable to the period on and after the Closing) or condemnation awards relating to the premises in question, and the Purchase Price shall be reduced by an amount equal to the uninsured portion of the Restoration Cost (including, without limitation, the deductible amount under Seller’s insurance policy); or 10

C. Neither of the Foregoing. Elect neither to reduce the Purchase Price nor assign insurance proceeds and/or condemnation awards pursuant to the foregoing subparagraphs A. and B. Seller shall make the elections required by this Paragraph 9.1 by written notice delivered to Buyer within ten (10) days following the date on which the Restoration Cost is determined and, if Seller fails to deliver its written election within such ten (10) day period, then Seller shall be deemed to have made the election under subparagraph C. above. If Seller makes an election under the foregoing subparagraphs A. or B., then this Agreement shall remain in full force and effect and the parties shall proceed to Closing as contemplated by this Agreement; provided that Seller shall reduce the Purchase Price and/or assign insurance and/or condemnation proceeds as provided in the foregoing subparagraphs A. or B., as applicable. However, if Seller makes (or is deemed to have made) the election under subparagraph C. above, then Buyer shall have the right to Terminate this Agreement by written notice delivered to Seller within five (5) days after receiving Seller’s election (or deemed election), in which event Buyer shall receive a refund of the Deposit (unless such loss or damage is caused by or contributed to by Buyer in which event Buyer shall not be entitled to a return of the Deposit) and neither party shall have any further obligation to the other under this Agreement (except for those obligations which expressly survive the termination hereof). 9.2. Major Damage. In the event of a “major” loss or damage, Buyer may terminate this Agreement by written notice to Seller, in which event the Deposit shall be returned to Buyer unless such loss or damage is caused by or contributed to by Buyer in which event Buyer shall not be entitled to a return of the Deposit. If Buyer does not elect to Terminate this Agreement within ten (10) days after Seller sends Buyer written notice of the occurrence of major loss or damage, then Buyer shall be deemed to have elected to proceed with Closing. 9.3. Definition of “Major” Loss or Damage. For purposes of the foregoing Paragraphs 9.1 and 9.2, “major” loss or damage refers to the following: (a) Any loss or damage to the Property or any portion thereof such that the cost of restoring the premises in question to a condition substantially identical to that of the premises in question prior to the event of damage would be, in the opinion of an architect selected by Seller and reasonably approved by Buyer, equal to or greater than Three Hundred Fifty Thousand and No/100 Dollars ($350,000.00), (b) Any loss that is not fully covered by insurance, and (c) with respect to condemnation, any improvements or access to the Property or more than ten percent (10%) of the Land is condemned or taken or threatened to be condemned or taken. 10. Other Conditions to Closing. The obligations of Buyer and Seller to close the Transaction shall be further subject to the satisfaction at or prior to Closing of the conditions precedent set forth in this Paragraph 10. 10.1 Conditions to Buyer’s Obligations. The conditions precedent to Buyer’s obligations at Closing referenced above are as follows, any or all of which may be waived by Buyer, at its sole option: A. Representations. Seller’s Warranties, subject to Paragraphs 8.2 and 8.3, shall be true and correct in all material respects on and as of the Closing Date, except as modified in a manner permitted by this Agreement, as if made on and as of such date except to the extent that they expressly relate to an earlier date. 11

B. Seller Compliance. Seller shall have performed all of the covenants, undertakings and obligations under this Agreement to be performed or complied with by Seller at or prior to the Closing. C. Title Policy. At Closing, Seller shall have conveyed title to the Real Property as will enable the Title Company to issue the Title Policy (or a specimen or proforma policy thereof or “marked” Title Commitment) to Buyer subject only to the Permitted Title Exceptions and consistent with Paragraph 4.3 hereof. If the condition set forth in this subparagraph C. has not been satisfied as of the Closing Date, and has not been waived by Buyer as of such date, Buyer may, as its sole and exclusive remedy, elect to Terminate this Agreement by notice to Seller and receive a return of the Deposit. 10.2 Conditions to Seller’s Obligations. The conditions precedent to Seller’s obligations at Closing referenced above are as follows, any or all of which may be waived by Seller, at its sole option: A. Representations. Buyer’s warranties set forth in Paragraph 8.5 shall be true and correct in all material respects on and as of the Closing Date, except as modified in a manner permitted by the Agreement, as if made on and as of such date except to the extent that they expressly relate to an earlier date. B. Buyer Compliance. Buyer shall have performed all of the covenants, undertakings and obligations to be performed or complied with by Buyer at or prior to the Closing. 10.3 Conclusive Waiver of Conditions. By closing the Transaction, Seller and Buyer shall be conclusively deemed to have waived the benefit of any remaining unfulfilled conditions set forth in Paragraphs 10.1 and 10.2, respectively. 11. Other Transaction Issues. 11.1 Brokers. Each party represents to the other that such party has not incurred any obligation to any broker or real estate agent with respect to the purchase or sale of the Property or the lease of the Real Property. Seller and Buyer each hereby (a) represent and warrant to the other that it has not employed, retained or consulted any other broker, agent, or finder in carrying on a negotiation in connection with this Agreement or the Transaction, and (b) indemnifies and agrees to hold the other harmless from and against any and all claims, demands, causes of action, debts, liabilities, judgments and damages (including costs and reasonable attorneys’ fees actually incurred in connection with the enforcement of this indemnity) which may be asserted or recovered against the indemnified party on account of any brokerage fee, commission or other compensation arising by reason of the indemnitor’s breach of this representation and warranty. 11.2 Confidentiality. Buyer and Seller, for the benefit of each other, hereby agree that they will not release or cause or permit to be released, and will use best efforts to prevent the Buyer’s Representatives and Seller’s Representatives, respectively, from releasing or causing or permitting the release of, any press notices, publicity (oral or written) or advertising promotion relating to, or otherwise announce or disclose or cause or permit to be announced or disclosed, in any manner whatsoever, the terms, conditions or substance of this Agreement or the Transaction. The foregoing 12

shall not preclude either party from (a) discussing the substance or any relevant details of the transactions contemplated in this Agreement with any of its representatives, employees, agents or consultants, or the Title Company; (b) complying with any Laws applicable to such party, including, without limitation, governmental regulatory, disclosure, tax and reporting requirements; (c) disclosing the terms of the Transaction to the extent necessary in connection with any tax appeal either party may pursue with respect to the Property; or (d) disclosing the terms of the Transaction to the extent necessary in written filings, evidence or testimony made or given in connection with any court proceedings either party may pursue in the event of the other party’s alleged default hereunder. Buyer and Seller shall indemnify and hold the other harmless from and against any and all Liabilities suffered or incurred by the indemnified party and arising out of or in connection with a breach by Buyer or Seller, as the case may be, of the provisions of this Paragraph. The obligations of Buyer contained in this Paragraph shall survive the Closing or the earlier termination of this Agreement; provided, however, that Buyer shall be permitted to announce the Transaction in a press release after Closing, the substance of which release shall be subject to Seller’s prior review and approval, which approval shall not be unreasonably withheld. 11.3 Indemnity. Buyer hereby agrees to indemnify, defend, and hold Seller and each of the other Seller Parties free and harmless from and against any and all Liabilities (including reasonable attorneys’ fees, expenses and disbursements) arising out of or resulting from the entry on the Property and/or the conduct of any Due Diligence by Buyer or any of Buyer’s Representatives at any time prior to the Closing; provided, however, that the foregoing indemnity shall not apply to any Liabilities to the extent such Liabilities arise out of the negligence or intentional acts of Seller or the mere discovery by Buyer of a pre-existing condition at the Property. The foregoing indemnity shall survive the Closing (and not be merged therein) or any earlier termination of this Agreement. 11.4 Tax Appeals. Seller shall have the right to continue and to control the progress of and to make all decisions with respect to any contest of the real estate taxes and personal property taxes for the Property due and payable during any Tax Year prior to the Closing Tax Year. Subject to the terms and conditions of the Lease, the lessee under the Lease shall have the right to continue and to control the progress of and to make all decisions with respect to any contest of the real estate taxes and personal property taxes for the Property due and payable during the Closing Tax Year, and Seller shall assign to the lessee at Closing all of its rights to continue any such appeal. Buyer and Seller agree to cooperate with each other and to execute any and all documents reasonably requested in furtherance of the foregoing, at no out-of-pocket cost or expense to Buyer. The provisions of this paragraph shall survive the Closing. 12. Default at or Prior to Closing. 12.1 Buyer Default. Except as set forth hereinbelow, if Buyer defaults in the observance or performance of its covenants and obligations hereunder, or in the event of any breach by Buyer of any of the representations and warranties set forth in Paragraph 8.5, and such default or breach continues for five (5) Business Days after the date Seller gives notice demanding cure thereof, or if Buyer defaults in the observance or performance of its covenants and obligations under the Related Contract beyond any cure period afforded to Buyer pursuant to the terms thereof, Seller shall be entitled, as its sole and exclusive remedy therefor, to Terminate this Agreement by notice to Buyer of such termination and to receive payment of the Deposit as full liquidated damages for such default or breach of Buyer, the parties hereto acknowledging the difficulty of ascertaining the actual damages in the event of such a default or breach, that it is impossible more precisely to estimate the damages 13

to be suffered by Seller upon Buyer’s default or breach, that such forfeiture of the Deposit is intended not as a penalty, but as full liquidated damages and that such amount constitutes a reasonable good faith estimate of the potential damages arising therefrom, it being otherwise difficult or impossible to estimate Seller’s actual damages which would be suffered by Seller in the event of default or breach by Buyer. Except with respect to any right, obligation or liability which survives Closing or termination of this Agreement, including any indemnification provisions set forth in this Agreement, and except as set forth in Paragraph 14.17, Seller’s right to Terminate this Agreement and receive payment of the Deposit as full liquidated damages, are Seller’s sole and exclusive remedies in the event of default or breach hereunder by Buyer, and Seller hereby waives, relinquishes and releases any and all other rights and remedies (except any that survive Closing or termination pursuant to the express provisions of this Agreement), including, but not limited to: (A) any right to sue Buyer for damages or to prove that Seller’s actual damages exceed the Deposit which is hereby provided Seller as full liquidated damages, (B) any right to sue Buyer for specific performance, or (C) any other right or remedy which Seller may otherwise have against Buyer, either at law, or equity or otherwise, including, without limitation, the right to seek and/or receive consequential damages. 12.2 Seller Default. If Seller defaults in the observance or performance of its covenants and obligations hereunder, and such default continues for five (5) Business Days after the date Buyer gives notice demanding cure of such default, in either such event, Buyer shall be entitled, as its sole and exclusive remedy therefor, to Terminate this Agreement by giving Seller notice of such termination and to receive the Deposit from Escrow Agent, in which event Seller shall reimburse to Buyer, within twenty (20) days after Seller’s receipt of reasonable documentation thereof, the Buyer’s Transaction Costs. Except with respect to any right, obligation or liability which survives Closing or termination of this Agreement, including any indemnification provisions set forth in this Agreement, Buyer’s right to so Terminate this Agreement and receive reimbursement of all Buyer’s Transaction Costs as described in the foregoing sentence is Buyer’s sole and exclusive remedy hereunder in the event of default hereunder by Seller, and Buyer hereby waives, relinquishes and releases any and all other rights and remedies (except any that survive Closing or termination pursuant to the express provisions of this Agreement), including, but not limited to: (A) any right to sue for damages (except to compel Seller to make the reimbursement described in the foregoing sentence), (B) any right to sue Seller for specific performance, or (C) any other right or remedy which Buyer may otherwise have against Seller either at law, in equity or otherwise, including, without limitation, the right to seek and/or receive consequential damages. 13. Notices. All notices, consents, approvals and other communications which may be or are required to be given by either Seller or Buyer under this Agreement shall be properly given only if made in writing and sent by (a) hand delivery; (b) a nationally recognized overnight delivery service (such as Federal Express or UPS Next Day Air), with all delivery charges paid by the sender; or (c) by email, provided that the sender also delivers the same notice in accordance with either of the foregoing subparagraphs (a) or (b) no later than the next business day after such email is sent, in each instance addressed to Buyer or Seller, as applicable, as set forth below. Such notices shall be deemed given on the date of delivery or rejection of delivery. Said notice addresses are as follows (and Seller and Buyer shall have the right to designate changes to their respective notice addresses, effective five (5) days after giving notice thereof): 14

If to Seller: ABP [__] LLC c/o BlueLinx Corporation 1950 Spectrum Circle, Suite 300 Marietta, Georgia 30067 Attn: General Counsel with a copy to: ABP [__] LLC c/o BlueLinx Corporation 1950 Spectrum Circle, Suite 300 Marietta, Georgia 30067 Attn: Shyam K. Reddy, Chief Transformation Officer Email: shyam.reddy@bluelinxco.com If to Buyer: BIG Acquisitions LLC 9450 W. Bryn Mawr, Suite 750 Rosemont, Illinois 60018 Attention: Michael W. Brennan E-Mail: mbrennan@brennanllc.com with a copy to: Brennan Investment Group 9450 W. Bryn Mawr, Suite 750 Rosemont, Illinois 60018 Attention: Samuel A. Mandarino E-Mail: smandarino@brennanllc.com and with a copy to: Attention: E-Mail: 14. General Provisions. 14.1 Execution Necessary. This Agreement shall not be binding upon Seller unless fully executed and delivered by a proper official of Seller, and no action taken by Seller’s representatives shall be deemed an acceptance of this Agreement until this Agreement has been so executed by Seller and delivered to Buyer. 14.2 Counterparts. This Agreement may be executed in separate counterparts. It shall be fully executed when each party whose signature is required has signed at least one counterpart even though no one counterpart contains the signatures of all of the parties to this Agreement. 14.3 Successors and Assigns. This Agreement shall be binding upon the parties hereto and their respective successors and assigns and inure to the benefit of the parties hereto and their respective permitted successors and assigns. Buyer shall not have the right to assign or delegate any right, duty or obligation of Buyer under this Agreement to any other party without the prior 15

written consent of Seller, which consent Seller may grant or withhold in its sole and absolute discretion, and any such assignment without Seller’s consent shall be null and void ab initio. Notwithstanding the foregoing, Buyer shall have the right to assign this Agreement to (a) an affiliate of Buyer which is under common control with Buyer or (b) an entity owned by a corporate services company pursuant to a corporate services agreement with either (1) Buyer or (2) any entity under common control with Buyer. Any such assignee so consented to by Seller or otherwise permitted pursuant to the terms of the foregoing sentence of this paragraph shall be designated by Buyer by the delivery to Seller of a written assignment of this Agreement pursuant to which Buyer’s obligations hereunder are expressly assumed by such assignee, together with delivery to Seller of evidence reasonably satisfactory to Seller of the valid legal existence of Buyer’s assignee, its qualification (if necessary) to do business in the jurisdiction in which the Property is located and of the authority of Buyer’s assignee to execute and deliver any and all documents required of Buyer under the terms of this Agreement, which items shall be received by Seller not less than three (3) Business Days prior to the Closing Date; notwithstanding the foregoing, the exercise of such right by Buyer shall not relieve Buyer of any of its obligations and liabilities hereunder including obligations and liabilities which survive the Closing or the termination of this Agreement, nor shall any such assignment alter, impair or relieve such assignee from the waivers, acknowledgements and agreements of Buyer set forth herein, all of which are binding upon the assignee of Buyer. In the event of any permitted assignment by Buyer, any assignee shall assume any and all obligations and liabilities of Buyer under this Agreement but, notwithstanding such assumption, Buyer shall continue to be liable hereunder. 14.4 Governing Law. This Agreement shall be governed by the Laws of the state in which the Land is located. 14.5 Entire Agreement. This Agreement and all the exhibits referenced herein and annexed hereto contain the entire agreement of the parties hereto with respect to the matters contained herein, and no prior agreement or understanding pertaining to any of the matters connected with this Transaction shall be effective for any purpose. Neither this Agreement nor any provision hereof may be waived, modified, amended, discharged or terminated except by an instrument signed by the party against whom the enforcement of such waiver, modification, amendment, discharge or termination is sought, and then only to the extent set forth in such instrument. 14.6 Time Is of the Essence. TIME IS OF THE ESSENCE of the Transaction and this Agreement. 14.7 Interpretation. The titles, captions and paragraph headings are inserted for convenience only and are in no way intended to interpret, define, limit or expand the scope or content of this Agreement or any provision hereof. If any party to this Agreement is made up of more than one person or entity, then all such persons and entities shall be included jointly and severally, even though the defined term for such party is used in the singular in this Agreement. If any time period under this Agreement ends on a day other than a Business Day, then the time period shall be extended until the next Business Day. This Agreement shall be construed without regard to any presumption or other rule requiring construction against the party causing this Agreement to be drafted. If any words or phrases in this Agreement shall have been stricken out or otherwise eliminated, whether or not any other words or phrases have been added, this Agreement shall be construed as if the words or phrases so stricken out or otherwise eliminated were never included in this Agreement and no implication or inference shall be drawn from the fact that said words or phrases were so stricken out or otherwise eliminated. 16

14.8 Survival. The covenants, agreements, indemnities, representations and warranties contained herein shall not survive the Closing Date or any termination of this Agreement, except as set forth in Paragraphs 8, 11, 13 and 14, each of which shall survive the Closing or any earlier termination of this Agreement (limited, as applicable, as set forth therein). 14.9 Exclusive Application. Nothing in this Agreement is intended or shall be construed to confer upon or to give to any person, firm or corporation other than Buyer and Seller hereto any right, remedy or claim under or by reason of this Agreement. All terms and conditions of this Agreement shall be for the sole and exclusive benefit of the parties hereto, and such benefit may not be assigned by Buyer except as set forth in Paragraph 14.3. 14.10 Partial Invalidity. If all or any portion of any of the provisions of this Agreement shall be declared invalid by Laws applicable thereto, then the performance of said offending provision shall be excused by the parties hereto; provided, however, that, if the performance of such excused provision materially affects any material aspect of this Transaction and the other party does not upon demand enter into a modification or separate agreement which sets forth in valid fashion the covenants of such offending provision in a manner which counsel to both parties determine is valid, then the party hereto for whose benefit such excused provision was inserted in this Agreement shall have the right, exercisable by notice given to the other party within ten (10) days after such provision is so declared invalid, to Terminate this Agreement. 14.11 Waiver Rights. Buyer reserves the right to waive, in whole or in part, any provision hereof which is for the benefit of Buyer. Seller reserves the right to waive, in whole or in part, any provision hereof that is for the benefit of Seller. 14.12 No Implied Waiver. Except as otherwise expressly provided in this Agreement, no waiver by Seller or Buyer of any provision hereof shall be deemed to have been made unless expressed in writing and signed by such party, and no delay or omission in the exercise of any right or remedy accruing to Seller or Buyer upon any breach under this Agreement shall impair such right or remedy or be construed as a waiver of any such breach theretofore or thereafter occurring. The waiver by Seller or Buyer of any breach of any term, covenant or condition herein stated shall not be deemed to be a waiver of any other breach, or of a subsequent breach of the same or any other term, covenant or condition herein contained. 14.13 Rights Cumulative. All rights, powers, options or remedies afforded to Seller or Buyer either hereunder or by Law shall be cumulative and not alternative, and the exercise of one right, power, option or remedy shall not bar other rights, powers, options or remedies allowed herein or by Law, unless expressly provided to the contrary herein. 14.14 Attorneys’ Fees. Should either party employ an attorney or attorneys to enforce any of the provisions hereof or to protect its interest in any manner arising under this Agreement, or to recover damages for breach of this Agreement, the non-prevailing party in any action pursued in a court of competent jurisdiction (the finality of which is not legally contested) shall pay to the prevailing party all reasonable costs, damages and expenses, including attorneys’ fees, expended or incurred in connection therewith. 17

14.15 Waiver of Jury Trial. EACH PARTY HEREBY WAIVES TRIAL BY JURY IN ANY PROCEEDINGS BROUGHT BY THE OTHER PARTY IN CONNECTION WITH ANY MATTER ARISING OUT OF OR IN ANY WAY CONNECTED WITH THE TRANSACTION, THIS AGREEMENT, THE PROPERTY OR THE RELATIONSHIP OF BUYER AND SELLER HEREUNDER. THE PROVISIONS OF THIS PARAGRAPH SHALL SURVIVE THE CLOSING (AND NOT BE MERGED THEREIN) OR ANY EARLIER TERMINATION OF THIS AGREEMENT. 14.16 Signatures. Signatures to this Agreement transmitted by electronic copy shall be valid and effective to bind the party so signing. Each party agrees to promptly deliver an execution original to this Agreement with its actual signature to the other party, but a failure to do so shall not affect the enforceability of this Agreement, it being expressly agreed that each party to this Agreement shall be bound by its own signature delivered by electronic copy and shall accept the electronic copy of the signature of the other party to this Agreement. 14.17 No Recordation. Seller and Buyer each agrees that neither this Agreement nor any memorandum or notice hereof shall be recorded and Buyer shall not file any notice of pendency or other instrument (other than a judgment) against the Property or any portion thereof in connection herewith. Buyer expressly acknowledges and agrees that, in the event of any breach by Buyer of its obligations as set forth in the foregoing sentence, the provisions of Paragraph 12.1 limiting Seller’s remedies shall not apply, and that Seller shall, in such event, be entitled to any remedy which Seller may otherwise have against Buyer, whether at law or in equity, or otherwise, including, without limitation, the right to seek and/or receive consequential damages. 14.18 Maximum Aggregate Liability. Notwithstanding any provision to the contrary contained in this Agreement or any documents executed by Seller pursuant hereto or in connection herewith, the maximum aggregate liability of Seller and the Seller Parties, and the maximum aggregate amount which may be awarded to and collected by Buyer, in connection with the Transaction, the Property, under this Agreement and under any and all documents executed pursuant hereto or in connection herewith (including, without limitation, in connection with the breach of any of Seller’s Warranties for which a claim is timely made by Buyer) shall not exceed Seller’s Liability Limit. The provisions of this section shall survive the Closing (and not be merged therein) or any earlier termination of this Agreement. 14.19 Exhibits and Schedules. All exhibits and schedules referred to in, and attached to, this Agreement are hereby incorporated herein in full by this reference. 15. Earnest Money and Escrow Agent. The Escrow Deposits shall be held by Escrow Agent, in trust, and disposed of only in accordance with the following provisions: 15.1 Deposit. Escrow Agent shall not invest the Escrow Deposits or commingle the Escrow Deposits with any funds of Escrow Agent or others. 15.2 Delivery at Closing. If the Closing occurs, Escrow Agent shall deliver the Escrow Deposits to, or upon the instructions of, Buyer and Seller on the Closing Date. 15.3 Return or Delivery of Deposit Outside Closing. Escrow Agent shall deliver the Escrow Deposits to Seller or Buyer only in accordance with the terms of this Paragraph 18

15.3. Upon receipt of a written demand for the Escrow Deposits from Buyer prior to the Due Diligence Deadline, Escrow Agent shall promptly deliver the Escrow Deposits to Buyer. Upon receipt of a written demand for the Escrow Deposits from either Buyer or Seller at any time thereafter, Escrow Agent shall give notice to the other party of such demand. Thereafter, (a) if Escrow Agent does not receive a written objection from the other party to the proposed payment within five (5) days after the giving of such notice, then Escrow Agent is hereby authorized to make such payment, but (b) if Escrow Agent does receive such written objection within such period, Escrow Agent shall continue to hold such amount until otherwise directed by written instructions signed by Seller and Buyer or a final judgment of a court. In the event of any return of the Deposit to Buyer pursuant to Paragraph 4.5, One Hundred and No/100 Dollars ($100.00) thereof shall be payable to Seller, and such amount shall in effect constitute option money, making this Agreement binding even if any conditions or provisions herein are entirely within the discretion or control of Buyer. 15.4 Stakeholder. The parties acknowledge that Escrow Agent is acting solely as a stakeholder at their request and for their convenience, that Escrow Agent shall not be deemed to be the agent of either of the parties, and that Escrow Agent shall not be liable to either of the parties for any action or omission on its part taken or made in good faith, and not in disregard of this Agreement, but shall be liable for its negligent acts and for any Liabilities (including reasonable attorneys’ fees, expenses and disbursements) incurred by Seller or Buyer resulting from Escrow Agent’s mistake of Law respecting Escrow Agent’s scope or nature of its duties. Seller and Buyer shall jointly and severally indemnify and hold Escrow Agent harmless from and against all Liabilities (including reasonable attorneys’ fees, expenses and disbursements) incurred in connection with the performance of Escrow Agent’s duties hereunder, except with respect to actions or omissions taken or made by Escrow Agent in bad faith, in disregard of this Agreement or involving negligence on the part of Escrow Agent. 15.5 Taxes. The party receiving the Escrow Deposits (or the benefit thereof) shall pay any income taxes on any interest earned on the Escrow Deposits. 15.6 Execution by Escrow Agent. Escrow Agent has executed this Agreement in order to confirm that Escrow Agent has received and shall hold the Escrow Deposits, in escrow, and shall disburse the Escrow Deposits pursuant to the provisions of this Paragraph 15. [The remainder of this page has been intentionally left blank. Signatures begin on the following page.] 19

IN WITNESS WHEREOF, Buyer and Seller have executed this Agreement as of the Effective Date. SELLER: ABP [__] LLC, a Delaware limited liability company By: Justin B. Heineman, Vice President and Corporate Secretary Date signed: BUYER: BIG ACQUISITIONS LLC, an Illinois limited liability company By: Name: Title: Date signed: 20

The undersigned has executed this Agreement solely to confirm its agreement to (i) hold the Escrow Deposits in escrow in accordance with the provisions hereof and (ii) comply with the provisions of Paragraph 15. ESCROW AGENT: ___________________________ By: ______________________________ Name: ________________________ Title: _________________________ Date signed: 21

SCHEDULE A “Agreement” shall mean this Purchase and Sale Agreement. “Assignment” shall mean an Assignment of Intangible Property in the form attached hereto as Exhibit I. “Business Day” shall mean Monday through Friday excluding holidays recognized by the state government of the State in which the Property is located. “Buyer” shall mean the buyer referenced in the first paragraph of this Agreement. “Buyer’s Reports” shall mean the results of any examinations, inspections, investigations, tests, studies, analyses, appraisals, evaluations and/or investigations prepared by or for or otherwise obtained by Buyer or Buyer’s Representatives in connection with Buyer’s Due Diligence. “Buyer’s Representatives” shall mean Buyer’s officers, employees, agents, advisors, representatives, attorneys, accountants, consultants, lenders, investors, contractors, architects and engineers. “Buyer’s Transaction Costs” shall mean, to the extent that Buyer has provided to Seller reasonable documentation thereof, Buyer’s reasonable actual out-of-pocket Due Diligence expenses incurred in connection with the Transaction after the Effective Date, in an aggregate amount not to exceed $125,000.00. “Certificate” shall mean a certificate in the form attached hereto as Exhibit J. “Closing” shall mean the consummation and closing of the Transaction. “Closing Date” shall mean the date on which the Closing occurs, which shall be on or before the Closing Deadline. “Closing Deadline” shall mean the date that is ten (10) days after the Due Diligence Deadline. “Closing Documents” shall mean the documents and instruments delivered by Buyer and Seller, in order to consummate the Transaction. “Closing Tax Year” shall mean the Tax Year in which the Closing Date occurs. “Condemnation Proceeding” shall mean any proceeding in condemnation, eminent domain or any written request for a conveyance in lieu thereof, or any notice that such proceedings have been or will be commenced against any portion of the Property. “Deed” shall mean a special warranty deed in the form attached hereto as Exhibit E. Schedule A – Page 1 of 6

“Deposit” shall mean the sum of One Hundred Twenty-Five Thousand and No/100 Dollars ($125,000.00), consisting of, collectively, the Initial Deposit of Sixty-Two Thousand Five Hundred and No/100 Dollars ($62,500.00), and the Secondary Deposit of Sixty-Two Thousand Five Hundred and No/100 Dollars ($62,500.00). “Documents” shall mean any documents and instruments applicable to the Property or any portion thereof that Seller or any of the other Seller Parties deliver or make available to Buyer or Buyer’ Representatives prior to Closing or which are otherwise obtained by Buyer or Buyer’s Representatives prior to Closing, including, but not limited to, the Title Commitment. “Due Diligence” shall mean the investigation by Buyer and Buyer’s Representatives of the feasibility and desirability of purchasing the Property, including all audits, surveys, examinations, inspections, investigations, tests, studies, analyses, appraisals, evaluations, investigations and verifications with respect to the Property, the Documents, title matters, applicable land use and zoning Laws and other Laws applicable to the Property, the physical condition of the Property, the economic status of the Property, and other information and documents regarding the Property, including, but not limited to, investigations of the legal and physical status of the Property by such consultants, engineers and architects as Buyer requires, structural review, examination of title to the Property, preparation of a survey of the Land, and verification of all information made or to be made available to Buyer with respect to Property. “Due Diligence Deadline” shall mean 6:00 P.M. Eastern time on the date that is forty (40) days after the Effective Date. “Effective Date” shall mean the date on which Seller or Buyer shall have executed this Agreement, as indicated under their respective signatures, whichever is the later to do so. “Escrow Agent” shall mean the Title Company. “Escrow Deposits” shall mean the Deposit, and any other sums (including, without limitation, any interest earned thereon) which the parties agree shall be held in escrow hereunder. “Government List” shall mean (1) the Specialty Designated Nationals and Blocked Persons Lists maintained by the Office of Foreign Assets Control, United States Department of the Treasury (“OFAC”), (2) the Denied Persons List and the Entity List maintained by the United States Department of Commerce, (3) the List of Terrorists and List of Disbarred Parties maintained by the United States Department of State, (4) any other list of terrorists, terrorist organizations or narcotics traffickers maintained pursuant to any of the lists, laws, rules and regulations maintained by OFAC pursuant to any authorizing statute, Executive Order or regulation, (5) any other similar list maintained by the United States Department of State, the United States Department of Commerce or any other governmental authority or pursuant to any Executive Order of the President of the United States of America, and (6) any list or qualification of “Designated Nationals” as defined in the Cuban Assets Control Regulations, 31 C.F.R. Part 515, as all such Government Lists may be updated from time to time. Schedule A – Page 2 of 6

“Initial Deposit” shall mean an amount equal to Sixty-Two Thousand Five Hundred and No/100 Dollars ($62,500.00), in immediately available funds, to the extent the same is deposited by Buyer in accordance with the terms of Paragraph 3.1 hereof, together with any interest earned thereon. “Land” shall mean all of Seller’s right, title and interest in and to that certain tract or parcel of land located in [__] County, [__] more particularly described on Exhibit A attached hereto and commonly known as [__]. “Landlord” shall mean that certain person or entity subleasing the Property from Master Tenant as of the Closing Date. “Landlord Agreement” shall mean a Landlord Agreement in the form attached to the Lease as Schedule 3.01. “Law” shall mean any federal, state or local law, statute, ordinance, code, order, decrees, or other governmental rule, regulation or requirement, including common law. “Lease” shall mean a Lease Agreement by and between Landlord and Tenant, in the form attached hereto as Exhibit F. “Lender” shall mean, collectively, any and all parties taking a security interest in the interest of Buyer, Master Tenant or Landlord in the Real Property, to the extent any such security interest is not intended to be subordinate to Tenant’s interest in the Real Property under the Lease. “Lien” shall mean any mortgage, deed of trust, security deed, lien, judgment, pledge, conditional sales contract, security interest, past due taxes, past due assessments, contractor’s lien, materialmen’s lien, judgment or similar encumbrance against the Property of a monetary nature. “Liabilities” shall mean any and all direct or indirect damages, demands, claims, payments, problems, conditions, obligations, actions or causes of action, assessments, losses, Liens, liabilities, costs and expenses of any kind or nature whatsoever, including, without limitation, penalties, interest on any amount payable to a third party, lost income and profits, and any legal or other expenses (including, without limitation, reasonable attorneys’ fees and expenses) reasonably incurred in connection with investigating or defending any claims or actions, whether or not resulting in any liability. “Master Tenant” shall mean that certain person or entity leasing the Property from Buyer as of the Closing Date. “Memorandum of Lease” shall mean a Memorandum of Lease in the form attached hereto as Exhibit K. “Non-Disturbance Agreement” shall mean an agreement in the form attached hereto as Exhibit L. “Other Interests” shall mean the following other interests of Seller in and to the Real Property, or pertaining thereto: (a) to the extent that the same are in effect as of the Closing Date, any licenses, permits and other written authorizations necessary for the use, operation or ownership of the Real Property, and (b) any guaranties and warranties in effect with respect to any portion of the Real Schedule A – Page 3 of 6

Property as of the Closing Date; provided, however, that Other Interests shall not include any such licenses, permits, authorizations, guaranties or warranties to the extent that said items are necessary or desirable for Tenant’s use of and operations upon the Land following Closing pursuant to the terms of the Lease. “Permitted Title Exceptions” shall mean, subject to Buyer’s rights to review and make objection to the status of title and survey as set forth in this Agreement, and the right of Buyer to Terminate this Agreement pursuant to Paragraph 4.5 if the Due Diligence is not satisfactory, the following: (a) all real estate taxes and assessments not yet due and payable as of the Closing Date; (b) any Laws affecting the Property; (c) the Record Exceptions; (d) the Lease; (e) the Sublease; (f) any state of facts which would be disclosed by a current survey or other inspection of the Land; and (g) any other matters approved as Permitted Title Exceptions by Buyer prior to Closing or deemed approved as Permitted Title Exceptions pursuant to this Agreement. “Property” shall mean the Real Property and the Other Interests. “Purchase Price” is defined in the Recitals to this Agreement. “Real Property” shall mean the Land, including, without limitation, (a) any and all buildings located on the Land and all other improvements, (b) all easements appurtenant to the Land and other easements, grants of right, licenses, privileges or other agreements for the benefit of, belonging to or appurtenant to the Land whether or not situate upon the Land, including, without limitation, signage rights and parking rights or agreements, all whether or not specifically referenced on Exhibit A, (c) all mineral, oil and gas rights, riparian rights, water rights, sewer rights and other utility rights allocated to the Land, (d) all right, title and interest, if any, of the owner of the Land in and to any and all strips and gores of land located on or adjacent to the Land, and (e) all right, title and interest of the owner of the Land in and to any roads, streets and ways, public or private, open or proposed, in front of or adjoining all or any part of the Land and serving the Land. “Record Exceptions” shall mean all instruments recorded in the real estate records of the County in which the Land is located which affect the status of title to the Real Property. “Related Contract” shall mean the [__] Contract. “Remove” with respect to any exception to title shall mean that Seller causes the Title Company to remove or affirmatively insure over the same as an exception to the Title Policy, without any additional cost to Buyer, whether such removal or insurance is made available in consideration of payment, bonding, indemnity of Seller or otherwise. “Required Removal Items” shall mean, collectively, any Title Objections to the extent (and only to the extent) that the same (a) have not been caused by Buyer or any Buyer’s Representatives, and (b) are either: (i) Liens evidencing monetary encumbrances (other than liens for non-delinquent general real estate taxes or assessments) which can be Removed by payment of liquidated amounts, but only if such Liens have been created by written instrument signed by Seller or assumed by written instrument signed by Seller, and provided that in no event shall Seller be required to Remove any such Lien which is not related to the operation of the Property by any method other than indemnity of Seller in favor of the Title Company (for example, unrelated items would include a judgment against such party in connection with its other operations; whereas a mechanic’s lien for work on the Property Schedule A – Page 4 of 6

pursuant to a contract entered into by Seller would be related to Property operations), or (ii) liens or encumbrances (including, but not limited to, Liens) created by Seller after the Effective Date. “Secondary Deposit” shall mean an amount equal to Sixty-Two Thousand Five Hundred and No/100 Dollars ($62,500.00), in immediately available funds, to the extent the same is deposited by Buyer in accordance with the terms of Paragraph 3.1 hereof, together with any interest earned thereon. “Seller” shall mean the seller referenced in the first paragraph of this Agreement. “Seller Parties” shall mean and include, collectively, (a) Seller; (b) its counsel; (c) any direct or indirect owner of any beneficial interest in Seller, or any subsidiaries, parents or affiliates of Seller; (d) any officer, director, employee, affiliate, principal, partner, shareholder, representative or agent of Seller, its counsel or any direct or indirect owner of any beneficial interest in Seller or of any subsidiaries, parents or affiliates of Seller; and (e) any other entity or individual affiliated or related in any way to any of the foregoing, and their successors and assigns. “Seller’s knowledge” or words of similar import shall refer only to the actual knowledge of Shyam K. Reddy, Chief Transformation Officer, and Gary Cummings, and shall not be construed to refer to the knowledge of any other Seller Party, or to impose or have imposed upon such individual any duty to investigate the matters to which such knowledge, or the absence thereof, pertains. There shall be no personal liability on the part of such individual arising out of any of the Seller’s Warranties. “Seller’s Liability Limit” shall mean an amount equal to the Purchase Price. “Seller’s Representatives” shall mean Seller’s officers, employees, agents, advisors, representatives, attorneys, accountants, consultants, investors, contractors, architects and engineers. “Seller’s Warranties” shall mean Seller’s representations and warranties set forth in Paragraph 8.1, as the same may be deemed modified or waived by Buyer pursuant to this Agreement. “SNDA” shall mean an agreement in the form attached hereto as Exhibit M. “Sublease” shall mean that certain [__] by and between BlueLinx Corporation and Subtenant, as amended by [__] by and between Tenant and Subtenant. “Subtenant” shall mean [__]. “Survey” shall mean an ALTA survey of the Property prepared by a surveyor licensed in the State in which the Property is located, to be certified to Seller and Buyer. “Survival Period” shall mean the first 180 days after Closing. “Tax Year” shall mean the year period commencing on January 1 of each calendar year and ending on December 31 of each calendar year. “Tenant” shall mean [__]. Schedule A – Page 5 of 6

“Terminate” shall mean the termination of this Agreement by notice from Buyer or Seller, as applicable, as set forth this Agreement, in which event thereafter neither party hereto shall have any further rights, obligations or liabilities hereunder except to the extent that any right, obligation or liability set forth herein expressly survives termination of this Agreement. “Title Commitment” shall mean the Commitment of the Title Company to issue the Title Policy, which commitment shall include hyperlinks providing access to copies of the Record Exceptions referenced therein. “Title Company” shall mean Stewart Title Guaranty Company, National Title Services, One Washington Mall, Suite 1400, Boston, Massachusetts 02108, Attn: Gayle Bourdeau, Esq., or such other title insurance company as may be designated by Seller in writing from time to time. “Title Cure Deadline” shall mean 6:00 P.M. Eastern time on that day which is 15 days after the date on which Buyer delivers to Seller the Title Objections. “Title Objections” shall mean any defects in title (including any Record Exceptions which are not acceptable to Buyer) or survey (including the description of the Land) which may be revealed by Buyer’s examinations thereof to which Buyer timely objects in accordance with the terms of Paragraph 4.3. “Title Policy” shall mean the ALTA Owner’s Policy of Title Insurance issued by the Title Company in the amount of the Purchase Price and in the form of the Title Commitment, and containing, unless prohibited by applicable statutes or regulations, such endorsements as Buyer may obtain from the Title Company in the Title Commitment prior to the Due Diligence Deadline. Buyer shall be entitled to request that the Title Company provide such endorsements (or amendments) to the Title Policy as Buyer may reasonably require, provided that (a) such endorsements (or amendments) shall be at no cost to, and shall impose no additional liability on, Seller, (b) Buyer’s obligations under this Agreement shall not be conditioned upon Buyer’s ability to obtain such endorsements and, if Buyer is unable to obtain such endorsements, Buyer shall nevertheless be obligated to proceed to close the Transaction without reduction of or set off against the Purchase Price, and (c) the Closing shall not be delayed as a result of Buyer’s request. “Transaction” shall mean the purchase and sale transaction contemplated by this Agreement. “[__] Contract” shall mean that certain Purchase and Sale Agreement of even date herewith by and between ABP [__] LLC and Buyer. Schedule A – Page 6 of 6

EX-10.2

EXHIBIT 10.2 THIRD AMENDMENT TO PURCHASE AND SALE AGREEMENT This Third Amendment to Purchase and Sale Agreement (this “Amendment”) dated as of the Effective Date (as hereinafter defined) is by and between ABP FL (YULEE) LLC, a Delaware limited liability company (“Seller”), and BIG ACQUISITIONS LLC, an Illinois limited liability company (“Buyer”). RECITALS: A. Seller and Buyer are parties to that certain Purchase and Sale Agreement dated as of March 19, 2019, as amended by that certain First Amendment to Purchase and Sale Agreement dated April 29, 2019 and that certain Second Amendment to Purchase and Sale Agreement dated April 30, 2019 pertaining to the proposed sale by Seller to Buyer of certain real property more particularly described therein (collectively, the “Agreement”). B. The parties desire to amend certain provisions of the Agreement regarding the legal description of the Property. OPERATIVE TERMS: NOW, THEREFORE, for and in consideration of the foregoing recitals, the mutual covenants set forth in the Agreement and in this Amendment, Ten Dollars ($10.00) and other good and valuable consideration in hand paid, the receipt and sufficiency of which are hereby acknowledged, Seller and Buyer hereby agree as follows: 1. Recitals; Defined Terms. The foregoing recitals are true and correct in all material respects. Capitalized terms and phrases used but not otherwise defined in this Amendment shall have the meanings ascribed to such terms and phrases in the Agreement. Unless the context clearly indicates otherwise, all references to “this Agreement” in the Agreement and in this Amendment shall hereinafter be deemed to refer to the Agreement, as amended hereby. As used in this Amendment (but not for purposes of the Agreement, in which context the definition of the term “Effective Date” shall remain unchanged), “Effective Date” shall mean the date on which Seller or Buyer shall have executed this Amendment, as indicated under their respective signatures, whichever is the later to do so. 2. Waiver of Due Diligence Termination Right. Buyer acknowledges that Buyer has completed all Due Diligence Buyer has deemed necessary or appropriate, and, subject to the Seller’s Warranties, Buyer has confirmed to its satisfaction all information that it considers material to its purchase of the Property or the Transaction. Accordingly, Buyer waives any right it may have had to Terminate the Agreement pursuant to Paragraph 4.3 or 4.5 thereof, based in part on the modifications to the Agreement set forth in this Amendment. 3. Port Authority Parcel. The following new definition is added to Schedule A to the Agreement: “‘Port Authority Parcel’ shall mean that parcel of land shown cross-hatched on Exhibit O attached hereto, which description shall be replaced at Closing by a legal description prepared by Buyer’s surveyor and (a) approved by the current owner of the Port Authority Parcel and (b) sufficient for the Title Company to issue a contiguity endorsement with respect to all separate parcels of the Real Property.” The Real Property shall include the Port Authority Parcel.

4. Conditions to Buyer’s Obligations. Paragraph 10.1 of the Agreement is amended by appending the following new paragraph after subparagraph C thereof: “D. Acquisition of Port Authority Parcel. At Seller’s sole cost and expense and prior to Closing, Seller shall have acquired the Port Authority Parcel, and at Closing, the Port Authority Parcel shall be conveyed to Purchaser as a part of the Real Property, all of which shall be subject only to the Permitted Title Exceptions and consistent with Paragraph 4.3 hereof.” 5. Closing Deadline. The definition of “Closing Deadline” in Schedule A to the Agreement is hereby deleted in its entirety and replaced with the following definition: “‘Closing Deadline’ shall mean May 16, 2019.” 6. Lease Amendment regarding Rail Service. The following shall be appended to Paragraph 5.01(b) of the Lease: “Tenant acknowledges and agrees that the loss of use of the existing rail spur servicing the Premises resulting from any loss of rights to use the track existing between the main railroad line adjacent to the Premises and the sidetrack servicing the Premises will not in and of itself be deemed a default by Landlord under this Lease or otherwise constitute grounds for termination of this Lease.” 7. Headings. The headings to sections of this Amendment are for convenient reference only and shall not be used in interpreting this Amendment. 8. Entire Agreement. This Amendment contains the entire agreement and understanding between the parties concerning the subject matter of this Amendment and supersedes all prior agreements, terms, understandings, conditions, representations and warranties, whether written or oral, concerning the matters that are the subject of this Amendment. 9. Force and Effect. Except as otherwise expressly modified by this Amendment, the Agreement shall remain in full force and effect. Seller and Buyer hereby ratify and confirm their respective rights and obligations under the Agreement, as amended by this Amendment. 10. Counterparts. This Amendment may be executed in counterparts, and all such counterparts shall when taken together, constitute one and the same instrument. 11. Electronic Execution. This Amendment may be executed and delivered by electronic transmission, with the same force and effect as a fully-executed or counterpart original document. [Remainder of this page has been intentionally left blank. Signatures appear on the following page.]

IN WITNESS WHEREOF, Seller and Buyer have executed this Amendment as of the Effective Date. SELLER: ABP FL (YULEE) LLC, a Delaware limited liability company By: /s/ Justin B. Heineman Justin B. Heineman Vice President and Corporate Secretary Date signed: May 1, 2019 BUYER: BIG ACQUISITIONS LLC, an Illinois limited liability company By: /s/ Michael W. Brennan Name: Michael W. Brennan Title: Manager Date signed: May 1, 2019

EX-10.3

EXHIBIT 10.3 THIRD AMENDMENT TO PURCHASE AND SALE AGREEMENT This Third Amendment to Purchase and Sale Agreement (this “Amendment”) dated as of the Effective Date (as hereinafter defined) is by and between ABP IL (UNIVERSITY PARK) LLC, a Delaware limited liability company (“Seller”), and BIG ACQUISITIONS LLC, an Illinois limited liability company (“Buyer”). RECITALS: A. Seller and Buyer are parties to that certain Purchase and Sale Agreement dated as of March 19, 2019, as amended by that certain First Amendment to Purchase and Sale Agreement dated April 29, 2019 and that certain Second Amendment to Purchase and Sale Agreement dated April 30, 2019 pertaining to the proposed sale by Seller to Buyer of certain real property more particularly described therein (collectively, the “Agreement”). B. The parties desire to amend certain provisions of the Agreement regarding the pre-closing inspection of the Property and the Lease. OPERATIVE TERMS: NOW, THEREFORE, for and in consideration of the foregoing recitals, the mutual covenants set forth in the Agreement and in this Amendment, Ten Dollars ($10.00) and other good and valuable consideration in hand paid, the receipt and sufficiency of which are hereby acknowledged, Seller and Buyer hereby agree as follows: 1. Recitals; Defined Terms. The foregoing recitals are true and correct in all material respects. Capitalized terms and phrases used but not otherwise defined in this Amendment shall have the meanings ascribed to such terms and phrases in the Agreement. Unless the context clearly indicates otherwise, all references to “this Agreement” in the Agreement and in this Amendment shall hereinafter be deemed to refer to the Agreement, as amended hereby. As used in this Amendment (but not for purposes of the Agreement, in which context the definition of the term “Effective Date” shall remain unchanged), “Effective Date” shall mean the date on which Seller or Buyer shall have executed this Amendment, as indicated under their respective signatures, whichever is the later to do so. 2. Waiver of Due Diligence Termination Right. Buyer acknowledges that Buyer has completed all Due Diligence Buyer has deemed necessary or appropriate, and, subject to the Seller’s Warranties, Buyer has confirmed to its satisfaction all information that it considers material to its purchase of the Property or the Transaction. Accordingly, Buyer waives any right it may have had to Terminate the Agreement pursuant to Paragraph 4.3 or 4.5 thereof, which waiver is in part based on the modifications to the Agreement set forth in this Amendment. 3. Closing Deadline. The definition of “Closing Deadline” in Schedule A to the Agreement is hereby deleted in its entirety and replaced with the following definition: “‘Closing Deadline’ shall mean May 16, 2019.”

4. Municipal Inspections. Paragraph 5.3 of the Agreement is hereby deleted in its entirety and replaced with the following: “5.3 Municipal Inspections. Prior to the Closing Date, Seller shall arrange, at Seller’s sole cost and expense, for any and all municipal inspections of the Property that are required to consummate this transaction (including any municipal inspections required as a condition to the issuance of transfer stamps). To the extent any such inspections require repairs to the Property as a condition to the sale of the Property or the issuance of transfer stamps, prior to or following Closing, Seller shall complete such repairs at Seller’s sole cost and expense within any time frame required pursuant to such inspections; provided, however, that if the cost to complete any such repairs is reasonably estimated by Seller to be equal to or greater than Three Hundred Fifty Thousand and No/100 Dollars ($350,000.00), then Seller shall have the right to Terminate this Agreement by written notice delivered to Buyer, in which event Buyer shall receive a refund of the Deposit and neither party shall have any further obligation to the other under this Agreement (except for those obligations which expressly survive the termination hereof). To the extent that the Village of University Park requires the deposit of funds (the “Repair Deposit”) to secure the completion of any such repairs, Seller shall cause the Repair Deposit to be deposited with the Village of University Park at or prior to Closing. Notwithstanding that Buyer may be a party to the escrow agreement with the Village of University Park with respect to the Repair Deposit, subject to the terms of the escrow agreement, the Repair Deposit shall remain the property of Seller and shall be released to Seller upon completion of any required repairs. In addition, Seller shall deposit an amount (the “Additional Deposit”) equal to the Repair Deposit with the Title Company. The Additional Deposit shall be held by the Title Company pursuant to an escrow agreement between Seller, Purchaser, Purchaser’s lender and the Title Company, which provides, among other things, that such amount of the Additional Deposit shall be released to Purchaser or Purchaser’s lender to as is necessary to for Purchaser, or Purchaser’s lender, as applicable, to pay any costs actually incurred in connection with completion the required repairs in the event Seller fails to complete the same, and any remaining amount of the Additional Deposit shall be released to Seller contemporaneously with release of the Repair Deposit from the Village of University Park.” 5. Lease Amendment regarding Compliance with Laws. Paragraph 5.02(b)(i) of the Lease is deleted and replaced with the following: “(i) all laws, ordinances and regulations and other governmental rules, orders and determinations presently in effect or hereafter enacted, made or issued, whether or not presently contemplated (collectively, “Legal Requirements”), as applied to the Premises or the ownership, operation, use or possession thereof, including maintaining an adequate number of vehicular parking spaces; in connection therewith, Tenant agrees that it shall, at Tenant’s sole cost and expense, as soon as is reasonably practicable following the Commencement Date, but in no event later than the date that is one hundred eighty (180) days following the Commencement Date, (A) with respect to parking compliance at the Premises, either (1) provide to Landlord written confirmation from the Village of University Park (the “Municipality”) that the available vehicular parking at the Premises as of the Commencement Date is in compliance with applicable zoning requirements or constitutes a legal, nonconforming condition, or (2) or take such actions as are necessary to cause the available vehicular parking at the Premises to comply with then-applicable zoning requirements of the Municipality (the “Zoning Code”), which may include, but shall not be limited to, obtaining a variance and/or providing additional spaces as may be required by the

Municipality in order to comply with the Zoning Code, and (B) if required by the Municipality in connection with the transfer of the Premises from Tenant to Title Holder simultaneously with this Lease, obtain a new certificate of occupancy for the Premises from the Municipality in the customary form issued by the Municipality permitted the use of an improvements located on the Premises, in each case, existing as of the Commencement Date; provided, however that if any repair work to the Premises is required as a condition to the issuance of any required certificate of occupancy, Tenant shall make or cause to be made such repair work and if such repair work cannot reasonably be completed within one hundred eighty (180) days following the Commencement Date, so long has Tenant has commenced and diligently and continuously pursues completion of such repair work and Extension Conditions (defined below) are satisfied, Tenant shall have such additional time as is reasonably necessary to complete the repair work and obtain the certificate of occupancy. For avoidance of doubt, any funds escrowed by Tenant with the Municipality with respect to any repairs required as a condition to the issuance of a new certificate of occupancy for the Premises shall remain the property of Tenant and shall be released by the Municipality to Tenant. As used herein “Extension Conditions” shall mean that Tenant has delivered to Landlord evidence reasonably acceptable to Landlord that (i) the failure to make the repairs will not result in a material adverse effect on the marketability or use and enjoyment of the Premises, (ii) the repairs do not relate to the functionality of fire prevention or suppression systems in the Premises and failure to complete the applicable repairs will not result in an imminent threat to persons or property or the continued use and operation of the Premises (iii) the insurance policies required to be maintained hereunder shall continue in full force and effect and (iv) the failure to complete the repairs and/or obtain the certificate of occupancy will not result in any enforcement action by the Municipality. 6. Lease Amendment regarding Rail Service. The following shall be appended to Paragraph 5.01(b) of the Lease: “Tenant acknowledges and agrees that the loss of use of the existing rail spur servicing the Premises resulting from any loss of rights to use the track existing between the main railroad line adjacent to the Premises and the sidetrack servicing the Premises will not in and of itself be deemed a default by Landlord under this Lease or otherwise constitute grounds for termination of this Lease.” 7. Headings. The headings to sections of this Amendment are for convenient reference only and shall not be used in interpreting this Amendment. 8. Entire Agreement. This Amendment contains the entire agreement and understanding between the parties concerning the subject matter of this Amendment and supersedes all prior agreements, terms, understandings, conditions, representations and warranties, whether written or oral, concerning the matters that are the subject of this Amendment. 9. Force and Effect. Except as otherwise expressly modified by this Amendment, the Agreement shall remain in full force and effect. Seller and Buyer hereby ratify and confirm their respective rights and obligations under the Agreement, as amended by this Amendment. 10. Counterparts. This Amendment may be executed in counterparts, and all such counterparts shall when taken together, constitute one and the same instrument.

11. Electronic Execution. This Amendment may be executed and delivered by electronic transmission, with the same force and effect as a fully-executed or counterpart original document. [Remainder of this page has been intentionally left blank. Signatures appear on the following page.]

IN WITNESS WHEREOF, Seller and Buyer have executed this Amendment as of the Effective Date. SELLER: ABP IL (UNIVERSITY PARK) LLC, a Delaware limited liability company By: /s/ Justin B. Heineman Justin B. Heineman Vice President and Corporate Secretary Date signed: May 1, 2019 BUYER: BIG ACQUISITIONS LLC, an Illinois limited liability company By: /s/ Michael W. Brennan Name: Michael W. Brennan Title: Manager Date signed: May 1, 2019

EX-31.1

EXHIBIT 31.1

 CERTIFICATION REQUIRED BY RULE 13a-14(a) OR RULE 15d-14(a) OF THE SECURITIES

EXCHANGE ACT OF 1934

I, Mitchell B. Lewis, certify that:

(1) I have reviewed this quarterly report on Form 10-Q of BlueLinx Holdings Inc.;

(2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

(3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

(4) The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f))for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

(5) The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

August 7, 2019	/s/ Mitchell B. Lewis
	Mitchell B. Lewis
	President and Chief Executive Officer

EX-31.2

EXHIBIT 31.2

 CERTIFICATION REQUIRED BY RULE 13a-14(a) OR RULE 15d-14(a) OF THE SECURITIES

EXCHANGE ACT OF 1934

I, Susan C. O'Farrell, certify that:

(1) I have reviewed this quarterly report on Form 10-Q of BlueLinx Holdings Inc.;

(2) Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

(3) Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

(4) The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f))for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

(5) The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

August 7, 2019	/s/ Susan C. O'Farrell
	Susan C. O'Farrell
	Chief Financial Officer and Treasurer

EX-32.1

EXHIBIT 32.1

BLUELINX HOLDINGS INC.

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report of BlueLinx Holdings Inc. (the “Company”) on Form 10-Q for the period ending June 29, 2019, as filed with the United States Securities and Exchange Commission on the date hereof (the “Report”), I, Mitchell B. Lewis, Chief Executive Officer of the Company, do hereby certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

August 7, 2019	/s/ Mitchell B. Lewis
	Mitchell B. Lewis
	President and Chief Executive Officer

EX-32.2

EXHIBIT 32.2

BLUELINX HOLDINGS INC.

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the quarterly report of BlueLinx Holdings Inc. (the “Company”) on Form 10-Q for the period ending June 29, 2019, as filed with the United States Securities and Exchange Commission on the date hereof (the “Report”), I, Susan C. O’Farrell, Chief Financial Officer and Treasurer of the Company, do hereby certify, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

August 7, 2019	/s/ Susan C. O’Farrell
	Susan C. O’Farrell
	Chief Financial Officer and Treasurer

XML

Document and Entity Information - shares	6 Months Ended
	Jun. 29, 2019	Aug. 05, 2019
Cover page.
Document Quarterly Report	true
Document Transition Report	false
City Area Code	770
Title of 12(b) Security	Common Stock, par value $0.01 per share
Security Exchange Name	NYSE
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	77-0627356
Entity Registrant Name	BlueLinx Holdings Inc.
Entity Central Index Key	0001301787
Trading Symbol	BXC
Current Fiscal Year Date	--12-28
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Common Stock, Shares Outstanding		9,364,959
Document Type	10-Q
Document Period End Date	Jun. 29, 2019
Entity File Number	1-32383
Amendment Flag	false
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q2
Entity Address, Address Line One	1950 Spectrum Circle, Suite 300
Entity Address, City or Town	Marietta
Entity Address, State or Province	GA
Entity Address, Postal Zip Code	30067
Local Phone Number	953-7000
Entity Shell Company	false
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes

XML

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jun. 29, 2019	Dec. 29, 2018
Current assets:
Cash	$ 12,662	$ 8,939
Receivables, less allowances of $3,811 and $3,656, respectively	262,042	208,434
Inventories, net	358,652	341,851
Other current assets	44,066	40,629
Total current assets	677,422	599,853
Property and equipment:
Property and equipment, at cost	310,751	308,398
Accumulated depreciation	(111,853)	(103,285)
Property and equipment, net	198,898	205,113
Operating lease right-of-use assets	55,240	0
Goodwill	47,772	47,772
Intangible assets, net	30,324	35,222
Deferred tax assets	52,193	52,645
Other non-current assets	19,305	19,284
Total assets	1,081,154	959,889
Current liabilities:
Accounts payable	174,860	149,188
Accrued compensation	7,712	7,974
Current maturities of long-term debt, net of discount and debt issuance costs of $64	1,427	1,736
Finance leases - short-term	8,166	7,555
Real estate deferred gains - short-term	3,935	5,330
Operating lease liabilities - short-term	6,690	0
Other current liabilities	18,625	24,985
Total current liabilities	221,415	196,768
Non-current liabilities:
Long-term debt, net of discount and debt issuance costs of $12,941 and $12,665, respectively	501,909	497,939
Finance leases - long-term	144,116	143,486
Real estate financing obligation	44,822	0
Real estate deferred gains - long-term	83,788	86,011
Operating lease liabilities - long-term	48,672	0
Pension benefit obligation	26,089	26,668
Other non-current liabilities	23,178	23,680
Total liabilities	1,093,989	974,552
Commitments and Contingencies
STOCKHOLDERS’ DEFICIT:
Common Stock, $0.01 par value, Authorized - 20,000,000 shares, Issued and Outstanding - 9,364,959 and 9,293,794, respectively	94	92
Additional paid-in capital	259,727	258,596
Accumulated other comprehensive loss	(37,307)	(37,129)
Accumulated stockholders’ deficit	(235,349)	(236,222)
Total stockholders’ deficit	(12,835)	(14,663)
Total liabilities and stockholders’ deficit	$ 1,081,154	$ 959,889

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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 29, 2019	Jun. 30, 2018	Jun. 29, 2019	Jun. 30, 2018
Income Statement [Abstract]
Net sales	$ 706,448	$ 892,952	$ 1,345,149	$ 1,330,439
Cost of sales	612,281	789,301	1,164,937	1,171,463
Gross profit	94,167	103,651	180,212	158,976
Operating expenses:
Selling, general, and administrative	74,101	91,723	148,511	150,963
Gains from sales of property	(9,760)	0	(9,760)	0
Depreciation and amortization	7,503	7,444	14,831	10,109
Total operating expenses	71,844	99,167	153,582	161,072
Operating income (loss)	22,323	4,484	26,630	(2,096)
Non-operating expenses (income):
Interest expense	13,717	12,194	27,118	20,674
Other (income) expense, net	(45)	(94)	105	(188)
Income (loss) before provision for (benefit from) income taxes	8,651	(7,616)	(593)	(22,582)
Provision for (benefit from) income taxes	2,350	942	(175)	(597)
Net income (loss)	$ 6,301	$ (8,558)	$ (418)	$ (21,985)
Basic earnings (loss) per share (in dollars per share)	$ 0.67	$ (0.93)	$ (0.04)	$ (2.40)
Diluted earnings (loss) per share (in dollars per share)	$ 0.67	$ (0.93)	$ (0.04)	$ (2.40)
Comprehensive income (loss):
Net income (loss)	$ 6,301	$ (8,558)	$ (418)	$ (21,985)
Other comprehensive income (loss):
Foreign currency translation, net of tax	0	(9)	7	(3)
Amortization of unrecognized pension loss, net of tax	208	201	431	404
Pension curtailment, net of tax	(1,486)	0	(632)	0
Other	1	0		0
Total other comprehensive income	(1,277)	192	(178)	401
Comprehensive income (loss)	$ 5,024	$ (8,366)	$ (596)	$ (21,584)

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CONDENSED CONSOLIDATED BALANCE SHEETS (Parentheticals) - USD ($) $ in Thousands	Jun. 29, 2019	Dec. 29, 2018
Statement of Financial Position [Abstract]
Allowance for doubtful accounts receivable	$ 3,811	$ 3,656
Debt discount, current	64	64
Debt discount, noncurrent	$ 12,941	$ 12,665
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	20,000,000	20,000,000
Common stock, shares issued (in shares)	9,364,959	9,293,794
Common stock, shares outstanding (in shares)	9,364,959	9,293,794

XML

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	6 Months Ended
	Jun. 29, 2019	Jun. 30, 2018
Statement of Cash Flows [Abstract]
Net cash used in operating activities	$ (67,688)	$ (98,470)
Cash flows from investing activities:
Proceeds from sale of assets	10,758	107,960
Acquisition of business, net of cash acquired - see Note 2	0	(353,094)
Property and equipment investments	(1,784)	(577)
Net cash provided by (used in) investing activities	8,974	(245,711)
Cash flows from financing activities:
Borrowings on revolving credit facilities	365,519	534,380
Repayments on revolving credit facilities	(329,683)	(267,449)
Borrowings on term loan	0	180,000
Repayments on term loan	(31,899)	(450)
Principal payments on mortgage	0	(97,847)
Proceeds from real estate transactions	44,822	0
Change in outstanding payments	19,706	10,919
Debt issuance costs	(1,588)	(9,775)
Payments on finance lease obligations	(4,232)	(3,262)
Repurchase of shares to satisfy employee tax withholdings	(208)	(1,821)
Net cash provided by financing activities	62,437	344,695
Net change in cash	3,723	514
Cash at beginning of period	8,939	4,696
Cash at end of period	$ 12,662	$ 5,210

XML

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' (DEFICIT) EQUITY - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock	Additional Paid-In Capital	Accumulated Other Comprehensive Loss	Accumulated Deficit
Beginning balance (in shares) at Dec. 30, 2017		9,101
Beginning balance at Dec. 30, 2017	$ 35,002	$ 91	$ 259,588	$ (36,507)	$ (188,170)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	(13,427)				(13,427)
Foreign currency translation, net of tax	6			6
Unrealized gain from pension plan, net of tax	203			203
Vesting of restricted stock units	0
Vesting of performance shares (in shares)		109
Vesting of performance shares	1	$ 1
Compensation related to share-based grants	319		319
Repurchase of shares to satisfy employee tax withholdings	(1)		(1)
Other	(7)				(7)
Ending balance (in shares) at Mar. 31, 2018		9,210
Ending balance at Mar. 31, 2018	22,096	$ 92	259,906	(36,298)	(201,604)
Beginning balance (in shares) at Dec. 30, 2017		9,101
Beginning balance at Dec. 30, 2017	35,002	$ 91	259,588	(36,507)	(188,170)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	(21,985)
Foreign currency translation, net of tax	(3)
Ending balance (in shares) at Jun. 30, 2018		9,219
Ending balance at Jun. 30, 2018	12,356	$ 92	258,525	(36,106)	(210,155)
Beginning balance (in shares) at Mar. 31, 2018		9,210
Beginning balance at Mar. 31, 2018	22,096	$ 92	259,906	(36,298)	(201,604)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	(8,558)				(8,558)
Foreign currency translation, net of tax	(9)			(9)
Unrealized gain from pension plan, net of tax	201			201
Vesting of restricted stock units (in shares)		11
Vesting of restricted stock units	0		0
Vesting of performance shares	0
Compensation related to share-based grants	338		338
Repurchase of shares to satisfy employee tax withholdings	(1,719)
Other	7			0	7
Ending balance (in shares) at Jun. 30, 2018		9,219
Ending balance at Jun. 30, 2018	12,356	$ 92	258,525	(36,106)	(210,155)
Beginning balance (in shares) at Dec. 29, 2018		9,294
Beginning balance at Dec. 29, 2018	(14,663)	$ 92	258,596	(37,129)	(236,222)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	(6,719)				(6,719)
Foreign currency translation, net of tax	7			7
Unrealized gain from pension plan, net of tax	1,077			1,077
Vesting of restricted stock units (in shares)		49
Vesting of restricted stock units	1	$ 1
Compensation related to share-based grants	706		706
Repurchase of shares to satisfy employee tax withholdings	0
Other	15			15
Ending balance (in shares) at Mar. 30, 2019		9,343
Ending balance at Mar. 30, 2019	(18,285)	$ 93	259,302	(36,030)	(241,650)
Beginning balance (in shares) at Dec. 29, 2018		9,294
Beginning balance at Dec. 29, 2018	(14,663)	$ 92	258,596	(37,129)	(236,222)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	(418)
Foreign currency translation, net of tax	7
Ending balance (in shares) at Jun. 29, 2019		9,365
Ending balance at Jun. 29, 2019	(12,835)	$ 94	259,727	(37,307)	(235,349)
Beginning balance (in shares) at Mar. 30, 2019		9,343
Beginning balance at Mar. 30, 2019	(18,285)	$ 93	259,302	(36,030)	(241,650)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	6,301				6,301
Foreign currency translation, net of tax	0			0
Unrealized gain from pension plan, net of tax	(1,278)			(1,278)
Vesting of restricted stock units (in shares)		32
Vesting of restricted stock units	1	$ 1
Compensation related to share-based grants	635		635
Repurchase of shares to satisfy employee tax withholdings (in shares)		(10)
Repurchase of shares to satisfy employee tax withholdings	(208)		(208)
Other	(1)		(2)	1	0
Ending balance (in shares) at Jun. 29, 2019		9,365
Ending balance at Jun. 29, 2019	$ (12,835)	$ 94	$ 259,727	$ (37,307)	$ (235,349)

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Summary of Significant Accounting Policies

6 Months Ended

Jun. 29, 2019

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

Basis of Presentation

The accompanying unaudited Condensed Consolidated Financial Statements include the accounts of BlueLinx Holdings Inc. and its wholly owned subsidiaries (the “Company”). These financial statements have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and footnotes required by accounting principles generally accepted (“GAAP”) in the United States (“U.S.”) for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. These statements should be read in conjunction with the Consolidated Financial Statements and notes thereto included in the Company’s Annual Report on Form 10-K (the “Annual Report on Form 10-K”) for the year ended December 29, 2018, as filed with the Securities and Exchange Commission on March 13, 2019.

Our financial condition as of, and our operating results for, the three and six-month periods ended June 29, 2019, are not necessarily indicative of the financial condition and results that may be expected for the full year ending December 28, 2019, or any other interim period. Certain prior period amounts have been reclassified to conform to the current period's presentation. These reclassifications did not impact the Company's operating income (loss) or consolidated net income (loss).

Outstanding Payments

Outstanding payments represent outstanding checks and electronic payments that have not been presented for payment as of the end of the period. These amounts are typically funded within 24 hours. As of June 29, 2019 and December 29, 2018 outstanding payments of $37.1 million and $17.4 million, respectively, were included in accounts payable on our condensed consolidated balance sheets.

Recently Adopted Accounting Standards

Leases.  In 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-02, “Leases (Topic 842).” Topic 842 establishes a new lease accounting model. The most significant changes include the clarification of the definition of a lease, the requirement for lessees to recognize, for all leases, a right-of-use asset and a lease liability in the consolidated balance sheet, and additional quantitative and qualitative disclosures which are designed to give financial statement users information on the amount, timing, and uncertainty of cash flows arising from leases. Lease expenses will continue to be recognized in the consolidated statement of income in a manner similar to prior accounting guidance. Lessor accounting under the new standard is substantially unchanged. We adopted this standard, and all related amendments thereto, effective December 30, 2018, the first day of our fiscal 2019 year, using a modified retrospective approach, which applies the provisions of the new guidance at the effective date without adjusting the comparative periods presented. We have elected the package of practical expedients permitted under the transition guidance within the new standard, which among other things, allows us to carry forward the historical accounting relating to lease identification and classification for existing leases upon adoption. We have made an accounting policy election to keep leases with an initial term of 12 months or less off of the consolidated balance sheet. We implemented internal controls and a lease accounting information system to enable the preparation of financial information required by the new standard. The adoption of Topic 842 had a material impact on our condensed consolidated balance sheets but did not have an impact on our condensed consolidated statements of operations and comprehensive loss. The most significant impact was the recognition of right-of-use assets and lease liabilities of $57.5 million in the consolidated balance sheet. Additionally, $1.7 million of deferred gains associated with sale-leaseback transactions was recorded as a cumulative-effect adjustment to accumulated deficit. See Note 9 “Leases” for additional disclosures regarding our lease commitments.

Comprehensive Income. In February 2018, the FASB issued ASU No. 2018-02, “Income Statement-Reporting Comprehensive Income (Topic 220).” This standard provides an option to reclassify stranded tax effects within accumulated other comprehensive income (loss) to retained earnings due to the U.S. federal corporate income tax rate change in the Tax Cuts and Jobs Act of 2017. This standard was effective for interim and annual reporting periods beginning after December 15, 2018. We did not exercise the option to make this reclassification.

Accounting Standards Effective in Future Years

Goodwill. In January 2017, the FASB issued ASU No. 2017-04, “Intangibles—Goodwill and Other (Topic 350).” This standard is intended to simplify the test for goodwill impairments by removing Step 2 of the goodwill impairment test, which requires a hypothetical purchase price allocation. Under the new ASU, a goodwill impairment will now be the amount by which a reporting unit's carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. The accounting standard will be effective for reporting periods beginning after December 15, 2019, and early adoption is permitted. We do not expect the adoption of the standard to have a material impact on the Company's consolidated financial position, results of operations or cash flows.

Fair Value Measurement. In August 2018, the FASB issued ASU No. 2018-13, “Fair Value (“FV”) Measurement (Topic 820).” Among other modifications, the standard removes the requirements to disclose: (i) the amount of and reasons for transfers between Level 1 and Level 2 of the FV hierarchy; (ii) the policy for timing transfers between levels; and (iii) the valuation process for Level 3 FV measurements. The standard will require public entities to disclose: (a) the changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 FV measurements held at the end of the reporting period; and (b) the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. For certain unobservable inputs, an entity may disclose other quantitative information in lieu of the weighted average if the entity determines that other quantitative information would be a more reasonable and rational method to reflect the distribution of unobservable inputs used to develop Level 3 FV measurements. The additional disclosure requirements should be applied prospectively for the most recent interim or annual period presented in the fiscal year of adoption. All other amendments should be applied retrospectively to all periods presented. The amendments in this standard are effective for fiscal years ending after December 15, 2019. Early adoption is permitted, and an entity may adopt the removed or modified disclosures and delay the adoption of new disclosures until the effective date. We have not completed our assessment of the standard but we do not expect the adoption to have a material impact on the Company's consolidated financial position, results of operations or cash flows.

Defined Benefit Pension Plan. In August 2018, the FASB issued ASU No. 2018-14, “Compensation-Retirement-Benefits-Defined Benefit Plans-General (Subtopic 715-20).” The amendments in this update modify the disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans by removing six previously required disclosures and adding two. The amendments also clarify certain other disclosure requirements. The amendments in this standard are effective for fiscal years ending after December 15, 2020. Early adoption is permitted. We have not completed our assessment of the standard but we do not expect the adoption to have a material impact on the Company's consolidated financial position, results of operations or cash flows.

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Acquisition

6 Months Ended

Jun. 29, 2019

Business Combinations [Abstract]

Acquisition

Acquisition

On April 13, 2018, we completed the acquisition of Cedar Creek Holdings, Inc. (“Cedar Creek”) for a purchase price of approximately $361.8 million. The acquisition was completed pursuant to the terms of an Agreement and Plan of Merger (the "Merger Agreement"), dated as of March 9, 2018, by and among BlueLinx Corporation, one of our wholly owned subsidiaries, Panther Merger Sub, Inc., a wholly-owned subsidiary of BlueLinx Corporation ("Merger Sub"), Cedar Creek, and CharlesBank Equity Fund VII, Limited Partnership. Upon closing the transactions contemplated by the Merger Agreement, among other things, Merger Sub was merged with and into Cedar Creek, with Cedar Creek surviving the merger as one of our indirect wholly-owned subsidiaries. The merger allowed us to expand our product offerings, while maintaining our existing geographical footprint.

Cedar Creek was established in 1977 as a wholesale building materials distribution company that distributes wood products across the United States. Its products include specialty lumber, oriented strand board, siding, cedar, spruce, engineered wood products and other building products.

The acquisition was accounted for under the acquisition method of accounting. The assets acquired, liabilities assumed and results of operations of the acquired business have been included in our consolidated results since April 13, 2018.

The following unaudited consolidated pro forma information presents consolidated information as if the acquisition had occurred on January 1, 2017:

	Pro forma
	Three Months Ended				Six Months Ended
(In thousands, except per share data)	June 29, 2019		June 30, 2018		June 29, 2019		June 30, 2018
Net sales	$	706,448	$	948,555	$	1,345,149	$	1,732,822
Net income (loss)	9,425		9,180		6,118		(1,439		)
Earnings (loss) per common share:
Basic	$	1.01	$	1.00	$	0.65	$	(0.16	)
Diluted	1.00		0.98		0.65		(0.16		)

The pro forma amounts above have been calculated in accordance with GAAP after applying the Company's accounting policies and adjusting the three and six months ended June 29, 2019 for $4.2 million and $8.8 million, and the three and six months ended June 30, 2018 for $30.4 million and $34.0 million, respectively, for transaction related costs, net of tax. Due to the net loss for the six-month period ended June 30, 2018, 164,550 incremental shares from share-based compensation arrangements were excluded from the computation of diluted weighted average shares outstanding because their effect would be anti-dilutive. The pro forma amounts do not include any potential synergies, cost savings or other expected benefits of the acquisition, are presented for illustrative purposes only, and are not necessarily indicative of results that would have been achieved had the acquisition occurred as of January 1, 2017, or of future operating performance.

The purchase price of Cedar Creek consisted of the following items:

	(In thousands)
Consideration paid to shareholders and amounts paid to creditors:
Payments to Cedar Creek shareholders[1]	$	166,447
Subordinated unsecured note (due to shareholder)[2]		13,743
Seller’s transaction costs paid by Company		7,349
Add: pay off of Cedar Creek debt[3]		174,213
Total cash purchase price	$	361,752

_____________

[1] Payments to Cedar Creek’s shareholders include the purchase of common stock and certain escrow adjustments.

[2] The Cedar Creek note payable to a shareholder of $13.7 million was paid in full upon the acquisition of Cedar Creek and included $10 million in subordinated debt and $3.7 million in accrued interest.

[3] To finance the acquisition of Cedar Creek, the Company amended and restated its Revolving Credit Facility to increase the capacity thereunder to $600.0 million and also entered into a new $180.0 million senior secured Term Loan Facility (See Note 6).

The excess of total purchase price, which includes the aggregate cash consideration paid in excess of the fair value of the tangible and intangible assets acquired, was recorded as goodwill. The goodwill recognized is attributable to the expected operating synergies and growth potential that the Company expects to realize from the acquisition. None of the goodwill generated from the acquisition is deductible for tax purposes.

The following table summarizes the values of the assets acquired and liabilities assumed at the date of the acquisition:

(In thousands)	Allocation as of December 29, 2018
Cash and net working capital assets (excluding inventory)	$	88,318
Inventory		159,227
Property and equipment		71,203
Other, net		(1,395	)
Intangible assets and goodwill:
Customer relationships		25,500
Non-compete agreements		8,254
Trade names		6,826
Favorable leasehold interests		800
Goodwill		47,772
Finance leases and other liabilities		(44,753	)
Cash purchase price	$	361,752

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Goodwill and Other Intangible Assets

6 Months Ended

Jun. 29, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangible Assets

Goodwill and Other Intangible Assets

In connection with the acquisition of Cedar Creek, we acquired certain intangible assets. As of June 29, 2019, our intangible assets consist of goodwill and other intangible assets including customer relationships, noncompete agreements, and trade names.

Goodwill

Goodwill is the excess of the cost of an acquired entity over the fair value of tangible and intangible assets (including customer relationships, noncompete agreements and trade names) acquired, and liabilities assumed, under acquisition accounting for business combinations.

As of June 29, 2019, goodwill was $47.8 million.

Goodwill is not subject to amortization but must be tested for impairment at least annually. This test requires us to assign goodwill to a reporting unit and to determine if the implied fair value of the reporting unit’s goodwill is less than its carrying amount. We evaluate goodwill for impairment during the fourth quarter of each fiscal year. In addition, we will evaluate the carrying values of these assets for impairment between annual impairment tests if an event occurs or circumstances change that would indicate the carrying amounts may be impaired. Such events and indicators may include, without limitation, significant declines in the industries in which our products are used, significant changes in capital market conditions, and significant changes in our market capitalization.

Definite-Lived Intangible Assets.

At June 29, 2019, in connection with the acquisition of Cedar Creek, we had definite-lived intangible assets that related to customer relationships, noncompete agreements, and trade names.

At June 29, 2019, the gross carrying amounts, the accumulated amortization and the net carrying amounts of our definite-lived intangible assets were as follows (in thousands):

	Gross carrying amounts		Accumulated Amortization			[1]	Net carrying amounts
Customer relationships	$	25,500	$	(4,999	)		$	20,501
Noncompete agreements	8,254		(2,500		)		5,754
Trade names	6,826		(2,757		)		4,069
Total	$	40,580	$	(10,256	)		$	30,324

____________________

^[1] Intangible assets except customer relationships are amortized on straight line basis. Customer relationships are amortized on a double declining balance method.

Amortization Expense

The weighted average estimated useful life remaining for customer relationships, noncompete agreements and trade names is approximately 11 years, 3 years, and 2 years, respectively. Amortization expense for the definite-lived intangible assets was $2.0 million and $4.1 million for the three and six month periods ended June 29, 2019, respectively. For the three and six month periods ended June 30, 2018, amortization expense was $1.9 million.

Estimated annual amortization expense for definite-lived intangible assets over the next five fiscal years is as follows (in thousands):

	Estimated Amortization
2019	$	8,085
2020	7,461
2021	4,973
2022	3,111
2023	1,807

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Revenue Recognition

6 Months Ended

Jun. 29, 2019

Revenue from Contract with Customer [Abstract]

Revenue Recognition

Revenue Recognition

We recognize revenue when control of promised goods or services is transferred to the Company’s customers in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services.

Contracts with our customers are generally in the form of standard terms and conditions of sale. From time to time, we may enter into specific contracts with some of our larger customers, which may affect delivery terms. Performance obligations in our contracts generally consist solely of delivery of goods. For all sales channel types, consisting of warehouse, direct, and reload sales, we typically satisfy our performance obligations upon shipment. Our customer payment terms are typical for our industry, and may vary by the type and location of our customer and the products or services offered. The term between invoicing and when payment is due is not deemed to be significant by us. For certain sales channels and/or products, our standard terms of payment may be as early as ten days.

In addition, we provide inventory to certain customers through pre-arranged agreements on a consignment basis. Customer consigned inventory is maintained and stored by certain customers; however, ownership and risk of loss remains with us. When the consigned inventory is sold by the customer, we recognize revenue, net of trade allowances.

All revenues recognized are net of trade allowances (i.e., rebates), cash discounts and sales returns. Cash discounts and sales returns are estimated using historical experience. Trade allowances are based on the estimated obligations and historical experience. Adjustments to earnings resulting from revisions to estimates on discounts and returns have been insignificant for each of the reported periods. Certain customers may receive cash-based incentives or credits (rebates), which are accounted for

as variable consideration. We estimate these amounts based on the expected amount to be provided to customers and reduce revenues recognized. We believe that there will not be significant changes to our estimates of variable consideration.

With the acquisition and integration of Cedar Creek, we changed our internal product hierarchy. The following table presents our revenues disaggregated by revenue source (in thousands). Certain prior year amounts have been reclassified to conform to the current year product mix of structural and specialty products. Sales and usage-based taxes are excluded from revenues.

	Three Months Ended				Six Months Ended
	June 29, 2019		June 30, 2018		June 29, 2019		June 30, 2018
Structural products	$	225,056	$	345,878	$	422,551	$	522,359
Specialty products and other	481,392		547,074		922,598		808,080
Total net sales	$	706,448	$	892,952	$	1,345,149	$	1,330,439

The following table presents our revenues disaggregated by sales channel (in thousands). Sales and usage-based taxes are excluded from revenues.

	Three Months Ended						Six Months Ended
	June 29, 2019			June 30, 2018			June 29, 2019			June 30, 2018
Warehouse	$	577,000		$	704,328		$	1,081,274		$	1,037,634
Direct	122,262			165,630			245,667			248,573
Reload and service revenue	16,617			34,914			35,522			63,184
Customer discounts and rebates	(9,431		)	(11,920		)	(17,314		)	(18,952		)
Total net sales	$	706,448		$	892,952		$	1,345,149		$	1,330,439

Practical Expedients and Exemptions

We generally expense sales commissions when incurred because the amortization period would have been one year or less. These costs are recorded within selling, general, and administrative expense.

We have made an accounting policy election to treat any common carrier shipping and handling activities as a fulfillment cost, rather than as a separate obligation or separate promised service.

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Assets Held for Sale and Net Gain on Disposition

6 Months Ended

Jun. 29, 2019

Discontinued Operations and Disposal Groups [Abstract]

Assets Held for Sale and Net Gain on Disposition

Assets Held for Sale and Net Gain on Disposition

In fiscal 2018, we designated certain non-operating properties as held for sale due to strategic realignments of our business. At the time of designation, we ceased recognizing depreciation expense on these assets. As of December 29, 2018, six properties were designated as held for sale, with an additional property designated during the first quarter of 2019. During the six months ended June 29, 2019, two properties were sold, as further described below. As of June 29, 2019 and December 29, 2018, the net book value of total assets held for sale was $3.3 million and $3.1 million, respectively, and was included in “Other current assets” in our Condensed Consolidated Balance Sheets. Properties held for sale as of June 29, 2019, consisted of land in Connecticut, and five warehouses located in the Midwest and South. We plan to sell these properties within the next 12 months. We continue to actively market all properties that are designated as held for sale.

During the six months ended June 29, 2019, we sold two non-operating distribution facilities previously designated as “held for sale”. We recognized a gain of $9.8 million in the Condensed Consolidated Statements of Operations as a result of these sales.

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Long-Term Debt

6 Months Ended

Jun. 29, 2019

Debt Disclosure [Abstract]

Long-Term Debt

Long-Term Debt

As of June 29, 2019, and December 29, 2018, long-term debt consisted of the following:

		June 29,			December 29,
(In thousands)	Maturity Date	2019			2018
Revolving Credit Facility (net of discounts and debt issuance costs of $5.2 million and $6.0 million at June 29, 2019 and December 29, 2018, respectively)	October 10, 2022	$	363,898		$	327,319
Term Loan Facility (net of discounts and debt issuance costs of $7.7 million and $6.7 million at June 29, 2019 and December 29, 2018, respectively)	October 13, 2023		139,438			172,356
Total debt			503,336			499,675
Less: current portion of long-term debt			(1,427	)		(1,736	)
Long-term debt, net		$	501,909		$	497,939

Revolving Credit Facility

On April 13, 2018, we entered into an Amended and Restated Credit Agreement with certain of our subsidiaries as borrowers (together with us, the “Borrowers”) or guarantors thereunder, Wells Fargo Bank, National Association, in its capacity as administrative agent, and certain other financial institutions party thereto (the “Revolving Credit Agreement”). The Revolving Credit Agreement provides for a senior secured asset-based revolving loan and letter of credit facility (the “Revolving Credit Facility”) of up to $600 million and an uncommitted accordion feature that permits the Borrowers to increase the facility by an aggregate additional principal amount of up to $150 million, which would allow borrowings of up to $750 million under the Revolving Credit Facility. Letters of credit in an aggregate amount of up to $30 million are also available under the Revolving Credit Agreement, which would reduce the amount of the revolving loans available under the Revolving Credit Facility. The maturity date of the Revolving Credit Agreement is October 10, 2022. The Borrowers’ obligations under the Revolving Credit Agreement are secured by a security interest in substantially all of our and our subsidiaries’ assets (other than real property), including inventories, accounts receivable, and proceeds from those items.

Borrowings under the Revolving Credit Agreement are subject to availability under the Borrowing Base (as that term is defined in the Revolving Credit Agreement). The Borrowers are required to repay revolving loans thereunder to the extent that such revolving loans exceed the Borrowing Base then in effect. The Revolving Credit Facility may be prepaid in whole or in part from time to time without penalty or premium, but including all breakage costs incurred by any lender thereunder.

The Revolving Credit Agreement provides for interest on the loans at a rate per annum equal to (i) LIBOR plus a margin ranging from 1.75 percent to 2.25 percent, with the amount of such margin determined based upon the average of the Borrowers’ excess availability for the immediately preceding fiscal quarter as calculated by the administrative agent, for loans based on LIBOR, or (ii) the administrative agent’s base rate plus a margin ranging from 0.75 percent to 1.25 percent, with the amount of such margin determined based upon the average of the Borrowers’ excess availability for the immediately preceding fiscal quarter as calculated by the administrative agent, for loans based on the base rate.

In the event excess availability falls below the greater of (i) $50 million and (ii) 10 percent of the lesser of (a) the Borrowing Base and (b) the maximum permitted credit at such time, the Revolving Credit Agreement requires maintenance of a fixed charge coverage ratio of 1.0 to 1.0 until such time as the Borrowers’ excess availability has been at least the greater of (i) $50 million and (ii) 10 percent of the lesser of (a) the Borrowing Base and (b) the maximum permitted credit at such time for a period of 30 consecutive days.

The Revolving Credit Agreement also contains representations and warranties and affirmative and negative covenants customary for financings of this type, as well as customary events of default.

As of June 29, 2019, we had outstanding borrowings of $369.1 million, excess availability of $100.8 million, and a weighted average interest rate of 4.5 percent under our Revolving Credit Facility. As of December 29, 2018, our principal balance was $333.3 million, excess availability was $91.7 million, and our weighted average interest rate was 4.2 percent under our Revolving Credit Facility.

We were in compliance with all covenants under the Revolving Credit Agreement as of June 29, 2019.

Term Loan Facility

On April 13, 2018, in connection with the acquisition of Cedar Creek, we entered into a credit and guaranty agreement with HPS Investment Partners, LLC, as administrative agent and collateral agent (“HPS”) and certain other financial institutions as party thereto. On February 28, 2019, the credit and guaranty agreement was amended to, among other things, permit certain real estate sale leaseback transactions and modify the total net leverage ratio beginning in the first quarter of 2019 (as amended, the “Term Loan Agreement”). The Term Loan Agreement provides for a senior secured first lien loan facility in an aggregate principal amount of $180 million (the “Term Loan Facility”). The maturity date of the Term Loan Agreement is October 13, 2023. The proceeds from the Term Loan Facility were used to fund a portion of the cash consideration payable in connection with the acquisition of Cedar Creek and to fund transaction costs in connection with the acquisition and the Term Loan Facility.

The obligations under the Term Loan Agreement are secured by a security interest in substantially all of our and our subsidiaries’ assets, including inventories, accounts receivable, real property, and proceeds from those items.

The Term Loan Agreement requires monthly interest payments, and quarterly principal payments of $450,000, in arrears. The Term Loan Agreement also requires certain mandatory prepayments of outstanding loans, subject to certain exceptions, including prepayments commencing with the fiscal year ending December 28, 2019, based on a percentage of excess cash flow (as defined in the Term Loan Agreement for such fiscal year). The remaining balance is due on the loan maturity date of October 13, 2023.

The Term Loan Facility may be prepaid in whole or in part from time to time, subject to payment of the “Prepayment Premium” (as such term is defined in the Term Loan Agreement) if such voluntary prepayment does not otherwise constitute an exception to the Prepayment Premium under the Term Loan Agreement and is made on or prior to February 28, 2023, and all breakage costs incurred by any lender thereunder. We used approximately $30 million of the proceeds from the sale-leaseback transactions described in Note 9, Leases, to prepay the Term Loan Facility, resulting in adjusted quarterly principal payments of $372,661.

Borrowings under the Term Loan Agreement may be made as Base Rate Loans or Eurodollar Rate Loans. The Base Rate Loans will bear interest at the rate per annum equal to (i) the greatest of the (a) U.S. prime lending rate published in The Wall Street Journal, (b) the Federal Funds Effective Rate plus 0.50 percent, and (c) the sum of the Adjusted Eurodollar Rate of one month plus 1.00 percent, provided that the Base Rate shall at no time be less than 2.00 percent per annum; and (ii) plus the Applicable Margin, as described below. Eurodollar Rate Loans will bear interest at the rate per annum equal to (i) the ICE Benchmark Administration LIBOR Rate, provided that the Adjusted Eurodollar Rate shall at no time be less than 1.00 percent per annum; plus (ii) the Applicable Margin. The Applicable Margin will be 6.00 percent with respect to Base Rate Loans and 7.00 percent with respect to Eurodollar Rate Loans.

The Term Loan Agreement required maintenance of a total net leverage ratio of 8.25 to 1.00 for the fiscal quarter ending June 29, 2019, and such required covenant level generally reduces over the term of the Term Loan Facility as set forth in the Term Loan Agreement. As of June 29, 2019, we were in compliance with the total net leverage ratio.

The Term Loan Agreement also contains representations, warranties, affirmative and negative covenants customary for financing transactions of this type, and customary events of default.

As of June 29, 2019, we had outstanding borrowings of $147.2 million under our Term Loan Credit Facility and an interest rate of 9.4 percent per annum. At December 29, 2018, our principal balance was $179.1 million with an interest rate of 9.3 percent per annum.

We were in compliance with all covenants under the Term Loan Agreement as of June 29, 2019.

Our remaining principal payment schedule for each of the next four years and thereafter is as follows:

(In thousands)
2019	$	373
2020		1,863
2021		1,491
2022		1,491
Thereafter		141,984

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Net Periodic Pension Cost

6 Months Ended

Jun. 29, 2019

Retirement Benefits [Abstract]

Net Periodic Pension Cost

Net Periodic Pension Cost

The following table shows the components of our net periodic pension cost:

	Three Months Ended						Six Months Ended
(In thousands)	June 29, 2019			June 30, 2018			June 29, 2019			June 30, 2018
Service cost	$	48		$	133		$	161		$	266
Interest cost on projected benefit obligation	973			963			2,018			1,926
Expected return on plan assets	(1,295		)	(1,327		)	(2,489		)	(2,654		)
Amortization of unrecognized loss	279			271			580			542
Net periodic pension cost	$	5		$	40		$	270		$	80

During the first six months of fiscal 2019, we renegotiated our collective bargaining agreement with 3 unionized locations. This collective bargaining agreement covers a number of specific items such as wages, medical coverage, and certain other benefit programs, including pension plan participation. As a result of these renegotiations, 38 of the participants in the plan are no longer accruing future years of service under the applicable pension plan, which triggered a curtailment. As a result of the curtailment, we performed a revaluation of plan assets and liabilities. The related pension benefit obligation decreased $0.3 million for the six months ended June 29, 2019, as a result of changes in valuation assumptions. An overall increase in plan asset valuation was accompanied by a decrease to accumulated other comprehensive income of $0.2 million, which was recorded in other comprehensive loss on the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). No intraperiod income tax effect was required to be recorded as a result of the curtailment.

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Stock Compensation

6 Months Ended

Jun. 29, 2019

Share-based Payment Arrangement [Abstract]

Stock Compensation

Stock Compensation

Cash-Settled Stock Appreciation Rights (“SARs”)

During fiscal 2016, we granted certain executives and employees cash-settled SARs. The cash-settled SARs vested on July 16, 2018. On the vesting date, half of the vested value of the cash-settled SARs became payable within thirty days of the vesting date, and the remainder payable within one year of the vesting date. The exercise price for the cash-settled SARs was amended so that it was based on a 20 day trading average of the Company’s common stock through the vesting date, in excess of the $7.00 grant date valuation.

On June 29, 2019, the total liability was approximately $7.2 million, which reflected the remaining payable balance.

Stock Compensation Expense

During the three months ended June 29, 2019 and June 30, 2018, we incurred stock compensation expense of $0.6 million and $3.8 million, respectively. During the six months ended June 29, 2019 and June 30, 2018, we incurred stock compensation expense of $1.3 million and $13.0 million, respectively. The decrease in our stock compensation expense for the three and six-month periods of fiscal 2019 is attributable to cash-settled SARs expense in the prior year.

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Leases

6 Months Ended

Jun. 29, 2019

Leases [Abstract]

Leases

Leases

Effective December 30, 2018, we adopted ASU No. 2016-02, “Leases (Topic 842)” using the modified retrospective method, which applies the provisions of the new guidance at the effective date without adjusting the comparative periods presented. We have elected the package of practical expedients permitted under the transition guidance within the new standard. This election allowed us to carry forward our historical lease classification. The adoption of this standard resulted in the recording of operating lease right-of-use (“ROU”) assets and corresponding operating lease liabilities of $57.5 million on the condensed consolidated balance sheet as of December 30, 2018, which amortizes over the lease term.

Our operating and finance (formerly capital) lease portfolio includes leases for real estate, certain logistics equipment and vehicles. The majority of our leases have remaining lease terms of 1 year to 15 years, some of which include one or more options to extend the leases for 5 years. Operating lease ROU assets and liabilities are presented separately on the condensed consolidated balance sheets. Finance lease assets are included in property and equipment and the finance lease obligations are presented separately in the condensed consolidated balance sheet.

A portion of our real estate lease cost is generally subject to annual changes in the Consumer Price Index (“CPI”). The changes to the CPI are treated as variable lease payments and recognized in the period in which the obligation for those payments was incurred. In addition, a subset of our vehicle lease cost is considered variable.

The components of lease expense were as follows:

(In thousands)	Three Months Ended June 29, 2019		Six Months Ended June 29, 2019
Operating lease cost	$	2,991	$	6,135
Finance lease cost:
Amortization of right-of-use assets	$	2,995	5,892
Interest on lease liabilities	4,049		7,297
Total finance lease costs	$	7,044	$	13,189

Supplemental cash flow information related to leases was as follows:

(In thousands)	Three Months Ended June 29, 2019		Six Months Ended June 29, 2019
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases	$	3,064	$	5,967
Operating cash flows from finance leases	3,155		6,403
Financing cash flows from finance leases	2,045		4,232
Right-of-use assets obtained in exchange for lease obligations
Operating leases	$	—	$	—
Finance leases	3,462		4,250

Supplemental balance sheet information related to leases was as follows:

(In thousands)	June 29, 2019
Finance leases
Property and equipment	$	156,050
Accumulated depreciation	(19,835		)
Property and equipment, net	$	136,215
Weighted Average Remaining Lease Term (in years)
Operating leases	12.17
Finance leases	20.34
Weighted Average Discount Rate
Operating leases	9.41		%
Finance leases	10.91		%

As of June 29, 2019, maturities of lease liabilities were as follows:

(In thousands)	Operating leases			Finance leases
2019	$	9,519		$	10,849
2020	8,790			20,814
2021	6,930			18,140
2022	6,243			17,153
2023	5,276			16,625
Thereafter	50,716			298,650
Total lease payments	$	87,474		$	382,231
Less: imputed interest	(32,112		)	(229,949		)
Total	$	55,362		$	152,282

At December 29, 2018, our total operating lease commitments were as follows:

	(In thousands)
2019	$	11,980
2020	9,928
2021	8,435
2022	8,066
2023	7,539
Thereafter	60,847
Total	$	106,795

Real Estate Transactions

During the three months ended June 29, 2019 we completed sale-leaseback transactions on two distribution centers. The aggregate gross proceeds for these real estate transactions were $45 million. We determined that the transactions did not qualify as sales in accordance with ASC Topic 842 and, for accounting purposes, the transactions were not accounted for as sale-leaseback transactions. When this occurs, the real estate transaction is accounted for as a financing transaction whereby the cash received is recorded as a financing obligation in our condensed consolidated balance sheets.

At June 29, 2019, our future minimum payments related to the financing obligations under these real estate transactions were as follows:

	(In thousands)
2019	$	1,833
2020	3,711
2021	3,794
2022	3,880
2023	3,997
Thereafter	47,187
Total	$	64,402

Leases

Leases

Effective December 30, 2018, we adopted ASU No. 2016-02, “Leases (Topic 842)” using the modified retrospective method, which applies the provisions of the new guidance at the effective date without adjusting the comparative periods presented. We have elected the package of practical expedients permitted under the transition guidance within the new standard. This election allowed us to carry forward our historical lease classification. The adoption of this standard resulted in the recording of operating lease right-of-use (“ROU”) assets and corresponding operating lease liabilities of $57.5 million on the condensed consolidated balance sheet as of December 30, 2018, which amortizes over the lease term.

Our operating and finance (formerly capital) lease portfolio includes leases for real estate, certain logistics equipment and vehicles. The majority of our leases have remaining lease terms of 1 year to 15 years, some of which include one or more options to extend the leases for 5 years. Operating lease ROU assets and liabilities are presented separately on the condensed consolidated balance sheets. Finance lease assets are included in property and equipment and the finance lease obligations are presented separately in the condensed consolidated balance sheet.

A portion of our real estate lease cost is generally subject to annual changes in the Consumer Price Index (“CPI”). The changes to the CPI are treated as variable lease payments and recognized in the period in which the obligation for those payments was incurred. In addition, a subset of our vehicle lease cost is considered variable.

The components of lease expense were as follows:

(In thousands)	Three Months Ended June 29, 2019		Six Months Ended June 29, 2019
Operating lease cost	$	2,991	$	6,135
Finance lease cost:
Amortization of right-of-use assets	$	2,995	5,892
Interest on lease liabilities	4,049		7,297
Total finance lease costs	$	7,044	$	13,189

Supplemental cash flow information related to leases was as follows:

(In thousands)	Three Months Ended June 29, 2019		Six Months Ended June 29, 2019
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases	$	3,064	$	5,967
Operating cash flows from finance leases	3,155		6,403
Financing cash flows from finance leases	2,045		4,232
Right-of-use assets obtained in exchange for lease obligations
Operating leases	$	—	$	—
Finance leases	3,462		4,250

Supplemental balance sheet information related to leases was as follows:

(In thousands)	June 29, 2019
Finance leases
Property and equipment	$	156,050
Accumulated depreciation	(19,835		)
Property and equipment, net	$	136,215
Weighted Average Remaining Lease Term (in years)
Operating leases	12.17
Finance leases	20.34
Weighted Average Discount Rate
Operating leases	9.41		%
Finance leases	10.91		%

As of June 29, 2019, maturities of lease liabilities were as follows:

(In thousands)	Operating leases			Finance leases
2019	$	9,519		$	10,849
2020	8,790			20,814
2021	6,930			18,140
2022	6,243			17,153
2023	5,276			16,625
Thereafter	50,716			298,650
Total lease payments	$	87,474		$	382,231
Less: imputed interest	(32,112		)	(229,949		)
Total	$	55,362		$	152,282

At December 29, 2018, our total operating lease commitments were as follows:

	(In thousands)
2019	$	11,980
2020	9,928
2021	8,435
2022	8,066
2023	7,539
Thereafter	60,847
Total	$	106,795

Real Estate Transactions

During the three months ended June 29, 2019 we completed sale-leaseback transactions on two distribution centers. The aggregate gross proceeds for these real estate transactions were $45 million. We determined that the transactions did not qualify as sales in accordance with ASC Topic 842 and, for accounting purposes, the transactions were not accounted for as sale-leaseback transactions. When this occurs, the real estate transaction is accounted for as a financing transaction whereby the cash received is recorded as a financing obligation in our condensed consolidated balance sheets.

At June 29, 2019, our future minimum payments related to the financing obligations under these real estate transactions were as follows:

	(In thousands)
2019	$	1,833
2020	3,711
2021	3,794
2022	3,880
2023	3,997
Thereafter	47,187
Total	$	64,402

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Commitments and Contingencies

6 Months Ended

Jun. 29, 2019

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Environmental and Legal Matters

From time to time, we are involved in various proceedings incidental to our businesses, and we are subject to a variety of environmental and pollution control laws and regulations in all jurisdictions in which we operate. Although the ultimate outcome of these proceedings cannot be determined with certainty, based on presently available information management believes that adequate reserves have been established for probable losses with respect thereto. Management further believes that, while the ultimate outcome of one or more of these matters could be material to operating results in any given quarter, it will not have a materially adverse effect on our long-term financial condition, our results of operations, or our cash flows.

Collective Bargaining Agreements

As of June 29, 2019, we had over 2,200 employees on a full-time basis, and approximately 20 percent of our employees were represented by various local labor union Collective Bargaining Agreements (“CBAs”). As of June 29, 2019, approximately 4 percent of our employees are covered by CBAs that are up for renewal in fiscal 2019 or are currently expired and under negotiation.

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Accumulated Other Comprehensive Loss

6 Months Ended

Jun. 29, 2019

Equity [Abstract]

Accumulated Other Comprehensive Loss

Accumulated Other Comprehensive Loss

Comprehensive income (loss) is a measure of income (loss) which includes both net income (loss) and other comprehensive income (loss). Other comprehensive income (loss) results from items deferred from recognition into our Condensed Consolidated Statements of Operations and Comprehensive Loss. Accumulated other comprehensive loss is separately presented on our Condensed Consolidated Balance Sheets as part of stockholders’ deficit.

The changes in balances for each component of accumulated other comprehensive loss for the six months ended June 29, 2019, were as follows:

(In thousands)	Foreign currency, net of tax		Defined benefit pension plan, net of tax			Other, net of tax		Total Accumulated Other Comprehensive Loss
December 29, 2018, beginning balance	$	660	$	(38,001	)	$	212	$	(37,129	)
Other comprehensive income, net of tax [1]	7		(201		)	16		(178		)
June 29, 2019, ending balance, net of tax	$	667	$	(38,202	)	$	228	$	(37,307	)

^{________________________________} 

^[1] For the six months ended June 29, 2019, the actuarial loss recognized in the Condensed Consolidated Statements of Operations and Comprehensive Loss as a component of net periodic pension cost was $0.3 million, net of tax of $0.1 million. Please see Note 7, Net Periodic Pension Cost, for further information.

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Earnings (Loss) per Share

6 Months Ended

Jun. 29, 2019

Earnings Per Share [Abstract]

Earnings (Loss) per Share

Earnings (Loss) per Share

We calculate basic earnings (loss) per share by dividing net income (loss) by the weighted average number of common shares outstanding. We calculate diluted earnings per share by dividing net income by the weighted average number of common shares outstanding plus the dilutive effect of outstanding share-based awards, including restricted stock units, and performance units. Due to the financial results for six month period ended June 29, 2019, and the three and six month periods ended June 30, 2018, 0.1 million and 0.2 million, respectively, of incremental shares from share-based compensation arrangements were excluded from the computation of diluted weighted average shares outstanding, because their effect would be anti-dilutive.

The reconciliation of basic loss and diluted loss per common share for the six-month periods of fiscal 2019 and 2018 were as follows:

	Three Months Ended					Six Months Ended
(in thousands, except per share data)	June 29, 2019		June 30, 2018			June 29, 2019			June 30, 2018
Net income (loss)	$	6,301	$	(8,558	)	$	(418	)	$	(21,985	)
Weighted-average shares outstanding - basic	9,351		9,215			9,344			9,176
Dilutive effect of share-based awards	8		—			—			—
Weighted-average shares outstanding - diluted	9,359		9,215			$	9,344		$	9,176
Basic earnings (loss) per share	$	0.67	$	(0.93	)	$	(0.04	)	$	(2.40	)
Diluted earnings (loss) per share	$	0.67	$	(0.93	)	$	(0.04	)	$	(2.40	)

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Summary of Significant Accounting Policies (Policies)

6 Months Ended

Jun. 29, 2019

Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation

The accompanying unaudited Condensed Consolidated Financial Statements include the accounts of BlueLinx Holdings Inc. and its wholly owned subsidiaries (the “Company”). These financial statements have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and footnotes required by accounting principles generally accepted (“GAAP”) in the United States (“U.S.”) for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. These statements should be read in conjunction with the Consolidated Financial Statements and notes thereto included in the Company’s Annual Report on Form 10-K (the “Annual Report on Form 10-K”) for the year ended December 29, 2018, as filed with the Securities and Exchange Commission on March 13, 2019.

Reclassifications

Certain prior period amounts have been reclassified to conform to the current period's presentation. These reclassifications did not impact the Company's operating income (loss) or consolidated net income (loss).

Recently Adopted Accounting Standards and Standards Effective in Future Years

Recently Adopted Accounting Standards

Leases.  In 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2016-02, “Leases (Topic 842).” Topic 842 establishes a new lease accounting model. The most significant changes include the clarification of the definition of a lease, the requirement for lessees to recognize, for all leases, a right-of-use asset and a lease liability in the consolidated balance sheet, and additional quantitative and qualitative disclosures which are designed to give financial statement users information on the amount, timing, and uncertainty of cash flows arising from leases. Lease expenses will continue to be recognized in the consolidated statement of income in a manner similar to prior accounting guidance. Lessor accounting under the new standard is substantially unchanged. We adopted this standard, and all related amendments thereto, effective December 30, 2018, the first day of our fiscal 2019 year, using a modified retrospective approach, which applies the provisions of the new guidance at the effective date without adjusting the comparative periods presented. We have elected the package of practical expedients permitted under the transition guidance within the new standard, which among other things, allows us to carry forward the historical accounting relating to lease identification and classification for existing leases upon adoption. We have made an accounting policy election to keep leases with an initial term of 12 months or less off of the consolidated balance sheet. We implemented internal controls and a lease accounting information system to enable the preparation of financial information required by the new standard. The adoption of Topic 842 had a material impact on our condensed consolidated balance sheets but did not have an impact on our condensed consolidated statements of operations and comprehensive loss. The most significant impact was the recognition of right-of-use assets and lease liabilities of $57.5 million in the consolidated balance sheet. Additionally, $1.7 million of deferred gains associated with sale-leaseback transactions was recorded as a cumulative-effect adjustment to accumulated deficit. See Note 9 “Leases” for additional disclosures regarding our lease commitments.

Comprehensive Income. In February 2018, the FASB issued ASU No. 2018-02, “Income Statement-Reporting Comprehensive Income (Topic 220).” This standard provides an option to reclassify stranded tax effects within accumulated other comprehensive income (loss) to retained earnings due to the U.S. federal corporate income tax rate change in the Tax Cuts and Jobs Act of 2017. This standard was effective for interim and annual reporting periods beginning after December 15, 2018. We did not exercise the option to make this reclassification.

Accounting Standards Effective in Future Years

Goodwill. In January 2017, the FASB issued ASU No. 2017-04, “Intangibles—Goodwill and Other (Topic 350).” This standard is intended to simplify the test for goodwill impairments by removing Step 2 of the goodwill impairment test, which requires a hypothetical purchase price allocation. Under the new ASU, a goodwill impairment will now be the amount by which a reporting unit's carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. The accounting standard will be effective for reporting periods beginning after December 15, 2019, and early adoption is permitted. We do not expect the adoption of the standard to have a material impact on the Company's consolidated financial position, results of operations or cash flows.

Fair Value Measurement. In August 2018, the FASB issued ASU No. 2018-13, “Fair Value (“FV”) Measurement (Topic 820).” Among other modifications, the standard removes the requirements to disclose: (i) the amount of and reasons for transfers between Level 1 and Level 2 of the FV hierarchy; (ii) the policy for timing transfers between levels; and (iii) the valuation process for Level 3 FV measurements. The standard will require public entities to disclose: (a) the changes in unrealized gains and losses for the period included in other comprehensive income for recurring Level 3 FV measurements held at the end of the reporting period; and (b) the range and weighted average of significant unobservable inputs used to develop Level 3 fair value measurements. For certain unobservable inputs, an entity may disclose other quantitative information in lieu of the weighted average if the entity determines that other quantitative information would be a more reasonable and rational method to reflect the distribution of unobservable inputs used to develop Level 3 FV measurements. The additional disclosure requirements should be applied prospectively for the most recent interim or annual period presented in the fiscal year of adoption. All other amendments should be applied retrospectively to all periods presented. The amendments in this standard are effective for fiscal years ending after December 15, 2019. Early adoption is permitted, and an entity may adopt the removed or modified disclosures and delay the adoption of new disclosures until the effective date. We have not completed our assessment of the standard but we do not expect the adoption to have a material impact on the Company's consolidated financial position, results of operations or cash flows.

Defined Benefit Pension Plan. In August 2018, the FASB issued ASU No. 2018-14, “Compensation-Retirement-Benefits-Defined Benefit Plans-General (Subtopic 715-20).” The amendments in this update modify the disclosure requirements for employers that sponsor defined benefit pension or other postretirement plans by removing six previously required disclosures and adding two. The amendments also clarify certain other disclosure requirements. The amendments in this standard are effective for fiscal years ending after December 15, 2020. Early adoption is permitted. We have not completed our assessment of the standard but we do not expect the adoption to have a material impact on the Company's consolidated financial position, results of operations or cash flows.

Revenue Recognition

We recognize revenue when control of promised goods or services is transferred to the Company’s customers in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services.

Contracts with our customers are generally in the form of standard terms and conditions of sale. From time to time, we may enter into specific contracts with some of our larger customers, which may affect delivery terms. Performance obligations in our contracts generally consist solely of delivery of goods. For all sales channel types, consisting of warehouse, direct, and reload sales, we typically satisfy our performance obligations upon shipment. Our customer payment terms are typical for our industry, and may vary by the type and location of our customer and the products or services offered. The term between invoicing and when payment is due is not deemed to be significant by us. For certain sales channels and/or products, our standard terms of payment may be as early as ten days.

In addition, we provide inventory to certain customers through pre-arranged agreements on a consignment basis. Customer consigned inventory is maintained and stored by certain customers; however, ownership and risk of loss remains with us. When the consigned inventory is sold by the customer, we recognize revenue, net of trade allowances.

All revenues recognized are net of trade allowances (i.e., rebates), cash discounts and sales returns. Cash discounts and sales returns are estimated using historical experience. Trade allowances are based on the estimated obligations and historical experience. Adjustments to earnings resulting from revisions to estimates on discounts and returns have been insignificant for each of the reported periods. Certain customers may receive cash-based incentives or credits (rebates), which are accounted for

as variable consideration. We estimate these amounts based on the expected amount to be provided to customers and reduce revenues recognized. We believe that there will not be significant changes to our estimates of variable consideration.

Practical Expedients and Exemptions

We generally expense sales commissions when incurred because the amortization period would have been one year or less. These costs are recorded within selling, general, and administrative expense.

We have made an accounting policy election to treat any common carrier shipping and handling activities as a fulfillment cost, rather than as a separate obligation or separate promised service.

Earnings per Share

We calculate basic earnings (loss) per share by dividing net income (loss) by the weighted average number of common shares outstanding. We calculate diluted earnings per share by dividing net income by the weighted average number of common shares outstanding plus the dilutive effect of outstanding share-based awards, including restricted stock units, and performance units.

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Acquisition (Tables)

6 Months Ended

Jun. 29, 2019

Business Combinations [Abstract]

Pro Forma Information

The purchase price of Cedar Creek consisted of the following items:

	(In thousands)
Consideration paid to shareholders and amounts paid to creditors:
Payments to Cedar Creek shareholders[1]	$	166,447
Subordinated unsecured note (due to shareholder)[2]		13,743
Seller’s transaction costs paid by Company		7,349
Add: pay off of Cedar Creek debt[3]		174,213
Total cash purchase price	$	361,752

_____________

[1] Payments to Cedar Creek’s shareholders include the purchase of common stock and certain escrow adjustments.

[2] The Cedar Creek note payable to a shareholder of $13.7 million was paid in full upon the acquisition of Cedar Creek and included $10 million in subordinated debt and $3.7 million in accrued interest.

[3] To finance the acquisition of Cedar Creek, the Company amended and restated its Revolving Credit Facility to increase the capacity thereunder to $600.0 million and also entered into a new $180.0 million senior secured Term Loan Facility (See Note 6).

The following table summarizes the values of the assets acquired and liabilities assumed at the date of the acquisition:

(In thousands)	Allocation as of December 29, 2018
Cash and net working capital assets (excluding inventory)	$	88,318
Inventory		159,227
Property and equipment		71,203
Other, net		(1,395	)
Intangible assets and goodwill:
Customer relationships		25,500
Non-compete agreements		8,254
Trade names		6,826
Favorable leasehold interests		800
Goodwill		47,772
Finance leases and other liabilities		(44,753	)
Cash purchase price	$	361,752

The following unaudited consolidated pro forma information presents consolidated information as if the acquisition had occurred on January 1, 2017:

	Pro forma
	Three Months Ended				Six Months Ended
(In thousands, except per share data)	June 29, 2019		June 30, 2018		June 29, 2019		June 30, 2018
Net sales	$	706,448	$	948,555	$	1,345,149	$	1,732,822
Net income (loss)	9,425		9,180		6,118		(1,439		)
Earnings (loss) per common share:
Basic	$	1.01	$	1.00	$	0.65	$	(0.16	)
Diluted	1.00		0.98		0.65		(0.16		)

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Goodwill and Other Intangible Assets (Tables)

6 Months Ended

Jun. 29, 2019

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Definite-Lived Intangible Assets

At June 29, 2019, the gross carrying amounts, the accumulated amortization and the net carrying amounts of our definite-lived intangible assets were as follows (in thousands):

	Gross carrying amounts		Accumulated Amortization			[1]	Net carrying amounts
Customer relationships	$	25,500	$	(4,999	)		$	20,501
Noncompete agreements	8,254		(2,500		)		5,754
Trade names	6,826		(2,757		)		4,069
Total	$	40,580	$	(10,256	)		$	30,324

____________________

^[1] Intangible assets except customer relationships are amortized on straight line basis. Customer relationships are amortized on a double declining balance method.

Schedule of Definite-Lived Intangible Asset Amortization

Estimated annual amortization expense for definite-lived intangible assets over the next five fiscal years is as follows (in thousands):

	Estimated Amortization
2019	$	8,085
2020	7,461
2021	4,973
2022	3,111
2023	1,807

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Revenue Recognition (Tables)

6 Months Ended

Jun. 29, 2019

Revenue from Contract with Customer [Abstract]

Schedule of Revenues Disaggregated by Revenue Source and Sales Channel

The following table presents our revenues disaggregated by revenue source (in thousands). Certain prior year amounts have been reclassified to conform to the current year product mix of structural and specialty products. Sales and usage-based taxes are excluded from revenues.

	Three Months Ended				Six Months Ended
	June 29, 2019		June 30, 2018		June 29, 2019		June 30, 2018
Structural products	$	225,056	$	345,878	$	422,551	$	522,359
Specialty products and other	481,392		547,074		922,598		808,080
Total net sales	$	706,448	$	892,952	$	1,345,149	$	1,330,439

The following table presents our revenues disaggregated by sales channel (in thousands). Sales and usage-based taxes are excluded from revenues.

	Three Months Ended						Six Months Ended
	June 29, 2019			June 30, 2018			June 29, 2019			June 30, 2018
Warehouse	$	577,000		$	704,328		$	1,081,274		$	1,037,634
Direct	122,262			165,630			245,667			248,573
Reload and service revenue	16,617			34,914			35,522			63,184
Customer discounts and rebates	(9,431		)	(11,920		)	(17,314		)	(18,952		)
Total net sales	$	706,448		$	892,952		$	1,345,149		$	1,330,439

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Long-Term Debt (Tables)

6 Months Ended

Jun. 29, 2019

Debt Disclosure [Abstract]

Schedule of Long-Term Debt

As of June 29, 2019, and December 29, 2018, long-term debt consisted of the following:

		June 29,			December 29,
(In thousands)	Maturity Date	2019			2018
Revolving Credit Facility (net of discounts and debt issuance costs of $5.2 million and $6.0 million at June 29, 2019 and December 29, 2018, respectively)	October 10, 2022	$	363,898		$	327,319
Term Loan Facility (net of discounts and debt issuance costs of $7.7 million and $6.7 million at June 29, 2019 and December 29, 2018, respectively)	October 13, 2023		139,438			172,356
Total debt			503,336			499,675
Less: current portion of long-term debt			(1,427	)		(1,736	)
Long-term debt, net		$	501,909		$	497,939

Schedule of Principal Payment Schedule

Our remaining principal payment schedule for each of the next four years and thereafter is as follows:

(In thousands)
2019	$	373
2020		1,863
2021		1,491
2022		1,491
Thereafter		141,984

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Net Periodic Pension Cost (Tables)

6 Months Ended

Jun. 29, 2019

Retirement Benefits [Abstract]

Schedule of net periodic pension cost for pension plans

The following table shows the components of our net periodic pension cost:

	Three Months Ended						Six Months Ended
(In thousands)	June 29, 2019			June 30, 2018			June 29, 2019			June 30, 2018
Service cost	$	48		$	133		$	161		$	266
Interest cost on projected benefit obligation	973			963			2,018			1,926
Expected return on plan assets	(1,295		)	(1,327		)	(2,489		)	(2,654		)
Amortization of unrecognized loss	279			271			580			542
Net periodic pension cost	$	5		$	40		$	270		$	80

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Leases (Tables)

6 Months Ended

Jun. 29, 2019

Leases [Abstract]

Lease Cost

The components of lease expense were as follows:

(In thousands)	Three Months Ended June 29, 2019		Six Months Ended June 29, 2019
Operating lease cost	$	2,991	$	6,135
Finance lease cost:
Amortization of right-of-use assets	$	2,995	5,892
Interest on lease liabilities	4,049		7,297
Total finance lease costs	$	7,044	$	13,189

Supplemental cash flow information related to leases was as follows:

(In thousands)	Three Months Ended June 29, 2019		Six Months Ended June 29, 2019
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases	$	3,064	$	5,967
Operating cash flows from finance leases	3,155		6,403
Financing cash flows from finance leases	2,045		4,232
Right-of-use assets obtained in exchange for lease obligations
Operating leases	$	—	$	—
Finance leases	3,462		4,250

Supplemental Balance Sheet Information

Supplemental balance sheet information related to leases was as follows:

(In thousands)	June 29, 2019
Finance leases
Property and equipment	$	156,050
Accumulated depreciation	(19,835		)
Property and equipment, net	$	136,215
Weighted Average Remaining Lease Term (in years)
Operating leases	12.17
Finance leases	20.34
Weighted Average Discount Rate
Operating leases	9.41		%
Finance leases	10.91		%

Operating Lease Maturities

As of June 29, 2019, maturities of lease liabilities were as follows:

(In thousands)	Operating leases			Finance leases
2019	$	9,519		$	10,849
2020	8,790			20,814
2021	6,930			18,140
2022	6,243			17,153
2023	5,276			16,625
Thereafter	50,716			298,650
Total lease payments	$	87,474		$	382,231
Less: imputed interest	(32,112		)	(229,949		)
Total	$	55,362		$	152,282

Finance Lease Maturities

As of June 29, 2019, maturities of lease liabilities were as follows:

(In thousands)	Operating leases			Finance leases
2019	$	9,519		$	10,849
2020	8,790			20,814
2021	6,930			18,140
2022	6,243			17,153
2023	5,276			16,625
Thereafter	50,716			298,650
Total lease payments	$	87,474		$	382,231
Less: imputed interest	(32,112		)	(229,949		)
Total	$	55,362		$	152,282

At June 29, 2019, our future minimum payments related to the financing obligations under these real estate transactions were as follows:

	(In thousands)
2019	$	1,833
2020	3,711
2021	3,794
2022	3,880
2023	3,997
Thereafter	47,187
Total	$	64,402

Schedule of Future Minimum Rental Payments for Operating Leases

At December 29, 2018, our total operating lease commitments were as follows:

	(In thousands)
2019	$	11,980
2020	9,928
2021	8,435
2022	8,066
2023	7,539
Thereafter	60,847
Total	$	106,795

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Accumulated Other Comprehensive Loss (Tables)

6 Months Ended

Jun. 29, 2019

Equity [Abstract]

Schedule of changes in accumulated balances for each component of other comprehensive income (loss)

The changes in balances for each component of accumulated other comprehensive loss for the six months ended June 29, 2019, were as follows:

(In thousands)	Foreign currency, net of tax		Defined benefit pension plan, net of tax			Other, net of tax		Total Accumulated Other Comprehensive Loss
December 29, 2018, beginning balance	$	660	$	(38,001	)	$	212	$	(37,129	)
Other comprehensive income, net of tax [1]	7		(201		)	16		(178		)
June 29, 2019, ending balance, net of tax	$	667	$	(38,202	)	$	228	$	(37,307	)

^{________________________________} 

^[1] For the six months ended June 29, 2019, the actuarial loss recognized in the Condensed Consolidated Statements of Operations and Comprehensive Loss as a component of net periodic pension cost was $0.3 million, net of tax of $0.1 million. Please see Note 7, Net Periodic Pension Cost, for further information.

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Earnings (Loss) per Share (Tables)

6 Months Ended

Jun. 29, 2019

Earnings Per Share [Abstract]

Schedule of Earnings (Loss) per Share

The reconciliation of basic loss and diluted loss per common share for the six-month periods of fiscal 2019 and 2018 were as follows:

	Three Months Ended					Six Months Ended
(in thousands, except per share data)	June 29, 2019		June 30, 2018			June 29, 2019			June 30, 2018
Net income (loss)	$	6,301	$	(8,558	)	$	(418	)	$	(21,985	)
Weighted-average shares outstanding - basic	9,351		9,215			9,344			9,176
Dilutive effect of share-based awards	8		—			—			—
Weighted-average shares outstanding - diluted	9,359		9,215			$	9,344		$	9,176
Basic earnings (loss) per share	$	0.67	$	(0.93	)	$	(0.04	)	$	(2.40	)
Diluted earnings (loss) per share	$	0.67	$	(0.93	)	$	(0.04	)	$	(2.40	)

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Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands	Jun. 29, 2019	Jan. 01, 2019	Dec. 29, 2018
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Operating lease assets	$ 55,240		$ 0
Operating lease liability	55,362
Cumulative impact, deferred gains		$ 1,291
ASU 2016-02
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Operating lease assets		57,500
Operating lease liability		57,500
Cumulative impact, deferred gains		$ 1,700
Accounts Payable
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Outstanding checks and electronic payments	$ 37,100		$ 17,400

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Acquisition - Narrative (Details) - USD ($)		3 Months Ended		6 Months Ended
	Apr. 13, 2018	Jun. 29, 2019	Jun. 30, 2018	Jun. 29, 2019	Jun. 30, 2018	Dec. 29, 2018
Business Acquisition [Line Items]
Antidilutive securities excluded from diluted shares calculation (in shares)		100,000	100,000	200,000	164,550
Cedar Creek
Business Acquisition [Line Items]
Aggregate purchase price	$ 361,752,000
Transaction related costs		$ 4,200,000	$ 30,400,000	$ 8,800,000	$ 34,000,000.0
Note payable to shareholder	13,700,000
Subordinated debt	10,000,000
Interest payable	3,700,000
Revolving Credit Facility | Line of Credit
Business Acquisition [Line Items]
Line of credit facility, maximum borrowing capacity		750,000,000		750,000,000
Long-term line of credit facility		369,100,000		369,100,000		$ 333,300,000
Revolving Credit Facility | Line of Credit | Cedar Creek
Business Acquisition [Line Items]
Line of credit facility, maximum borrowing capacity	$ 600,000,000.0
Term Loan | Secured Debt
Business Acquisition [Line Items]
Long-term line of credit facility		$ 180,000,000.0		$ 180,000,000.0

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Acquisition - Proforma Income Statement (Details) - Cedar Creek - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 29, 2019	Jun. 30, 2018	Jun. 29, 2019	Jun. 30, 2018
Business Acquisition [Line Items]
Net sales	$ 706,448	$ 948,555	$ 1,345,149	$ 1,732,822
Net income (loss)	$ 9,425	$ 9,180	$ 6,118	$ (1,439)
Earnings (loss) per common share:
Basic (in dollars per share)	$ 1.01	$ 1.00	$ 0.65	$ (0.16)
Diluted (in dollars per share)	$ 1.00	$ 0.98	$ 0.65	$ (0.16)

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Acquisition - Preliminary Cash Purchase Price (Details) - Cedar Creek $ in Thousands	Apr. 13, 2018 USD ($)
Business Acquisition [Line Items]
Payments to Cedar Creek shareholders	$ 166,447
Subordinated unsecured note (due to shareholder)	13,743
Seller’s transaction costs paid by Company	7,349
Add: pay off of Cedar Creek debt	174,213
Total cash purchase price	$ 361,752

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Acquisition - Cash Purchase Price (Details) - USD ($) $ in Thousands	Jun. 29, 2019	Dec. 29, 2018
Business Acquisition [Line Items]
Goodwill	$ 47,772	$ 47,772
Cedar Creek
Business Acquisition [Line Items]
Cash and net working capital assets (excluding inventory)		88,318
Inventory		159,227
Property and equipment		71,203
Other, net		(1,395)
Goodwill		47,772
Finance leases and other liabilities		(44,753)
Cash purchase price		361,752
Customer relationships | Cedar Creek
Business Acquisition [Line Items]
Intangible assets		25,500
Noncompete agreements | Cedar Creek
Business Acquisition [Line Items]
Intangible assets		8,254
Trade names | Cedar Creek
Business Acquisition [Line Items]
Intangible assets		6,826
Favorable leasehold interests | Cedar Creek
Business Acquisition [Line Items]
Intangible assets		$ 800

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Goodwill and Other Intangible Assets - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 29, 2019	Jun. 30, 2018	Jun. 29, 2019	Jun. 30, 2018	Dec. 29, 2018
Finite-Lived Intangible Assets [Line Items]
Goodwill	$ 47,772		$ 47,772		$ 47,772
Amortization of intangible assets	$ 2,000	$ 1,900	$ 4,100	$ 1,900
Customer relationships
Finite-Lived Intangible Assets [Line Items]
Useful lives			11 years
Noncompete agreements
Finite-Lived Intangible Assets [Line Items]
Useful lives			3 years
Trade names
Finite-Lived Intangible Assets [Line Items]
Useful lives			2 years

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Goodwill and Other Intangible Assets - Schedule of Definite Lived Intangible Assets (Details) $ in Thousands	Jun. 29, 2019 USD ($)
Finite-Lived Intangible Assets [Line Items]
Gross carrying amounts	$ 40,580
Accumulated Amortization	(10,256)
Net carrying amounts	30,324
Customer relationships
Finite-Lived Intangible Assets [Line Items]
Gross carrying amounts	25,500
Accumulated Amortization	(4,999)
Net carrying amounts	20,501
Noncompete agreements
Finite-Lived Intangible Assets [Line Items]
Gross carrying amounts	8,254
Accumulated Amortization	(2,500)
Net carrying amounts	5,754
Trade names
Finite-Lived Intangible Assets [Line Items]
Gross carrying amounts	6,826
Accumulated Amortization	(2,757)
Net carrying amounts	$ 4,069

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Goodwill and Other Intangible Assets - Amortization Expense (Details) $ in Thousands	Jun. 29, 2019 USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]
Expected amortization expense, year 1	$ 8,085
Expected amortization expense, year 2	7,461
Expected amortization expense, year 3	4,973
Expected amortization expense, year 4	3,111
Expected amortization expense, year 5	$ 1,807

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Revenue Recognition (Details) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 29, 2019 USD ($) day	Jun. 30, 2018 USD ($)	Jun. 29, 2019 USD ($) day	Jun. 30, 2018 USD ($)
Disaggregation of Revenue [Line Items]
Standard terms of payment, number of days | day	10		10
Net sales	$ 706,448	$ 892,952	$ 1,345,149	$ 1,330,439
Warehouse
Disaggregation of Revenue [Line Items]
Net sales	577,000	704,328	1,081,274	1,037,634
Direct
Disaggregation of Revenue [Line Items]
Net sales	122,262	165,630	245,667	248,573
Reload and service revenue
Disaggregation of Revenue [Line Items]
Net sales	16,617	34,914	35,522	63,184
Customer discounts and rebates
Disaggregation of Revenue [Line Items]
Net sales	(9,431)	(11,920)	(17,314)	(18,952)
Structural products
Disaggregation of Revenue [Line Items]
Net sales	225,056	345,878	422,551	522,359
Specialty products and other
Disaggregation of Revenue [Line Items]
Net sales	$ 481,392	$ 547,074	$ 922,598	$ 808,080

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Assets Held for Sale and Net Gain on Disposition (Details) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 29, 2019 USD ($) property	Jun. 30, 2018 USD ($)	Jun. 29, 2019 USD ($) property	Jun. 30, 2018 USD ($)	Dec. 29, 2018 USD ($) property
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Gains from sales of property | $	$ 9,760	$ 0	$ 9,760	$ 0
Discontinued Operations, Held-for-sale
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Number of properties held for sale | property	5		5		6
Number of properties sold | property			2
Net book value of assets held for sale | $	$ 3,300		$ 3,300		$ 3,100

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Long-Term Debt - Schedule of Long-Term Debt (Details) - USD ($) $ in Thousands	Jun. 29, 2019	Dec. 29, 2018
Debt Instrument [Line Items]
Long-term debt	$ 503,336	$ 499,675
Less: current portion of long-term debt	(1,427)	(1,736)
Long-term debt, net	501,909	497,939
Revolving Credit Facility | Line of Credit
Debt Instrument [Line Items]
Long-term debt	363,898	327,319
Deferred financing fees	5,200	6,000
Term Loan Facility | Secured Debt
Debt Instrument [Line Items]
Long-term debt	139,438	172,356
Deferred financing fees	$ 7,700	$ 6,700

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Long-Term Debt - Narrative (Details) - USD ($)		6 Months Ended
	Apr. 13, 2018	Jun. 29, 2019	Dec. 29, 2018
Line of Credit | Revolving Credit Facility
Debt Instrument [Line Items]
Line of credit facility, maximum borrowing capacity		$ 750,000,000
Letters of credit		30,000,000
Minimum remaining borrowing capacity before fixed covered ratio is applicable		$ 50,000,000
Minimum percentage of borrowing base and maximum borrowing capacity to apply fixed charge coverage ratio		10.00%
Interest coverage ratio, minimum		1.0
Long-term line of credit facility		$ 369,100,000	$ 333,300,000
Line of credit facility, remaining borrowing capacity		$ 100,800,000	$ 91,700,000
Line of credit facility, interest rate at period end		4.50%	4.20%
Cedar Creek
Debt Instrument [Line Items]
Repayments of debt	$ 174,213,000
Cedar Creek | Line of Credit | Revolving Credit Facility
Debt Instrument [Line Items]
Line of credit facility, maximum borrowing capacity	600,000,000.0
Line of credit facility, additional borrowing capacity under uncommitted accordion feature	150,000,000
LIBOR | Line of Credit | Revolving Credit Facility
Debt Instrument [Line Items]
Variable rate basis		LIBOR
LIBOR | Minimum | Line of Credit | Revolving Credit Facility
Debt Instrument [Line Items]
Basis spread		1.75%
LIBOR | Maximum | Line of Credit | Revolving Credit Facility
Debt Instrument [Line Items]
Basis spread		2.25%
Base Rate | Line of Credit | Revolving Credit Facility
Debt Instrument [Line Items]
Variable rate basis		agent’s base rate
Base Rate | Minimum | Line of Credit | Revolving Credit Facility
Debt Instrument [Line Items]
Basis spread		0.75%
Base Rate | Maximum | Line of Credit | Revolving Credit Facility
Debt Instrument [Line Items]
Basis spread		1.25%
Term Loan Facility | Secured Debt
Debt Instrument [Line Items]
Long-term line of credit facility		$ 180,000,000.0
Face amount	180,000,000
Quarterly term loan principal payments	$ 450,000	372,661
Repayments of debt		30,000,000
Long-term debt, gross		$ 147,200,000	$ 179,100,000
Stated interest rate		9.40%	9.30%
Term Loan Facility | Maximum | Secured Debt
Debt Instrument [Line Items]
Net leverage ratio		8.25
Term Loan Facility | Base Rate | Secured Debt
Debt Instrument [Line Items]
Variable rate basis		Base Rate
Basis spread		6.00%
Term Loan Facility | Base Rate | Minimum | Secured Debt
Debt Instrument [Line Items]
Basis spread		2.00%
Term Loan Facility | ICE Benchmark Administration LIBOR Rate | Secured Debt
Debt Instrument [Line Items]
Variable rate basis		ICE Benchmark Administration LIBOR Rate
Term Loan Facility | Prime Rate | Secured Debt
Debt Instrument [Line Items]
Variable rate basis		U.S. prime lending rate
Term Loan Facility | Federal Funds Effective Swap Rate | Secured Debt
Debt Instrument [Line Items]
Variable rate basis		Federal Funds Effective Rate
Basis spread		0.50%
Term Loan Facility | Eurodollar | Secured Debt
Debt Instrument [Line Items]
Variable rate basis		Eurodollar Rate
Basis spread		7.00%
Term Loan Facility | Eurodollar | Minimum | Secured Debt
Debt Instrument [Line Items]
Basis spread		1.00%

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Long-Term Debt - Maturities of Long-Term Debt (Details) - Term Loan - Secured Debt $ in Thousands	Jun. 29, 2019 USD ($)
Debt Instrument [Line Items]
2019	$ 373
2020	1,863
2021	1,491
2022	1,491
Thereafter	$ 141,984

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Net Periodic Pension Cost (Details) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 29, 2019 USD ($) employee	Jun. 30, 2018 USD ($)	Jun. 29, 2019 USD ($) employee	Jun. 30, 2018 USD ($)
Retirement Benefits [Abstract]
Service cost	$ 48	$ 133	$ 161	$ 266
Interest cost on projected benefit obligation	973	963	2,018	1,926
Expected return on plan assets	(1,295)	(1,327)	(2,489)	(2,654)
Amortization of unrecognized loss	279	271	580	542
Net periodic pension cost	$ 5	$ 40	$ 270	$ 80
Number of participants not accruing future years of service | employee	38		38
Decrease in pension benefit obligation	$ 300
Decrease to AOCI, plan asset valuation	$ 200		$ 200

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Stock Compensation (Details) $ / shares in Units, $ in Millions	3 Months Ended		6 Months Ended
	Jun. 29, 2019 USD ($) trading_day $ / shares	Jun. 30, 2018 USD ($)	Jun. 29, 2019 USD ($)	Jun. 30, 2018 USD ($)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock based compensation expense	$ 0.6	$ 3.8	$ 1.3	$ 13.0
Stock Appreciation Rights (SARs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted average exercise price, trading day average | trading_day	20
Weighted average exercise price (in dollars per share) | $ / shares	$ 7.00
Deferred compensation liability	$ 7.2		$ 7.2
Payable within thirty days of the vesting date | Stock Appreciation Rights (SARs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period			30 days
Payable within one year of vesting date | Stock Appreciation Rights (SARs)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period			1 year

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Leases - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 29, 2019	Jun. 29, 2019	Jun. 30, 2018	Jan. 01, 2019	Dec. 29, 2018
Operating Leased Assets [Line Items]
Lease renewal term	5 years	5 years
Operating lease assets	$ 55,240	$ 55,240			$ 0
Operating lease liability	55,362	55,362
Proceeds from real estate transactions	$ 45,000	$ 44,822	$ 0
Minimum
Operating Leased Assets [Line Items]
Lease term	1 year	1 year
Maximum
Operating Leased Assets [Line Items]
Lease term	15 years	15 years
ASU 2016-02
Operating Leased Assets [Line Items]
Operating lease assets				$ 57,500
Operating lease liability				$ 57,500

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Leases - Lease Cost (Details) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 29, 2019	Jun. 29, 2019
Leases [Abstract]
Operating lease cost	$ 2,991	$ 6,135
Amortization of right-of-use assets	2,995	5,892
Interest on lease liabilities	4,049	7,297
Total finance lease costs	$ 7,044	$ 13,189

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Leases - Supplemental Cash Flow (Details) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 29, 2019	Jun. 29, 2019	Jun. 30, 2018
Leases [Abstract]
Operating cash flows from operating leases	$ 3,064	$ 5,967
Operating cash flows from finance leases	3,155	6,403
Financing cash flows from finance leases	2,045	4,232	$ 3,262
Operating leases	0	0
Finance leases	$ 3,462	$ 4,250

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Leases - Supplemental Balance Sheet (Details) $ in Thousands	Jun. 29, 2019 USD ($)
Finance leases
Property and equipment	$ 156,050
Accumulated depreciation	(19,835)
Property and equipment, net	$ 136,215
Weighted Average Remaining Lease Term (in years)
Operating leases	12 years 2 months 1 day
Finance leases	20 years 4 months 2 days
Weighted Average Discount Rate
Operating leases	9.41%
Finance leases	10.91%

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Leases - Lease Maturities (Details) $ in Thousands	Jun. 29, 2019 USD ($)
Finance leases
2019	$ 10,849
2020	20,814
2021	18,140
2022	17,153
2023	16,625
Thereafter	298,650
Total lease payments	382,231
Less: imputed interest	(229,949)
Total	152,282
Operating leases
2019	9,519
2020	8,790
2021	6,930
2022	6,243
2023	5,276
Thereafter	50,716
Total lease payments	87,474
Less: imputed interest	(32,112)
Total	55,362
Failed Sale-Leaseback Transactions
Finance leases
2019	1,833
2020	3,711
2021	3,794
2022	3,880
2023	3,997
Thereafter	47,187
Total lease payments	$ 64,402

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Leases - Minimum Payments Due (Details) $ in Thousands	Dec. 29, 2018 USD ($)
Leases [Abstract]
2019	$ 11,980
2020	9,928
2021	8,435
2022	8,066
2022	7,539
Thereafter	60,847
Total	$ 106,795

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Commitments and Contingencies (Details)	Jun. 29, 2019 employee
Other Commitments [Line Items]
Percentage of employees represented by various labor unions	20.00%
Percentage of employees covered by CBAs	4.00%
Minimum
Other Commitments [Line Items]
Entity number of employees	2,200

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Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 29, 2019	Jun. 30, 2018	Jun. 29, 2019	Jun. 30, 2018
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Beginning balance	$ (18,285)	$ 22,096	$ (14,663)	$ 35,002
Other comprehensive income (loss), net of tax	(1,277)	192	(178)	401
Ending balance	(12,835)	12,356	(12,835)	12,356
Total Accumulated Other Comprehensive Loss
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Beginning balance	(36,030)	(36,298)	(37,129)	(36,507)
Ending balance	(37,307)	$ (36,106)	(37,307)	$ (36,106)
Foreign currency, net of tax
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Beginning balance			660
Other comprehensive income (loss), net of tax			7
Ending balance	667		667
Defined benefit pension plan, net of tax
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Beginning balance			(38,001)
Other comprehensive income (loss), net of tax			(201)
Ending balance	(38,202)		(38,202)
Other, net of tax
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Beginning balance			212
Other comprehensive income (loss), net of tax			16
Ending balance	$ 228		228
Accumulated defined benefit plan adjustment, net gain (loss) attributable to parent
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
Reclassification of actuarial loss			300
Reclassification of actuarial loss, tax			$ 100

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Earnings (Loss) per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended				6 Months Ended
	Jun. 29, 2019	Mar. 30, 2019	Jun. 30, 2018	Mar. 31, 2018	Jun. 29, 2019	Jun. 30, 2018
Earnings Per Share [Abstract]
Antidilutive securities excluded from diluted shares calculation (in shares)	100,000		100,000		200,000	164,550
Net income (loss)	$ 6,301	$ (6,719)	$ (8,558)	$ (13,427)	$ (418)	$ (21,985)
Weighted-average shares outstanding - basic (in shares)	9,351,000		9,215,000		9,344,000	9,176,000
Dilutive effect of share-based awards (in shares)	8,000		0		0	0
Weighted-average shares outstanding - diluted (in shares)	9,359,000		9,215,000		9,344,000	9,176,000
Basic earnings (loss) per share (in dollars per share)	$ 0.67		$ (0.93)		$ (0.04)	$ (2.40)
Diluted earnings (loss) per share (in dollars per share)	$ 0.67		$ (0.93)		$ (0.04)	$ (2.40)

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Label	Element	Value
Retained Earnings [Member]
Cumulative Effect of New Accounting Principle in Period of Adoption	us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption	$ 1,291,000