Delaware
|
75-1256622
|
(State or other jurisdiction of
|
(I.R.S. Employer Identification No.)
|
incorporation or organization)
|
|
1650 Hwy 6 South
|
Suite 190
|
77478
|
Sugar Land
|
Texas
|
|
(Address of principal executive offices)
|
(Zip code)
|
Title of each class
|
Trading Symbol(s)
|
Name of each exchange on which registered
|
Common Stock, par value $0.10 per share
|
TREC
|
New York Stock Exchange
|
|
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30,
2020 (Unaudited) |
|
December 31,
2019 |
||||
ASSETS
|
|
(thousands of dollars, except par value)
|
||||||
Current Assets
|
|
|
|
|
||||
Cash
|
|
$
|
29,877
|
|
|
$
|
6,145
|
|
Trade receivables, net
|
|
20,240
|
|
|
26,320
|
|
||
Inventories
|
|
7,595
|
|
|
13,624
|
|
||
Investment in AMAK (held-for-sale)
|
|
29,175
|
|
|
32,872
|
|
||
Prepaid expenses and other assets
|
|
3,233
|
|
|
4,947
|
|
||
Taxes receivable
|
|
16,229
|
|
|
182
|
|
||
Total current assets
|
|
106,349
|
|
|
84,090
|
|
||
|
|
|
|
|
||||
Plant, pipeline and equipment, net
|
|
189,237
|
|
|
188,919
|
|
||
|
|
|
|
|
||||
Intangible assets, net
|
|
13,814
|
|
|
14,736
|
|
||
Lease right-of-use assets, net
|
|
11,915
|
|
|
13,512
|
|
||
Mineral properties in the United States
|
|
562
|
|
|
562
|
|
||
|
|
|
|
|
||||
TOTAL ASSETS
|
|
$
|
321,877
|
|
|
$
|
301,819
|
|
LIABILITIES
|
|
|
|
|
||||
Current Liabilities
|
|
|
|
|
||||
Accounts payable
|
|
$
|
11,027
|
|
|
$
|
14,603
|
|
Accrued liabilities
|
|
7,801
|
|
|
5,740
|
|
||
Current portion of long-term debt
|
|
4,194
|
|
|
4,194
|
|
||
Current portion of lease liabilities
|
|
3,142
|
|
|
3,174
|
|
||
Current portion of other liabilities
|
|
955
|
|
|
924
|
|
||
Total current liabilities
|
|
27,119
|
|
|
28,635
|
|
||
|
|
|
|
|
||||
CARES Act, PPP Loans
|
|
6,123
|
|
|
—
|
|
||
Long-term debt, net of current portion
|
|
73,998
|
|
|
79,095
|
|
||
Post-retirement benefit, net of current portion
|
|
327
|
|
|
338
|
|
||
Lease liabilities, net of current portion
|
|
8,773
|
|
|
10,338
|
|
||
Other liabilities, net of current portion
|
|
512
|
|
|
595
|
|
||
Deferred income taxes
|
|
23,860
|
|
|
11,375
|
|
||
Total liabilities
|
|
140,712
|
|
|
130,376
|
|
||
|
|
|
|
|
||||
EQUITY
|
|
|
|
|
||||
Common stock‑authorized 40 million shares of $0.10 par value; issued and outstanding 24.8 million and 24.8 million in 2020 and 2019, respectively
|
|
2,482
|
|
|
2,475
|
|
||
Additional paid-in capital
|
|
60,386
|
|
|
59,530
|
|
||
Retained earnings
|
|
118,008
|
|
|
109,149
|
|
||
Total Trecora Resources Stockholders' Equity
|
|
180,876
|
|
|
171,154
|
|
||
Noncontrolling Interest
|
|
289
|
|
|
289
|
|
||
Total equity
|
|
181,165
|
|
|
171,443
|
|
||
|
|
|
|
|
||||
TOTAL LIABILITIES AND EQUITY
|
|
$
|
321,877
|
|
|
$
|
301,819
|
|
|
|
THREE MONTHS ENDED
JUNE 30, |
|
SIX MONTHS ENDED
JUNE 30, |
||||||||||||
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
|
|
(thousands of dollars, except per share amounts)
|
||||||||||||||
REVENUES
|
|
|
|
|
|
|
|
|
||||||||
Product sales
|
|
$
|
36,707
|
|
|
$
|
65,329
|
|
|
$
|
93,890
|
|
|
$
|
126,822
|
|
Processing fees
|
|
3,967
|
|
|
4,042
|
|
|
8,851
|
|
|
7,704
|
|
||||
|
|
40,674
|
|
|
69,371
|
|
|
102,741
|
|
|
134,526
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
OPERATING COSTS AND EXPENSES
|
|
|
|
|
|
|
|
|
||||||||
Cost of sales and processing
|
|
|
|
|
|
|
|
|
||||||||
(including depreciation and amortization of $3,750, $4,128, $7,486 and $8,357, respectively)
|
|
34,507
|
|
|
58,806
|
|
|
88,496
|
|
|
113,888
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
GROSS PROFIT
|
|
6,167
|
|
|
10,565
|
|
|
14,245
|
|
|
20,638
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
GENERAL AND ADMINISTRATIVE EXPENSES
|
|
|
|
|
|
|
|
|
||||||||
General and administrative
|
|
6,289
|
|
|
6,042
|
|
|
12,963
|
|
|
12,076
|
|
||||
Depreciation
|
|
212
|
|
|
208
|
|
|
428
|
|
|
421
|
|
||||
|
|
6,501
|
|
|
6,250
|
|
|
13,391
|
|
|
12,497
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
OPERATING INCOME (LOSS)
|
|
(334
|
)
|
|
4,315
|
|
|
854
|
|
|
8,141
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
OTHER INCOME (EXPENSE)
|
|
|
|
|
|
|
|
|
||||||||
Interest income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5
|
|
||||
Interest expense
|
|
(735
|
)
|
|
(1,401
|
)
|
|
(1,651
|
)
|
|
(2,900
|
)
|
||||
Miscellaneous income, net
|
|
68
|
|
|
284
|
|
|
6
|
|
|
256
|
|
||||
|
|
(667
|
)
|
|
(1,117
|
)
|
|
(1,645
|
)
|
|
(2,639
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES
|
|
(1,001
|
)
|
|
3,198
|
|
|
(791
|
)
|
|
5,502
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
INCOME TAX EXPENSE (BENEFIT)
|
|
858
|
|
|
691
|
|
|
(4,795
|
)
|
|
1,185
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
INCOME (LOSS) FROM CONTINUING OPERATIONS
|
|
(1,859
|
)
|
|
2,507
|
|
|
4,004
|
|
|
4,317
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
INCOME (LOSS) FROM DISCONTINUED OPERATIONS, NET OF TAX
|
|
(2
|
)
|
|
(103
|
)
|
|
4,855
|
|
|
(162
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
NET INCOME (LOSS)
|
|
$
|
(1,861
|
)
|
|
$
|
2,404
|
|
|
$
|
8,859
|
|
|
$
|
4,155
|
|
|
|
|
|
|
|
|
|
|
||||||||
Basic Earnings per Common Share
|
|
|
|
|
|
|
|
|
||||||||
Net income (loss) from continuing operations (dollars)
|
|
$
|
(0.07
|
)
|
|
$
|
0.10
|
|
|
$
|
0.16
|
|
|
$
|
0.17
|
|
Net income (loss) from discontinued operations, net of tax (dollars)
|
|
—
|
|
|
—
|
|
|
0.20
|
|
|
(0.01
|
)
|
||||
Net income (loss) (dollars)
|
|
$
|
(0.07
|
)
|
|
$
|
0.10
|
|
|
$
|
0.36
|
|
|
$
|
0.16
|
|
|
|
|
|
|
|
|
|
|
||||||||
Basic weighted average number of common shares outstanding
|
|
24,802
|
|
|
24,696
|
|
|
24,784
|
|
|
24,675
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Diluted Earnings per Common Share
|
|
|
|
|
|
|
|
|
||||||||
Net income (loss) from continuing operations (dollars)
|
|
$
|
(0.07
|
)
|
|
$
|
0.10
|
|
|
$
|
0.16
|
|
|
$
|
0.17
|
|
Net income (loss) from discontinued operations, net of tax (dollars)
|
|
—
|
|
|
—
|
|
|
0.19
|
|
|
(0.01
|
)
|
||||
Net income (loss) (dollars)
|
|
$
|
(0.07
|
)
|
|
$
|
0.10
|
|
|
$
|
0.35
|
|
|
$
|
0.16
|
|
|
|
|
|
|
|
|
|
|
||||||||
Diluted weighted average number of common shares outstanding
|
|
24,802
|
|
|
25,091
|
|
|
25,360
|
|
|
25,089
|
|
|
|
TRECORA RESOURCES STOCKHOLDERS
|
|
|
|
|
|||||||||||||||||||||||||
|
|
COMMON STOCK
|
|
ADDITIONAL
PAID-IN
|
|
TREASURY
|
|
RETAINED
|
|
|
|
NON-
CONTROLLING
|
|
TOTAL
|
|||||||||||||||||
|
|
SHARES
|
|
AMOUNT
|
|
CAPITAL
|
|
STOCK
|
|
EARNINGS
|
|
TOTAL
|
|
INTEREST
|
|
EQUITY
|
|||||||||||||||
|
|
(thousands)
|
|
|
(thousands of dollars)
|
||||||||||||||||||||||||||
March 31, 2020
|
|
24,780
|
|
|
$
|
2,478
|
|
|
$
|
59,880
|
|
|
$
|
—
|
|
|
$
|
119,869
|
|
|
$
|
182,227
|
|
|
$
|
289
|
|
|
$
|
182,516
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Restricted Stock Units
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Issued to Directors
|
|
—
|
|
|
—
|
|
|
101
|
|
|
—
|
|
|
—
|
|
|
101
|
|
|
—
|
|
|
101
|
|
|||||||
Issued to Employees
|
|
—
|
|
|
—
|
|
|
409
|
|
|
—
|
|
|
—
|
|
|
409
|
|
|
—
|
|
|
409
|
|
|||||||
Common Stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Issued to Directors
|
|
28
|
|
|
3
|
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Issued to Employees
|
|
9
|
|
|
1
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Net Income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(1,861
|
)
|
|
(1,861
|
)
|
|
—
|
|
|
(1,861
|
)
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
June 30, 2020
|
|
24,817
|
|
|
$
|
2,482
|
|
|
$
|
60,386
|
|
|
$
|
—
|
|
|
$
|
118,008
|
|
|
$
|
180,876
|
|
|
$
|
289
|
|
|
$
|
181,165
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
March 31, 2019
|
|
24,687
|
|
|
$
|
2,469
|
|
|
$
|
58,565
|
|
|
$
|
(8
|
)
|
|
$
|
125,874
|
|
|
$
|
186,900
|
|
|
$
|
289
|
|
|
$
|
187,189
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Restricted Stock Units
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Issued to Directors
|
|
—
|
|
|
—
|
|
|
146
|
|
|
—
|
|
|
—
|
|
|
146
|
|
|
—
|
|
|
146
|
|
|||||||
Issued to Employees
|
|
—
|
|
|
—
|
|
|
209
|
|
|
—
|
|
|
—
|
|
|
209
|
|
|
—
|
|
|
209
|
|
|||||||
Common Stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Issued to Directors
|
|
10
|
|
|
1
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
7
|
|
|
—
|
|
|
7
|
|
|||||||
Issued to Employees
|
|
18
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
2
|
|
|||||||
Net Income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,404
|
|
|
2,404
|
|
|
—
|
|
|
2,404
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
June 30, 2019
|
|
24,715
|
|
|
$
|
2,472
|
|
|
$
|
58,920
|
|
|
$
|
(2
|
)
|
|
$
|
128,278
|
|
|
$
|
189,668
|
|
|
$
|
289
|
|
|
$
|
189,957
|
|
|
|
TRECORA RESOURCES STOCKHOLDERS
|
|
|
|
|
|||||||||||||||||||||||||
|
|
COMMON STOCK
|
|
ADDITIONAL
PAID-IN
|
|
TREASURY
|
|
RETAINED
|
|
|
|
NON-
CONTROLLING
|
|
TOTAL
|
|||||||||||||||||
|
|
SHARES
|
|
AMOUNT
|
|
CAPITAL
|
|
STOCK
|
|
EARNINGS
|
|
TOTAL
|
|
INTEREST
|
|
EQUITY
|
|||||||||||||||
|
|
(thousands)
|
|
|
(thousands of dollars)
|
||||||||||||||||||||||||||
January 1, 2020
|
|
24,750
|
|
|
$
|
2,475
|
|
|
$
|
59,530
|
|
|
$
|
—
|
|
|
$
|
109,149
|
|
|
$
|
171,154
|
|
|
$
|
289
|
|
|
$
|
171,443
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Restricted Stock Units
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Issued to Directors
|
|
—
|
|
|
—
|
|
|
195
|
|
|
—
|
|
|
—
|
|
|
195
|
|
|
—
|
|
|
195
|
|
|||||||
Issued to Employees
|
|
—
|
|
|
—
|
|
|
668
|
|
|
—
|
|
|
—
|
|
|
668
|
|
|
—
|
|
|
668
|
|
|||||||
Common Stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Issued to Directors
|
|
28
|
|
|
3
|
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Issued to Employees
|
|
39
|
|
|
4
|
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Net Income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,859
|
|
|
8,859
|
|
|
—
|
|
|
8,859
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
June 30, 2020
|
|
24,817
|
|
|
$
|
2,482
|
|
|
$
|
60,386
|
|
|
$
|
—
|
|
|
$
|
118,008
|
|
|
$
|
180,876
|
|
|
$
|
289
|
|
|
$
|
181,165
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
January 1, 2019
|
|
24,626
|
|
|
$
|
2,463
|
|
|
$
|
58,294
|
|
|
$
|
(8
|
)
|
|
$
|
124,123
|
|
|
$
|
184,872
|
|
|
$
|
289
|
|
|
$
|
185,161
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Restricted Stock Units
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Issued to Directors
|
|
—
|
|
|
—
|
|
|
168
|
|
|
—
|
|
|
—
|
|
|
168
|
|
|
—
|
|
|
168
|
|
|||||||
Issued to Employees
|
|
—
|
|
|
—
|
|
|
458
|
|
|
—
|
|
|
—
|
|
|
458
|
|
|
—
|
|
|
458
|
|
|||||||
Common Stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Issued to Directors
|
|
10
|
|
|
1
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
7
|
|
|
—
|
|
|
7
|
|
|||||||
Issued to Employees
|
|
79
|
|
|
8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8
|
|
|
—
|
|
|
8
|
|
|||||||
Net Income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,155
|
|
|
4,155
|
|
|
—
|
|
|
4,155
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
June 30, 2019
|
|
24,715
|
|
|
$
|
2,472
|
|
|
$
|
58,920
|
|
|
$
|
(2
|
)
|
|
$
|
128,278
|
|
|
$
|
189,668
|
|
|
$
|
289
|
|
|
$
|
189,957
|
|
|
|
SIX MONTHS ENDED
JUNE 30, |
||||||
|
|
2020
|
|
2019
|
||||
|
|
(thousands of dollars)
|
||||||
OPERATING ACTIVITIES
|
|
|
|
|
||||
Net Income
|
|
$
|
8,859
|
|
|
$
|
4,155
|
|
Income (Loss) from Discontinued Operations
|
|
4,855
|
|
|
(162
|
)
|
||
Income from Continuing Operations
|
|
$
|
4,004
|
|
|
$
|
4,317
|
|
Adjustments to Reconcile Income from Continuing Operations To Net Cash Provided by Operating Activities:
|
|
|
|
|
||||
Depreciation and Amortization
|
|
6,993
|
|
|
7,880
|
|
||
Amortization of Intangible Assets
|
|
921
|
|
|
931
|
|
||
Stock-based Compensation
|
|
933
|
|
|
558
|
|
||
Deferred Income Taxes
|
|
11,109
|
|
|
978
|
|
||
Postretirement Obligation
|
|
5
|
|
|
(18
|
)
|
||
Amortization of Loan Fees
|
|
91
|
|
|
91
|
|
||
Loss on Disposal of Assets
|
|
18
|
|
|
—
|
|
||
Changes in Operating Assets and Liabilities:
|
|
|
|
|
||||
Decrease (Increase) in Trade Receivables
|
|
6,080
|
|
|
(3,393
|
)
|
||
Decrease in Insurance Receivables
|
|
1,148
|
|
|
—
|
|
||
Increase in Taxes Receivable
|
|
(15,726
|
)
|
|
—
|
|
||
Decrease in Inventories
|
|
6,029
|
|
|
1,244
|
|
||
Decrease in Prepaid Expenses and Other Assets
|
|
536
|
|
|
16
|
|
||
Decrease in Accounts Payable and Accrued Liabilities
|
|
(1,765
|
)
|
|
(6,767
|
)
|
||
Decrease in Other Liabilities
|
|
456
|
|
|
54
|
|
||
Net Cash Provided by Operating Activities - Continuing Operations
|
|
20,831
|
|
|
5,891
|
|
||
Net Cash Used in Operating Activities - Discontinued Operations
|
|
(276
|
)
|
|
(43
|
)
|
||
Net Cash Provided by Operating Activities
|
|
20,555
|
|
|
5,848
|
|
||
INVESTING ACTIVITIES
|
|
|
|
|
||||
Additions to Plant, Pipeline and Equipment
|
|
(7,851
|
)
|
|
(4,286
|
)
|
||
Proceeds from PEVM
|
|
—
|
|
|
30
|
|
||
Net Cash Used in Investing Activities - Continuing Operations
|
|
(7,851
|
)
|
|
(4,256
|
)
|
||
Net Cash Provided by Investing Activities - Discontinued Operations
|
|
10,163
|
|
|
414
|
|
||
Net Cash Provided by (Used in) Investing Activities
|
|
2,312
|
|
|
(3,842
|
)
|
||
FINANCING ACTIVITIES
|
|
|
|
|
||||
Net Cash Paid Related to Stock-Based Compensation
|
|
(71
|
)
|
|
(228
|
)
|
||
Additions to CARES Act, PPP Loans
|
|
6,123
|
|
|
—
|
|
||
Additions to Long-Term Debt
|
|
20,000
|
|
|
2,000
|
|
||
Repayments of Long-Term Debt
|
|
(25,187
|
)
|
|
(6,188
|
)
|
||
Net Cash Provided by (Used in) Financing Activities - Continuing Operations
|
|
865
|
|
|
(4,416
|
)
|
||
NET INCREASE (DECREASE) IN CASH
|
|
23,732
|
|
|
(2,410
|
)
|
||
CASH AT BEGINNING OF PERIOD
|
|
6,145
|
|
|
6,735
|
|
||
CASH AT END OF PERIOD
|
|
$
|
29,877
|
|
|
$
|
4,325
|
|
Supplemental disclosure of cash flow information:
|
|
|
||||||
Cash payments for interest
|
|
$
|
1,560
|
|
|
$
|
1,355
|
|
Cash payments for taxes, net of refunds
|
|
$
|
—
|
|
|
$
|
80
|
|
Supplemental disclosure of non-cash items:
|
|
|
|
|
||||
Capital expansion amortized to depreciation expense
|
|
$
|
521
|
|
|
$
|
244
|
|
Foreign taxes paid by AMAK
|
|
$
|
—
|
|
|
$
|
891
|
|
(1)
|
TOCCO – Texas Oil & Chemical Co. II, Inc. – Wholly owned subsidiary of TREC and parent of SHR and TC
|
(2)
|
SHR – South Hampton Resources, Inc. – Specialty Petrochemicals segment and parent of GSPL
|
(3)
|
GSPL – Gulf State Pipe Line Co, Inc. – Pipeline support for the Specialty Petrochemicals segment
|
(4)
|
TC – Trecora Chemical, Inc. – Specialty Waxes segment
|
(5)
|
AMAK – Al Masane Al Kobra Mining Company – Held-for-sale mining equity investment – 28.3% ownership
|
(6)
|
PEVM – Pioche Ely Valley Mines, Inc. – Inactive mine – 55% ownership
|
|
|
June 30, 2020
|
|
|
December 31, 2019
|
|
||
|
|
(thousands of dollars)
|
||||||
Trade receivables
|
|
$
|
20,668
|
|
|
$
|
26,749
|
|
Less allowance for doubtful accounts
|
|
(428
|
)
|
|
(429
|
)
|
||
Trade receivables, net
|
|
$
|
20,240
|
|
|
$
|
26,320
|
|
|
|
June 30, 2020
|
|
|
December 31, 2019
|
|
||
|
|
(thousands of dollars)
|
||||||
Raw material
|
|
$
|
738
|
|
|
$
|
2,100
|
|
Work in process
|
|
244
|
|
|
142
|
|
||
Finished products
|
|
6,613
|
|
|
11,382
|
|
||
Total inventory
|
|
$
|
7,595
|
|
|
$
|
13,624
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended
June 30, |
||||||||||||
|
|
2020
|
|
|
2019
|
|
|
2020
|
|
|
2019
|
|
||||
|
|
(thousands of dollars)
|
|
(thousands of dollars)
|
||||||||||||
Saudi administration (income) expenses
|
|
$
|
(97
|
)
|
|
$
|
39
|
|
|
$
|
(114
|
)
|
|
$
|
55
|
|
Equity in (earnings) losses of AMAK
|
|
(306
|
)
|
|
91
|
|
|
226
|
|
|
150
|
|
||||
Gain on sale of equity interest
|
|
—
|
|
|
—
|
|
|
(6,663
|
)
|
|
—
|
|
||||
(Income) loss from discontinued operations before taxes
|
|
(403
|
)
|
|
130
|
|
|
(6,551
|
)
|
|
205
|
|
||||
Tax expense (benefit)
|
|
405
|
|
|
(27
|
)
|
|
1,696
|
|
|
(43
|
)
|
||||
(Income) loss from discontinued operations (net of tax)
|
|
$
|
2
|
|
|
$
|
103
|
|
|
$
|
(4,855
|
)
|
|
$
|
162
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
|
2020
|
|
|
2019
|
|
|
2020
|
|
|
2019
|
|
||||
|
|
(thousands of dollars)
|
|
(thousands of dollars)
|
||||||||||||
Sales
|
|
$
|
20,752
|
|
|
$
|
20,566
|
|
|
$
|
38,689
|
|
|
$
|
41,230
|
|
Cost of sales
|
|
17,829
|
|
|
18,162
|
|
|
34,650
|
|
|
36,732
|
|
||||
Gross profit
|
|
2,923
|
|
|
2,404
|
|
|
4,039
|
|
|
4,498
|
|
||||
Selling, general, and administrative
|
|
2,362
|
|
|
2,807
|
|
|
5,042
|
|
|
5,545
|
|
||||
Operating income (loss)
|
|
561
|
|
|
(403
|
)
|
|
(1,003
|
)
|
|
(1,047
|
)
|
||||
Other income (expense)
|
|
—
|
|
|
(75
|
)
|
|
17
|
|
|
353
|
|
||||
Finance and interest expense
|
|
(103
|
)
|
|
(448
|
)
|
|
(634
|
)
|
|
(893
|
)
|
||||
Income (loss) before Zakat and income taxes
|
|
458
|
|
|
(926
|
)
|
|
(1,620
|
)
|
|
(1,587
|
)
|
||||
Zakat and income taxes
|
|
566
|
|
|
366
|
|
|
1,099
|
|
|
888
|
|
||||
Net Loss
|
|
$
|
(108
|
)
|
|
$
|
(1,292
|
)
|
|
$
|
(2,719
|
)
|
|
$
|
(2,475
|
)
|
|
|
June 30,
|
|
|
December 31,
|
|
||
|
|
2020
|
|
|
2019
|
|
||
|
|
(thousands of dollars)
|
||||||
Current assets
|
|
$
|
41,193
|
|
|
$
|
45,354
|
|
Noncurrent assets
|
|
200,828
|
|
|
196,564
|
|
||
Total assets
|
|
$
|
242,021
|
|
|
$
|
241,918
|
|
|
|
|
|
|
||||
Current liabilities
|
|
$
|
23,307
|
|
|
$
|
27,645
|
|
Long term liabilities
|
|
86,508
|
|
|
79,348
|
|
||
Stockholders' equity
|
|
132,206
|
|
|
134,925
|
|
||
|
|
$
|
242,021
|
|
|
$
|
241,918
|
|
•
|
In the first quarter of 2020, we completed a portion of the Share Sale to an existing shareholder of AMAK. We sold 4 million shares of AMAK, thereby reducing our ownership percentage from 33.3% to 28.3%. As this transaction
|
•
|
In the second quarter of 2019, certain shareholders of AMAK transferred a portion of their shares to the CEO of AMAK as a one-time retention and performance bonus. The Company transferred 100,000 shares and the transaction reduced our ownership percentage from 33.4% to 33.3%.
|
|
|
June 30, 2020
|
|
|
December 31, 2019
|
|
||
|
|
(thousands of dollars)
|
||||||
Prepaid license
|
|
$
|
806
|
|
|
$
|
1,209
|
|
Spare parts
|
|
2,049
|
|
|
1,857
|
|
||
Insurance receivable
|
|
—
|
|
|
1,148
|
|
||
Other prepaid expenses and assets
|
|
378
|
|
|
733
|
|
||
Total prepaid expenses and other assets
|
|
$
|
3,233
|
|
|
$
|
4,947
|
|
|
|
June 30, 2020
|
|
|
December 31, 2019
|
|
||
|
|
(thousands of dollars)
|
||||||
Platinum catalyst metal
|
|
$
|
1,580
|
|
|
$
|
1,580
|
|
Catalyst
|
|
4,325
|
|
|
4,095
|
|
||
Land
|
|
5,428
|
|
|
5,428
|
|
||
Plant, pipeline and equipment
|
|
264,839
|
|
|
258,651
|
|
||
Construction in progress
|
|
6,359
|
|
|
5,052
|
|
||
Total plant, pipeline and equipment
|
|
$
|
282,531
|
|
|
$
|
274,806
|
|
Less accumulated depreciation
|
|
(93,294
|
)
|
|
(85,887
|
)
|
||
Net plant, pipeline and equipment
|
|
$
|
189,237
|
|
|
$
|
188,919
|
|
($ in thousands)
|
Classification on the Condensed Consolidated Balance Sheets
|
June 30, 2020
|
|
December 31, 2019
|
||||
Assets:
|
|
|
|
|
||||
Operating
|
Operating lease assets
|
$
|
11,915
|
|
|
$
|
13,512
|
|
Total leased assets
|
|
$
|
11,915
|
|
|
$
|
13,512
|
|
|
|
|
|
|
||||
Liabilities:
|
|
|
|
|
||||
Current:
|
|
|
|
|
||||
Operating
|
Current portion of operating lease liabilities
|
$
|
3,142
|
|
|
$
|
3,174
|
|
Noncurrent:
|
|
|
|
|
||||
Operating
|
Operating lease liabilities
|
8,773
|
|
|
10,338
|
|
||
Total lease liabilities
|
|
$
|
11,915
|
|
|
$
|
13,512
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
($ in thousands)
|
2020
|
|
2019
|
|
2020
|
|
2019
|
||||||||
Cash paid for amounts included in the measurement of lease liabilities:
|
|
|
|
|
|
|
|
||||||||
Operating cash flows used for operating leases
|
$
|
933
|
|
|
$
|
1,122
|
|
|
$
|
1,881
|
|
|
$
|
3,385
|
|
Right-of-use assets obtained in exchange for lease obligations:
|
|
|
|
|
|
|
|
||||||||
Operating leases
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
138
|
|
|
June 30, 2020
|
|
Weighted-average remaining lease term (in years):
|
|
|
Operating leases
|
4.1
|
|
Weighted-average discount rate:
|
|
|
Operating leases
|
4.5
|
%
|
($ in thousands)
|
Operating Leases
|
||
2020
|
$
|
1,824
|
|
2021
|
3,540
|
|
|
2022
|
3,218
|
|
|
2023
|
2,329
|
|
|
2024
|
1,026
|
|
|
Thereafter
|
1,082
|
|
|
Total lease payments
|
$
|
13,019
|
|
Less: Interest
|
1,104
|
|
|
Total lease obligations
|
$
|
11,915
|
|
|
|
June 30, 2020
|
||||||||||
|
|
Gross
|
|
Accumulated Amortization
|
|
Net
|
||||||
|
|
(thousands of dollars)
|
||||||||||
Customer relationships
|
|
$
|
16,852
|
|
|
$
|
(6,460
|
)
|
|
$
|
10,392
|
|
Non-compete agreements
|
|
94
|
|
|
(94
|
)
|
|
—
|
|
|||
Licenses and permits
|
|
1,471
|
|
|
(654
|
)
|
|
817
|
|
|||
Developed technology
|
|
6,131
|
|
|
(3,526
|
)
|
|
2,605
|
|
|||
Total
|
|
$
|
24,548
|
|
|
$
|
(10,734
|
)
|
|
$
|
13,814
|
|
|
|
December 31, 2019
|
||||||||||
|
|
Gross
|
|
Accumulated Amortization
|
|
Net
|
||||||
|
|
(thousands of dollars)
|
||||||||||
Customer relationships
|
|
$
|
16,852
|
|
|
$
|
(5,898
|
)
|
|
$
|
10,954
|
|
Non-compete agreements
|
|
94
|
|
|
(94
|
)
|
|
—
|
|
|||
Licenses and permits
|
|
1,471
|
|
|
(601
|
)
|
|
870
|
|
|||
Developed technology
|
|
6,131
|
|
|
(3,219
|
)
|
|
2,912
|
|
|||
Total
|
|
$
|
24,548
|
|
|
$
|
(9,812
|
)
|
|
$
|
14,736
|
|
|
|
Total
|
|
|
Remainder of 2020
|
|
|
2021
|
|
|
2022
|
|
|
2023
|
|
|
2024
|
|
|
2025
|
|
|
Thereafter
|
|
||||||||
|
|
(thousands of dollars)
|
||||||||||||||||||||||||||||||
Customer relationships
|
|
$
|
10,392
|
|
|
$
|
562
|
|
|
$
|
1,123
|
|
|
$
|
1,123
|
|
|
1,123
|
|
|
1,123
|
|
|
1,123
|
|
|
$
|
4,215
|
|
|||
Licenses and permits
|
|
817
|
|
|
53
|
|
|
101
|
|
|
86
|
|
|
86
|
|
|
86
|
|
|
86
|
|
|
319
|
|
||||||||
Developed technology
|
|
2,605
|
|
|
306
|
|
|
613
|
|
|
613
|
|
|
613
|
|
|
460
|
|
|
—
|
|
|
—
|
|
||||||||
Total future amortization expense
|
|
$
|
13,814
|
|
|
$
|
921
|
|
|
$
|
1,837
|
|
|
$
|
1,822
|
|
|
$
|
1,822
|
|
|
$
|
1,669
|
|
|
$
|
1,209
|
|
|
$
|
4,534
|
|
|
|
June 30, 2020
|
|
|
December 31, 2019
|
|
||
|
|
(thousands of dollars)
|
||||||
State taxes
|
|
$
|
297
|
|
|
$
|
215
|
|
Property taxes
|
|
1,811
|
|
|
—
|
|
||
Payroll
|
|
1,789
|
|
|
1,250
|
|
||
Royalties
|
|
544
|
|
|
273
|
|
||
Officer compensation
|
|
674
|
|
|
1,687
|
|
||
Legal
|
|
161
|
|
|
212
|
|
||
Foreign taxes
|
|
320
|
|
|
—
|
|
||
AMAK transaction costs
|
|
1,000
|
|
|
1,000
|
|
||
Other
|
|
1,205
|
|
|
1,103
|
|
||
Total
|
|
$
|
7,801
|
|
|
$
|
5,740
|
|
|
June 30, 2020
|
|
December 31, 2019
|
||
|
(thousands of dollars)
|
||||
Revolving Facility
|
—
|
|
|
3,000
|
|
Term Loan Facility
|
78,750
|
|
|
80,938
|
|
Loan fees
|
(558
|
)
|
|
(649
|
)
|
Total long-term debt
|
78,192
|
|
|
83,289
|
|
|
|
|
|
||
Less current portion including loan fees
|
4,194
|
|
|
4,194
|
|
|
|
|
|
||
Total long-term debt, less current portion including loan fees
|
73,998
|
|
|
79,095
|
|
|
Stock Options and Warrants
|
|
|
Weighted Average Exercise Price Per Share
|
|
|
Weighted Average Remaining Contractual Life
|
|
Intrinsic
Value
(in thousands)
|
|
|
Outstanding at January 1, 2020
|
487,000
|
|
|
10.87
|
|
|
|
|
|
||
Granted
|
—
|
|
|
—
|
|
|
|
|
|
||
Exercised
|
—
|
|
|
—
|
|
|
|
|
|
||
Forfeited
|
—
|
|
|
—
|
|
|
|
|
|
||
Outstanding at June 30, 2020
|
487,000
|
|
|
10.87
|
|
|
3.3
|
|
$
|
—
|
|
Expected to vest
|
—
|
|
|
|
|
|
|
$
|
—
|
|
|
Exercisable at June 30, 2020
|
487,000
|
|
|
10.87
|
|
|
3.3
|
|
$
|
—
|
|
|
Shares of Restricted Stock Units
|
|
|
Weighted Average Grant Date Price per Share
|
|
Outstanding at January 1, 2020
|
298,864
|
|
|
9.78
|
|
Granted
|
364,637
|
|
|
6.32
|
|
Forfeited
|
(15,571
|
)
|
|
11.40
|
|
Vested
|
(71,409
|
)
|
|
8.40
|
|
Outstanding at June 30, 2020
|
576,521
|
|
|
7.51
|
|
Expected to vest
|
576,521
|
|
|
|
|
Three Months Ended June 30, 2020
|
||||||||||||||||||
|
Specialty Petrochemicals
|
|
|
Specialty Waxes
|
|
|
Corporate
|
|
|
Eliminations
|
|
|
Consolidated
|
|
|||||
|
(in thousands)
|
||||||||||||||||||
Product sales
|
$
|
31,236
|
|
|
$
|
5,471
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
36,707
|
|
Processing fees
|
1,159
|
|
|
2,808
|
|
|
—
|
|
|
—
|
|
|
3,967
|
|
|||||
Total revenues
|
32,395
|
|
|
8,279
|
|
|
—
|
|
|
—
|
|
|
40,674
|
|
|||||
Operating income (loss) before depreciation and amortization
|
4,974
|
|
|
854
|
|
|
(2,199
|
)
|
|
—
|
|
|
3,629
|
|
|||||
Operating income (loss)
|
2,354
|
|
|
(485
|
)
|
|
(2,203
|
)
|
|
—
|
|
|
(334
|
)
|
|||||
Income (loss) from continuing operations before taxes
|
1,648
|
|
|
(445
|
)
|
|
(2,204
|
)
|
|
—
|
|
|
(1,001
|
)
|
|||||
Depreciation and amortization
|
2,621
|
|
|
1,338
|
|
|
3
|
|
|
—
|
|
|
3,962
|
|
|||||
Capital expenditures
|
5,382
|
|
|
285
|
|
|
—
|
|
|
—
|
|
|
5,667
|
|
|
Three Months Ended June 30, 2019
|
|||||||||||||||||
|
Specialty Petrochemicals
|
|
|
Specialty Waxes
|
|
|
Corporate
|
|
|
Eliminations
|
|
|
Consolidated
|
|
||||
|
(in thousands)
|
|||||||||||||||||
Product sales
|
$
|
58,584
|
|
|
$
|
6,745
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
65,329
|
|
Processing fees
|
1,527
|
|
|
2,515
|
|
|
—
|
|
|
—
|
|
|
4,042
|
|
||||
Total revenues
|
60,111
|
|
|
9,260
|
|
|
—
|
|
|
—
|
|
|
69,371
|
|
||||
Operating income (loss) before depreciation and amortization
|
10,028
|
|
|
766
|
|
|
(2,128
|
)
|
|
—
|
|
|
8,666
|
|
||||
Operating income (loss)
|
7,104
|
|
|
(633
|
)
|
|
(2,156
|
)
|
|
—
|
|
|
4,315
|
|
||||
Income (loss) from continuing operations before taxes
|
6,375
|
|
|
(1,013
|
)
|
|
(2,164
|
)
|
|
—
|
|
|
3,198
|
|
||||
Depreciation and amortization
|
2,925
|
|
|
1,399
|
|
|
12
|
|
|
—
|
|
|
4,336
|
|
||||
Capital expenditures
|
1,461
|
|
|
426
|
|
|
—
|
|
|
—
|
|
|
1,887
|
|
|
Six Months Ended June 30, 2020
|
||||||||||||||||||
|
Specialty Petrochemicals
|
|
|
Specialty Waxes
|
|
|
Corporate
|
|
|
Eliminations
|
|
|
Consolidated
|
|
|||||
|
(in thousands)
|
||||||||||||||||||
Product sales
|
$
|
81,622
|
|
|
$
|
12,268
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
93,890
|
|
Processing fees
|
2,403
|
|
|
6,448
|
|
|
—
|
|
|
—
|
|
|
8,851
|
|
|||||
Total revenues
|
84,025
|
|
|
18,716
|
|
|
—
|
|
|
—
|
|
|
102,741
|
|
|||||
Operating income (loss) before depreciation and amortization
|
11,464
|
|
|
1,920
|
|
|
(4,615
|
)
|
|
—
|
|
|
8,769
|
|
|||||
Operating income (loss)
|
6,226
|
|
|
(747
|
)
|
|
(4,625
|
)
|
|
—
|
|
|
854
|
|
|||||
Income (loss) from continuing operations before taxes
|
4,590
|
|
|
(687
|
)
|
|
(4,694
|
)
|
|
—
|
|
|
(791
|
)
|
|||||
Depreciation and amortization
|
5,238
|
|
|
2,666
|
|
|
10
|
|
|
—
|
|
|
7,914
|
|
|||||
Capital expenditures
|
6,983
|
|
|
601
|
|
|
—
|
|
|
—
|
|
|
7,584
|
|
|
Six Months Ended June 30, 2019
|
|||||||||||||||||
|
Specialty Petrochemicals
|
|
|
Specialty Waxes
|
|
|
Corporate
|
|
|
Eliminations
|
|
|
Consolidated
|
|
||||
|
(in thousands)
|
|||||||||||||||||
Product sales
|
$
|
114,074
|
|
|
$
|
12,748
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
126,822
|
|
Processing fees
|
2,910
|
|
|
4,794
|
|
|
—
|
|
|
—
|
|
|
7,704
|
|
||||
Total revenues
|
116,984
|
|
|
17,542
|
|
|
—
|
|
|
—
|
|
|
134,526
|
|
||||
Operating income (loss) before depreciation and amortization
|
21,435
|
|
|
(83
|
)
|
|
(4,433
|
)
|
|
—
|
|
|
16,919
|
|
||||
Operating income (loss)
|
15,437
|
|
|
(2,830
|
)
|
|
(4,466
|
)
|
|
—
|
|
|
8,141
|
|
||||
Income (loss) from continuing operations before taxes
|
13,510
|
|
|
(3,552
|
)
|
|
(4,456
|
)
|
|
—
|
|
|
5,502
|
|
||||
Depreciation and amortization
|
5,999
|
|
|
2,747
|
|
|
32
|
|
|
—
|
|
|
8,778
|
|
||||
Capital expenditures
|
2,839
|
|
|
935
|
|
|
—
|
|
|
—
|
|
|
3,774
|
|
|
June 30, 2020
|
||||||||||||||||||
|
Specialty Petrochemicals
|
|
|
Specialty Waxes
|
|
|
Corporate
|
|
|
Eliminations
|
|
|
Consolidated
|
|
|||||
|
(in thousands)
|
||||||||||||||||||
Trade receivables, product sales
|
$
|
14,934
|
|
|
$
|
3,005
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
17,939
|
|
Trade receivables, processing fees
|
927
|
|
|
1,374
|
|
|
—
|
|
|
—
|
|
|
2,301
|
|
|||||
Intangible assets, net
|
—
|
|
|
13,814
|
|
|
—
|
|
|
—
|
|
|
13,814
|
|
|||||
Total assets
|
300,996
|
|
|
87,755
|
|
|
101,714
|
|
|
(168,588
|
)
|
|
321,877
|
|
|
December 31, 2019
|
||||||||||||||||||
|
Specialty Petrochemicals
|
|
|
Specialty Waxes
|
|
|
Corporate
|
|
|
Eliminations
|
|
|
Consolidated
|
|
|||||
|
(in thousands)
|
||||||||||||||||||
Trade receivables, product sales
|
$
|
18,911
|
|
|
$
|
3,613
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
22,524
|
|
Trade receivables, processing fees
|
748
|
|
|
3,048
|
|
|
—
|
|
|
—
|
|
|
3,796
|
|
|||||
Intangible assets, net
|
—
|
|
|
14,736
|
|
|
—
|
|
|
—
|
|
|
14,736
|
|
|||||
Total assets
|
289,546
|
|
|
88,245
|
|
|
90,203
|
|
|
(166,175
|
)
|
|
301,819
|
|
|
|
Three Months Ended
June 30, 2020 |
|
Three Months Ended
June 30, 2019 |
||||||||||||||||||
|
|
Income
|
|
|
Shares
|
|
|
Per Share
Amount
|
|
|
Income
|
|
|
Shares
|
|
|
Per Share
Amount
|
|
||||
|
|
(in thousands, except per share amounts)
|
||||||||||||||||||||
Basic:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income (loss) from continuing operations
|
|
$
|
(1,859
|
)
|
|
24,802
|
|
|
$
|
(0.07
|
)
|
|
$
|
2,507
|
|
|
24,696
|
|
|
$
|
0.10
|
|
Unvested restricted stock units
|
|
|
|
—
|
|
|
|
|
|
|
395
|
|
|
|
||||||||
Diluted:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income (loss) from continuing operations
|
|
$
|
(1,859
|
)
|
|
24,802
|
|
|
$
|
(0.07
|
)
|
|
$
|
2,507
|
|
|
25,091
|
|
|
$
|
0.10
|
|
|
|
Six Months Ended
June 30, 2020 |
|
Six Months Ended
June 30, 2019 |
||||||||||||||||||
|
|
Income
|
|
|
Shares
|
|
|
Per Share
Amount
|
|
|
Income
|
|
|
Shares
|
|
|
Per Share
Amount
|
|
||||
|
|
(in thousands, except per share amounts)
|
||||||||||||||||||||
Basic:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income from continuing operations
|
|
$
|
4,004
|
|
|
24,784
|
|
|
$
|
0.16
|
|
|
$
|
4,317
|
|
|
24,675
|
|
|
$
|
0.17
|
|
Unvested restricted stock units
|
|
|
|
577
|
|
|
|
|
|
|
414
|
|
|
|
||||||||
Diluted:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income from continuing operations
|
|
$
|
4,004
|
|
|
25,360
|
|
|
$
|
0.16
|
|
|
$
|
4,317
|
|
|
25,089
|
|
|
$
|
0.17
|
|
|
|
Three Months Ended
June 30, 2020 |
|
Three Months Ended
June 30, 2019 |
||||||||||||||||||
|
|
Income
|
|
|
Shares
|
|
|
Per Share
Amount
|
|
|
Income (Loss)
|
|
|
Shares
|
|
|
Per Share
Amount
|
|
||||
|
|
(in thousands, except per share amounts)
|
||||||||||||||||||||
Basic:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net loss from discontinued operations, net of tax
|
|
$
|
(2
|
)
|
|
24,802
|
|
|
$
|
—
|
|
|
$
|
(103
|
)
|
|
24,696
|
|
|
$
|
—
|
|
Unvested restricted stock units
|
|
|
|
—
|
|
|
|
|
|
|
395
|
|
|
|
||||||||
Diluted:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net loss from discontinued operations, net of tax
|
|
$
|
(2
|
)
|
|
24,802
|
|
|
$
|
—
|
|
|
$
|
(103
|
)
|
|
25,091
|
|
|
$
|
—
|
|
|
|
Six Months Ended
June 30, 2020 |
|
Six Months Ended
June 30, 2019 |
||||||||||||||||||
|
|
Income (Loss)
|
|
|
Shares
|
|
|
Per Share
Amount
|
|
|
Income (Loss)
|
|
|
Shares
|
|
|
Per Share
Amount
|
|
||||
|
|
(in thousands, except per share amounts)
|
||||||||||||||||||||
Basic:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income (loss) from discontinued operations, net of tax
|
|
$
|
4,855
|
|
|
24,784
|
|
|
$
|
0.20
|
|
|
$
|
(162
|
)
|
|
24,675
|
|
|
$
|
(0.01
|
)
|
Unvested restricted stock units
|
|
|
|
577
|
|
|
|
|
|
|
414
|
|
|
|
||||||||
Diluted:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income (loss) from discontinued operations, net of tax
|
|
$
|
4,855
|
|
|
25,360
|
|
|
$
|
0.19
|
|
|
$
|
(162
|
)
|
|
25,089
|
|
|
$
|
(0.01
|
)
|
|
|
Three Months Ended
June 30, 2020 |
|
Three Months Ended
June 30, 2019 |
||||||||||||||||||
|
|
Income
|
|
|
Shares
|
|
|
Per Share
Amount
|
|
|
Income
|
|
|
Shares
|
|
|
Per Share
Amount
|
|
||||
|
|
(in thousands, except per share amounts)
|
||||||||||||||||||||
Basic:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income (loss)
|
|
$
|
(1,861
|
)
|
|
24,802
|
|
|
$
|
(0.07
|
)
|
|
$
|
2,404
|
|
|
24,696
|
|
|
$
|
0.10
|
|
Unvested restricted stock units
|
|
|
|
—
|
|
|
|
|
|
|
395
|
|
|
|
||||||||
Diluted:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income (loss)
|
|
$
|
(1,861
|
)
|
|
24,802
|
|
|
$
|
(0.07
|
)
|
|
$
|
2,404
|
|
|
25,091
|
|
|
$
|
0.10
|
|
|
|
Six Months Ended
June 30, 2020 |
|
Six Months Ended
June 30, 2019 |
||||||||||||||||||
|
|
Income (Loss)
|
|
|
Shares
|
|
|
Per Share
Amount
|
|
|
Income (Loss)
|
|
|
Shares
|
|
|
Per Share
Amount
|
|
||||
|
|
(in thousands, except per share amounts)
|
||||||||||||||||||||
Basic:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income
|
|
$
|
8,859
|
|
|
24,784
|
|
|
$
|
0.36
|
|
|
$
|
4,155
|
|
|
24,675
|
|
|
$
|
0.16
|
|
Unvested restricted stock units
|
|
|
|
577
|
|
|
|
|
|
|
414
|
|
|
|
||||||||
Diluted:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income
|
|
$
|
8,859
|
|
|
25,360
|
|
|
$
|
0.35
|
|
|
$
|
4,155
|
|
|
25,089
|
|
|
$
|
0.16
|
|
|
Three Months Ended
June 30, 2020 |
||||||||||||||
|
Specialty Petrochemicals
|
|
Specialty Waxes
|
|
Corporate
|
|
Consolidated
|
||||||||
|
(in thousands)
|
||||||||||||||
Net Income (Loss)
|
$
|
1,393
|
|
|
$
|
(332
|
)
|
|
$
|
(2,922
|
)
|
|
$
|
(1,861
|
)
|
Loss from discontinued operations, net of tax
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
(2
|
)
|
||||
Income (loss) from continuing operations
|
$
|
1,393
|
|
|
$
|
(332
|
)
|
|
$
|
(2,920
|
)
|
|
$
|
(1,859
|
)
|
Interest
|
736
|
|
|
—
|
|
|
(1
|
)
|
|
735
|
|
||||
Income tax expense (benefit)
|
255
|
|
|
(113
|
)
|
|
716
|
|
|
858
|
|
||||
Depreciation and amortization
|
185
|
|
|
23
|
|
|
4
|
|
|
212
|
|
||||
Depreciation and amortization in cost of sales
|
2,436
|
|
|
1,314
|
|
|
—
|
|
|
3,750
|
|
||||
EBITDA from continuing operations
|
$
|
5,005
|
|
|
$
|
892
|
|
|
$
|
(2,201
|
)
|
|
$
|
3,696
|
|
Stock-based compensation
|
—
|
|
|
—
|
|
|
543
|
|
|
543
|
|
||||
Gain on disposal of assets
|
(7
|
)
|
|
—
|
|
|
—
|
|
|
(7
|
)
|
||||
Adjusted EBITDA from continuing operations
|
$
|
4,998
|
|
|
$
|
892
|
|
|
$
|
(1,658
|
)
|
|
$
|
4,232
|
|
|
Three Months Ended
June 30, 2019 |
||||||||||||||
|
Specialty Petrochemicals
|
|
Specialty Waxes
|
|
Corporate
|
|
Consolidated
|
||||||||
|
(in thousands)
|
||||||||||||||
Net Income (Loss)
|
$
|
4,666
|
|
|
$
|
(1,013
|
)
|
|
$
|
(1,249
|
)
|
|
$
|
2,404
|
|
Loss from discontinued operations, net of tax
|
—
|
|
|
—
|
|
|
(103
|
)
|
|
(103
|
)
|
||||
Income (Loss) from continuing operations
|
$
|
4,666
|
|
|
$
|
(1,013
|
)
|
|
$
|
(1,146
|
)
|
|
$
|
2,507
|
|
Interest
|
1,053
|
|
|
347
|
|
|
1
|
|
|
1,401
|
|
||||
Income tax expense (benefit)
|
1,709
|
|
|
—
|
|
|
(1,018
|
)
|
|
691
|
|
||||
Depreciation and amortization
|
172
|
|
|
24
|
|
|
12
|
|
|
208
|
|
||||
Depreciation and amortization in cost of sales
|
2,753
|
|
|
1,375
|
|
|
—
|
|
|
4,128
|
|
||||
EBITDA from continuing operations
|
$
|
10,353
|
|
|
$
|
733
|
|
|
$
|
(2,151
|
)
|
|
$
|
8,935
|
|
Stock-based compensation
|
—
|
|
|
—
|
|
|
345
|
|
|
345
|
|
||||
Adjusted EBITDA from continuing operations
|
$
|
10,353
|
|
|
$
|
733
|
|
|
$
|
(1,806
|
)
|
|
$
|
9,280
|
|
|
Six Months Ended
June 30, 2020 |
||||||||||||||
|
Specialty Petrochemicals
|
|
Specialty Waxes
|
|
Corporate
|
|
Consolidated
|
||||||||
|
(in thousands)
|
||||||||||||||
Net Income
|
$
|
5,989
|
|
|
$
|
882
|
|
|
$
|
1,988
|
|
|
$
|
8,859
|
|
Income from discontinued operations, net of tax
|
—
|
|
|
—
|
|
|
4,855
|
|
|
4,855
|
|
||||
Income (loss) from continuing operations
|
$
|
5,989
|
|
|
$
|
882
|
|
|
$
|
(2,867
|
)
|
|
$
|
4,004
|
|
Interest
|
1,651
|
|
|
—
|
|
|
—
|
|
|
1,651
|
|
||||
Income tax benefit
|
(1,399
|
)
|
|
(1,569
|
)
|
|
(1,827
|
)
|
|
(4,795
|
)
|
||||
Depreciation and amortization
|
371
|
|
|
47
|
|
|
10
|
|
|
428
|
|
||||
Depreciation and amortization in cost of sales
|
4,867
|
|
|
2,619
|
|
|
—
|
|
|
7,486
|
|
||||
EBITDA from continuing operations
|
$
|
11,479
|
|
|
$
|
1,979
|
|
|
$
|
(4,684
|
)
|
|
$
|
8,774
|
|
Stock-based compensation
|
—
|
|
|
—
|
|
|
933
|
|
|
933
|
|
||||
(Gain) Loss on disposal of assets
|
(8
|
)
|
|
17
|
|
|
—
|
|
|
9
|
|
||||
Adjusted EBITDA from continuing operations
|
$
|
11,471
|
|
|
$
|
1,996
|
|
|
$
|
(3,751
|
)
|
|
$
|
9,716
|
|
|
Six Months Ended
June 30, 2019 |
||||||||||||||
|
Specialty Petrochemicals
|
|
Specialty Waxes
|
|
Corporate
|
|
Consolidated
|
||||||||
|
(in thousands)
|
||||||||||||||
Net Income (Loss)
|
$
|
10,808
|
|
|
$
|
(3,552
|
)
|
|
$
|
(3,101
|
)
|
|
$
|
4,155
|
|
Loss from discontinued operations, net of tax
|
—
|
|
|
—
|
|
|
(162
|
)
|
|
(162
|
)
|
||||
Income (loss) from continuing operations
|
$
|
10,808
|
|
|
$
|
(3,552
|
)
|
|
$
|
(2,939
|
)
|
|
$
|
4,317
|
|
Interest
|
2,248
|
|
|
651
|
|
|
1
|
|
|
2,900
|
|
||||
Income tax expense (benefit)
|
2,703
|
|
|
—
|
|
|
(1,518
|
)
|
|
1,185
|
|
||||
Depreciation and amortization
|
341
|
|
|
48
|
|
|
32
|
|
|
421
|
|
||||
Depreciation and amortization in cost of sales
|
5,658
|
|
|
2,699
|
|
|
—
|
|
|
8,357
|
|
||||
EBITDA from continuing operations
|
$
|
21,758
|
|
|
$
|
(154
|
)
|
|
$
|
(4,424
|
)
|
|
$
|
17,180
|
|
Stock-based compensation
|
—
|
|
|
—
|
|
|
558
|
|
|
558
|
|
||||
Adjusted EBITDA from continuing operations
|
$
|
21,758
|
|
|
$
|
(154
|
)
|
|
$
|
(3,866
|
)
|
|
$
|
17,738
|
|
|
June 30, 2020
|
|
|
December 31, 2019
|
|
|
June 30, 2019
|
|
Days sales outstanding in accounts receivable
|
45.3
|
|
|
37.1
|
|
|
41.1
|
|
Days sales outstanding in inventory
|
17.0
|
|
|
19.2
|
|
|
20.6
|
|
Days sales outstanding in accounts payable
|
24.7
|
|
|
20.6
|
|
|
15.0
|
|
Days of working capital
|
37.6
|
|
|
35.7
|
|
|
46.6
|
|
|
|
Six Months Ended
June 30, |
||||||
|
|
2020
|
|
|
2019
|
|
||
Net cash provided by (used in)
|
|
(thousands of dollars)
|
||||||
Operating activities
|
|
$
|
20,555
|
|
|
$
|
5,848
|
|
Investing activities
|
|
2,312
|
|
|
(3,842
|
)
|
||
Financing activities
|
|
865
|
|
|
(4,416
|
)
|
||
Increase (decrease) in cash
|
|
$
|
23,732
|
|
|
$
|
(2,410
|
)
|
Cash
|
|
$
|
29,877
|
|
|
$
|
4,325
|
|
•
|
Under the CARES Act, we recorded an income tax receivable related to the carryback of NOL claims. This resulted in an increase in our income tax receivable of approximately $15.7 million. On April 30, 2020 we filed our first refund claims for approximately $14.1 million and on June 30, 2020 we filed our second and final refund claims for approximately $2.4 million.
|
•
|
Trade receivables decreased approximately $6.1 million. This is due to lower sales within the quarter and we do not expect any collection issues at this time.
|
•
|
Inventories decreased approximately $6.0 million driven by lower inventory values associated with the continued decline in feedstock prices.
|
•
|
Accounts payable and accrued liabilities decreased $1.8 million primarily due to a reduced payable to our feedstock supplier driven by lower feedstock prices, as well as payments to vendors in the first quarter of 2020 for costs associated with the aforementioned weather event in the fourth quarter of 2019.
|
|
|
Three Months Ended June 30,
|
|||||||||||||
|
|
2020
|
|
|
2019
|
|
|
Change
|
|
|
% Change
|
|
|||
|
|
(thousands of dollars)
|
|||||||||||||
Product Sales
|
|
$
|
31,236
|
|
|
$
|
58,584
|
|
|
$
|
(27,348
|
)
|
|
(46.7
|
)%
|
Processing
|
|
1,159
|
|
|
1,527
|
|
|
(368
|
)
|
|
(24.1
|
)%
|
|||
Gross Revenue
|
|
$
|
32,395
|
|
|
$
|
60,111
|
|
|
$
|
(27,716
|
)
|
|
(46.1
|
)%
|
|
|
|
|
|
|
|
|
|
|||||||
Volume of Sales (gallons)
|
|
|
|
|
|
|
|
|
|||||||
Specialty Petrochemicals Products
|
|
15,343
|
|
|
21,447
|
|
|
(6,104
|
)
|
|
(28.5
|
)%
|
|||
Prime Product Sales
|
|
13,090
|
|
|
17,732
|
|
|
(4,642
|
)
|
|
(26.2
|
)%
|
|||
By-product Sales
|
|
2,253
|
|
|
3,715
|
|
|
(1,462
|
)
|
|
(39.4
|
)%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Cost of Sales
|
|
$
|
27,126
|
|
|
$
|
50,049
|
|
|
(22,923
|
)
|
|
(45.8
|
)%
|
|
Gross Margin
|
|
16.3
|
%
|
|
16.7
|
%
|
|
|
|
(0.4
|
)%
|
||||
Total Operating Expense*
|
|
16,160
|
|
|
18,455
|
|
|
(2,295
|
)
|
|
(12.4
|
)%
|
|||
Natural Gas Expense*
|
|
685
|
|
|
1,253
|
|
|
(568
|
)
|
|
(45.3
|
)%
|
|||
Operating Labor Costs*
|
|
3,932
|
|
|
3,596
|
|
|
336
|
|
|
9.3
|
%
|
|||
Transportation Costs*
|
|
4,890
|
|
|
7,360
|
|
|
(2,470
|
)
|
|
(33.6
|
)%
|
|||
General & Administrative Expense
|
|
2,730
|
|
|
2,816
|
|
|
(86
|
)
|
|
(3.1
|
)%
|
|||
Depreciation and Amortization**
|
|
2,621
|
|
|
2,925
|
|
|
(304
|
)
|
|
(10.4
|
)%
|
|||
Capital Expenditures
|
|
5,382
|
|
|
1,461
|
|
|
3,921
|
|
|
268.4
|
%
|
|
|
Three Months Ended June 30,
|
|||||||||||||
|
|
2020
|
|
|
2019
|
|
|
Change
|
|
|
% Change
|
|
|||
|
|
(thousands of dollars)
|
|||||||||||||
Product Sales
|
|
$
|
5,471
|
|
|
$
|
6,745
|
|
|
$
|
(1,274
|
)
|
|
(18.9
|
)%
|
Processing
|
|
2,808
|
|
|
2,515
|
|
|
293
|
|
|
11.7
|
%
|
|||
Gross Revenue
|
|
$
|
8,279
|
|
|
$
|
9,260
|
|
|
$
|
(981
|
)
|
|
(10.6
|
)%
|
|
|
|
|
|
|
|
|
|
|||||||
Volume of specialty wax sales (thousand pounds)
|
|
8,366
|
|
|
9,955
|
|
|
(1,589
|
)
|
|
(16.0
|
)%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Cost of Sales
|
|
$
|
7,381
|
|
|
$
|
8,757
|
|
|
$
|
(1,376
|
)
|
|
(15.7
|
)%
|
Gross Margin (Loss)
|
|
10.8
|
%
|
|
5.4
|
%
|
|
|
|
5.4
|
%
|
||||
General & Administrative Expense
|
|
1,359
|
|
|
1,083
|
|
|
276
|
|
|
25.5
|
%
|
|||
Depreciation and Amortization*
|
|
1,338
|
|
|
1,399
|
|
|
(61
|
)
|
|
(4.4
|
)%
|
|||
Capital Expenditures
|
|
$
|
285
|
|
|
$
|
426
|
|
|
$
|
(141
|
)
|
|
(33.1
|
)%
|
|
|
Three Months Ended June 30,
|
|||||||||||||
|
|
2020
|
|
|
2019
|
|
|
Change
|
|
|
% Change
|
|
|||
|
|
(thousands of dollars)
|
|
|
|||||||||||
General & Administrative Expense
|
|
$
|
2,200
|
|
|
$
|
2,182
|
|
|
$
|
18
|
|
|
0.8
|
%
|
|
|
Three Months Ended June 30,
|
|||||||||||||
|
|
2020
|
|
|
2019
|
|
|
Change
|
|
|
% Change
|
|
|||
|
|
(thousands of dollars)
|
|
|
|||||||||||
Equity in earnings (losses) of AMAK
|
|
$
|
306
|
|
|
$
|
(91
|
)
|
|
$
|
397
|
|
|
436.3
|
%
|
|
|
Three Months Ended
June 30, |
||||||
|
|
2020
|
|
2019
|
||||
|
|
(thousands of dollars)
|
||||||
Sales
|
|
$
|
20,752
|
|
|
$
|
20,566
|
|
Cost of sales
|
|
17,829
|
|
|
18,162
|
|
||
Gross profit
|
|
2,923
|
|
|
2,404
|
|
||
Selling, general, and administrative
|
|
2,362
|
|
|
2,807
|
|
||
Operating loss
|
|
561
|
|
|
(403
|
)
|
||
Other income
|
|
—
|
|
|
(75
|
)
|
||
Finance and interest expense
|
|
(103
|
)
|
|
(448
|
)
|
||
Loss before Zakat and income taxes
|
|
458
|
|
|
(926
|
)
|
||
Zakat and income taxes
|
|
566
|
|
|
366
|
|
||
Net Loss
|
|
$
|
(108
|
)
|
|
$
|
(1,292
|
)
|
|
|
|
|
|
||||
Finance and interest expense
|
|
103
|
|
|
448
|
|
||
Depreciation and amortization
|
|
6,393
|
|
|
7,746
|
|
||
Zakat and income taxes
|
|
566
|
|
|
366
|
|
||
EBITDA
|
|
$
|
6,954
|
|
|
$
|
7,268
|
|
|
|
Six Months Ended June 30,
|
|||||||||||||
|
|
2020
|
|
|
2019
|
|
|
Change
|
|
|
% Change
|
|
|||
|
|
(thousands of dollars)
|
|||||||||||||
Product Sales
|
|
$
|
81,622
|
|
|
$
|
114,074
|
|
|
$
|
(32,452
|
)
|
|
(28.4
|
)%
|
Processing
|
|
2,403
|
|
|
2,910
|
|
|
(507
|
)
|
|
(17.4
|
)%
|
|||
Gross Revenue
|
|
$
|
84,025
|
|
|
$
|
116,984
|
|
|
$
|
(32,959
|
)
|
|
(28.2
|
)%
|
|
|
|
|
|
|
|
|
|
|||||||
Volume of Sales (gallons)
|
|
|
|
|
|
|
|
|
|||||||
Specialty Petrochemicals Products
|
|
35,084
|
|
|
43,915
|
|
|
(8,831
|
)
|
|
(20.1
|
)%
|
|||
Prime Product Sales
|
|
29,309
|
|
|
35,370
|
|
|
(6,061
|
)
|
|
(17.1
|
)%
|
|||
By-product Sales
|
|
5,775
|
|
|
8,545
|
|
|
(2,770
|
)
|
|
(32.4
|
)%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Cost of Sales
|
|
$
|
71,922
|
|
|
$
|
95,915
|
|
|
(23,993
|
)
|
|
(25.0
|
)%
|
|
Gross Margin
|
|
14.4
|
%
|
|
18.0
|
%
|
|
|
|
(3.6
|
)%
|
||||
Total Operating Expense*
|
|
32,900
|
|
|
36,735
|
|
|
(3,835
|
)
|
|
(10.4
|
)%
|
|||
Natural Gas Expense*
|
|
1,612
|
|
|
2,636
|
|
|
(1,024
|
)
|
|
(38.8
|
)%
|
|||
Operating Labor Costs*
|
|
7,937
|
|
|
7,299
|
|
|
638
|
|
|
8.7
|
%
|
|||
Transportation Costs*
|
|
9,777
|
|
|
14,408
|
|
|
(4,631
|
)
|
|
(32.1
|
)%
|
|||
General & Administrative Expense
|
|
5,506
|
|
|
5,291
|
|
|
215
|
|
|
4.1
|
%
|
|||
Depreciation and Amortization**
|
|
5,238
|
|
|
5,999
|
|
|
(761
|
)
|
|
(12.7
|
)%
|
|||
Capital Expenditures
|
|
6,983
|
|
|
2,839
|
|
|
4,144
|
|
|
146.0
|
%
|
|
|
Six Months Ended June 30,
|
|||||||||||||
|
|
2020
|
|
|
2019
|
|
|
Change
|
|
|
% Change
|
|
|||
|
|
(thousands of dollars)
|
|||||||||||||
Product Sales
|
|
$
|
12,268
|
|
|
$
|
12,748
|
|
|
$
|
(480
|
)
|
|
(3.8
|
)%
|
Processing
|
|
6,448
|
|
|
4,794
|
|
|
1,654
|
|
|
34.5
|
%
|
|||
Gross Revenue
|
|
$
|
18,716
|
|
|
$
|
17,542
|
|
|
$
|
1,174
|
|
|
6.7
|
%
|
|
|
|
|
|
|
|
|
|
|||||||
Volume of specialty wax sales (thousand pounds)
|
|
18,540
|
|
|
17,837
|
|
|
703
|
|
|
3.9
|
%
|
|||
|
|
|
|
|
|
|
|
|
|||||||
Cost of Sales
|
|
$
|
16,574
|
|
|
$
|
17,973
|
|
|
$
|
(1,399
|
)
|
|
(7.8
|
)%
|
Gross Margin (Loss)
|
|
11.4
|
%
|
|
(2.5
|
)%
|
|
|
|
13.9
|
%
|
||||
General & Administrative Expense
|
|
2,842
|
|
|
2,352
|
|
|
490
|
|
|
20.8
|
%
|
|||
Depreciation and Amortization*
|
|
2,666
|
|
|
2,747
|
|
|
(81
|
)
|
|
(2.9
|
)%
|
|||
Capital Expenditures
|
|
$
|
601
|
|
|
$
|
935
|
|
|
$
|
(334
|
)
|
|
(35.7
|
)%
|
|
|
Six Months Ended June 30,
|
|||||||||||||
|
|
2020
|
|
|
2019
|
|
|
Change
|
|
|
% Change
|
|
|||
|
|
(thousands of dollars)
|
|
|
|||||||||||
General & Administrative Expense
|
|
$
|
4,615
|
|
|
$
|
4,487
|
|
|
$
|
128
|
|
|
2.9
|
%
|
|
|
Six Months Ended June 30,
|
|||||||||||||
|
|
2020
|
|
|
2019
|
|
|
Change
|
|
|
% Change
|
|
|||
|
|
(thousands of dollars)
|
|
|
|||||||||||
Equity in losses of AMAK
|
|
$
|
(226
|
)
|
|
$
|
(150
|
)
|
|
$
|
(76
|
)
|
|
50.7
|
%
|
|
|
Six Months Ended
June 30, |
||||||
|
|
2020
|
|
2019
|
||||
|
|
(thousands of dollars)
|
||||||
Sales
|
|
$
|
38,689
|
|
|
$
|
41,230
|
|
Cost of sales
|
|
34,650
|
|
|
36,732
|
|
||
Gross profit
|
|
4,039
|
|
|
4,498
|
|
||
Selling, general, and administrative
|
|
5,042
|
|
|
5,545
|
|
||
Operating loss
|
|
(1,003
|
)
|
|
(1,047
|
)
|
||
Other income
|
|
17
|
|
|
353
|
|
||
Finance and interest expense
|
|
(634
|
)
|
|
(893
|
)
|
||
Loss before Zakat and income taxes
|
|
(1,620
|
)
|
|
(1,587
|
)
|
||
Zakat and income taxes
|
|
1,099
|
|
|
888
|
|
||
Net Loss
|
|
$
|
(2,719
|
)
|
|
$
|
(2,475
|
)
|
|
|
|
|
|
||||
Finance and interest expense
|
|
634
|
|
|
893
|
|
||
Depreciation and amortization
|
|
13,722
|
|
|
15,070
|
|
||
Zakat and income taxes
|
|
1,099
|
|
|
888
|
|
||
EBITDA
|
|
$
|
12,736
|
|
|
$
|
14,376
|
|
(a)
|
Evaluation of disclosure controls and procedures. Our Chief Executive Officer and Chief Financial Officer, with the participation of management, have evaluated the effectiveness of our "disclosure controls and procedures" (as defined in Rules 13a-15(e) and 15(d)-15(e) under the Securities Exchange Act of 1934) and determined that our disclosure controls and procedures were effective as of the end of the period covered by this report.
|
(b)
|
Changes in internal control. There were no significant changes in our internal control over financial reporting that occurred during the three months ended June 30, 2020, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
|
Period
|
(a)
Total Number of Shares (or Units) Purchased(1) |
|
|
(b)
Average Price Paid Per Share (or Unit)(1) |
|
|
(c)
Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs |
|
|
(d)
Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs |
|
|
April 1, 2020 - April 30, 2020
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
—
|
|
May 1, 2020 - May 31, 2020
|
2,456
|
|
|
4.44
|
|
|
—
|
|
|
—
|
|
|
June 1, 2020 - June 30, 2020
|
3,547
|
|
|
6.22
|
|
|
—
|
|
|
—
|
|
|
Total
|
6,003
|
|
|
$
|
5.49
|
|
|
—
|
|
|
—
|
|
(1) Represents shares of our common stock withheld for satisfaction of tax liabilities of a holder of restricted shares. The value of such shares was calculated based on the closing price of our common stock on the New York Stock Exchange on the date when the withholding was made.
|
Exhibit
Number
|
Description
|
10.1*
|
|
10.2*
|
|
10.3*
|
|
10.4*°
|
|
10.5*+
|
|
31.1*
|
|
31.2*
|
|
32.1*
|
|
32.2*
|
|
101.INS*
|
XBRL Instance Document (XBRL tags are embedded within the Inline XBRL document)
|
101.SCH*
|
XBRL Taxonomy Schema Document
|
101.CAL*
|
XBRL Taxonomy Calculation Linkbase Document
|
101.LAB*
|
XBRL Taxonomy Label Linkbase Document
|
101.PRE*
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
101.DEF*
|
XBRL Taxonomy Extension Definition Linkbase Document
|
104*
|
Cover Page Interactive Data File (formatted as inline XBRL and included as Exhibit 101)
|
|
TRECORA RESOURCES
|
|
|
|
|
Dated: August 6, 2020
|
By:
|
/s/ Sami Ahmad
|
|
|
Sami Ahmad
|
|
|
Principal Financial Officer and Duly Authorized Officer
|
|
Promissory Note
|
|
|||
Date
|
Loan Amount
|
|
Interest Rate after Deferment Period
|
Deferment Period
|
|
April 30, 2020
|
|
$3,934,750.00
|
|
1.00% fixed per annum
|
6 months
|
1.
|
DEPOSIT ACCOUNT/USE OF LOAN PROCEEDS: Borrower is required to maintain a deposit account with Bank of America, N.A. (the “Deposit Account”) until the Loan is either forgiven in full or the Loan is fully paid by Borrower. Borrower acknowledges and agrees that the proceeds of the Loan shall be deposited by Bank into the Deposit Account. The Loan proceeds are to not be used by Borrower for any illegal purpose and Borrower represents to the Bank that it will derive material benefit, directly and indirectly, from the making of the Loan.
|
2.
|
DIRECT DEBIT. If the Loan is not forgiven and a Loan Balance remains, Borrower agrees that on the due date of any amount due as set forth in the Repayment Letter, Bank will debit the amount due from the Deposit Account established by Borrower in connection with this Loan. Should there be insufficient funds in the Deposit Account to pay all such sums when due, the full amount of such deficiency be shall be immediately due and payable by Borrower.
|
3.
|
INTEREST RATE: Bank shall charge interest on the unpaid principal balance of the Loan at the interest rate set forth above under “Interest Rate” from the date the Loan was funded until the Loan is paid in full.
|
4.
|
REPRESENTATIONS, WARRANTIES AND COVENANTS. (1) Borrower represents and warrants to Bank, and covenants and agrees with Bank, that: (i) Borrower has read the statements included in the Application, including the Statements Required by Law and Executive Orders, and Borrower understands them. (ii) Borrower was and remains eligible to receive a loan under the rules in effect at the time Borrower submitted to Bank its Paycheck Protection Program Application Form (the “Application”) that have been issued by the SBA implementing the Paycheck Protection Program under Division A, Title I of the CARES Act (the “Paycheck Protection Program Rule”). (iii) Borrower (a) is an independent contractor, eligible self-employed individual, or sole proprietor or (b) employs no more than the greater of 500 employees or, if applicable, the size standard in number of employees established by the SBA in 13 C.F.R. 121.201 for Borrower’s industry. (iv) Borrower will comply whenever applicable, with the civil rights and other limitations in the Application. (v) All proceeds of the Loan will be used only for business-related purposes as specified in the Application and consistent with the Paycheck Protection Program Rule. (vi) To the extent feasible, Borrower will purchase only American-made equipment and products. (vii) Borrower is not engaged in any activity that is illegal under federal, state or local law. (viii) Borrower certifies that any loan received by Borrower under Section 7(b)(2) of the Small Business Act between January 31, 2020 and April 3, 2020 that will remain outstanding after funding of this Loan was for a purpose other than paying payroll costs and other allowable uses loans under the Paycheck Protection Program Rule. (ix) Borrower was in operation on February 15, 2020 and had employees for whom Borrower paid salaries and payroll taxes or paid independent contractors (as reported on Form(s) 1099-MISC). (x) The current economic uncertainty makes the request for the Loan necessary to support the ongoing operations of Borrower. (xi) All proceeds of the Loan will be used to retain workers and maintain payroll or make mortgage interest payments, lease payments, and utility payments, as specified under the Paycheck Protection Program Rule and Borrower acknowledges that if the funds are knowingly used for unauthorized purposes, the federal government may hold Borrower and/or Borrower’s authorized representative legally liable, such as for charges of fraud. (xii) Borrower has provided Bank true, correct and complete information demonstrating that Borrower had employees for whom Borrower paid salaries and payroll taxes on or around February 15, 2020. (xiii) Borrower has provided to Bank all documentation available to Borrower on a reasonable basis verifying the dollar amounts of average monthly payroll costs for the calendar year 2019, which documentation shall include, as applicable, copies of payroll processor records, payroll tax filings and/or Form 1099-MISC. (xiv) Borrower will promptly provide to Bank (a) any additional documentation that Bank requests in order to verify payroll costs and (b) documentation verifying the number of full-time equivalent employees on payroll as well as the dollar amounts of payroll costs, covered mortgage interest payments, covered rent payments, and covered utilities for the eight week period following the Loan. (xv) Borrower acknowledges that (a) loan forgiveness will be provided by the SBA for the sum of documented payroll costs, covered mortgage interest payments, covered rent payments, and covered utilities, and not more than 25% of the Forgivable Amount may be for non-payroll costs (xvi) During the period beginning on February 15, 2020 and ending on December 31, 2020, Borrower has not and will not receive any other loan under
|
5.
|
EVENTS OF DEFAULT: If the Loan is not forgiven and a Loan Balance remains, then from the date the Repayment Letter is sent to Borrower until the Loan Balance is fully paid, the occurrence and continuation of any of the following events shall constitute a default hereunder: (i) insolvency, bankruptcy, dissolution, issuance of an attachment or garnishment against Borrower; (ii) failure to make any payment when due under the Loan or any or all other loans made by Bank to Borrower, and such failure continues for ten (10) days after it first became due; (iii) failure to provide current financial information promptly upon request by Bank; (iv) the making of any false or materially misleading statement on any application or any financial statement for the Loan or for any or all other loans made by Bank to Borrower; (v) Bank in good faith believes the prospect of payment under the Loan or any or all other loans made by Bank to Borrower is impaired; (vi) Borrower under or in connection with the Loan or any or all other loans made by Bank to Borrower fails to timely and properly observe, keep or perform any term, covenant, agreement, or condition therein; (vii) default shall be made with respect to any other indebtedness for borrowed money of Borrower, if the default is a failure to pay at maturity or if the effect of such default is to accelerate the maturity of such indebtedness for borrowed money or to permit the holder or obligee thereof or other party thereto to cause any such indebtedness for borrowed money to become due prior to its stated maturity; (viii) the Bank in its sole discretion determines in good faith that an event has occurred that materially and adversely affects Borrower;
|
6.
|
REMEDIES: If the Loan is not forgiven and a Loan Balance remains, then from the date the Repayment Letter is sent to Borrower, upon the occurrence of a default, all or any portion of the entire amount owing on the Loan, and any and all other loans made by Bank to Borrower, shall, at Bank’s option, become immediately due and payable without demand or notice. Upon a default, Bank may exercise any other right or remedy available to it at law or in equity. All persons included in the term “Borrower” are jointly and severally liable for repayment, regardless of to whom any advance of credit was made. Borrower shall pay any costs Bank may incur including without limitation reasonable attorney’s fees and court costs should the Loan and/or any and all other loans made by Bank to Borrower be referred to an attorney for collection to the extent permitted under applicable state law. EACH PERSON INCLUDED IN THE TERM BORROWER WAIVES ALL SURETYSHIP AND OTHER SIMILAR DEFENSES TO THE FULL EXTENT PERMITTED BY APPLICABLE LAW.
|
7.
|
CREDIT INVESTIGATION: If the Loan is not forgiven and a Loan Balance remains, then from the date the Repayment Letter is sent to Borrower until the Loan Balance is fully paid, Borrower authorizes Bank and any of its affiliates at any time to make whatever credit investigation Bank deems is proper to evaluate Borrower’s credit, financial standing and employment and Borrower authorizes Bank to exchange Borrower’s credit experience with credit bureaus and other creditors Bank reasonably believes are doing business with Borrower. Borrower also agrees to furnish Bank with any financial statements Bank may request at any time and in such detail as Bank may require.
|
8.
|
NOTICES: Borrower’s request for Loan forgiveness, and the documentation that must accompany that request, shall be submitted to Bank by transmitting the communication to the electronic address, website, or other electronic transmission portal provided by Bank to Borrower.
|
9.
|
CHOICE OF LAW; JURISDICTION; VENUE. (1) At all times that Bank is the holder of this Note, except to the extent that any law of the United States may apply, this Note shall be governed and interpreted according to the internal laws of the state of Borrower’s principal place of business (the “Governing Law State”), without regard to any choice of law, rules or principles to the contrary. However, the charging and calculating of interest on the obligations under this Note shall be governed by, construed and enforced in accordance with the laws of the state of North Carolina and applicable federal law. Nothing in this paragraph shall be construed to limit or otherwise affect any rights or remedies of Bank under federal law. Borrower and Bank agree and consent to be subject to the personal jurisdiction of any state or federal court located in the Governing Law State so that trial shall only be conducted by a court in that state. (2) Notwithstanding the foregoing, when SBA is the holder, this Note will be interpreted and enforced under federal law, including SBA regulations. Lender or SBA may use state or local procedures for filing papers, recording documents, giving notice, foreclosing liens, and other purposes. By using such procedures, SBA does not waive any federal immunity from state or local control, penalty, tax, or liability. As to this Note, Borrower may not claim or assert against SBA any local or state law to deny any obligation, defeat any claim of SBA, or preempt federal law.
|
10.
|
MISCELLANEOUS. The Loan may be sold or assigned by Bank without notice to Borrower. Borrower may not assign the Loan or its rights hereunder to anyone without Bank’s prior written consent. If any provision of this Note is contrary to applicable law or is found unenforceable, such provision shall be severed from this Note without invalidating the other provisions thereof. Bank may delay enforcing any of its rights under this Note without losing them, and no failure or delay on the part of Bank in exercising any right, power or privilege hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right, power or privilege hereunder preclude any other or future exercise thereof or the exercise of any other right, power or privilege. Bank, by its acceptance hereof, and the making of the Loan and Borrower understand and agree that this Note constitutes the complete understanding between them. This Note shall be binding upon Borrower, and its successors and assigns, and inure to the benefit of Bank and its successors and assigns.
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11.
|
BORROWING AUTHORIZED. The signer for Borrower represents, covenants and warrants to Bank that he or she is certified to borrow for the Borrower and is signing this Note as the duly authorized sole proprietor, owner, sole shareholder, officer, member, managing member, partner, trustee, principal, agent or representative of Borrower, and further acknowledges and confirms to Bank that by said signature he or she has read and understands all of the terms and provisions contained in this Note and agrees and consents to be bound by them. This Note and any instrument or agreement required herein, are within the Borrower's powers, have been duly authorized, and do not conflict with any of its organizational papers. The individuals signing this Agreement on behalf of each Borrower are authorized to sign such documents on behalf of such entities. For purposes of this Note only, the Bank may rely upon and accept the authority of only one signer on behalf of the Borrower, and for this Note, this resolution supersedes and replaces any prior and existing contrary resolution provided by Borrower to Bank.
|
12.
|
ELECTRONIC COMMUNICATIONS AND SIGNATURES. This Note and any document, amendment, approval, consent, information, notice, certificate, request, statement, disclosure or authorization related to this Note (each a “Communication”), including Communications required to be in writing, may, if agreed by the Bank, be in the form of an Electronic Record and may be executed using Electronic Signatures, including, without limitation, facsimile and/or .pdf. The Borrower agrees that any Electronic Signature (including, without limitation, facsimile or .pdf) on or associated with any Communication shall be valid and binding on the Borrower to the same extent as a manual, original signature, and that any Communication entered into by Electronic Signature, will constitute the legal, valid and binding obligation of the Borrower enforceable against the Borrower in accordance with the terms thereof to the same extent as if a manually executed original signature was delivered to the Bank. Any Communication may be executed in as many counterparts as necessary or convenient, including both paper and electronic counterparts, but all such counterparts are one and the same Communication. For the avoidance of doubt, the authorization under this paragraph may include, without limitation, use or acceptance by the Bank of a manually signed paper Communication which has been converted into electronic form (such as scanned into PDF format), or an electronically signed Communication converted into another format, for transmission, delivery and/or retention. The Bank may, at its option, create one or more copies of any Communication in the form of an imaged Electronic Record (“Electronic Copy”), which shall be deemed created in the ordinary course of the Bank’s business, and destroy the original paper document. All Communications in the form of an Electronic Record, including an Electronic Copy, shall be considered an original for all purposes, and shall have the same legal effect, validity and enforceability as a paper record. Notwithstanding anything contained herein to the contrary, the Bank is under no obligation to accept an Electronic Signature in any form or in any format unless expressly agreed to by the Bank pursuant to procedures approved by it; provided, further, without limiting the foregoing, (a) to the extent the Bank has agreed to accept such Electronic Signature, the Bank shall be entitled to rely on any such Electronic Signature without further verification and (b) upon the request of the Bank any Electronic Signature shall be promptly followed by a manually executed, original counterpart. For purposes hereof, “Electronic Record” and “Electronic Signature” shall have the meanings assigned to them, respectively, by 15 USC §7006, as it may be amended from time to time.
|
13.
|
CONVERSION TO PAPER ORIGINAL. At the Bank’s discretion the authoritative electronic copy of this Note ("Authoritative Copy") may be converted to paper and marked as the original by the Bank (the "Paper Original"). Unless and until the Bank creates a Paper Original, the Authoritative Copy of this Agreement: (1) shall at all times reside in a document management system designated by the Bank for the storage of authoritative copies of electronic records, and (2) is held in the ordinary course of business. In the event the Authoritative Copy is converted to a Paper Original, the parties hereto acknowledge and agree that: (1) the electronic signing of this Agreement also constitutes issuance and delivery of the Paper Original, (2) the electronic signature(s) associated with this Agreement, when affixed to the Paper Original, constitutes legally valid
|
14.
|
BORROWER ATTESTATION. Borrower attests and certifies to Bank that it has not provided false or misleading information or statements to the Bank in its application for the Loan, and that the certifications, representations, warranties, and covenants made to the Bank in this Note and elsewhere relating to the Loan are true, accurate, and correct. Borrower further attests and certifies to Bank that it is has read, understands, and acknowledges that the Loan is being made under the CARES Act, and any use of the proceeds of the Loan other than as permitted by the CARES Act, or any false or misleading information or statements provided to the Bank in its application for the Loan or in this Note may subject the Borrower to criminal and civil liability under applicable state and federal laws and regulations, including but not limited to, the False Claims Act, 31 U.S.C. Section 3729, et. seq. Borrower further acknowledges and understands that this Note is not valid and effective until and unless Borrower’s application for the Loan is approved and Bank’s receiving confirmation from the SBA that Bank may proceed with the Loan.
|
BORROWER: South Hampton Resources, Inc.
|
/s/ Sami Ahmad
|
Signature of Authorized Representative of Borrower
|
Sami Ahmad
|
Print Name
|
Authorized Representative
|
Title
|
STREET ADDRESS: 7752 FM 418
|
CITY/STATE/ZIP CODE: Silsbee, TX, 77656/
|
|
Promissory Note
|
|
|||
Date
|
Loan Amount
|
|
Interest Rate after Deferment Period
|
Deferment Period
|
|
April 30, 2020
|
|
$2,188,087.50
|
|
1.00% fixed per annum
|
6 months
|
1.
|
DEPOSIT ACCOUNT/USE OF LOAN PROCEEDS: Borrower is required to maintain a deposit account with Bank of America, N.A. (the “Deposit Account”) until the Loan is either forgiven in full or the Loan is fully paid by Borrower. Borrower acknowledges and agrees that the proceeds of the Loan shall be deposited by Bank into the Deposit Account. The Loan proceeds are to not be used by Borrower for any illegal purpose and Borrower represents to the Bank that it will derive material benefit, directly and indirectly, from the making of the Loan.
|
2.
|
DIRECT DEBIT. If the Loan is not forgiven and a Loan Balance remains, Borrower agrees that on the due date of any amount due as set forth in the Repayment Letter, Bank will debit the amount due from the Deposit Account established by Borrower in connection with this Loan. Should there be insufficient funds in the Deposit Account to pay all such sums when due, the full amount of such deficiency be shall be immediately due and payable by Borrower.
|
3.
|
INTEREST RATE: Bank shall charge interest on the unpaid principal balance of the Loan at the interest rate set forth above under “Interest Rate” from the date the Loan was funded until the Loan is paid in full.
|
4.
|
REPRESENTATIONS, WARRANTIES AND COVENANTS. (1) Borrower represents and warrants to Bank, and covenants and agrees with Bank, that: (i) Borrower has read the statements included in the Application, including the Statements Required by Law and Executive Orders, and Borrower understands them. (ii) Borrower was and remains eligible to receive a loan under the rules in effect at the time Borrower submitted to Bank its Paycheck Protection Program Application Form (the “Application”) that have been issued by the SBA implementing the Paycheck Protection Program under Division A, Title I of the CARES Act (the “Paycheck Protection Program Rule”). (iii) Borrower (a) is an independent contractor, eligible self-employed individual, or sole proprietor or (b) employs no more than the greater of 500 employees or, if applicable, the size standard in number of employees established by the SBA in 13 C.F.R. 121.201 for Borrower’s industry. (iv) Borrower will comply whenever applicable, with the civil rights and other limitations in the Application. (v) All proceeds of the Loan will be used only for business-related purposes as specified in the Application and consistent with the Paycheck Protection Program Rule. (vi) To the extent feasible, Borrower will purchase only American-made equipment and products. (vii) Borrower is not engaged in any activity that is illegal under federal, state or local law. (viii) Borrower certifies that any loan received by Borrower under Section 7(b)(2) of the Small Business Act between January 31, 2020 and April 3, 2020 that will remain outstanding after funding of this Loan was for a purpose other than paying payroll costs and other allowable uses loans under the Paycheck Protection Program Rule. (ix) Borrower was in operation on February 15, 2020 and had employees for whom Borrower paid salaries and payroll taxes or paid independent contractors (as reported on Form(s) 1099-MISC). (x) The current economic uncertainty makes the request for the Loan necessary to support the ongoing operations of Borrower. (xi) All proceeds of the Loan will be used to retain workers and maintain payroll or make mortgage interest payments, lease payments, and utility payments, as specified under the Paycheck Protection Program Rule and Borrower acknowledges that if the funds are knowingly used for unauthorized purposes, the federal government may hold Borrower and/or Borrower’s authorized representative legally liable, such as for charges of fraud. (xii) Borrower has provided Bank true, correct and complete information demonstrating that Borrower had employees for whom Borrower paid salaries and payroll taxes on or around February 15, 2020. (xiii) Borrower has provided to Bank all documentation available to Borrower on a reasonable basis verifying the dollar amounts of average monthly payroll costs for the calendar year 2019, which documentation shall include, as applicable, copies of payroll processor records, payroll tax filings and/or Form 1099-MISC. (xiv) Borrower will promptly provide to Bank (a) any additional documentation that Bank requests in order to verify payroll costs and (b) documentation verifying the number of full-time equivalent employees on payroll as well as the dollar amounts of payroll costs, covered mortgage interest payments, covered rent payments, and covered utilities for the eight week period following the Loan. (xv) Borrower acknowledges that (a) loan forgiveness will be provided by the SBA for the sum of documented payroll costs, covered mortgage interest payments, covered rent payments, and covered utilities, and not more than 25% of the Forgivable Amount may be for non-payroll costs (xvi) During the period beginning on February 15, 2020 and ending on December 31, 2020, Borrower has not and will not receive any other loan under
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5.
|
EVENTS OF DEFAULT: If the Loan is not forgiven and a Loan Balance remains, then from the date the Repayment Letter is sent to Borrower until the Loan Balance is fully paid, the occurrence and continuation of any of the following events shall constitute a default hereunder: (i) insolvency, bankruptcy, dissolution, issuance of an attachment or garnishment against Borrower; (ii) failure to make any payment when due under the Loan or any or all other loans made by Bank to Borrower, and such failure continues for ten (10) days after it first became due; (iii) failure to provide current financial information promptly upon request by Bank; (iv) the making of any false or materially misleading statement on any application or any financial statement for the Loan or for any or all other loans made by Bank to Borrower; (v) Bank in good faith believes the prospect of payment under the Loan or any or all other loans made by Bank to Borrower is impaired; (vi) Borrower under or in connection with the Loan or any or all other loans made by Bank to Borrower fails to timely and properly observe, keep or perform any term, covenant, agreement, or condition therein; (vii) default shall be made with respect to any other indebtedness for borrowed money of Borrower, if the default is a failure to pay at maturity or if the effect of such default is to accelerate the maturity of such indebtedness for borrowed money or to permit the holder or obligee thereof or other party thereto to cause any such indebtedness for borrowed money to become due prior to its stated maturity; (viii) the Bank in its sole discretion determines in good faith that an event has occurred that materially and adversely affects Borrower;
|
6.
|
REMEDIES: If the Loan is not forgiven and a Loan Balance remains, then from the date the Repayment Letter is sent to Borrower, upon the occurrence of a default, all or any portion of the entire amount owing on the Loan, and any and all other loans made by Bank to Borrower, shall, at Bank’s option, become immediately due and payable without demand or notice. Upon a default, Bank may exercise any other right or remedy available to it at law or in equity. All persons included in the term “Borrower” are jointly and severally liable for repayment, regardless of to whom any advance of credit was made. Borrower shall pay any costs Bank may incur including without limitation reasonable attorney’s fees and court costs should the Loan and/or any and all other loans made by Bank to Borrower be referred to an attorney for collection to the extent permitted under applicable state law. EACH PERSON INCLUDED IN THE TERM BORROWER WAIVES ALL SURETYSHIP AND OTHER SIMILAR DEFENSES TO THE FULL EXTENT PERMITTED BY APPLICABLE LAW.
|
7.
|
CREDIT INVESTIGATION: If the Loan is not forgiven and a Loan Balance remains, then from the date the Repayment Letter is sent to Borrower until the Loan Balance is fully paid, Borrower authorizes Bank and any of its affiliates at any time to make whatever credit investigation Bank deems is proper to evaluate Borrower’s credit, financial standing and employment and Borrower authorizes Bank to exchange Borrower’s credit experience with credit bureaus and other creditors Bank reasonably believes are doing business with Borrower. Borrower also agrees to furnish Bank with any financial statements Bank may request at any time and in such detail as Bank may require.
|
8.
|
NOTICES: Borrower’s request for Loan forgiveness, and the documentation that must accompany that request, shall be submitted to Bank by transmitting the communication to the electronic address, website, or other electronic transmission portal provided by Bank to Borrower.
|
9.
|
CHOICE OF LAW; JURISDICTION; VENUE. (1) At all times that Bank is the holder of this Note, except to the extent that any law of the United States may apply, this Note shall be governed and interpreted according to the internal laws of the state of Borrower’s principal place of business (the “Governing Law State”), without regard to any choice of law, rules or principles to the contrary. However, the charging and calculating of interest on the obligations under this Note shall be governed by, construed and enforced in accordance with the laws of the state of North Carolina and applicable federal law. Nothing in this paragraph shall be construed to limit or otherwise affect any rights or remedies of Bank under federal law. Borrower and Bank agree and consent to be subject to the personal jurisdiction of any state or federal court located in the Governing Law State so that trial shall only be conducted by a court in that state. (2) Notwithstanding the foregoing, when SBA is the holder, this Note will be interpreted and enforced under federal law, including SBA regulations. Lender or SBA may use state or local procedures for filing papers, recording documents, giving notice, foreclosing liens, and other purposes. By using such procedures, SBA does not waive any federal immunity from state or local control, penalty, tax, or liability. As to this Note, Borrower may not claim or assert against SBA any local or state law to deny any obligation, defeat any claim of SBA, or preempt federal law.
|
10.
|
MISCELLANEOUS. The Loan may be sold or assigned by Bank without notice to Borrower. Borrower may not assign the Loan or its rights hereunder to anyone without Bank’s prior written consent. If any provision of this Note is contrary to applicable law or is found unenforceable, such provision shall be severed from this Note without invalidating the other provisions thereof. Bank may delay enforcing any of its rights under this Note without losing them, and no failure or delay on the part of Bank in exercising any right, power or privilege hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right, power or privilege hereunder preclude any other or future exercise thereof or the exercise of any other right, power or privilege. Bank, by its acceptance hereof, and the making of the Loan and Borrower understand and agree that this Note constitutes the complete understanding between them. This Note shall be binding upon Borrower, and its successors and assigns, and inure to the benefit of Bank and its successors and assigns.
|
11.
|
BORROWING AUTHORIZED. The signer for Borrower represents, covenants and warrants to Bank that he or she is certified to borrow for the Borrower and is signing this Note as the duly authorized sole proprietor, owner, sole shareholder, officer, member, managing member, partner, trustee, principal, agent or representative of Borrower, and further acknowledges and confirms to Bank that by said signature he or she has read and understands all of the terms and provisions contained in this Note and agrees and consents to be bound by them. This Note and any instrument or agreement required herein, are within the Borrower's powers, have been duly authorized, and do not conflict with any of its organizational papers. The individuals signing this Agreement on behalf of each Borrower are authorized to sign such documents on behalf of such entities. For purposes of this Note only, the Bank may rely upon and accept the authority of only one signer on behalf of the Borrower, and for this Note, this resolution supersedes and replaces any prior and existing contrary resolution provided by Borrower to Bank.
|
12.
|
ELECTRONIC COMMUNICATIONS AND SIGNATURES. This Note and any document, amendment, approval, consent, information, notice, certificate, request, statement, disclosure or authorization related to this Note (each a “Communication”), including Communications required to be in writing, may, if agreed by the Bank, be in the form of an Electronic Record and may be executed using Electronic Signatures, including, without limitation, facsimile and/or .pdf. The Borrower agrees that any Electronic Signature (including, without limitation, facsimile or .pdf) on or associated with any Communication shall be valid and binding on the Borrower to the same extent as a manual, original signature, and that any Communication entered into by Electronic Signature, will constitute the legal, valid and binding obligation of the Borrower enforceable against the Borrower in accordance with the terms thereof to the same extent as if a manually executed original signature was delivered to the Bank. Any Communication may be executed in as many counterparts as necessary or convenient, including both paper and electronic counterparts, but all such counterparts are one and the same Communication. For the avoidance of doubt, the authorization under this paragraph may include, without limitation, use or acceptance by the Bank of a manually signed paper Communication which has been converted into electronic form (such as scanned into PDF format), or an electronically signed Communication converted into another format, for transmission, delivery and/or retention. The Bank may, at its option, create one or more copies of any Communication in the form of an imaged Electronic Record (“Electronic Copy”), which shall be deemed created in the ordinary course of the Bank’s business, and destroy the original paper document. All Communications in the form of an Electronic Record, including an Electronic Copy, shall be considered an original for all purposes, and shall have the same legal effect, validity and enforceability as a paper record. Notwithstanding anything contained herein to the contrary, the Bank is under no obligation to accept an Electronic Signature in any form or in any format unless expressly agreed to by the Bank pursuant to procedures approved by it; provided, further, without limiting the foregoing, (a) to the extent the Bank has agreed to accept such Electronic Signature, the Bank shall be entitled to rely on any such Electronic Signature without further verification and (b) upon the request of the Bank any Electronic Signature shall be promptly followed by a manually executed, original counterpart. For purposes hereof, “Electronic Record” and “Electronic Signature” shall have the meanings assigned to them, respectively, by 15 USC §7006, as it may be amended from time to time.
|
13.
|
CONVERSION TO PAPER ORIGINAL. At the Bank’s discretion the authoritative electronic copy of this Note ("Authoritative Copy") may be converted to paper and marked as the original by the Bank (the "Paper Original"). Unless and until the Bank creates a Paper Original, the Authoritative Copy of this Agreement: (1) shall at all times reside in a document management system designated by the Bank for the storage of authoritative copies of electronic records, and (2) is held in the ordinary course of business. In the event the Authoritative Copy is converted to a Paper Original, the parties hereto acknowledge and agree that: (1) the electronic signing of this Agreement also constitutes issuance and delivery of the Paper Original, (2) the electronic signature(s) associated with this Agreement, when affixed to the Paper Original, constitutes legally valid
|
14.
|
BORROWER ATTESTATION. Borrower attests and certifies to Bank that it has not provided false or misleading information or statements to the Bank in its application for the Loan, and that the certifications, representations, warranties, and covenants made to the Bank in this Note and elsewhere relating to the Loan are true, accurate, and correct. Borrower further attests and certifies to Bank that it is has read, understands, and acknowledges that the Loan is being made under the CARES Act, and any use of the proceeds of the Loan other than as permitted by the CARES Act, or any false or misleading information or statements provided to the Bank in its application for the Loan or in this Note may subject the Borrower to criminal and civil liability under applicable state and federal laws and regulations, including but not limited to, the False Claims Act, 31 U.S.C. Section 3729, et. seq. Borrower further acknowledges and understands that this Note is not valid and effective until and unless Borrower’s application for the Loan is approved and Bank’s receiving confirmation from the SBA that Bank may proceed with the Loan.
|
BORROWER: Trecora Chemical Inc
|
/s/ Sami Ahmad
|
Signature of Authorized Representative of Borrower
|
Sami Ahmad
|
Print Name
|
Authorized Representative
|
Title
|
STREET ADDRESS: 12500 Bay Area Blvd
|
CITY/STATE/ZIP CODE: Pasadena, TX, 77507
|
1.
|
Definitions.
|
2.
|
Term of Agreement. The initial term of this Agreement shall begin on the Effective Date and shall end at 11:59 p.m. CPT on [***] (the “Initial Term”) and shall automatically be renewed for successive one-year terms (each, a “Renewal Term”) after the Initial Term, unless cancelled in writing by either party by one hundred eighty (180) Days’ written notice prior to the end of then-existing term. The Initial Term and each Renewal Term hereunder shall be collectively, the “Term.”
|
3.
|
Services. In consideration of the compensation provided in Section 4 hereof, Operator will purchase Product and either transport or exchange such Product into the Tank, and then transfer the Product from the Tank to Customer’s Pipeline at the Meter (as hereinafter defined) utilizing Operator’s Pipeline (the “Services”). Operator will be responsible for providing all manpower and utilities required to perform all of the Services, which are not provided by third-parties. In the performance of the Services, Operator shall comply in all material respects with all requirements of federal, state and local laws, ordinances, decrees, orders, regulations, permits or other requirements having the force of law (hereinafter the “Laws”) and shall be responsible for all regulatory compliance reporting.
|
4.
|
Operator’s Compensation. As compensation for the Services performed hereunder, each Month Customer shall pay Operator the following:
|
a.
|
Product Acquisition Cost of the Product delivered to Customer’s Pipeline;
|
b.
|
The Feedstock Terminal Fee multiplied by the actual number of Gallons of Feedstock Supply delivered to Customer’s Pipeline;
|
c.
|
The Fuel Terminal Fee multiplied by the actual number of Gallons of Fuel Supply delivered to Customer’s Pipeline; and
|
d.
|
The [**SOURCE A**] Fee.
|
5.
|
Shortfall Payments and Rebate. In the event that less than the Minimum Quarterly Volume of Feedstock Supply is delivered into Customer’s Pipeline during a Quarter through no fault of Operator, then for such Quarter Customer shall additionally pay Operator the Shortfall Fee. At the end of the Contract Year ending July 31, 2020, Customer shall be entitled to a rebate equal to the positive amount, if any, resulting from the sum of the actual Shortfall Fees paid hereunder during such Contract Year and less the product of (i) the difference of the Minimum Annual Volume less the actual quantity of Feedstock Supply delivered into Customer’s Pipeline during such Contract Year times (ii) the sum of the Feedstock Terminal Fee plus the Average Feedstock Marketing Fee. At the end of each Contract Year thereafter, Customer shall be entitled to a rebate equal to the positive amount, if any, resulting from the sum of the actual Shortfall Fees paid hereunder during the Contract Year and less the product of (i) the difference of the Minimum Annual Volume less the actual quantity of Feedstock Supply delivered into Customer’s Pipeline during such Contract Year times (ii) the sum of the Feedstock Terminal Fee plus the Feedstock Marketing Fee. An example calculation is attached hereto as Exhibit E.
|
6.
|
Title to Product. Title to, possession and risk of loss of the Product shall pass from Operator to Customer when the Product passes through the transfer meter located where Operator’s Pipeline interconnects with Customer’s Pipeline (the “Meter”). The readings from the Meter shall be used for calculation of the amounts owed to Operator by Customer pursuant to Section 4 and in determining any Shortfall Fee due under Section 5. The Meter will be calibrated at least annually according to Operator’s standard practices. Customer shall have the right to attend said calibration check and Operator shall provide Customer at least three (3) Business Days prior notice of each calibration. In the event the Meter is out of service or upon inspection is off by more than one percent (1%), the quantity of Product delivered hereunder will be determined by using the first of the of the following methods available:
|
a.
|
By using the measurement of any check meter if same is installed correctly and registering accurately;
|
b.
|
By correcting the error of the Meter if ascertainable by calibration, test or mathematical calculation and the length of time the meter has been inaccurate is known; or
|
c.
|
By using the combination of the Product received into the Tank, if known, and the Tank inventory for the respective period.
|
7.
|
Representations and Warranties.
|
a.
|
Operator represents and warrants to Customer that:
|
i.
|
Operator has title to the Product delivered by it hereunder or the right to deliver same;
|
ii.
|
Product delivered hereunder shall be delivered in full compliance with all federal and state laws, rules and regulations and orders that may be applicable thereto; and
|
iii.
|
Product delivered under this Agreement will meet the specifications set forth in Exhibit C to this Agreement.
|
b.
|
Customer represents and warrants to Operator that:
|
i.
|
Customer is knowledgeable and aware that the Product delivered hereunder is hazardous material and Customer is sophisticated and knowledgeable of (i) the hazards and risks associated with such Product, and (ii) the handling, receipt, transportation, storage and use of such Product; and
|
ii.
|
Product received hereunder shall be received in full compliance with all applicable federal and state laws, rules and regulations and orders that may be applicable thereto.
|
8.
|
Nomination. Customer shall provide Operator a firm nomination, in writing, specifying the volume of Product that Customer desires delivered into Customer’s Pipeline each Month at least twelve (12) Business Days prior to the beginning of the applicable Month of delivery. For planning purposes, Customer shall also provide Operator with a three (3) Month rolling quantity of estimated future Product needs at least twelve (12) Business Days prior to the beginning of each Month. Customer further agrees to provide Operator with a report of Customer’s actual Product usage for each three (3) Month period during the Term of this Agreement to be delivered by the fifteenth (15) day of the Month following each such three (3) Month period.
|
9.
|
Exclusivity. With the exception of the exclusions provided for in this paragraph, Customer shall be obligated to source all of its Product needs for Customer’s Facility through Operator. In the event that during any Quarter Customer’s Feedstock Supply needs exceed the Threshold Volume, then Customer may source up to [***] of its Feedstock Supply needs in excess of the Threshold Volume for the applicable Quarter through persons other than Operator. Notwithstanding the foregoing sentence, in the event that Customer provides Operator with written notice during January of 2022, beginning August 1, 2022 Customer may source up to [***] of its Product needs during a Quarter through persons other than Operator, so long as the amount of Feedstock Supply purchased from Operator during such Quarter is at least [***] Barrels per Day. In addition to the foregoing amounts, Customer may source de minimus amounts of Product from sources other than Operator, being no more than [***] Barrels per Quarter. In no event will Operator be obligated hereunder to deliver to Customer’s Pipeline more than [***] Barrels of Product in any Day. During any time period when Operator is unable to supply Customer with Product, Customer may source Product through persons other than Operator to meet its operational requirements. Nothing in this Section 9 shall in any way reduce the Minimum Annual Volume, the Minimum Quarterly Volume or the Threshold Volume.
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10.
|
Truck or Rail. In the event that Customer wishes to deliver Customer Supply to the Tank by truck or rail for subsequent delivery by Operator to Customer’s Pipeline, the Parties agrees that they will work in good faith to amend this Agreement to make the various revisions necessary to permit such. The cost of all upgrades to Operator’s facilities needed to facilitate receipt of Customer Supply into the Operator’s Pipeline by rail or truck shall be paid solely by Customer. The Parties acknowledge and agree that a separate terminalling fee shall be applicable to the receipt and redelivery of Customer Supply. Further, the Parties agree that all Customer Supply delivered by Operator to the Customer’s Pipeline shall be credited against the Minimum Quarterly Volume, but shall not reduce any volume obligations under any agreement between Operator and [**SOURCE A**] related to the purchase of Natural Gasoline to be supplied to Customer.
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11.
|
Indemnification.
|
a.
|
OPERATOR. OPERATOR AGREES TO INDEMNIFY AND HOLD HARMLESS CUSTOMER FROM AND AGAINST ANY AND ALL CLAIMS, SUITS, LIABILITIES, DEMANDS, LOSSES OR EXPENSES OF ANY KIND, INCLUDING, WITHOUT LIMITATION, INJURY OR DEATH OF PERSONS OR DAMAGE TO OR DESTRUCTION OF PROPERTY AS WELL AS REASONABLE ATTORNEYS’ FEES AND EXPENSES ARISING OUT OF OR IN ANY WAY CONNECTED WITH OR RESULTING FROM OPERATOR’S FAILURE TO OBSERVE ANY OF ITS MATERIAL OBLIGATIONS HEREUNDER OR OPERATOR’S MISCONDUCT OR NEGLIGENT ACTS OR OMISSIONS; PROVIDED, HOWEVER, THAT IN NO EVENT SHALL OPERATOR BE LIABLE TO CUSTOMER OR ANY OTHER PARTY FOR INDIRECT, SPECIAL, CONSEQUENTIAL OR PUNITIVE DAMAGES OF ANY KIND OR CHARACTER FROM ANY CAUSE WHATSOEVER.
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b.
|
CUSTOMER. CUSTOMER AGREES TO INDEMNIFY AND HOLD HARMLESS OPERATOR FROM AND AGAINST ANY AND ALL CLAIMS, SUITS, LIABILITIES, DEMANDS, DAMAGES, LOSSES OR EXPENSES OF ANY KIND, INCLUDING, WITHOUT LIMITATION, INJURY OR DEATH OF PERSONS OR DAMAGE TO OR DESTRUCTION OF PROPERTY AS WELL AS REASONABLE ATTORNEYS’ FEES AND EXPENSES ARISING OUT OF OR IN ANY WAY CONNECTED WITH OR RESULTING FROM CUSTOMER’S FAILURE TO OBSERVE ANY OF ITS MATERIAL OBLIGATIONS HEREUNDER OR CUSTOMER’S MISCONDUCT OR NEGLIGENT ACTS OR OMISSIONS; PROVIDED, HOWEVER, THAT IN NO EVENT SHALL CUSTOMER BE LIABLE TO OPERATOR OR ANY OTHER PARTY FOR THE LOSS OF PROFITS OR INDIRECT, SPECIAL CONSEQUENTIAL OR PUNITIVE DAMAGES OF ANY KIND OR CHARACTER FROM ANY CAUSE WHATSOEVER.
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12.
|
Payment Terms. Within five (5) Business Days after the end of each Month, Customer shall send Operator a detailed breakdown delineating how much of the Product purchased by the Customer for such Month constituted Feedstock Supply and how much constituted Fuel Supply. Within ten (10) Business Days following the end of each Month, Operator shall send to Customer an invoice for the Terminal Fees and Product Acquisition Cost attributable to such Month. Additionally, within ten (10) Business Days following the end of each Quarter, Operator shall, to the extent due from Customer, send Customer an invoice for any Shortfall Fee due. Customer agrees to pay a service charge to Operator equal to one percent (1.0%) per Month on all undisputed payments due Operator and not paid by Customer on or before the date due, which shall be thirty (30) Days after the invoice date. Notwithstanding the foregoing, if at any time the amount owed hereunder to Operator by Customer, whether invoiced or not, exceeds Customer’s credit limit established by Operator, which may be amended from time to time, Customer shall immediately pay Operator all amounts owed in excess of such credit limit by wire transfer.
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13.
|
Default/Termination. Either Party may terminate this Agreement upon thirty (30) days’ prior written notice to the other in the Event of Default. The following events are considered an “Event of Default” under this Agreement:
|
a.
|
a breach of any material term or condition of this Agreement that remains uncured for a period of thirty (30) days;
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b.
|
if a Party becomes insolvent or if the normal conduct of a Party’s business, or its credit, becomes substantially impaired;
|
c.
|
if a Party calls any meeting of creditors or if a receiver or trustee is appointed for such Party or its assets; or
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d.
|
if any petition, proceeding or action under any bankruptcy proceedings is filed or instituted by a Party or against such Party and such proceeding is not dismissed within sixty (60) days.
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14.
|
Force Majeure.
|
a.
|
Natural. If either party is rendered unable, wholly or in part, by force majeure or any other cause of any kind not reasonably within its control to perform or comply with any obligation or condition of this Agreement, other than obligation to pay money, upon giving written notice to the other party, such obligation or condition shall be suspended during the continuance of the inability so caused and such party shall be relieved of any liability during such period. The term “force majeure” shall include, without limitation, by the following acts of God, or when the supply of product or any facility of production, manufacture/storage, transportation, distribution or delivery contemplated by either party is interrupted, unavailable, or inadequate because of war or the public enemy, strikes, lockouts, or other disturbances, riots, hurricanes, floods, fires, explosion, or destruction from any involuntary cause or any character either similar or dissimilar to the foregoing, reasonably beyond the control of the party failing to perform. Further, a force majeure event affecting [**SOURCE A**] ability to deliver Product into the Tank or Operator’s ability to acquire Product otherwise, which prevents Operator from performing its obligations hereunder shall also serve as a force majeure event hereunder.
|
b.
|
Regulatory. In the event that after the date on which this Agreement becomes effective any new and/or modified federal, state and/or local statutes, ordinances, regulations, laws or court or regulatory decisions (a “Subsequent Law”) become applicable to the Tank or Operator’s Pipeline, and as a result thereof Operator is required to make capital expenditures in excess of $250,000.00 to bring those items into compliance with such Subsequent Law, then in such event Operator shall give written notice of such occurrence to Customer setting for the amount of such required capital expenditures. If the required capital expenditures exceed $250,000.00, the parties agree to renegotiate in good faith the terms of this Agreement in light of said required capital expenditures to equitably share such costs.
|
15.
|
Customer’s Compliance with Laws. In the operation of Customer’s Pipeline, Customer agrees to comply in all material respects with all applicable Laws.
|
16.
|
Notices. All notices pertaining to this Agreement shall be sent by certified U.S. mail or overnight courier service, on a prepaid basis along with a fax copy. Said notices shall be effective on the Day sent and shall be addressed as follows unless another address is specified in writing by either party:
|
17.
|
No Agency. The subject matter of this Agreement is purchase and delivery of the Product identified herein. There is no agency, distributorship, partnership, or joint venture being created by the existence of this Agreement. Neither party shall represent itself to be the agent, servant or partner of the other.
|
18.
|
Construction. The paragraph headings of this Agreement shall not be considered to be part hereof for the purposes of interpreting or applying this Agreement, or any section hereof but are for convenience only.
|
19.
|
Severability. In the event that any one or more of the provisions contained in this Agreement shall for any reason be held to be invalid, illegal, or enforceable in any respect, such invalidity, illegality, or unenforceability shall not affect any other provisions, and this Agreement shall be construed as if such invalid and illegal or unenforceable provisions have never been contained in it.
|
20.
|
Entire Agreement. This Agreement shall constitute the entire agreement concerning the subject hereof between the parties superseding all previous agreements, negotiations and representations made prior or contemporaneous to the date hereof. This Agreement shall be modified or amended only in written agreement executed by both parties hereto.
|
21.
|
Assignment. Neither party shall assign this Agreement without the express written consent of the other party which shall not be unreasonably withheld. This Agreement shall not be assigned by operation of law and shall not become an asset in any bankruptcy or receivership proceedings. In the case of any permitted assignment hereof, the rights and obligations of the parties hereto shall be binding upon such successors and assigns.
|
22.
|
Survival. The provisions of this Agreement which by their nature are intended to survive the termination or expiration of this Agreement will continue as valid and enforceable obligations notwithstanding any such termination or expiration, including, without limitation, the indemnification obligations contained in Section 11.
|
23.
|
Authority. Each party by executing this Agreement represents that the execution and delivery of this Agreement has been duly authorized by all necessary action on its part and that this Agreement is a legal, valid and binding obligation of such party, enforceable in accordance with the terms hereof, except as enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to the enforcement of creditor’s rights generally and by general principles of equity.
|
24.
|
No Third Party Beneficiaries. Except for [**SOURCE A**], nothing in this Agreement will create, or be construed as creating any express or implied rights in any person or entity other than the parties and their respective successors and permitted assigns.
|
25.
|
Controlling Law and Venue. This Agreement shall be governed by and construed in accordance with the laws of the State of Texas and exclusive venue for any dispute hereunder shall be the State District Courts of Jefferson County, Texas, to whose jurisdiction all parties hereto consent.
|
26.
|
Information/Audit Rights. Customer shall keep detailed books and records relating to all Feedstock Supply and Fuel Supply provided hereunder by Operator and all natural gasoline consumed by Customer in its operations. Such books and records must be maintained for a minimum of twenty-four (24) Months and shall, upon request at reasonable times, be made available for an audit by a representative of Operator. The Parties agree that Operator may share any information it obtains hereunder from Customer with [**SOURCE A**]. Further, Customer agrees that [**SOURCE A**] shall have the right to audit Customer’s books and records in accordance with the Condition Precedent section of the [**SOURCE A**] Agreement, which was effective on and after April 21, 2017.
|
27.
|
Confidentiality. The Parties agree to treat this Agreement and any information exchanged under this Agreement as confidential information and Customer shall hold as confidential any information concerning the [**SOURCE A**] Exchange Agreement and the [**SOURCE A**] Purchase Agreement; provided, however, that the Parties may disclose any information concerning this Agreement required by (i) law or (ii) listing agreements with national security exchanges as determined by the discloser’s legal advisor. Each Party will be responsible for any breach of the foregoing confidentiality obligations by itself, its employees, officers, agents or representatives and agrees that it will be liable to the other Party for all damages suffered by such other Party as a result of its breach.
|
Title: President & Chief Executive Officer
|
Title: Executive Vice President & Chief Financial Officer
|
TRECORA RESOURCES
By:
Name: Christopher Groves
Title: Corporate Secretary
Date:
|
HOLDER
By:
Name:
Date:
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Trecora Resources;
|
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 consolidated financial statements, and other financial information included in this quarterly 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 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 that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.
|
5.
|
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 independent registered public accounting firm 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.
|
Dated: Aug 06, 2020
|
/s/ Patrick Quarles
|
|
Patrick Quarles
|
|
President and Chief Executive Officer
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Trecora Resources;
|
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 consolidated financial statements, and other financial information included in this quarterly 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 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 that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.
|
5.
|
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 independent registered public accounting firm 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.
|
Dated: Aug 06, 2020
|
/s/ Sami Ahmad
|
|
Sami Ahmad
|
|
Chief Financial Officer
|
(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.
|
(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.
|