Delaware
|
54-2091194
|
(State or other jurisdiction of
incorporation or organization)
|
(I.R.S. Employer
Identification No.)
|
|
|
801 Cherry Street, Suite 2100
Fort Worth, Texas
|
76102
|
(Address of principal executive offices)
|
(Zip code)
|
Large accelerated filer
|
☐
|
Accelerated filer
|
☒
|
|
|
|
|
Non-accelerated filer
|
☐ (Do not check if a smaller reporting company)
|
Smaller reporting company
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☐
|
•
|
a decline in, or substantial volatility of, oil or natural gas prices, and any related changes in expenditures by our customers;
|
•
|
the effects of future acquisitions on our business;
|
•
|
changes in customer requirements in markets or industries we serve;
|
•
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competition within our industry;
|
•
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general economic and market conditions;
|
•
|
our access to current or future financing arrangements;
|
|
|
June 30,
2016 |
|
December 31,
2015 |
||||
|
|
(Unaudited)
|
|
|
||||
ASSETS
|
|
|
|
|
||||
Current assets:
|
|
|
|
|
||||
Cash and cash equivalents
|
|
$
|
86,100
|
|
|
$
|
46,732
|
|
Restricted cash
|
|
30,196
|
|
|
—
|
|
||
Trade accounts receivable, net of allowance of $2,029 and $2,670, respectively
|
|
78,767
|
|
|
102,127
|
|
||
Accounts receivable - related parties
|
|
26
|
|
|
35
|
|
||
Income tax receivable
|
|
1,276
|
|
|
1,828
|
|
||
Inventories
|
|
33,364
|
|
|
36,944
|
|
||
Prepaid expenses
|
|
14,271
|
|
|
13,851
|
|
||
Other current assets
|
|
9,101
|
|
|
9,968
|
|
||
Total current assets
|
|
253,101
|
|
|
211,485
|
|
||
Property and equipment, net
|
|
751,070
|
|
|
846,290
|
|
||
Deferred debt costs, net of amortization
|
|
1,573
|
|
|
3,420
|
|
||
Intangible assets, net of amortization
|
|
62,298
|
|
|
66,745
|
|
||
Other assets
|
|
10,316
|
|
|
10,241
|
|
||
Total assets
|
|
$
|
1,078,358
|
|
|
$
|
1,138,181
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|
|
|
|
||||
Current liabilities:
|
|
|
|
|
||||
Accounts payable
|
|
$
|
33,033
|
|
|
$
|
54,521
|
|
Accrued expenses
|
|
75,457
|
|
|
59,380
|
|
||
Current portion of long-term debt
|
|
42,923
|
|
|
48,651
|
|
||
Other current liabilities
|
|
1,011
|
|
|
7,003
|
|
||
Total current liabilities
|
|
152,424
|
|
|
169,555
|
|
||
Long-term debt, net of unamortized premium on notes of $818 and $956, and deferred debt costs of $24,321 and $9,704, respectively
|
|
961,416
|
|
|
828,664
|
|
||
Deferred tax liabilities
|
|
662
|
|
|
5,066
|
|
||
Other long-term liabilities
|
|
26,263
|
|
|
28,558
|
|
||
Commitments and contingencies
|
|
|
|
|
|
|||
Stockholders' equity:
|
|
|
|
|
||||
Preferred stock; $0.01 par value; 5,000,000 shares authorized; none designated or issued at June 30, 2016 and December 31, 2015
|
|
—
|
|
|
—
|
|
||
Common stock; $0.01 par value; 80,000,000 shares authorized; 43,500,032 shares issued and 42,758,940 shares outstanding at June 30, 2016; 43,500,032 shares issued and 42,196,680 shares outstanding at December 31, 2015
|
|
435
|
|
|
435
|
|
||
Additional paid-in capital
|
|
374,711
|
|
|
374,729
|
|
||
Retained deficit
|
|
(430,034
|
)
|
|
(256,812
|
)
|
||
Treasury stock, at cost, 741,092 and 1,303,352 shares at June 30, 2016 and December 31, 2015, respectively
|
|
(7,519
|
)
|
|
(12,014
|
)
|
||
Total stockholders' (deficit) equity
|
|
(62,407
|
)
|
|
106,338
|
|
||
Total liabilities and stockholders' equity
|
|
$
|
1,078,358
|
|
|
$
|
1,138,181
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
|
|
(Unaudited)
|
|
(Unaudited)
|
||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
||||||||
Completion and remedial services
|
|
$
|
36,228
|
|
|
$
|
69,056
|
|
|
$
|
75,924
|
|
|
$
|
181,831
|
|
Fluid services
|
|
45,491
|
|
|
63,704
|
|
|
95,741
|
|
|
137,506
|
|
||||
Well servicing
|
|
36,824
|
|
|
56,500
|
|
|
75,731
|
|
|
120,168
|
|
||||
Contract drilling
|
|
1,461
|
|
|
4,336
|
|
|
2,965
|
|
|
15,812
|
|
||||
Total revenues
|
|
120,004
|
|
|
193,596
|
|
|
250,361
|
|
|
455,317
|
|
||||
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Completion and remedial services
|
|
32,860
|
|
|
57,670
|
|
|
67,648
|
|
|
138,921
|
|
||||
Fluid services
|
|
38,619
|
|
|
48,381
|
|
|
79,786
|
|
|
102,512
|
|
||||
Well servicing
|
|
31,847
|
|
|
47,035
|
|
|
66,318
|
|
|
99,437
|
|
||||
Contract drilling
|
|
1,368
|
|
|
3,488
|
|
|
2,929
|
|
|
11,014
|
|
||||
General and administrative, including stock-based compensation of $2,277 and $3,270 in three months ended June 30, 2016 and 2015, and $5,117 and $7,239 in the six months ended June 30, 2016 and 2015, respectively
|
|
27,078
|
|
|
35,673
|
|
|
56,640
|
|
|
74,877
|
|
||||
Depreciation and amortization
|
|
54,847
|
|
|
60,231
|
|
|
110,999
|
|
|
121,160
|
|
||||
Loss (gain) on disposal of assets
|
|
336
|
|
|
(57
|
)
|
|
261
|
|
|
(9
|
)
|
||||
Total expenses
|
|
186,955
|
|
|
252,421
|
|
|
384,581
|
|
|
547,912
|
|
||||
Operating loss
|
|
(66,951
|
)
|
|
(58,825
|
)
|
|
(134,220
|
)
|
|
(92,595
|
)
|
||||
Other income (expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest expense
|
|
(22,521
|
)
|
|
(16,841
|
)
|
|
(43,235
|
)
|
|
(33,704
|
)
|
||||
Interest income
|
|
7
|
|
|
4
|
|
|
9
|
|
|
10
|
|
||||
Other income
|
|
244
|
|
|
215
|
|
|
340
|
|
|
335
|
|
||||
Loss before income taxes
|
|
(89,221
|
)
|
|
(75,447
|
)
|
|
(177,106
|
)
|
|
(125,954
|
)
|
||||
Income tax benefit (expense)
|
|
(662
|
)
|
|
27,152
|
|
|
3,884
|
|
|
45,035
|
|
||||
Net loss
|
|
$
|
(89,883
|
)
|
|
$
|
(48,295
|
)
|
|
$
|
(173,222
|
)
|
|
$
|
(80,919
|
)
|
Loss per share of common stock:
|
|
|
|
|
|
|
|
|
||||||||
Basic
|
|
$
|
(2.11
|
)
|
|
$
|
(1.20
|
)
|
|
$
|
(4.14
|
)
|
|
$
|
(2.00
|
)
|
Diluted
|
|
$
|
(2.11
|
)
|
|
$
|
(1.20
|
)
|
|
$
|
(4.14
|
)
|
|
$
|
(2.00
|
)
|
|
|
|
|
|
|
Additional
|
|
|
|
|
|
Total
|
|||||||||||
|
|
Common Stock
|
|
Paid-In
|
|
Treasury
|
|
Retained
|
|
Stockholders'
|
|||||||||||||
|
|
Shares
|
|
Amount
|
|
Capital
|
|
Stock
|
|
Deficit
|
|
Equity
|
|||||||||||
Balance - December 31, 2015
|
|
43,500,032
|
|
|
$
|
435
|
|
|
$
|
374,729
|
|
|
$
|
(12,014
|
)
|
|
$
|
(256,812
|
)
|
|
$
|
106,338
|
|
Issuances of restricted stock
|
|
—
|
|
|
—
|
|
|
(5,135
|
)
|
|
5,135
|
|
|
—
|
|
|
—
|
|
|||||
Amortization of share-based compensation
|
|
—
|
|
|
—
|
|
|
5,117
|
|
|
—
|
|
|
—
|
|
|
5,117
|
|
|||||
Purchase of treasury stock
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(640
|
)
|
|
—
|
|
|
(640
|
)
|
|||||
Net loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(173,222
|
)
|
|
(173,222
|
)
|
|||||
Balance - June 30, 2016 (unaudited)
|
|
43,500,032
|
|
|
$
|
435
|
|
|
$
|
374,711
|
|
|
$
|
(7,519
|
)
|
|
$
|
(430,034
|
)
|
|
$
|
(62,407
|
)
|
|
|
Six Months Ended June 30,
|
||||||
|
|
2016
|
|
2015
|
||||
Cash flows from operating activities:
|
|
|
|
|
||||
Net loss
|
|
$
|
(173,222
|
)
|
|
$
|
(80,919
|
)
|
Adjustments to reconcile net loss to net cash
|
|
|
|
|
||||
(used in) provided by operating activities:
|
|
|
|
|
||||
Depreciation and amortization
|
|
110,999
|
|
|
121,160
|
|
||
Accretion on asset retirement obligation
|
|
72
|
|
|
66
|
|
||
Change in allowance for doubtful accounts
|
|
(641
|
)
|
|
(582
|
)
|
||
Amortization of deferred financing costs
|
|
4,486
|
|
|
1,525
|
|
||
Amortization of premium on notes
|
|
(138
|
)
|
|
(126
|
)
|
||
Non-cash compensation
|
|
5,117
|
|
|
7,239
|
|
||
(Gain) loss on disposal of assets
|
|
261
|
|
|
(9
|
)
|
||
Deferred income taxes
|
|
(4,404
|
)
|
|
(45,037
|
)
|
||
Changes in operating assets and liabilities, net of acquisitions:
|
|
|
|
|
||||
Accounts receivable
|
|
24,010
|
|
|
121,348
|
|
||
Inventories
|
|
4,440
|
|
|
3,949
|
|
||
Income tax receivable
|
|
552
|
|
|
954
|
|
||
Prepaid expenses and other current assets
|
|
294
|
|
|
(978
|
)
|
||
Other assets
|
|
(85
|
)
|
|
160
|
|
||
Accounts payable
|
|
(21,488
|
)
|
|
(23,474
|
)
|
||
Other liabilities
|
|
(8,338
|
)
|
|
(956
|
)
|
||
Accrued expenses
|
|
16,077
|
|
|
(16,204
|
)
|
||
Net cash (used in) provided by operating activities
|
|
(42,008
|
)
|
|
88,116
|
|
||
Cash flows from investing activities:
|
|
|
|
|
||||
Purchase of property and equipment
|
|
(11,561
|
)
|
|
(34,823
|
)
|
||
Proceeds from sale of assets
|
|
1,451
|
|
|
6,411
|
|
||
Net cash used in investing activities
|
|
(10,110
|
)
|
|
(28,412
|
)
|
||
Cash flows from financing activities:
|
|
|
|
|
||||
Payments of debt
|
|
(25,422
|
)
|
|
(43,111
|
)
|
||
Proceeds from debt
|
|
165,000
|
|
|
—
|
|
||
Change in restricted cash
|
|
(30,196
|
)
|
|
—
|
|
||
Purchase of treasury stock
|
|
(640
|
)
|
|
(4,562
|
)
|
||
Tax withholding from exercise of stock options
|
|
—
|
|
|
(3
|
)
|
||
Exercise of employee stock options
|
|
—
|
|
|
727
|
|
||
Deferred loan costs and other financing activities
|
|
(17,256
|
)
|
|
(848
|
)
|
||
Net cash provided by (used in) financing activities
|
|
91,486
|
|
|
(47,797
|
)
|
||
Net increase in cash and equivalents
|
|
39,368
|
|
|
11,907
|
|
||
Cash and cash equivalents - beginning of period
|
|
$
|
46,732
|
|
|
79,915
|
|
|
Cash and cash equivalents - end of period
|
|
$
|
86,100
|
|
|
$
|
91,822
|
|
|
|
June 30, 2016
|
|
December 31, 2015
|
||||
Customer relationships
|
|
$
|
92,660
|
|
|
$
|
92,660
|
|
Non-compete agreements
|
|
9,427
|
|
|
13,057
|
|
||
Trade names
|
|
1,939
|
|
|
1,939
|
|
||
Other intangible assets
|
|
2,096
|
|
|
2,086
|
|
||
|
|
106,122
|
|
|
109,742
|
|
||
Less accumulated amortization
|
|
43,824
|
|
|
42,997
|
|
||
Intangible assets subject to amortization, net
|
|
$
|
62,298
|
|
|
$
|
66,745
|
|
|
|
Completion
|
|
|
|
|
|
|
|
|
||||||||||
|
|
And Remedial
|
|
|
|
|
|
Contract
|
|
|
||||||||||
|
|
Services
|
|
Well Servicing
|
|
Fluid Services
|
|
Drilling
|
|
Total
|
||||||||||
Intangible assets subject to amortization, net
|
|
$
|
46,467
|
|
|
$
|
5,647
|
|
|
$
|
7,467
|
|
|
$
|
2,717
|
|
|
$
|
62,298
|
|
|
|
June 30, 2016
|
|
December 31, 2015
|
||||
Land
|
|
$
|
20,422
|
|
|
$
|
19,893
|
|
Buildings and improvements
|
|
75,359
|
|
|
73,599
|
|
||
Well service units and equipment
|
|
489,345
|
|
|
488,003
|
|
||
Frac equipment/test tanks
|
|
355,358
|
|
|
363,346
|
|
||
Pumping equipment
|
|
344,679
|
|
|
345,938
|
|
||
Fluid services equipment
|
|
268,778
|
|
|
268,249
|
|
||
Disposal facilities
|
|
163,015
|
|
|
166,371
|
|
||
Contract drilling equipment
|
|
112,690
|
|
|
112,068
|
|
||
Rental equipment
|
|
95,633
|
|
|
94,970
|
|
||
Light vehicles
|
|
67,419
|
|
|
67,521
|
|
||
Software
|
|
21,920
|
|
|
21,920
|
|
||
Other
|
|
16,335
|
|
|
16,672
|
|
||
Construction equipment
|
|
15,010
|
|
|
15,174
|
|
||
Brine and fresh water stations
|
|
15,810
|
|
|
13,761
|
|
||
|
|
2,061,773
|
|
|
2,067,485
|
|
||
Less accumulated depreciation and amortization
|
|
1,310,703
|
|
|
1,221,195
|
|
||
Property and equipment, net
|
|
$
|
751,070
|
|
|
$
|
846,290
|
|
|
|
June 30, 2016
|
|
December 31, 2015
|
||||
Fluid services equipment
|
|
$
|
117,773
|
|
|
$
|
129,459
|
|
Pumping equipment
|
|
39,709
|
|
|
43,573
|
|
||
Light vehicles
|
|
27,996
|
|
|
33,424
|
|
||
Contract drilling equipment
|
|
5,840
|
|
|
6,493
|
|
||
Well service units and equipment
|
|
335
|
|
|
541
|
|
||
Construction equipment
|
|
118
|
|
|
288
|
|
||
|
|
191,771
|
|
|
213,778
|
|
||
Less accumulated amortization
|
|
84,363
|
|
|
82,679
|
|
||
|
|
$
|
107,408
|
|
|
$
|
131,099
|
|
|
|
June 30, 2016
|
|
December 31, 2015
|
||||
Credit Facilities:
|
|
|
|
|
||||
Term Loan
|
|
$
|
165,000
|
|
|
$
|
—
|
|
7.75% Senior Notes due 2019
|
|
475,000
|
|
|
475,000
|
|
||
7.75% Senior Notes due 2022
|
|
300,000
|
|
|
300,000
|
|
||
Unamortized premium
|
|
818
|
|
|
956
|
|
||
Capital leases and other notes
|
|
87,842
|
|
|
111,063
|
|
||
Total debt
|
|
1,028,660
|
|
|
887,019
|
|
||
Less debt issuance costs, net of amortization
|
|
24,321
|
|
|
9,704
|
|
||
Less current portion
|
|
42,923
|
|
|
48,651
|
|
||
Long-term debt
|
|
$
|
961,416
|
|
|
$
|
828,664
|
|
•
|
incur indebtedness;
|
•
|
grant liens;
|
•
|
enter into sale and leaseback transactions;
|
•
|
make loans, capital expenditures, acquisitions and investments;
|
•
|
change the nature of business;
|
•
|
acquire or sell assets or consolidate or merge with or into other companies;
|
•
|
declare or pay dividends;
|
•
|
enter into transactions with affiliates;
|
•
|
enter into burdensome agreements;
|
•
|
prepay, redeem or modify or terminate other indebtedness;
|
•
|
change accounting policies and reporting practices;
|
•
|
amend organizational documents; and
|
•
|
use proceeds to fund any activities of or business with any person that is the subject of governmental sanctions.
|
|
|
Six Months Ended June 30,
|
||||||
|
|
2016
|
|
2015
|
||||
Cash payments for interest
|
|
$
|
32,560
|
|
|
$
|
30,892
|
|
Commitment and other fees paid
|
|
1,272
|
|
|
1,336
|
|
||
Amortization of debt issuance costs and discount or premium on notes
|
|
4,348
|
|
|
1,398
|
|
||
Change in accrued interest
|
|
5,010
|
|
|
174
|
|
||
Other
|
|
45
|
|
|
(96
|
)
|
||
|
|
$
|
43,235
|
|
|
$
|
33,704
|
|
|
|
|
|
|
|
Weighted
|
|
|
|||||
|
|
|
|
|
|
Average
|
|
|
|||||
|
|
|
|
Weighted
|
|
Remaining
|
|
Aggregate
|
|||||
|
|
Number of
|
|
Average
|
|
Contractual
|
|
Intrinsic
|
|||||
|
|
Options
|
|
Exercise
|
|
Term
|
|
Value
|
|||||
|
|
Granted
|
|
Price
|
|
(Years)
|
|
(000's)
|
|||||
Non-statutory stock options:
|
|
|
|
|
|
|
|
|
|||||
Outstanding, beginning of period
|
|
175,000
|
|
|
$
|
26.29
|
|
|
|
|
|
||
Options expired
|
|
(152,000
|
)
|
|
26.84
|
|
|
|
|
|
|||
Outstanding, end of period
|
|
23,000
|
|
|
$
|
22.66
|
|
|
0.7
|
|
$
|
—
|
|
Exercisable, end of period
|
|
23,000
|
|
|
$
|
22.66
|
|
|
0.7
|
|
$
|
—
|
|
Vested or expected to vest, end of period
|
|
23,000
|
|
|
$
|
22.66
|
|
|
0.7
|
|
$
|
—
|
|
|
|
|
|
Weighted Average
|
|||
|
|
Number of
|
|
Grant Date Fair
|
|||
Nonvested Shares
|
|
Shares
|
|
Value Per Share
|
|||
Nonvested at beginning of period
|
|
1,967,376
|
|
|
$
|
14.34
|
|
Granted during period
|
|
790,263
|
|
|
2.73
|
|
|
Vested during period
|
|
(858,705
|
)
|
|
15.02
|
|
|
Forfeited during period
|
|
(7,612
|
)
|
|
23.81
|
|
|
Nonvested at end of period
|
|
1,891,322
|
|
|
$
|
9.14
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
|
|
(Unaudited)
|
|
(Unaudited)
|
||||||||||||
Numerator (both basic and diluted):
|
|
|
|
|
|
|
|
|
|
|
||||||
Net loss
|
|
$
|
(89,883
|
)
|
|
$
|
(48,295
|
)
|
|
$
|
(173,222
|
)
|
|
$
|
(80,919
|
)
|
Denominator:
|
|
|
|
|
|
|
|
|
||||||||
Denominator for basic loss per share
|
|
42,602,128
|
|
|
40,167,876
|
|
|
41,869,855
|
|
|
40,360,194
|
|
||||
Denominator for diluted loss per share
|
|
42,602,128
|
|
|
40,167,876
|
|
|
41,869,855
|
|
|
40,360,194
|
|
||||
Basic loss per common share:
|
|
$
|
(2.11
|
)
|
|
$
|
(1.20
|
)
|
|
$
|
(4.14
|
)
|
|
$
|
(2.00
|
)
|
Diluted loss per common share:
|
|
$
|
(2.11
|
)
|
|
$
|
(1.20
|
)
|
|
$
|
(4.14
|
)
|
|
$
|
(2.00
|
)
|
|
|
Completion
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
and Remedial
|
|
Fluid
|
|
Well
|
|
Contract
|
|
Corporate and
|
|
|
||||||||||||
|
|
Services
|
|
Services
|
|
Servicing
|
|
Drilling
|
|
Other
|
|
Total
|
||||||||||||
Three Months Ended June 30, 2016 (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Operating revenues
|
|
$
|
36,228
|
|
|
45,491
|
|
|
36,824
|
|
|
1,461
|
|
|
$
|
—
|
|
|
$
|
120,004
|
|
|||
Direct operating costs
|
|
(32,860
|
)
|
|
(38,619
|
)
|
|
(31,847
|
)
|
|
(1,368
|
)
|
|
—
|
|
|
$
|
(104,694
|
)
|
|||||
Segment profits
|
|
$
|
3,368
|
|
|
$
|
6,872
|
|
|
$
|
4,977
|
|
|
$
|
93
|
|
|
$
|
—
|
|
|
$
|
15,310
|
|
Depreciation and amortization
|
|
$
|
18,954
|
|
|
$
|
16,145
|
|
|
$
|
13,886
|
|
|
$
|
3,201
|
|
|
$
|
2,661
|
|
|
$
|
54,847
|
|
Capital expenditures (excluding acquisitions)
|
|
$
|
935
|
|
|
$
|
3,031
|
|
|
$
|
2,303
|
|
|
$
|
—
|
|
|
$
|
1,526
|
|
|
$
|
7,795
|
|
Three Months Ended June 30, 2015 (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Operating revenues
|
|
$
|
69,056
|
|
|
$
|
63,704
|
|
|
$
|
56,500
|
|
|
$
|
4,336
|
|
|
$
|
—
|
|
|
$
|
193,596
|
|
Direct operating costs
|
|
(57,670
|
)
|
|
(48,381
|
)
|
|
(47,035
|
)
|
|
(3,488
|
)
|
|
—
|
|
|
(156,574
|
)
|
||||||
Segment profits
|
|
$
|
11,386
|
|
|
$
|
15,323
|
|
|
$
|
9,465
|
|
|
$
|
848
|
|
|
$
|
—
|
|
|
$
|
37,022
|
|
Depreciation and amortization
|
|
$
|
21,056
|
|
|
$
|
17,515
|
|
|
$
|
15,284
|
|
|
$
|
3,512
|
|
|
$
|
2,864
|
|
|
$
|
60,231
|
|
Capital expenditures (excluding acquisitions)
|
|
$
|
2,274
|
|
|
$
|
2,710
|
|
|
$
|
2,892
|
|
|
$
|
236
|
|
|
$
|
1,831
|
|
|
$
|
9,943
|
|
Six Months Ended June 30, 2016 (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Operating revenues
|
|
$
|
75,924
|
|
|
95,741
|
|
|
75,731
|
|
|
2,965
|
|
|
$
|
—
|
|
|
$
|
250,361
|
|
|||
Direct operating costs
|
|
(67,648
|
)
|
|
(79,786
|
)
|
|
(66,318
|
)
|
|
(2,929
|
)
|
|
—
|
|
|
$
|
(216,681
|
)
|
|||||
Segment profits
|
|
$
|
8,276
|
|
|
$
|
15,955
|
|
|
$
|
9,413
|
|
|
$
|
36
|
|
|
$
|
—
|
|
|
$
|
33,680
|
|
Depreciation and amortization
|
|
$
|
38,359
|
|
|
$
|
32,673
|
|
|
$
|
28,102
|
|
|
$
|
6,479
|
|
|
$
|
5,386
|
|
|
$
|
110,999
|
|
Capital expenditures (excluding acquisitions)
|
|
$
|
1,511
|
|
|
$
|
6,178
|
|
|
$
|
3,454
|
|
|
$
|
113
|
|
|
$
|
2,506
|
|
|
$
|
13,762
|
|
Identifiable assets
|
|
$
|
324,114
|
|
|
$
|
227,006
|
|
|
$
|
209,498
|
|
|
$
|
45,976
|
|
|
$
|
271,764
|
|
|
$
|
1,078,358
|
|
Six Months Ended June 30, 2015 (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Operating revenues
|
|
$
|
181,831
|
|
|
$
|
137,506
|
|
|
$
|
120,168
|
|
|
$
|
15,812
|
|
|
$
|
—
|
|
|
$
|
455,317
|
|
Direct operating costs
|
|
(138,921
|
)
|
|
(102,512
|
)
|
|
(99,437
|
)
|
|
(11,014
|
)
|
|
—
|
|
|
(351,884
|
)
|
||||||
Segment profits
|
|
$
|
42,910
|
|
|
$
|
34,994
|
|
|
$
|
20,731
|
|
|
$
|
4,798
|
|
|
$
|
—
|
|
|
$
|
103,433
|
|
Depreciation and amortization
|
|
$
|
42,356
|
|
|
$
|
35,233
|
|
|
$
|
30,745
|
|
|
$
|
7,064
|
|
|
$
|
5,762
|
|
|
$
|
121,160
|
|
Capital expenditures (excluding acquisitions)
|
|
$
|
16,446
|
|
|
$
|
8,936
|
|
|
$
|
13,243
|
|
|
$
|
1,110
|
|
|
$
|
4,346
|
|
|
$
|
44,081
|
|
Identifiable assets
|
|
$
|
477,316
|
|
|
$
|
277,739
|
|
|
$
|
257,778
|
|
|
$
|
56,230
|
|
|
$
|
333,011
|
|
|
$
|
1,402,074
|
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Segment profits
|
|
$
|
15,310
|
|
|
$
|
37,022
|
|
|
$
|
33,680
|
|
|
$
|
103,433
|
|
General and administrative expenses
|
|
(27,078
|
)
|
|
(35,673
|
)
|
|
(56,640
|
)
|
|
(74,877
|
)
|
||||
Depreciation and amortization
|
|
(54,847
|
)
|
|
(60,231
|
)
|
|
(110,999
|
)
|
|
(121,160
|
)
|
||||
Gain (Loss) on disposal of assets
|
|
(336
|
)
|
|
57
|
|
|
(261
|
)
|
|
9
|
|
||||
Operating loss
|
|
$
|
(66,951
|
)
|
|
$
|
(58,825
|
)
|
|
$
|
(134,220
|
)
|
|
$
|
(92,595
|
)
|
|
|
Six Months Ended June 30,
|
||||||
|
|
2016
|
|
2015
|
||||
|
|
(In thousands)
|
||||||
Capital leases issued for equipment
|
|
$
|
2,201
|
|
|
$
|
9,257
|
|
Asset retirement obligation additions (retirements)
|
|
$
|
(21
|
)
|
|
$
|
13
|
|
|
Fair Value
|
|
June 30, 2016
|
|
December 31, 2015
|
||||||||||||
|
Hierarchy Level
|
|
Carrying Amount
|
|
Fair Value
|
|
Carrying Amount
|
|
Fair Value
|
||||||||
|
|
|
(In thousands)
|
||||||||||||||
7.75% Senior Notes due 2019, excluding premium
|
1
|
|
$
|
475,000
|
|
|
$
|
180,500
|
|
|
$
|
475,000
|
|
|
$
|
399,000
|
|
7.75% Senior Notes due 2022, excluding premium
|
1
|
|
$
|
300,000
|
|
|
$
|
84,006
|
|
|
$
|
300,000
|
|
|
$
|
238,500
|
|
Term Loan
|
3
|
|
$
|
165,000
|
|
|
$
|
167,968
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
Six-Months-Ended June 30,
|
||||||||||||
|
|
2016
|
|
2015
|
||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
||||||
Completion and remedial services
|
|
$
|
75.9
|
|
|
30
|
%
|
|
$
|
181.8
|
|
|
41
|
%
|
Fluid services
|
|
$
|
95.8
|
|
|
38
|
%
|
|
$
|
137.5
|
|
|
30
|
%
|
Well servicing
|
|
$
|
75.7
|
|
|
31
|
%
|
|
$
|
120.2
|
|
|
26
|
%
|
Contract drilling
|
|
$
|
3.0
|
|
|
1
|
%
|
|
$
|
15.8
|
|
|
3
|
%
|
Total revenues
|
|
$
|
250.4
|
|
|
100
|
%
|
|
$
|
455.3
|
|
|
100
|
%
|
•
|
Completion and Remedial Services
— segment profits as a percent of revenues;
|
•
|
Well Servicing
— rig hours, rig utilization rate, revenue per rig hour, profits per rig hour and segment profits as a percent of revenues;
|
•
|
Fluid Services —
trucking hours, revenue per truck, segment profits per truck and segment profits as a percent of revenues; and
|
•
|
Contract Drilling
— rig operating days, revenue per drilling day, profits per drilling day and segment profits as a percent of revenues.
|
|
|
|
|
Segment
|
|||
|
|
Revenues
|
|
Profits %
|
|||
2015:
|
|
|
|
|
|||
First Quarter
|
|
$
|
112,775
|
|
|
28
|
%
|
Second Quarter
|
|
$
|
69,055
|
|
|
17
|
%
|
Third Quarter
|
|
$
|
67,240
|
|
|
16
|
%
|
Fourth Quarter
|
|
$
|
58,480
|
|
|
15
|
%
|
Full Year
|
|
$
|
307,550
|
|
|
20
|
%
|
2016:
|
|
|
|
|
|||
First Quarter
|
|
$
|
39,696
|
|
|
12
|
%
|
Second Quarter
|
|
$
|
36,228
|
|
|
9
|
%
|
|
|
Weighted
|
|
|
|
|
|
Segment
|
|
|
|||||||
|
|
Average
|
|
|
|
Revenue
|
|
Profits Per
|
|
|
|||||||
|
|
Number of
|
|
|
|
Per Fluid
|
|
Fluid
|
|
|
|||||||
|
|
Fluid Service
|
|
Trucking
|
|
Service
|
|
Service
|
|
Segment
|
|||||||
|
|
Trucks
|
|
Hours
|
|
Truck
|
|
Truck
|
|
Profits %
|
|||||||
2015:
|
|
|
|
|
|
|
|
|
|
|
|||||||
First Quarter
|
|
1,046
|
|
|
595,100
|
|
|
$
|
71
|
|
|
$
|
19
|
|
|
27
|
%
|
Second Quarter
|
|
1,011
|
|
|
573,700
|
|
|
$
|
63
|
|
|
$
|
15
|
|
|
24
|
%
|
Third Quarter
|
|
1,012
|
|
|
565,400
|
|
|
$
|
62
|
|
|
$
|
15
|
|
|
24
|
%
|
Fourth Quarter
|
|
1,002
|
|
|
557,000
|
|
|
$
|
58
|
|
|
$
|
12
|
|
|
21
|
%
|
Full Year
|
|
1,018
|
|
|
2,291,200
|
|
|
$
|
254
|
|
|
$
|
61
|
|
|
24
|
%
|
2016:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
First Quarter
|
|
985
|
|
|
521,500
|
|
|
$
|
51
|
|
|
$
|
10
|
|
|
18
|
%
|
Second Quarter
|
|
976
|
|
|
474,400
|
|
|
$
|
47
|
|
|
$
|
7
|
|
|
15
|
%
|
|
|
Weighted
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
Average
|
|
|
|
Rig
|
|
Revenue
|
|
|
|
|
||||||||
|
|
Number
|
|
|
|
Utilization
|
|
Per Rig
|
|
Profits Per
|
|
|
||||||||
|
|
Of Rigs
|
|
Rig hours
|
|
Rate
|
|
Hour
|
|
Rig hour
|
|
Profits %
|
||||||||
2015:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
First Quarter
|
|
421
|
|
|
163,900
|
|
|
55
|
%
|
|
$
|
377
|
|
|
$
|
69
|
|
|
18
|
%
|
Second Quarter
|
|
421
|
|
|
154,700
|
|
|
51
|
%
|
|
$
|
351
|
|
|
$
|
61
|
|
|
17
|
%
|
Third Quarter
|
|
421
|
|
|
154,100
|
|
|
50
|
%
|
|
$
|
334
|
|
|
$
|
50
|
|
|
14
|
%
|
Fourth Quarter
|
|
421
|
|
|
120,000
|
|
|
39
|
%
|
|
$
|
324
|
|
|
$
|
33
|
|
|
9
|
%
|
Full Year
|
|
421
|
|
|
592,700
|
|
|
49
|
%
|
|
$
|
348
|
|
|
$
|
54
|
|
|
15
|
%
|
2016:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
First Quarter
|
|
421
|
|
|
108,400
|
|
|
36
|
%
|
|
$
|
321
|
|
|
$
|
44
|
|
|
11
|
%
|
Second Quarter
|
|
421
|
|
|
113,700
|
|
|
38
|
%
|
|
$
|
308
|
|
|
$
|
44
|
|
|
14
|
%
|
|
|
Weighted
|
|
|
|
|
|
|
|
|
|||||||
|
|
Average
|
|
Rig
|
|
|
|
|
|
|
|||||||
|
|
Number of
|
|
Operating
|
|
Revenue Per
|
|
Profits Per
|
|
Segment
|
|||||||
|
|
Rigs
|
|
Days
|
|
Drilling Day
|
|
Drilling Day
|
|
Profits %
|
|||||||
2015:
|
|
|
|
|
|
|
|
|
|
|
|||||||
First Quarter
|
|
12
|
|
|
674
|
|
|
$
|
17,000
|
|
|
$
|
5,900
|
|
|
34
|
%
|
Second Quarter
|
|
12
|
|
|
280
|
|
|
$
|
15,500
|
|
|
$
|
3,000
|
|
|
20
|
%
|
Third Quarter
|
|
12
|
|
|
252
|
|
|
$
|
15,300
|
|
|
$
|
2,600
|
|
|
17
|
%
|
Fourth Quarter
|
|
12
|
|
|
155
|
|
|
$
|
16,500
|
|
|
$
|
400
|
|
|
3
|
%
|
Full Year
|
|
12
|
|
|
1,361
|
|
|
$
|
16,300
|
|
|
$
|
4,000
|
|
|
25
|
%
|
2016:
|
|
|
|
|
|
|
|
|
|
|
|||||||
First Quarter
|
|
12
|
|
|
91
|
|
|
$
|
16,500
|
|
|
$
|
(600
|
)
|
|
(4
|
)%
|
Second Quarter
|
|
12
|
|
|
91
|
|
|
$
|
16,100
|
|
|
$
|
1,000
|
|
|
6
|
%
|
|
|
Issuer Purchases of Equity Securities
|
||||||||||||
|
|
|
|
|
|
Total Number of
|
|
Approximate Dollar
|
||||||
|
|
|
|
|
|
Shares Purchased
|
|
Value of Shares
|
||||||
|
|
|
|
|
|
as Part of Publicly
|
|
that May Yet be
|
||||||
|
|
Total Number of
|
|
Average Price Paid
|
|
Announced
|
|
Purchased Under
|
||||||
Period
|
|
Shares Purchased
|
|
Per Share
|
|
Program (1)
|
|
the Program (1)
|
||||||
April 1 — April 30 (2)
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
|
|
|
May 1 — May 31 (2)
|
|
351
|
|
|
$
|
2.35
|
|
|
—
|
|
|
|
|
|
June 1 — June 30 (2)
|
|
203
|
|
|
$
|
1.83
|
|
|
—
|
|
|
|
|
|
Total
|
|
554
|
|
|
$
|
2.16
|
|
|
—
|
|
|
$
|
9,451
|
|
Exhibit
|
|
|
No.
|
|
Description
|
|
|
|
3.1*
|
|
Amended and Restated Certificate of Incorporation of the Company, dated September 22, 2005. (Incorporated by reference to Exhibit 3.1 of the Company’s Registration Statement on Form S-1/A (SEC File No. 333-127517), filed on September 28, 2005)
|
3.2*
|
|
Amended and Restated Bylaws of the Company, effective as of March 9, 2010. (Incorporated by reference to Exhibit 3.1 of the Company’s Current Report on Form 8-K (SEC File No. 001-32693), filed on March 15, 2010)
|
4.1*
|
|
Specimen Stock Certificate Representing Common Stock of the Company. (Incorporated by reference to Exhibit 4.1 of the Company’s Registration Statement on Form S-1/A (SEC File No. 333-127517), filed on November 4, 2005)
|
4.2*
|
|
Indenture dated as of February 15, 2011, among Basic Energy Services, Inc. as Issuer, the Guarantors named therein and Wells Fargo Bank, N.A., as Trustee. (Incorporated by reference to Exhibit 4.2 of the Company’s Current Report on Form 8-K (SEC File No. 001-32693), filed on February 18, 2011)
|
4.3*
|
|
Form of 7.75% Senior Note due 2019. (Included as Exhibit A to Exhibit 4.2 of the Company’s Current Report on Form 8-K (SEC File No. 001-32693), filed on February 18, 2011)
|
4.4*
|
|
First Supplemental Indenture dated as of August 5, 2011 to Indenture dated as of February 15, 2011 among Basic Energy Services, Inc. as Issuer, the Guarantors named therein and Wells Fargo Bank, N.A., as Trustee. (Incorporated by reference to Exhibit 10.2 of the Company’s Current Report on Form 8-K (SEC File No. 001-32693), filed on August 10, 2011)
|
4.5*
|
|
Indenture dated as of October 16, 2012, among Basic Energy Services, Inc. as Issuer, the Guarantors named therein and Wells Fargo Bank, National Association, as Trustee. (Incorporated by reference to Exhibit 4.1 of the Company’s Current Report on Form 8-K/A (SEC File No. 001-32693), filed on October 26, 2012)
|
4.6*
|
|
Form of 7.75% Senior Note due 2022. (Included as Exhibit A to Exhibit 4.1 of the Company’s Current Report on Form 8-K/A (SEC File No. 001-32693), filed on October 26, 2012)
|
10.1*
|
|
Amendment No. 1 to Term Loan Credit Agreement, dated as of March 28, 2016, among Basic Energy Services, Inc. as Borrower, U.S. Bank National Association, as administrative agent and the Lenders Party thereto. (Incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K (SEC File No. 001-32693), filed on May 11, 2016)
|
10.2*
|
|
Amendment No. 2 to Term Loan Credit Agreement, dated as of April 27, 2016, among Basic Energy Services, Inc. as Borrower, U.S. Bank National Association, as administrative agent and the Lenders Party thereto. (Incorporated by reference to Exhibit 10.2 of the Company’s Current Report on Form 8-K (SEC File No. 001-32693), filed on May 11, 2016)
|
10.3*
|
|
Amendment No. 3 to Term Loan Credit Agreement, dated as of May 10, 2016, among Basic Energy Services, Inc. as Borrower, U.S. Bank National Association, as administrative agent and the Lenders Party thereto. (Incorporated by reference to Exhibit 10.3 of the Company’s Current Report on Form 8-K (SEC File No. 001-32693), filed on May 11, 2016)
|
10.4*
|
|
Amendment No. 1 to Sixth Amended and Restated Basic Energy Services, Inc. 2003 Incentive Plan. (Incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K (SEC File No. 001-32693), filed on May 23, 2016)
|
10.5#
|
|
Form of Key Employee Retention Bonus agreement
|
10.6#
|
|
Form of Key Employee Incentive Bonus agreement
|
31.1#
|
|
Certification by Chief Executive Officer required by Rule 13a-14(a) and 15d-14(a) under the Exchange Act
|
31.2#
|
|
Certification by Chief Financial Officer required by Rule 13a-14(a) and 15d-14(a) under the Exchange Act
|
32.1##
|
|
Certification of Chief Executive Officer pursuant to 18 U.S.C Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
32.2##
|
|
Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
101.CAL#
|
|
XBRL Calculation Linkbase Document
|
101.DEF#
|
|
XBRL Definition Linkbase Document
|
101.INS#
|
|
XBRL Instance Document
|
101.LAB#
|
|
XBRL Labels Linkbase Document
|
101.PRE#
|
|
XBRL Presentation Linkbase Document
|
101.SCH#
|
|
XBRL Schema Document
|
|
|
|
|
BASIC ENERGY SERVICES, INC.
|
|
|
|
By:
|
/s/ T. M. “Roe” Patterson
|
Name:
|
T. M. “Roe” Patterson
|
Title:
|
President, Chief Executive Officer and
|
|
Director (Principal Executive Officer)
|
|
|
By:
|
/s/ Alan Krenek
|
Name:
|
Alan Krenek
|
Title:
|
Senior Vice President, Chief Financial Officer, Treasurer
|
|
and Secretary (Principal Financial Officer)
|
|
|
By:
|
/s/ John Cody Bissett
|
Name:
|
John Cody Bissett
|
Title:
|
Vice President, Controller and Chief Accounting Officer
|
|
(Principal Accounting Officer)
|
Exhibit
|
|
|
No.
|
|
Description
|
|
|
|
3.1*
|
|
Amended and Restated Certificate of Incorporation of the Company, dated September 22, 2005. (Incorporated by reference to Exhibit 3.1 of the Company’s Registration Statement on Form S-1/A (SEC File No. 333-127517), filed on September 28, 2005)
|
3.2*
|
|
Amended and Restated Bylaws of the Company, effective as of March 9, 2010. (Incorporated by reference to Exhibit 3.1 of the Company’s Current Report on Form 8-K (SEC File No. 001-32693), filed on March 15, 2010)
|
4.1*
|
|
Specimen Stock Certificate Representing Common Stock of the Company. (Incorporated by reference to Exhibit 4.1 of the Company’s Registration Statement on Form S-1/A (SEC File No. 333-127517), filed on November 4, 2005)
|
4.2*
|
|
Indenture dated as of February 15, 2011, among Basic Energy Services, Inc. as Issuer, the Guarantors named therein and Wells Fargo Bank, N.A., as Trustee. (Incorporated by reference to Exhibit 4.2 of the Company’s Current Report on Form 8-K (SEC File No. 001-32693), filed on February 18, 2011)
|
4.3*
|
|
Form of 7.75% Senior Note due 2019. (Included as Exhibit A to Exhibit 4.2 of the Company’s Current Report on Form 8-K (SEC File No. 001-32693), filed on February 18, 2011)
|
4.4*
|
|
First Supplemental Indenture dated as of August 5, 2011 to Indenture dated as of February 15, 2011 among Basic Energy Services, Inc. as Issuer, the Guarantors named therein and Wells Fargo Bank, N.A., as Trustee. (Incorporated by reference to Exhibit 10.2 of the Company’s Current Report on Form 8-K (SEC File No. 001-32693), filed on August 10, 2011)
|
4.5*
|
|
Indenture dated as of October 16, 2012, among Basic Energy Services, Inc. as Issuer, the Guarantors named therein and Wells Fargo Bank, National Association, as Trustee. (Incorporated by reference to Exhibit 4.1 of the Company’s Current Report on Form 8-K/A (SEC File No. 001-32693), filed on October 26, 2012)
|
4.6*
|
|
Form of 7.75% Senior Note due 2022. (Included as Exhibit A to Exhibit 4.1 of the Company’s Current Report on Form 8-K/A (SEC File No. 001-32693), filed on October 26, 2012)
|
10.1*
|
|
Amendment No. 1 to Term Loan Credit Agreement, dated as of March 28, 2016, among Basic Energy Services, Inc. as Borrower, U.S. Bank National Association, as administrative agent and the Lenders Party thereto. (Incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K (SEC File No. 001-32693), filed on May 11, 2016)
|
10.2*
|
|
Amendment No. 2 to Term Loan Credit Agreement, dated as of April 27, 2016, among Basic Energy Services, Inc. as Borrower, U.S. Bank National Association, as administrative agent and the Lenders Party thereto. (Incorporated by reference to Exhibit 10.2 of the Company’s Current Report on Form 8-K (SEC File No. 001-32693), filed on May 11, 2016)
|
10.3*
|
|
Amendment No. 3 to Term Loan Credit Agreement, dated as of May 10, 2016, among Basic Energy Services, Inc. as Borrower, U.S. Bank National Association, as administrative agent and the Lenders Party thereto. (Incorporated by reference to Exhibit 10.3 of the Company’s Current Report on Form 8-K (SEC File No. 001-32693), filed on May 11, 2016)
|
10.4*
|
|
Amendment No. 1 to Sixth Amended and Restated Basic Energy Services, Inc. 2003 Incentive Plan. (Incorporated by reference to Exhibit 10.1 of the Company’s Current Report on Form 8-K (SEC File No. 001-32693), filed on May 23, 2016)
|
10.5#
|
|
Form of Key Employee Retention Bonus agreement
|
10.6#
|
|
Form of Key Employee Incentive Bonus agreement
|
31.1#
|
|
Certification by Chief Executive Officer required by Rule 13a-14(a) and 15d-14(a) under the Exchange Act
|
31.2#
|
|
Certification by Chief Financial Officer required by Rule 13a-14(a) and 15d-14(a) under the Exchange Act
|
32.1##
|
|
Certification of Chief Executive Officer pursuant to 18 U.S.C Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
32.2##
|
|
Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
101.CAL#
|
|
XBRL Calculation Linkbase Document
|
101.DEF#
|
|
XBRL Definition Linkbase Document
|
101.INS#
|
|
XBRL Instance Document
|
101.LAB#
|
|
XBRL Labels Linkbase Document
|
101.PRE#
|
|
XBRL Presentation Linkbase Document
|
101.SCH#
|
|
XBRL Schema Document
|
1.
|
Retention Bonus
. You shall be entitled to a retention bonus of
$
«Total_Retention_Award_Amount1»
(the “
Retention Bonus
”), payable on the schedule set forth below, subject to your continued employment through June 20, 2017 (the “
Vesting Date
”) and certain exceptions as provided in Section 4 of this Agreement.
|
2.
|
Payment Schedule
. The Retention Bonus will be paid to you in four cash installment payments equal to twenty-five percent (25%) of the amount of the Retention Bonus (less all required tax withholdings) (each, an “
Installment Payment
”). The first Installment Payment will be paid to you as soon as administratively practicable after the execution of this Agreement. The remaining three Installment Payments will be paid to you on each of (i) August, 15, 2016, (ii) November 15, 2016 and (iii) February 15, 2017, subject to the terms and conditions of this Agreement.
|
3.
|
Clawback; Forfeiture
. Notwithstanding anything herein to the contrary, if prior to the Vesting Date you voluntarily terminate your employment with the Company other than as an Eligible Retirement, or your employment is terminated by the Company for Cause, you agree that (a) you shall forfeit all of your rights to payment of any remaining Installment Payments, and (b) you will re-pay to the Company the total amount of each Installment Payment paid prior to such termination, within five days after receipt of a written notice of the Company requiring the same.
|
4.
|
Nonforfeiture
. If your employment with the Company is terminated without Cause, by you as an Eligible Retirement, or by reason of Disability or death, in each case, prior to the Vesting Date, you (or your estate or beneficiaries, as applicable) shall remain eligible to receive any scheduled Installment Payment after such termination date on the scheduled payment date. If any of the foregoing terminations occur, any previously paid Installment Payments will not be subject to the clawback provision in Section 3 above.
|
5.
|
Release of Claims
. Your retention of all or any portion of the Retention Bonus on account of a termination of employment by the Company without Cause or by you as an Eligible Retirement
|
6.
|
409A
. The payments and benefits under this Agreement are intended to be exempt from Section 409A of the Internal Revenue Code of 1986, as amended, and the regulations and guidance promulgated thereunder (collectively “
Section 409A
”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be exempt from Section 409A.
|
7.
|
Assignment
. You may not assign your rights under this Agreement except upon your death. The Company may assign its obligations hereunder to any successor (including any acquirer of substantially all of the assets of the Company).
|
8.
|
Entire Agreement
. This Agreement sets forth the entire understanding of the Company and you regarding the subject matter hereof and supersedes all prior agreements, understandings and inducements, whether express or implied, oral or written;
provided, however
, this Agreement does not impact, alter, modify, amend or otherwise supersede any of the rights or obligations of either party under any employment agreement or arrangement, or any existing severance agreements in place between you and the Company. No modification or amendment of this Agreement shall be effective without a prior written agreement signed by you and the Company.
|
9.
|
Notices
. All notices, approvals and other communications required or permitted to be given under this Agreement shall be in writing and shall be validly served or given if delivered in person, electronically (with read receipt acknowledgment), mailed by first class mail (registered or certified, return receipt requested), or overnight air courier with proof of delivery (i) if to the Company, at its principal corporate offices addressed to the attention of Gina McCormick, and (ii) if to you, at your home address as such address may appear on the records of the Company, or to such other address as such party may hereafter specify in written notice to the other party.
|
10.
|
Confidentiality
. You hereby agree, to the maximum extent permitted by law, to, and cause your affiliates and representatives to, keep confidential the existence and the terms of this Agreement;
provided, however
, that (i) you may disclose the terms of this Agreement to your financial or legal advisers who reasonably need to have access to such information to provide services to you, provided that you have made such advisors aware of the confidential nature of such information prior to disclosure, and (ii) you may disclose the terms of this Agreement if required to do so by any applicable legal requirement so long as reasonable prior notice of such required disclosure is given to the Company.
|
11.
|
Governing Law;
WAIVER OF JURY TRIAL
. To the maximum extent permitted by law, this Agreement is governed by and to be construed in accordance with the laws of the State of Texas, without regard to conflicts of laws principles thereof. The parties to this Agreement each hereby irrevocably submits to the non-exclusive jurisdiction of Texas or federal court sitting in Tarrant County in any action or proceeding arising out of or relating to this Agreement, and all such parties hereby irrevocably agree that all claims in respect of such action or proceeding may be heard and determined in Texas or federal court and hereby irrevocably waive, to the fullest extent that they may legally do so, the defense of an inconvenient forum to the maintenance of such action or proceeding.
EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT.
|
12.
|
Tax
. Amounts payable under this Agreement shall be subject to withholding for federal, state, local or foreign taxes (including, but not limited to, any social security contributions) as shall be required to be withheld pursuant to any applicable law or regulation.
|
13.
|
Waiver
. Failure by either party to exercise, or any delay in exercising, any right or remedy provided under this Agreement or by law shall not constitute a waiver of that or any other right or remedy, nor shall it prevent or restrict any further exercise of that or any other right or remedy.
|
14.
|
Severability
. In case any provision in this Agreement shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.
|
15.
|
Counterpart Originals
. This Agreement may be executed in two or more counterparts, and by the different parties in separate counterparts, each of which when executed shall be deemed to be an original but all of which taken together shall constitute one and the same agreement. Delivery of an executed counterpart of a signature page to this Agreement electronically (including portable document format (pdf.)) or by facsimile shall be as effective as delivery of a manually executed counterpart of this Agreement.
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1.
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Incentive Bonus
. You shall be entitled to an incentive bonus of $
[______]
(the “
Incentive Bonus
”), payable in accordance with the schedule set forth in Section 2.
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2.
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Payment Schedule
. Provided that you remain employed by the Company on each Payment Date (as defined below) and subject to certain exceptions as provided in Section 4, the Incentive Bonus will be paid to you in three cash installment payments equal to one-third (1/3) of the amount of the Incentive Bonus (less all required tax withholdings) (each, an “
Installment Payment
”). Subject to the terms and conditions of this Agreement, each Installment Payment will be payable as follows:
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a.
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The first Installment Payment will be paid to you as soon as administratively practicable after the execution of this Agreement.
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b.
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The second Installment Payment will be paid to you as soon as administratively practicable (but in all events, within thirty (30) days) following the execution by the Company of definitive documentation relating to a Restructuring Transaction, including, without limitation, a non-binding term-sheet, a restructuring support agreement or plan support agreement, a chapter 11 plan or asset purchase agreement for the sale of all or substantially all of the Company’s assets;
provided, however
, that such execution must occur prior to June 20, 2017 (the “
Expiration Date
”).
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c.
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The third Installment Payment will be paid to you as soon as administratively practicable (but in all events, within thirty (30) days) following the (i) closing of any out of court Restructuring Transaction or (ii) the Company’s emergence from any chapter 11 case filed with the United States Bankruptcy Court (“
Bankruptcy Court
”) pursuant to chapter 11 of title 11 of the United States Code, which emergence shall be the date the Company files a notice with the Bankruptcy Court that is chapter 11 plan has become effective;
provided, however
, that such closing or emergence must occur prior to the Expiration Date.
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3.
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Clawback; Forfeiture
. Notwithstanding anything herein to the contrary, if prior to the Expiration Date, you voluntarily terminate your employment with the Company without Good Reason or your employment is terminated by the Company for Cause, you agree that (a) you shall forfeit all of your rights to payment of any remaining Installment Payments, and (b) you will re-pay to the Company the total amount of each Installment Payment paid prior to such termination, within five (5) days after receipt of a written notice of the Company requiring the same.
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4.
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Nonforfeiture
. If your employment with the Company is terminated without Cause, by you for Good Reason, or by reason of Disability or death, in each case, prior to the Expiration Date, you (or your estate or beneficiaries, as applicable) shall remain eligible to receive any scheduled Installment Payment after such termination date on the scheduled Payment Date. If any of the foregoing terminations occur prior to the Expiration Date, any previously paid Installment Payments will not be subject to the clawback provision in Section 3 above.
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5.
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Release of Claims
. Your retention of all or any portion of the Incentive Bonus on account of a termination of employment by the Company without Cause or by you for Good Reason shall be contingent on your executing and not revoking an agreement, in a standard form provided by the Company, granting a full release of all actual and potential claims you have or may have against the Company or its affiliates.
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6.
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409A
. The payments and benefits under this Agreement are intended to be exempt from Section 409A of the Internal Revenue Code of 1986, as amended, and the regulations and guidance promulgated thereunder (collectively “
Section 409A
”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be exempt from Section 409A.
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7.
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Assignment
. You may not assign your rights under this Agreement except upon your death. The Company may assign its obligations hereunder to any successor (including any acquirer of substantially all of the assets of the Company).
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8.
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Entire Agreement
. This Agreement sets forth the entire understanding of the Company and you regarding the subject matter hereof and supersedes all prior agreements, understandings and inducements, whether express or implied, oral or written, with respect to such subject matter. No
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9.
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Notices
. All notices, approvals and other communications required or permitted to be given under this Agreement shall be in writing and shall be validly served or given if delivered in person, electronically (with read receipt acknowledgment), mailed by first class mail (registered or certified, return receipt requested), or overnight air courier with proof of delivery (i) if to the Company, at its principal corporate offices addressed to the attention of Gina McCormick, and (ii) if to you, at your home address as such address may appear on the records of the Company, or to such other address as such party may hereafter specify in written notice to the other party.
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10.
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Confidentiality
. You hereby agree, to the maximum extent permitted by law, to, and cause your affiliates and representatives to, keep confidential the existence and the terms of this Agreement;
provided, however
, that (i) you may disclose the terms of this Agreement to your financial or legal advisers who reasonably need to have access to such information to provide services to you, provided that you have made such advisors aware of the confidential nature of such information prior to disclosure, and (ii) you may disclose the terms of this Agreement if required to do so by any applicable legal requirement so long as reasonable prior notice of such required disclosure is given to the Company.
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11.
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Governing Law;
WAIVER OF JURY TRIAL
. To the maximum extent permitted by law, this Agreement is governed by and to be construed in accordance with the laws of the State of Texas, without regard to conflicts of laws principles thereof. The parties to this Agreement each hereby irrevocably submits to the non-exclusive jurisdiction of Texas or federal court sitting in Tarrant County in any action or proceeding arising out of or relating to this Agreement, and all such parties hereby irrevocably agree that all claims in respect of such action or proceeding may be heard and determined in Texas or federal court and hereby irrevocably waive, to the fullest extent that they may legally do so, the defense of an inconvenient forum to the maintenance of such action or proceeding.
EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT.
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12.
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Tax
. Amounts payable under this Agreement shall be subject to withholding for federal, state, local or foreign taxes (including, but not limited to, any social security contributions) as shall be required to be withheld pursuant to any applicable law or regulation.
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13.
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Waiver
. Failure by either party to exercise, or any delay in exercising, any right or remedy provided under this Agreement or by law shall not constitute a waiver of that or any other right or remedy, nor shall it prevent or restrict any further exercise of that or any other right or remedy.
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14.
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Severability
. In case any provision in this Agreement shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.
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15.
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Counterpart Originals
. This Agreement may be executed in two or more counterparts, and by the different parties in separate counterparts, each of which when executed shall be deemed to be an original but all of which taken together shall constitute one and the same agreement. Delivery of an executed counterpart of a signature page to this Agreement electronically (including portable document format (pdf.)) or by facsimile shall be as effective as delivery of a manually executed counterpart of this Agreement.
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/s/ T. M. “Roe” Patterson
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T. M. “Roe” Patterson
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Chief Executive Officer
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/s/ Alan Krenek
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Alan Krenek
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Chief Financial Officer
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/s/ T. M. “Roe” Patterson
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T. M. “Roe” Patterson
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Chief Executive Officer
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/s/ Alan Krenek
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Alan Krenek
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Chief Financial Officer
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