Delaware
|
|
74-1753147
|
(State or Other Jurisdiction of
Incorporation or Organization)
|
|
(I.R.S. Employer
Identification No.)
|
17 South Briar Hollow Lane, Suite 100
Houston, Texas 77027
|
(Address of Principal Executive Offices, including Zip Code)
|
Large accelerated filer
o
|
Accelerated filer
þ
|
Non-accelerated filer
o
(Do not check if a smaller reporting company)
|
Smaller reporting company
o
|
Emerging growth company
o
|
|
|
|
Page No.
|
|
||
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||
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||
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||
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||
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||
|
|
|
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Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
September 30,
|
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September 30,
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||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
||||||||
Marketing
|
$
|
282,229
|
|
|
$
|
243,704
|
|
|
$
|
872,020
|
|
|
$
|
758,627
|
|
Transportation
|
13,082
|
|
|
12,310
|
|
|
40,153
|
|
|
39,517
|
|
||||
Oil and natural gas
|
—
|
|
|
863
|
|
|
1,427
|
|
|
2,427
|
|
||||
Total revenues
|
295,311
|
|
|
256,877
|
|
|
913,600
|
|
|
800,571
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Costs and expenses:
|
|
|
|
|
|
|
|
||||||||
Marketing
|
277,906
|
|
|
240,021
|
|
|
860,567
|
|
|
737,858
|
|
||||
Transportation
|
12,668
|
|
|
11,039
|
|
|
36,681
|
|
|
33,537
|
|
||||
Oil and natural gas
|
—
|
|
|
1,011
|
|
|
951
|
|
|
2,421
|
|
||||
General and administrative
|
2,787
|
|
|
2,114
|
|
|
6,884
|
|
|
6,252
|
|
||||
Depreciation, depletion and amortization
|
3,240
|
|
|
4,514
|
|
|
10,772
|
|
|
14,385
|
|
||||
Total costs and expenses
|
296,601
|
|
|
258,699
|
|
|
915,855
|
|
|
794,453
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Operating earnings (losses)
|
(1,290
|
)
|
|
(1,822
|
)
|
|
(2,255
|
)
|
|
6,118
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Other income (expense):
|
|
|
|
|
|
|
|
||||||||
Loss on deconsolidation of subsidiary (Note 3)
|
(1,870
|
)
|
|
—
|
|
|
(3,505
|
)
|
|
—
|
|
||||
Impairment of investments in unconsolidated affiliates
|
(2,500
|
)
|
|
(1,732
|
)
|
|
(2,500
|
)
|
|
(1,732
|
)
|
||||
Losses from equity investment
|
—
|
|
|
(68
|
)
|
|
—
|
|
|
(468
|
)
|
||||
Interest income
|
370
|
|
|
245
|
|
|
789
|
|
|
444
|
|
||||
Interest expense
|
(8
|
)
|
|
—
|
|
|
(10
|
)
|
|
—
|
|
||||
Total other income (expense), net
|
(4,008
|
)
|
|
(1,555
|
)
|
|
(5,226
|
)
|
|
(1,756
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
(Losses) earnings before income taxes
|
(5,298
|
)
|
|
(3,377
|
)
|
|
(7,481
|
)
|
|
4,362
|
|
||||
Income tax benefit (provision)
|
2,265
|
|
|
1,224
|
|
|
3,306
|
|
|
(1,681
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Net (losses) earnings
|
$
|
(3,033
|
)
|
|
$
|
(2,153
|
)
|
|
$
|
(4,175
|
)
|
|
$
|
2,681
|
|
|
|
|
|
|
|
|
|
||||||||
Earnings (losses) per share:
|
|
|
|
|
|
|
|
||||||||
Basic and diluted net (losses) earnings
|
|
|
|
|
|
|
|
||||||||
per common share
|
$
|
(0.72
|
)
|
|
$
|
(0.51
|
)
|
|
$
|
(0.99
|
)
|
|
$
|
0.64
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted average number of common
|
|
|
|
|
|
|
|
||||||||
shares outstanding
|
4,218
|
|
|
4,218
|
|
|
4,218
|
|
|
4,218
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Dividends per common share
|
$
|
0.22
|
|
|
$
|
0.22
|
|
|
$
|
0.66
|
|
|
$
|
0.66
|
|
|
|
|
|
|
|
|
|
|
September 30,
|
|
December 31,
|
||||
|
2017
|
|
2016
|
||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
99,449
|
|
|
$
|
87,342
|
|
Accounts receivable, net of allowance for doubtful
|
|
|
|
||||
accounts of $216 and $225, respectively
|
81,277
|
|
|
87,162
|
|
||
Inventory
|
22,398
|
|
|
13,070
|
|
||
Derivative assets
|
—
|
|
|
112
|
|
||
Income tax receivable
|
4,147
|
|
|
2,735
|
|
||
Prepayments and other current assets
|
1,168
|
|
|
2,097
|
|
||
Total current assets
|
208,439
|
|
|
192,518
|
|
||
Property and equipment, net
|
31,958
|
|
|
46,325
|
|
||
Investments in unconsolidated affiliates
|
3,200
|
|
|
2,500
|
|
||
Cash deposits and other assets
|
4,932
|
|
|
5,529
|
|
||
Total assets
|
$
|
248,529
|
|
|
$
|
246,872
|
|
|
|
|
|
||||
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
89,339
|
|
|
$
|
79,897
|
|
Accounts payable – related party
|
—
|
|
|
53
|
|
||
Derivative liabilities
|
—
|
|
|
64
|
|
||
Current portion of capital lease obligations
|
306
|
|
|
—
|
|
||
Other current liabilities
|
5,860
|
|
|
6,060
|
|
||
Total current liabilities
|
95,505
|
|
|
86,074
|
|
||
Other long-term liabilities:
|
|
|
|
||||
Asset retirement obligations
|
1,263
|
|
|
2,329
|
|
||
Capital lease obligations
|
1,465
|
|
|
—
|
|
||
Deferred taxes and other liabilities
|
5,943
|
|
|
7,157
|
|
||
Total liabilities
|
104,176
|
|
|
95,560
|
|
||
|
|
|
|
||||
Commitments and contingencies (Note 10)
|
|
|
|
||||
|
|
|
|
||||
Shareholders’ equity:
|
|
|
|
||||
Preferred stock – $1.00 par value, 960,000 shares
|
|
|
|
||||
authorized, none outstanding
|
—
|
|
|
—
|
|
||
Common stock – $0.10 par value, 7,500,000 shares
|
|
|
|
||||
authorized, 4,217,596 shares outstanding
|
422
|
|
|
422
|
|
||
Contributed capital
|
11,693
|
|
|
11,693
|
|
||
Retained earnings
|
132,238
|
|
|
139,197
|
|
||
Total shareholders’ equity
|
144,353
|
|
|
151,312
|
|
||
Total liabilities and shareholders’ equity
|
$
|
248,529
|
|
|
$
|
246,872
|
|
|
Nine Months Ended
|
||||||
|
September 30,
|
||||||
|
2017
|
|
2016
|
||||
Operating activities:
|
|
|
|
||||
Net (losses) earnings
|
$
|
(4,175
|
)
|
|
$
|
2,681
|
|
Adjustments to reconcile net (losses) earnings to net cash
|
|
|
|
||||
provided by (used in) operating activities:
|
|
|
|
||||
Depreciation, depletion and amortization
|
10,772
|
|
|
14,385
|
|
||
Gains on sale of property
|
(347
|
)
|
|
(1,948
|
)
|
||
Impairment of oil and natural gas properties
|
3
|
|
|
87
|
|
||
Provision for doubtful accounts
|
(9
|
)
|
|
19
|
|
||
Deferred income taxes
|
(1,198
|
)
|
|
(1,170
|
)
|
||
Net change in fair value contracts
|
48
|
|
|
(305
|
)
|
||
Losses from equity investment
|
—
|
|
|
468
|
|
||
Impairment of investments in unconsolidated affiliates
|
2,500
|
|
|
1,732
|
|
||
Loss on deconsolidation of subsidiary (Note 3)
|
3,505
|
|
|
—
|
|
||
Changes in assets and liabilities:
|
|
|
|
||||
Accounts receivable
|
5,228
|
|
|
(1,767
|
)
|
||
Accounts receivable/payable, affiliates
|
266
|
|
|
—
|
|
||
Inventories
|
(9,328
|
)
|
|
(8,395
|
)
|
||
Income tax receivable
|
(1,412
|
)
|
|
113
|
|
||
Prepayments and other current assets
|
927
|
|
|
(1,570
|
)
|
||
Accounts payable
|
9,482
|
|
|
(8,795
|
)
|
||
Accrued liabilities
|
465
|
|
|
1,378
|
|
||
Other
|
(240
|
)
|
|
(252
|
)
|
||
Net cash provided by (used in) operating activities
|
16,487
|
|
|
(3,339
|
)
|
||
|
|
|
|
||||
Investing activities:
|
|
|
|
||||
Property and equipment additions
|
(2,465
|
)
|
|
(7,186
|
)
|
||
Proceeds from property sales
|
430
|
|
|
3,536
|
|
||
Investments in unconsolidated affiliates
|
—
|
|
|
(4,700
|
)
|
||
Insurance and state collateral (deposits) refunds
|
439
|
|
|
1,081
|
|
||
Net cash used in investing activities
|
(1,596
|
)
|
|
(7,269
|
)
|
||
|
|
|
|
||||
Financing activities:
|
|
|
|
||||
Dividends paid on common stock
|
(2,784
|
)
|
|
(2,784
|
)
|
||
Net cash used in financing activities
|
(2,784
|
)
|
|
(2,784
|
)
|
||
|
|
|
|
||||
Increase (decrease) in cash and cash equivalents
|
12,107
|
|
|
(13,392
|
)
|
||
Cash and cash equivalents at beginning of period
|
87,342
|
|
|
91,877
|
|
||
Cash and cash equivalents at end of period
|
$
|
99,449
|
|
|
$
|
78,485
|
|
|
|
|
|
|
|
|
Total
|
||||||||
|
Common
|
|
Contributed
|
|
Retained
|
|
Shareholders’
|
||||||||
|
Stock
|
|
Capital
|
|
Earnings
|
|
Equity
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Balance, January 1, 2017
|
$
|
422
|
|
|
$
|
11,693
|
|
|
$
|
139,197
|
|
|
$
|
151,312
|
|
Net losses
|
—
|
|
|
—
|
|
|
(4,175
|
)
|
|
(4,175
|
)
|
||||
Dividends paid on common stock
|
—
|
|
|
—
|
|
|
(2,784
|
)
|
|
(2,784
|
)
|
||||
Balance, September 30, 2017
|
$
|
422
|
|
|
$
|
11,693
|
|
|
$
|
132,238
|
|
|
$
|
144,353
|
|
|
|
|
|
|
|
|
Total
|
||||||||
|
Common
|
|
Contributed
|
|
Retained
|
|
Shareholders’
|
||||||||
|
Stock
|
|
Capital
|
|
Earnings
|
|
Equity
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Balance, January 1, 2016
|
$
|
422
|
|
|
$
|
11,693
|
|
|
$
|
140,395
|
|
|
$
|
152,510
|
|
Net earnings
|
—
|
|
|
—
|
|
|
2,681
|
|
|
2,681
|
|
||||
Dividends paid on common stock
|
—
|
|
|
—
|
|
|
(2,784
|
)
|
|
(2,784
|
)
|
||||
Balance, September 30, 2016
|
$
|
422
|
|
|
$
|
11,693
|
|
|
$
|
140,292
|
|
|
$
|
152,407
|
|
|
September 30,
|
|
December 31,
|
||||
|
2017
|
|
2016
|
||||
|
|
|
|
||||
Insurance premiums
|
$
|
201
|
|
|
$
|
1,403
|
|
Rents, licenses and other
|
967
|
|
|
694
|
|
||
Total
|
$
|
1,168
|
|
|
$
|
2,097
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
September 30,
|
|
September 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Revenue gross-up
|
$
|
46,306
|
|
|
$
|
70,236
|
|
|
$
|
148,779
|
|
|
$
|
245,245
|
|
|
September 30,
|
|
December 31,
|
||||
|
2017
|
|
2016
|
||||
|
|
|
|
||||
Marketing
|
$
|
56,913
|
|
|
$
|
56,907
|
|
Transportation
|
70,790
|
|
|
70,849
|
|
||
Oil and natural gas (successful efforts)
|
—
|
|
|
62,784
|
|
||
Other
|
108
|
|
|
108
|
|
||
Total
|
127,811
|
|
|
190,648
|
|
||
Less accumulated depreciation, depletion and amortization
|
(95,853
|
)
|
|
(144,323
|
)
|
||
Property and equipment, net
|
$
|
31,958
|
|
|
$
|
46,325
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
September 30,
|
|
September 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Depreciation, depletion and amortization,
|
|
|
|
|
|
|
|
||||||||
excluding amounts under capital leases
|
$
|
3,210
|
|
|
$
|
4,514
|
|
|
$
|
10,742
|
|
|
$
|
14,385
|
|
Amortization of property and equipment
|
|
|
|
|
|
|
|
||||||||
under capital leases
|
30
|
|
|
—
|
|
|
30
|
|
|
—
|
|
||||
Total depreciation, depletion and amortization
|
$
|
3,240
|
|
|
$
|
4,514
|
|
|
$
|
10,772
|
|
|
$
|
14,385
|
|
|
September 30,
|
|
December 31,
|
||||
|
2017
|
|
2016
|
||||
|
|
|
|
||||
Amounts associated with liability insurance program:
|
|
|
|
||||
Insurance collateral deposits
|
$
|
2,252
|
|
|
$
|
2,599
|
|
Excess loss fund
|
1,495
|
|
|
1,450
|
|
||
Accumulated interest income
|
777
|
|
|
812
|
|
||
Other amounts:
|
|
|
|
||||
State collateral deposits
|
51
|
|
|
143
|
|
||
Materials and supplies
|
320
|
|
|
354
|
|
||
Other
|
37
|
|
|
171
|
|
||
Total
|
$
|
4,932
|
|
|
$
|
5,529
|
|
|
Reporting Segments
|
|
|
||||||||||||
|
Marketing
|
|
Transportation
|
|
Oil and Gas
|
|
Total
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Three Months Ended September 30, 2017
|
|
|
|
|
|
|
|
||||||||
Revenues
|
$
|
282,229
|
|
|
$
|
13,082
|
|
|
$
|
—
|
|
|
$
|
295,311
|
|
Segment operating (losses) earnings
|
2,412
|
|
|
(915
|
)
|
|
—
|
|
|
1,497
|
|
||||
Depreciation, depletion and amortization
|
1,911
|
|
|
1,329
|
|
|
—
|
|
|
3,240
|
|
||||
Property and equipment additions
|
178
|
|
|
179
|
|
|
—
|
|
|
357
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Three Months Ended September 30, 2016
|
|
|
|
|
|
|
|
||||||||
Revenues
|
$
|
243,704
|
|
|
$
|
12,310
|
|
|
$
|
863
|
|
|
$
|
256,877
|
|
Segment operating (losses) earnings
|
1,265
|
|
|
(430
|
)
|
|
(543
|
)
|
|
292
|
|
||||
Depreciation, depletion and amortization
|
2,418
|
|
|
1,701
|
|
|
395
|
|
|
4,514
|
|
||||
Property and equipment additions
|
—
|
|
|
2,329
|
|
|
85
|
|
|
2,414
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Nine Months Ended September 30, 2017
|
|
|
|
|
|
|
|
||||||||
Revenues
|
$
|
872,020
|
|
|
$
|
40,153
|
|
|
$
|
1,427
|
|
|
$
|
913,600
|
|
Segment operating (losses) earnings
|
5,496
|
|
|
(920
|
)
|
|
53
|
|
|
4,629
|
|
||||
Depreciation, depletion and amortization
|
5,957
|
|
|
4,392
|
|
|
423
|
|
|
10,772
|
|
||||
Property and equipment additions
|
451
|
|
|
189
|
|
|
1,825
|
|
|
2,465
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Nine Months Ended September 30, 2016
|
|
|
|
|
|
|
|
||||||||
Revenues
|
$
|
758,627
|
|
|
$
|
39,517
|
|
|
$
|
2,427
|
|
|
$
|
800,571
|
|
Segment operating (losses) earnings
|
13,148
|
|
|
444
|
|
|
(1,222
|
)
|
|
12,370
|
|
||||
Depreciation, depletion and amortization
|
7,621
|
|
|
5,536
|
|
|
1,228
|
|
|
14,385
|
|
||||
Property and equipment additions
|
514
|
|
|
6,480
|
|
|
192
|
|
|
7,186
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
September 30,
|
|
September 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Segment operating earnings
|
$
|
1,497
|
|
|
$
|
292
|
|
|
$
|
4,629
|
|
|
$
|
12,370
|
|
General and administrative
|
(2,787
|
)
|
|
(2,114
|
)
|
|
(6,884
|
)
|
|
(6,252
|
)
|
||||
Operating earnings (losses)
|
(1,290
|
)
|
|
(1,822
|
)
|
|
(2,255
|
)
|
|
6,118
|
|
||||
Loss on deconsolidation of subsidiary
|
(1,870
|
)
|
|
—
|
|
|
(3,505
|
)
|
|
—
|
|
||||
Impairment of investments in unconsolidated affiliates
|
(2,500
|
)
|
|
(1,732
|
)
|
|
(2,500
|
)
|
|
(1,732
|
)
|
||||
Losses from equity investment
|
—
|
|
|
(68
|
)
|
|
—
|
|
|
(468
|
)
|
||||
Interest income
|
370
|
|
|
245
|
|
|
789
|
|
|
444
|
|
||||
Interest expense
|
(8
|
)
|
|
—
|
|
|
(10
|
)
|
|
—
|
|
||||
(Losses) earnings before income taxes
|
$
|
(5,298
|
)
|
|
$
|
(3,377
|
)
|
|
$
|
(7,481
|
)
|
|
$
|
4,362
|
|
|
September 30,
|
|
December 31,
|
||||
|
2017
|
|
2016
|
||||
|
|
|
|
||||
Reporting segment:
|
|
|
|
||||
Marketing
|
$
|
107,388
|
|
|
$
|
107,257
|
|
Transportation
|
29,492
|
|
|
32,120
|
|
||
Oil and Gas
(1)
|
3,200
|
|
|
7,279
|
|
||
Cash and other assets
|
108,449
|
|
|
100,216
|
|
||
Total assets
|
$
|
248,529
|
|
|
$
|
246,872
|
|
(1)
|
At September 30, 2017, amount represents our cost method investment in this segment.
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
September 30,
|
|
September 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Overhead recoveries
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
30
|
|
Affiliate billings to us
|
16
|
|
|
13
|
|
|
52
|
|
|
51
|
|
||||
Billings to affiliates
|
1
|
|
|
1
|
|
|
3
|
|
|
3
|
|
||||
Rentals paid to affiliate
|
137
|
|
|
155
|
|
|
462
|
|
|
473
|
|
||||
Fees paid to Bencap
(1)
|
—
|
|
|
309
|
|
|
108
|
|
|
439
|
|
(1)
|
Amounts represent fees paid to Bencap through the date of the forfeiture of our investment during the first quarter of 2017. As a result of the investment forfeiture, Bencap is no longer an affiliate.
|
|
December 31, 2016
|
||||||||||||||
|
Balance Sheet Location and Amount
|
||||||||||||||
|
Current
|
|
Other
|
|
Current
|
|
Other
|
||||||||
|
Assets
|
|
Assets
|
|
Liabilities
|
|
Liabilities
|
||||||||
Asset derivatives:
|
|
|
|
|
|
|
|
||||||||
Fair value forward hydrocarbon commodity
|
|
|
|
|
|
|
|
||||||||
contracts at gross valuation
|
$
|
378
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Liability derivatives:
|
|
|
|
|
|
|
|
||||||||
Fair value forward hydrocarbon commodity
|
|
|
|
|
|
|
|
||||||||
contracts at gross valuation
|
—
|
|
|
—
|
|
|
330
|
|
|
—
|
|
||||
Less counterparty offsets
|
(266
|
)
|
|
—
|
|
|
(266
|
)
|
|
—
|
|
||||
As reported fair value contracts
|
$
|
112
|
|
|
$
|
—
|
|
|
$
|
64
|
|
|
$
|
—
|
|
|
December 31, 2016
|
||||||||||||||||||
|
Fair Value Measurements Using
|
|
|
|
|
||||||||||||||
|
Quoted Prices
|
|
|
|
|
|
|
|
|
||||||||||
|
in Active
|
|
Significant
|
|
|
|
|
|
|
||||||||||
|
Markets for
|
|
Other
|
|
Significant
|
|
|
|
|
||||||||||
|
Identical Assets
|
|
Observable
|
|
Unobservable
|
|
|
|
|
||||||||||
|
and Liabilities
|
|
Inputs
|
|
Inputs
|
|
Counterparty
|
|
|
||||||||||
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
Offsets
|
|
Total
|
||||||||||
Derivatives:
|
|
|
|
|
|
|
|
|
|
||||||||||
Current assets
|
$
|
—
|
|
|
$
|
378
|
|
|
$
|
—
|
|
|
$
|
(266
|
)
|
|
$
|
112
|
|
Current liabilities
|
—
|
|
|
(330
|
)
|
|
—
|
|
|
266
|
|
|
(64
|
)
|
|||||
Net value
|
$
|
—
|
|
|
$
|
48
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
48
|
|
|
|
|
Fair Value Measurements at the End of the Reporting Period Using
|
|
|
||||||||||||||
|
|
|
Quoted Prices
|
|
|
|
|
|
|
||||||||||
|
|
|
in Active
|
|
Significant
|
|
|
|
|
||||||||||
|
Carrying
|
|
Markets for
|
|
Other
|
|
Significant
|
|
Total
|
||||||||||
|
Value at
|
|
Identical Assets
|
|
Observable
|
|
Unobservable
|
|
Non-Cash
|
||||||||||
|
September 30,
|
|
and Liabilities
|
|
Inputs
|
|
Inputs
|
|
Impairment
|
||||||||||
|
2017
|
|
(Level 1)
|
|
(Level 2)
|
|
(Level 3)
|
|
Loss
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Investment in AREC
|
$
|
3,200
|
|
|
$
|
—
|
|
|
$
|
3,200
|
|
|
$
|
—
|
|
|
$
|
3,505
|
|
Investment in VestaCare
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,500
|
|
|||||
|
|
|
|
|
|
|
|
|
$
|
6,005
|
|
|
Nine Months Ended
|
||||||
|
September 30,
|
||||||
|
2017
|
|
2016
|
||||
|
|
|
|
||||
Cash paid for federal and state taxes
|
$
|
381
|
|
|
$
|
2,582
|
|
|
|
|
|
||||
Non-cash transactions:
|
|
|
|
||||
Change in accounts payable related to property and equipment additions
|
—
|
|
|
382
|
|
||
Property and equipment acquired under capital leases
|
1,808
|
|
|
—
|
|
Remainder of 2017
|
$
|
100
|
|
2018
|
398
|
|
|
2019
|
398
|
|
|
2020
|
398
|
|
|
2021
|
398
|
|
|
Thereafter
|
255
|
|
|
Total minimum lease payments
|
1,947
|
|
|
Less: Amount representing interest
|
(176
|
)
|
|
Present value of capital lease obligations
|
1,771
|
|
|
Less current portion of capital lease obligations
|
(306
|
)
|
|
Total long-term capital lease obligations
|
$
|
1,465
|
|
|
September 30,
|
|
December 31,
|
||||
|
2017
|
|
2016
|
||||
Estimated expenses and liabilities
|
$
|
1,573
|
|
|
$
|
2,657
|
|
|
September 30,
|
|
December 31,
|
||||
|
2017
|
|
2016
|
||||
Accrued medical claims
|
$
|
1,424
|
|
|
$
|
1,411
|
|
|
Three Months Ended
|
|
|
|
Nine Months Ended
|
|
|
||||||||||||||
|
September 30,
|
|
|
|
September 30,
|
|
|
||||||||||||||
|
2017
|
|
2016
|
|
Change
(1)
|
|
2017
|
|
2016
|
|
Change
(1)
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenues
|
$
|
282,229
|
|
|
$
|
243,704
|
|
|
16
|
%
|
|
$
|
872,020
|
|
|
$
|
758,627
|
|
|
15
|
%
|
Operating earnings
|
2,412
|
|
|
1,265
|
|
|
91
|
%
|
|
5,496
|
|
|
13,148
|
|
|
(58
|
%)
|
||||
Depreciation
|
1,911
|
|
|
2,418
|
|
|
(21
|
%)
|
|
5,957
|
|
|
7,621
|
|
|
(22
|
%)
|
||||
Driver commissions
|
2,962
|
|
|
3,361
|
|
|
(12
|
%)
|
|
9,153
|
|
|
11,702
|
|
|
(22
|
%)
|
||||
Insurance
|
1,358
|
|
|
1,816
|
|
|
(25
|
%)
|
|
3,855
|
|
|
5,934
|
|
|
(35
|
%)
|
||||
Fuel
|
1,249
|
|
|
1,185
|
|
|
5
|
%
|
|
3,887
|
|
|
4,162
|
|
|
(7
|
%)
|
(1)
|
Represents the percentage increase (decrease) from the prior year periods.
|
(1)
|
Reflects the volume purchased from third parties at the field level of operations.
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
September 30,
|
|
September 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
|
|
|
|
|
|
|
|
||||||||
As reported segment operating earnings
|
$
|
2,412
|
|
|
$
|
1,265
|
|
|
$
|
5,496
|
|
|
$
|
13,148
|
|
Add (subtract):
|
|
|
|
|
|
|
|
||||||||
Inventory liquidation gains
|
(1,954
|
)
|
|
—
|
|
|
—
|
|
|
(5,779
|
)
|
||||
Inventory valuation losses
|
—
|
|
|
432
|
|
|
109
|
|
|
—
|
|
||||
Derivative valuation (gains) losses
|
748
|
|
|
(181
|
)
|
|
48
|
|
|
(305
|
)
|
||||
Field level operating earnings
(1)
|
$
|
1,206
|
|
|
$
|
1,516
|
|
|
$
|
5,653
|
|
|
$
|
7,064
|
|
(1)
|
The use of field level operating earnings is (a) unique to us, (b) not a substitute for a GAAP measure and (c) not comparable to any similar measures developed by industry participants. We utilize such data to evaluate the profitability of our operations.
|
|
September 30, 2017
|
|
December 31, 2016
|
||||||||||
|
|
|
Average
|
|
|
|
Average
|
||||||
|
Barrels
|
|
Price
|
|
Barrels
|
|
Price
|
||||||
|
|
|
|
|
|
|
|
||||||
Crude oil inventory
|
434,746
|
|
|
$
|
51.52
|
|
|
255,146
|
|
|
$
|
51.22
|
|
|
Three Months Ended
|
|
|
|
Nine Months Ended
|
|
|
||||||||||||||
|
September 30,
|
|
|
|
September 30,
|
|
|
||||||||||||||
|
2017
|
|
2016
|
|
Change
(1)
|
|
2017
|
|
2016
|
|
Change
(1)
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenues
|
$
|
13,082
|
|
|
$
|
12,310
|
|
|
6
|
%
|
|
$
|
40,153
|
|
|
$
|
39,517
|
|
|
2
|
%
|
Operating earnings (losses)
|
$
|
(915
|
)
|
|
$
|
(430
|
)
|
|
113
|
%
|
|
$
|
(920
|
)
|
|
$
|
444
|
|
|
(307
|
%)
|
Depreciation
|
$
|
1,329
|
|
|
$
|
1,701
|
|
|
(22
|
%)
|
|
$
|
4,392
|
|
|
$
|
5,536
|
|
|
(21
|
%)
|
Driver commissions
|
$
|
2,912
|
|
|
$
|
2,672
|
|
|
9
|
%
|
|
$
|
8,640
|
|
|
$
|
8,477
|
|
|
2
|
%
|
Insurance
|
$
|
1,598
|
|
|
$
|
1,285
|
|
|
24
|
%
|
|
$
|
4,051
|
|
|
$
|
3,880
|
|
|
4
|
%
|
Fuel
|
$
|
1,582
|
|
|
$
|
1,365
|
|
|
16
|
%
|
|
$
|
4,691
|
|
|
$
|
4,124
|
|
|
14
|
%
|
Maintenance expense
|
$
|
1,532
|
|
|
$
|
1,350
|
|
|
13
|
%
|
|
$
|
4,641
|
|
|
$
|
3,991
|
|
|
16
|
%
|
Mileage (000s)
|
5,404
|
|
|
5,315
|
|
|
2
|
%
|
|
16,647
|
|
|
16,800
|
|
|
(1
|
%)
|
(1)
|
Represents the percentage increase (decrease) from the prior year periods.
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
September 30,
|
|
September 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Total transportation revenue
|
$
|
13,082
|
|
|
$
|
12,310
|
|
|
$
|
40,153
|
|
|
$
|
39,517
|
|
Diesel fuel cost
|
(1,582
|
)
|
|
(1,365
|
)
|
|
(4,691
|
)
|
|
(4,124
|
)
|
||||
Revenues, net of fuel costs
(1)
|
$
|
11,500
|
|
|
$
|
10,945
|
|
|
$
|
35,462
|
|
|
$
|
35,393
|
|
(1)
|
Revenues, net of fuel costs is a non-GAAP financial measure and is utilized for internal analysis of the results of our transportation segment.
|
|
Three Months Ended
|
|
|
|
Nine Months Ended
|
|
|
||||||||||||||
|
September 30,
|
|
|
|
September 30,
|
|
|
||||||||||||||
|
2017
|
|
2016
|
|
Change
(1)
|
|
2017
|
|
2016
|
|
Change
(1)
|
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Revenues
(2)
|
$
|
—
|
|
|
$
|
863
|
|
|
(100
|
%)
|
|
$
|
1,427
|
|
|
$
|
2,427
|
|
|
(41
|
%)
|
Operating earnings (losses)
(2)
|
—
|
|
|
(543
|
)
|
|
100
|
%
|
|
53
|
|
|
(1,222
|
)
|
|
104
|
%
|
||||
Depreciation/depletion
(2)
|
—
|
|
|
395
|
|
|
(100
|
%)
|
|
423
|
|
|
1,228
|
|
|
(66
|
%)
|
(1)
|
Represents the percentage increase (decrease) from the prior year periods.
|
(2)
|
Results for the 2017 periods represent amounts from January 1, 2017 through April 30, 2017.
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
September 30,
|
|
September 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
Crude oil
|
|
|
|
|
|
|
|
||||||||
Volume – barrels
(1)
|
—
|
|
|
6,859
|
|
|
11,643
|
|
|
25,112
|
|
||||
Average price per barrel
|
$
|
—
|
|
|
$
|
39.70
|
|
|
$
|
49.44
|
|
|
$
|
36.20
|
|
|
|
|
|
|
|
|
|
||||||||
Natural gas
|
|
|
|
|
|
|
|
||||||||
Volume – mcf
(1)
|
—
|
|
|
153,048
|
|
|
189,488
|
|
|
513,827
|
|
||||
Average price per mcf
|
$
|
—
|
|
|
$
|
2.76
|
|
|
$
|
2.86
|
|
|
$
|
2.14
|
|
|
|
|
|
|
|
|
|
||||||||
Natural gas liquids
|
|
|
|
|
|
|
|
||||||||
Volume – barrels
(1)
|
—
|
|
|
11,167
|
|
|
11,204
|
|
|
32.156
|
|
||||
Average price per barrel
|
$
|
—
|
|
|
$
|
15.15
|
|
|
$
|
26.77
|
|
|
$
|
12.97
|
|
(1)
|
Volumes for the 2017 periods are only through April 30, 2017 as a result of the deconsolidation of AREC due to its bankruptcy filing.
|
|
September 30,
|
|
December 31,
|
||||
|
2017
|
|
2016
|
||||
|
|
|
|
||||
Cash
|
$
|
99,449
|
|
|
$
|
87,342
|
|
Working capital
|
112,934
|
|
|
106,444
|
|
|
Nine Months Ended
|
||||||
|
September 30,
|
||||||
|
2017
|
|
2016
|
||||
|
|
|
|
||||
Cash provided by (used in):
|
|
|
|
||||
Operating activities
|
$
|
16,487
|
|
|
$
|
(3,339
|
)
|
Investing activities
|
(1,596
|
)
|
|
(7,269
|
)
|
||
Financing activities
|
(2,784
|
)
|
|
(2,784
|
)
|
|
September 30,
|
|
December 31,
|
||||
|
2017
|
|
2016
|
||||
|
|
|
|
||||
Early payments received
|
$
|
8,715
|
|
|
$
|
15,032
|
|
Early payments to suppliers
|
2,608
|
|
|
14,382
|
|
|
Nine Months Ended
|
||||||
|
September 30,
|
||||||
|
2017
|
|
2016
|
||||
|
|
|
|
||||
Crude oil marketing
|
$
|
451
|
|
|
$
|
514
|
|
Truck transportation
|
189
|
|
|
6,480
|
|
||
Oil and gas exploration
|
1,825
|
|
|
192
|
|
||
Investments in unconsolidated affiliates
|
—
|
|
|
4,700
|
|
||
Total
|
$
|
2,465
|
|
|
$
|
11,886
|
|
|
|
|
Payments due by period
|
||||||||||||||||
|
Total
|
|
Less than 1 year
|
|
1-3 years
|
|
3-5 years
|
|
More than 5 years
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Capital lease obligations
|
$
|
1,947
|
|
|
$
|
398
|
|
|
$
|
796
|
|
|
$
|
753
|
|
|
$
|
—
|
|
(i)
|
that our disclosure controls and procedures are designed to ensure that information required to be disclosed by us in the 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 that such information is accumulated and communicated to our management, including our principal executive and financial officers, as appropriate to allow for timely decisions regarding required disclosures; and
|
(ii)
|
that our disclosure controls and procedures are effective.
|
•
|
Performing a review to ensure that no personnel signs off as the reviewer and subsequently posts the journal entry to the general ledger.
|
•
|
Considering repositioning the personnel in the financial close group to allow for more segregation of duties within the group.
|
•
|
Addressing the control gap relating to the segregation of duties by requiring review of the manual journal entry to occur after the journal entry is independently posted. Review after posting restricts the ability to edit the journal entry.
|
Exhibit
|
|
Number
|
Exhibit
|
|
|
3.1
|
Certificate of Incorporation of Adams Resources & Energy, Inc., as amended (incorporated by reference to Exhibit 3(a) to Form 10-K for the fiscal year ended December 31, 1987).
|
3.2
|
|
10.1*
|
|
31.1*
|
|
31.2*
|
|
32.1*
|
|
32.2*
|
|
101.CAL*
|
XBRL Calculation Linkbase Document
|
101.DEF*
|
XBRL Definition Linkbase Document
|
101.INS*
|
XBRL Instance Document
|
101.LAB*
|
XBRL Labels Linkbase Document
|
101.PRE*
|
XBRL Presentation Linkbase Document
|
101.SCH*
|
XBRL Schema Document
|
|
|
ADAMS RESOURCES & ENERGY, INC.
|
|
|
(Registrant)
|
|
|
|
|
|
|
|
|
|
Date: November 9, 2017
|
By:
|
/s/ Townes G. Pressler
|
|
|
Townes G. Pressler
|
|
|
Executive Chairman
|
|
|
(Principal Executive Officer)
|
|
|
|
|
By:
|
/s/ Josh C. Anders
|
|
|
Josh C. Anders
|
|
|
Chief Financial Officer
|
|
|
(Principal Financial Officer and Principal
|
|
|
Accounting Officer)
|
(b)
|
Expiration
. No Letter of Credit shall be issued that has an expiry date that is later than the Maturity Date in effect on the date of issuance.
|
(h)
|
Letter of Credit Fees
. The Companies shall jointly and severally pay a fee (the “
Commission Fee
”) with respect to each Letter of Credit issued by Wells Fargo of one and three-quarter percent (1.75%) per annum of the aggregate undrawn amount of the Letter of Credit (the “
Aggregate Face Amount
”) accruing daily from and including the date the Letter of Credit is issued until the date that it either expires or is returned, which shall be payable monthly in arrears on the first day of each month and on the date that the Letter of Credit either expires or is returned; and following an Event of Default, this fee shall increase to five and one-quarter percent (5.25%) of the Aggregate Face Amount, commencing on the first day of the month in which the Default Period begins and continuing through the last day of such Default Period, or any shorter time period that Wells Fargo in its sole discretion may deem appropriate, without waiving any of its other rights and remedies.
|
3.2
|
Additional Conditions Precedent to All Letters of Credit
. Wells Fargo’s obligation to issue any Letter of Credit shall be subject to the further additional conditions: (a) that the representations and warranties described in Exhibit D, as amended hereby, are correct on the date of the issuance of the Letter of Credit, except to the extent that such representations and warranties relate solely to an earlier date; (b) that no event has occurred and is continuing, or would result from the requested issuance of the Letter of Credit that would result in an Event of Default; and (c) notwithstanding anything to the contrary set forth in Section 5.1, the Companies shall have delivered all financial statements, collateral reports, borrowing base reports, tax reports, and contract and hedging positions for the month most recently ended for which such reporting information is available.
|
(b)
|
Monthly Financial Statements
. No later than 30 days after the end of each month (so long as no Reporting Trigger Threshold Event has occurred and continuing for a full calendar month and subject to
Section 3.2
, in which case, no later than 30 days after the end of each fiscal quarter), a balance sheet, income statement, and statement of retained earnings prepared by the Parent for that month or fiscal quarter, as applicable, and for the year-to-date period then ended, prepared on a consolidated and consolidating basis to include the Parent’s Affiliates (including without limitation, the Companies and the Guarantors), and stating in comparative form the figures for the corresponding date and periods in the prior fiscal year, subject to year-end adjustments. The financial statements shall be accompanied by a Compliance Certificate in the form of Exhibit E that is signed by the Parent’s chief financial officer.
|
(c)
|
Collateral Reports
. No later than (i) 30 days after each month end (or more frequently if Wells Fargo shall request it), or (ii) so long as no Reporting Trigger Threshold Event has occurred and continuing for a full calendar month and subject to
Section 3.2
, 30 days after each fiscal quarter end, detailed agings of each Company’s accounts receivable and accounts payable, a general ledger trial balance for each Company, the first purchaser report for each Company, and any other documents deemed appropriate by Wells Fargo, in its reasonable discretion as of the end of that month or fiscal quarter, as applicable, or shorter time period requested by Wells Fargo.
|
(d)
|
Borrowing Base Reports
. No later than (i) the 28
th
day of each month (or more frequently if Wells Fargo shall request it), or (ii) so long as no Reporting Trigger Threshold Event has occurred and continuing for a full calendar month and subject to
Section 3.2
, 30 days after each fiscal quarter end, (A) detailed calculation of each Company’s Accounts and Eligible Accounts, as of the end of such current month or fiscal quarter, as applicable, or shorter time period reasonably requested by Wells Fargo, and (B) projections of each Company’s Accounts and Eligible Accounts for the current month and the following month.
|
(e)
|
Monthly Tax Report
. No later than (i) 30 days after each month and (or more frequently if Wells Fargo shall request it), or (ii) so long as no Reporting Trigger Threshold Event has occurred and continuing for a full calendar month and subject to
Section 3.2
, 30 days after each fiscal quarter end, a detailed list of all taxes due (including excise and royalty payments), the last payment date, and a certification signed by each Company’s chief financial officer that such taxes are current.
|
(f)
|
Contracts and Hedge Positions
. No later than (i) 30 days after each month end (or more frequently if Wells Fargo shall request it), or (ii) so long as no Reporting Trigger Threshold Event has occurred and continuing for a full calendar month and subject to
Section 3.2
, 30 days after each fiscal quarter end, a detailed list of each Company’s contracts and current hedge positions and detailed information regarding any material deviation from any Company’s stated policies and procedures regarding hedging.
|
(g)
|
Litigation
. No later than three days after discovery, a Record notifying Wells Fargo of any litigation or other proceeding before any court or governmental agency which seeks a monetary recovery against any Company in excess of $100,000.
|
5.2
|
Financial Covenants
. The Companies agree to comply with the financial covenants described below during each testing period below if at any time during such testing period an FC Trigger Threshold Event has occurred and continuing for a full calendar month, which financial covenants shall be calculated using GAAP consistently applied, except as they may be otherwise modified by the following capitalized definitions:
|
(a)
|
Other Liens; Permitted Liens
. No Company shall create, incur or suffer to exist any Lien upon any of its assets, now owned or later acquired, as security for any indebtedness, with the exception of the following (each a “
Permitted Lien
”; collectively, “
Permitted Liens
”): (i) In the case of real property, covenants, restrictions, rights, easements and minor irregularities in title which do not materially interfere with such Company’s business or operations as presently conducted; (ii) Liens in existence on the date of this Agreement that are described in Exhibit F and secure indebtedness for borrowed money permitted under Section 5.4; (iii) the Security Interest and Liens created by the Security Documents; (iv) Purchase money Liens on Equipment relating to the acquisition of such Equipment and Liens on Equipment subject to a Capital Lease, in each case not exceeding the lesser of cost or fair market value not to exceed $5,000,000 for any one asset purchase or lease and so long as no Default Period is then in existence and none would exist immediately after such acquisition or lease; (v) Liens on Commodity Swap Agreements or funds deposited in connection therewith permitted under Section 5.4(f); (vi) Liens on amounts deposited with customers of a Company as permitted in Section 5.6(f); (vii) financing statements filed in connection with operating lease transactions for Equipment; (viii) statutory Liens on crude oil securing obligations that are not yet due and are incurred in the ordinary course of business; and (ix) Liens on amounts deposited with insurers in connection with liability insurance policies and workers’ compensation insurance policies obtained to cover the transportation business of a Company.
|
5.4
|
Indebtedness
. No Company shall incur, create, assume or permit to exist any indebtedness or liability on account of deposits or letters of credit issued on such Company’s behalf, or advances or any indebtedness for borrowed money of any kind, whether or not evidenced by an instrument, except: (a) Indebtedness described in this Agreement; (b) indebtedness of such Company described in Exhibit F; (c) indebtedness secured by Permitted Liens (including without limitation, Capitalized Lease Obligations secured by Liens permitted under Section 5.3(a)(iv)); (d) trade accounts payable of such Company arising in the ordinary course of business that are not past due by more than 90 days unless being contested in good faith by appropriate action and for which adequate reserves have been maintained in accordance with GAAP; (e) all operating lease obligations of such Company; and (f) indebtedness incurred under Commodity Swap Agreements of the type traded in the New York Mercantile Exchange, Inc. so long as (i) such Commodity Swap Agreements are incurred in the ordinary course of business and consistent with such Company’s past practices and (ii) no Default is in existence or would result therefrom when such Commodity Swap Agreements are executed and delivered.
|
(c)
|
Collateral Exams and Inspections
. Each Company shall permit Wells Fargo’s employees, accountants, attorneys or other Persons acting as its agent, to examine and inspect any Collateral or any other property of such Company no more than one time each calendar year during business hours (so long as no FC Trigger Threshold Event has occurred and continuing for a full calendar month and subject to
Section 3.2
or any Event of Default has occurred and is continuing, in which case Wells Fargo may in its sole discretion conduct additional examinations and inspections at any time during ordinary business hours).
|
(b)
|
OFAC; Sanctions; Anti-Corruption Laws; Anti-Money Laundering Laws
. Each Company will implement and maintain in effect policies and procedures designed to promote and achieve compliance by such Company and its Subsidiaries and their respective directors, officers, employees, agents and Affiliates with applicable Sanctions, Anti‑Corruption Laws and Anti‑Money Laundering Laws, and each Company, its respective Subsidiaries, their respective officers and employees and, to the knowledge of each Company, such Company’s directors, agents and Affiliates, are in compliance with all applicable Sanctions, Anti‑Corruption Laws and Anti‑Money Laundering.
|
7.9
|
Additional Costs.
|
(a)
|
Capital Requirements
. Each Company will pay Wells Fargo, within 10 days of demand, for Wells Fargo’s costs or losses arising from any Change in Law which are allocated to this Agreement or any credit outstanding under this Agreement. The allocation will be made as determined by Wells Fargo, using any reasonable method. The costs include, without limitation, (i) any reserve or deposit requirements (excluding any reserve requirement already reflected in the calculation of the interest rate in this Agreement); and (ii) any capital requirements relating to Wells Fargo’s assets and commitments for credit. “
Change in Law
” means the occurrence, after the date of this Agreement, of the adoption or taking effect of any new or changed law, rule, regulation or treaty, or the issuance of any request, rule, guideline or directive (whether or not having the force of law) by any governmental authority; provided that (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives issued in connection with that Act, and (y) all requests, rules, guidelines or directives promulgated by Wells Fargo for International Settlements, the Basel Committee on Banking Supervision (or any successor authority) or the United States regulatory authorities, in each case pursuant to Basel III, will in each case be deemed to be a “Change in Law,” regardless of the date enacted, adopted or issued.
|
(b)
|
Illegality; Impractibility; Increased Costs
. In the event that (i) any change in market conditions or any Change in Law shall, in the reasonable opinion of Wells Fargo, make it unlawful or impractical for Wells Fargo to fund or maintain extensions of credit with interest based upon Daily Three Month LIBOR or to continue to so fund or maintain, or to determine or charge interest rates based upon Daily Three Month LIBOR, or (ii) Wells Fargo determines that the interest rate based on the Daily Three Month LIBOR will not adequately and fairly reflect the cost to Wells Fargo of maintaining L/C Obligations or issuing Letters of Credit at the interest rate based upon Daily Three Month LIBOR, Wells Fargo will give notice of such changed circumstances to each Company and (a) interest on the principal amount of such extensions of credit will then accrue interest at a rate equal to 5.25% per annum, and (b) no Company will be entitled to elect Daily Three Month LIBOR until Wells Fargo determines that the conditions described in clauses (i) and (ii) no longer exist
|
7.10
|
Patriot Act; Due Diligence. Wells Fargo hereby notifies the Companies that pursuant to the requirements of the Patriot Act, it is required to obtain, verify and record information that identifies each Company and its Subsidiaries, which information includes the name and address of each Company and its Subsidiaries and other information that will allow Wells Fargo to identify each Company and its Subsidiaries in accordance with the Patriot Act. In addition, Wells Fargo shall have the right to periodically conduct due diligence on all Companies, their Subsidiaries, their senior management and key principals and legal and beneficial owners to the extent required to comply with the requirements of the Patriot Act. Each Company agrees to cooperate in respect of the conduct of such due diligence and further agrees that the reasonable and documented costs and charges for any such due diligence by Wells Fargo shall constitute Wells Fargo’s expenses under Section 7.7 and be for the account of Borrowers.
|
(a)
|
to delete all references to ARM (Adams Resources Marketing, Ltd.), Adams Resources Marketing GP, Inc., and Adams Resources Marketing II, Inc.;
|
(b)
|
to change the address of Gulfmark Energy, Inc. to 17 S. Briar Hollow Lane, Suite 100, Houston, TX 77027; and
|
(c)
|
by amending and restating subsection (g) thereof to read as follows:
|
(g)
|
Litigation
. There are no actions, suits or proceedings pending or, to such Company’s knowledge, threatened against or affecting such Company or any of its Subsidiaries or the properties of such Company or any of its Subsidiaries before any court or governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign, which could reasonably be expected to result in a final judgment or judgments against such Company or any of its Subsidiaries in an amount in excess of $1,000,000, apart from those matters specifically disclosed to Wells Fargo in writing. Without limiting the foregoing, the Company is involved in various actions, suits and proceedings in the ordinary course of business; however, as of September 28, 2017, there are no actions, suits or proceedings that have a high probability of settling and are reasonably estimable in an amount in excess of $100,000.
|
(q)
|
OFAC; Sanctions; Anti-Corruption Laws; Anti-Money Laundering Laws
. No Company or any of its Subsidiaries is in violation of any Sanctions. No Company or any of its Subsidiaries nor, to the knowledge of such Company, any director, officer, employee, agent or Affiliate of such Company or such Subsidiary (a) is a Sanctioned Person or a Sanctioned Entity, (b) has any assets located in Sanctioned Entities, or (c) derives revenues from investments in, or transactions with Sanctioned Persons or Sanctioned Entities. Each of the Companies and its Subsidiaries has implemented and maintains in effect policies and procedures designed to promote and achieve compliance with all applicable Sanctions, Anti-Corruption Laws and Anti-Money Laundering Laws. Each of the Companies and its Subsidiaries, and to the knowledge of each such Company, each director, officer, employee, agent and Affiliate of each such Company and each such Subsidiary, is in compliance with all applicable Sanctions, Anti-Corruption Laws and Anti Laundering Laws. No proceeds of any Letter of Credit issued hereunder will be used to fund any operations in, finance any investments or activities in, or make any payments to, a Sanctioned Person or a Sanctioned Entity, or otherwise used in any manner that would result in a violation of any Sanction, Anti-Corruption Law or Anti Money Laundering Law by any Person (including Wells Fargo or other individual or entity participating in any transaction).
|
(a)
|
This Amendment duly executed by the Borrower, the Guarantors and Wells Fargo.
|
(b)
|
A Certificate of the Secretary of Borrower certifying as to (i) the resolutions of the board of directors of Borrower approving the execution and delivery of this Amendment, (ii) the fact that the articles of incorporation, bylaws or other charter documents of Borrower, which were certified and delivered to Wells Fargo pursuant to the Certificate of Authority of Borrower’s secretary or assistant secretary dated August 27, 2009 continue in full force and effect and have not been amended or otherwise modified except as set forth in the Certificate to be delivered, and (iii) certifying that the officers and agents of Borrower who have been certified to Wells Fargo, pursuant to the Certificate of Authority of such Person’s secretary or assistant secretary dated August 27, 2009, as being authorized to sign and to act on behalf of Borrower continue to be so authorized or setting forth the sample signatures of each of the officers and agents of Borrower authorized to execute and deliver this Amendment and all other documents, agreements and certificates on behalf of Borrower.
|
(c)
|
Payment of the fee described in
Section 2.1
.
|
(d)
|
Such other matters as Wells Fargo may reasonably require.
|
(a)
|
Borrower has all requisite power and authority to execute this Amendment
and any other agreements or instruments required hereunder and to perform all of its obligations hereunder, and this Amendment
and all such other agreements and instruments has been duly executed and delivered by Borrower and constitute the legal, valid and binding obligation of Borrower, enforceable in accordance with its terms except as such enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer and conveyance or similar laws of, general application relating to the enforcement of creditors’ rights and by general principles of equity.
|
(b)
|
The execution, delivery and performance by Borrower of this Amendment
and any other agreements or instruments required hereunder have been duly authorized by all necessary corporate or company action and do not (i) require any authorization, consent or approval by any governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign, (ii) violate any provision of any law, rule or regulation or of any order, writ, injunction or decree presently in effect, having applicability to Borrower, or the articles of incorporation, by-laws or other charter documents of Borrower, or (iii) result in a breach of or constitute a default under any indenture or loan or credit agreement or any other material agreement, lease or instrument to which Borrower is a party or by which it or its properties may be bound or affected.
|
(c)
|
All of the representations and warranties contained in Article 4 and Exhibit D of the Credit Agreement, as amended hereby, are correct in all material respects on and as of the date hereof as though made on and as of such date, except to the extent that such representations and warranties relate solely to an earlier date.
|
(a)
|
WAIVER
. WAIVES ANY AND ALL SUCH CLAIMS, WHETHER KNOWN OR UNKNOWN, ARISING PRIOR TO THE DATE OF THIS AMENDMENT; AND
|
(b)
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RELEASE
. RELEASES, ACQUITS AND FOREVER DISCHARGES RELEASED PARTIES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE STATE AND FEDERAL LAW, FROM ANY AND ALL OBLIGATIONS, INDEBTEDNESS, LIABILITIES, CLAIMS, COUNTERCLAIMS, CONTROVERSIES, COSTS, DEBTS, SUMS OF MONEY, ACCOUNTS, BONDS, BILLS, RIGHTS, CAUSES OF ACTION OR DEMANDS WHATSOEVER, WHETHER KNOWN OR UNKNOWN, SUSPECTED OR UNSUSPECTED, IN LAW OR EQUITY, WHICH BORROWER OR SUCH GUARANTOR EVER HAD, NOW HAS, CLAIMS TO HAVE OR MAY HAVE AGAINST ANY RELEASED PARTY ARISING PRIOR TO THE DATE HEREOF AND FROM OR IN CONNECTION WITH THIS AMENDMENT, THE LOAN DOCUMENTS OR THE TRANSACTIONS DIRECTLY OR INDIRECTLY CONTEMPLATED THEREBY.
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WELLS FARGO BANK,
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GULFMARK ENERGY, INC.
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NATIONAL ASSOCIATION
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By:
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/s/ Ron M. Zieber
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By:
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/s/ Josh C. Anders
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Ron M. Zieber
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Josh Anders
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Vice President
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Chief Financial Officer
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GUARANTORS:
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SERVICE TRANSPORT COMPANY
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By:
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/s/ Josh C. Anders
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Josh Anders
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Chief Financial Officer
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ADAMS RESOURCES & ENERGY, INC.
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By:
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/s/ Josh C. Anders
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Josh Anders
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Chief Financial Officer
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1.
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I have reviewed this quarterly report on Form 10-Q of Adams Resources & Energy, Inc.;
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2.
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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;
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3.
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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;
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4.
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The registrant’s other certifying officer 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:
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(a)
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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;
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(b)
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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;
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(c)
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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
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(d)
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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
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5.
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The registrant’s other certifying officer 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 registrant’s board of directors (or persons performing the equivalent functions):
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(a)
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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
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(b)
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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.
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Date:
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November 9, 2017
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By:
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/s/ Townes G. Pressler
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Townes G. Pressler
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Executive Chairman
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1.
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I have reviewed this quarterly report on Form 10-Q of Adams Resources & Energy, Inc.;
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2.
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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;
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3.
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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;
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4.
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The registrant’s other certifying officer 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:
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(a)
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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;
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(b)
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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;
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(c)
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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
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(d)
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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
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5.
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The registrant’s other certifying officer 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 registrant’s board of directors (or persons performing the equivalent functions):
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(a)
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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
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(b)
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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.
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Date:
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November 9, 2017
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By:
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/s/ Josh C. Anders
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Josh C. Anders
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Chief Financial Officer
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(1)
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The Report fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934; and
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(2)
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.
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Date:
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November 9, 2017
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By:
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/s/ Townes G. Pressler
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Townes G. Pressler
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Executive Chairman
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(1)
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The Report fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934; and
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(2)
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.
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Date:
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November 9, 2017
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By:
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/s/ Josh C. Anders
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Josh C. Anders
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Chief Financial Officer
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