UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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of the Securities Exchange Act of 1934
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
| Item 3.03 | Material Modification to Rights of Security Holders. |
On October 31, 2022, U.S. Well Services, Inc. (the “Company”) filed with the Secretary of State of the State of Delaware an amendment (the “Certificate of Designations Amendment”) to that certain Certificate of Designations (the “Certificate of Designations” and, as amended by the Certificate of Designations Amendment, the “Amended Series A Certificate of Designations”) of the Series A Redeemable Convertible Preferred Stock (the “Series A Preferred Stock”), which provides each holder of shares of the Series A Preferred Stock with the option, exercisable by delivery of written notice to the Company (a “Conversion Notice”), to convert all but not less than all of such holder’s shares of the Series A Preferred Stock (any such conversion, an “Optional Merger Conversion”) into shares of Company’s Class A common stock, par value $0.0001 per share (the “Common Stock”). Under the terms of the Amended Series A Certificate of Designations, in connection with any Optional Merger Conversion, each share of the Series A Preferred Stock subject to such Optional Merger Conversion would be converted into a number of shares of Common Stock (the “Optional Merger Conversion Shares”) equal to the quotient obtained by dividing (i) the then applicable liquidation preference of such share of the Series A Preferred Stock (as determined in accordance with the Amended Series A Certificate of Designations), by (ii) an amount initially equal to $7.32, subject from time to time to certain adjustments (such amount, the “Merger Conversion Price”).
The foregoing description of the Certificate of Designations Amendment does not purport to be complete and is qualified in its entirety by reference to the complete text of the Certificate of Designations Amendment, which is filed herewith as Exhibit 3.1 to this Current Report on Form 8-K and is incorporated herein by reference.
| Item 5.07 | Submission of Matters to a Vote of Security Holders. |
The Company held a special meeting of stockholders on October 31, 2022 and the Company’s stockholders voted on five (5) proposals.
The first proposal was the approval of an Agreement and Plan of Merger, dated as of June 21, 2022 (the “Merger Agreement”), among the Company, ProFrac Holding Corp. (“ProFrac”) and Thunderclap Merger Sub I, Inc., an indirect subsidiary of ProFrac (“Merger Sub”) and the transactions contemplated thereby, including the merger, pursuant to which Merger Sub will merge with and into the Company, with the Company surviving as an indirect subsidiary of ProFrac (the “Merger”). The votes on the proposal were:
| Proposal 1 |
Votes For | Votes Against | Abstentions | |||||||||
| Approval of the Merger Agreement |
8,201,073 | 106,517 | 6,617 | |||||||||
The second proposal was the approval, for purposes of complying with the Nasdaq listing rules, of the issuance of shares of the Common Stock, to be issued by the Company upon the conversion of the Series A Preferred Stock and the Convertible Senior Secured (Third Lien) PIK Notes (the “PIK Notes”), in an amount equal to 20% or more of the Common Stock outstanding. The votes on the proposal were:
| Proposal 2 |
Votes For | Votes Against | Abstentions | |||||||||
| Approval of the issuance of shares of the Company’s Common Stock upon the conversion of the Series A Preferred Stock and the PIK Notes |
7,980,597 | 184,579 | 149,031 | |||||||||
The third proposal was the approval of the Certificate of Designations Amendment to modify certain terms relating to the conversion rights of the Series A Preferred Stock. The votes on the proposal were:
| Proposal 3 |
Votes For | Votes Against | Abstentions | |||||||||
| Approval of an amendment to the Company’s Certificate of Designations of the Series A Preferred Stock |
7,971,736 | 192,597 | 149,874 | |||||||||
The fourth proposal was the approval of an amendment to the Amended and Restated U.S. Well Services, Inc. 2018 Stock Incentive Plan (the “A&R LTIP”) to increase the maximum number of shares of Common Stock that may be issued under the A&R LTIP by 2,000,000 shares. The votes on the proposal were:
| Proposal 4 |
Votes For | Votes Against | Abstentions | |||||||||
| Approval of an amendment to the Company’s A&R LTIP |
7,801,456 | 365,571 | 147,180 | |||||||||
The fifth proposal, if submitted to a vote of Company stockholders, was the approval of an adjournment of the Special Meeting of Stockholders, including, if necessary, to solicit additional proxies in favor of the foregoing proposals if there are not sufficient votes for those proposals. The votes on the proposal were:
| Proposal 5 |
Votes For | Votes Against | Abstentions | |||||||||
| Approval of an adjournment of the Special Meeting of Stockholders |
7,914,774 | 377,212 | 22,221 | |||||||||
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits
| Exhibit |
Description | |
| 3.1 | First Amendment to Certificate of Designations of the Series A Redeemable Convertible Preferred Stock, dated October 31, 2022. | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). | |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| U.S. Well Services, Inc. | ||||||
| Dated: October 31, 2022 | By: | /s/ Erin C. Simonson | ||||
| Name: | Erin C. Simonson | |||||
| Title: | Vice President & Corporate Secretary | |||||
Exhibit 3.1
[Execution]
U.S. WELL SERVICES, INC.
FIRST AMENDMENT TO THE
CERTIFICATE OF DESIGNATIONS
Pursuant to Section 242 of the General
Corporation Law of the State of Delaware
SERIES A REDEEMABLE CONVERTIBLE PREFERRED STOCK
(Par Value $0.0001 Per Share)
U.S. Well Services, Inc. (the “Corporation”), a corporation organized and existing under and by virtue of the provisions of the General Corporation Law of the State of Delaware (the “General Corporation Law”), hereby certifies that, pursuant to the authority expressly granted to and vested in the Board of Directors of the Corporation (the “Board of Directors”) by the Second Amended and Restated Certificate of Incorporation of the Corporation (as amended from time to time in accordance with its terms and the General Corporation Law, the “Certificate of Incorporation”), which authorizes the Board of Directors, by resolution, to provide out of the unissued shares of the preferred stock (the “Preferred Stock”) for one or more series of Preferred Stock and to establish from time to time the number of shares to be included in each such series and to fix the voting rights (if any), designations, powers, preferences and relative, participating, optional, special and other rights (if any) of each such series and any qualifications, limitations and restrictions thereof, and in accordance with the provisions of Section 242 of the General Corporation Law, the Board of Directors duly adopted on June 21, 2022 the following recitals and resolutions:
WHEREAS, the Board of Directors previously fixed the rights, preferences, restrictions and other matters relating to a Series A Redeemable Convertible Preferred Stock (hereinafter referred to as the “Series A Preferred Stock”), consisting of up to 55,000 shares of the Series A Preferred Stock which the Corporation has the authority to issue, as set forth in that certain Certificate of Designations of the Series A Preferred Stock dated May 24, 2019 (the “Certificate of Designations”);
WHEREAS, pursuant to Section 7.14(b) of the Purchase Agreement among the Corporation and the purchasers party thereto dated May 23, 2019, such parties agreed not to treat the Series A Preferred Stock as “preferred stock” within the meaning of Section 305 of the Internal Revenue Code of 1986, as amended, and U.S. Treasury Regulation § 1.305-5 for U.S. federal income tax and withholding tax purposes;
WHEREAS, on June 21, 2022, the Corporation, ProFrac Holding Corp., a Delaware corporation (“Parent”), and Thunderclap Merger Sub I, Inc., a Delaware corporation and an indirect subsidiary of Parent (“Merger Sub Inc”), have entered into an Agreement and Plan of Merger (as the same may be amended from time to time, the “Merger Agreement”), providing for, among other things, the merger of Merger Sub Inc. with and into the Corporation, with the Corporation surviving the merger as the surviving corporation pursuant to the terms and conditions of the Merger Agreement.
WHEREAS, the Board of Directors wishes to amend the Certificate of Designations in accordance with the General Corporation Law; and
WHEREAS, the Board of Directors has determined that the amendments to the terms of the Series A Preferred Stock set forth in this First Amendment to the Certificate of Designations do not adversely affect the rights, preferences, privileges or powers of the Series A Preferred Stock.
NOW, THEREFORE, BE IT RESOLVED, that the Board of Directors does hereby amend the Certificate of Designations and the rights, preferences, restrictions and other matters relating to the Series A Preferred Stock as follows:
1. Conversion. The Certificate of Designations is hereby amended by adding a new Section 7(q) as follows:
(q) Each holder of Series A Preferred Stock shall have the option, exercisable by delivery of a Conversion Notice to the Corporation, to convert all of such holder’s shares of Series A Preferred Stock into Class A Common Stock at the Merger Conversion Ratio (such conversion, a “Merger Conversion”). The Corporation shall cause the effective date for the delivery of shares of Class A Common Stock issued in a Merger Conversion to be the Business Day on which the Conversion Notice is received. The “Merger Conversion Ratio” means, for each share of Series A Preferred Stock, the quotient of (i) its Liquidation Preference as of the date of the conversion and (ii) Merger Conversion Price. The “Merger Conversion Price” shall initially be $7.32, which may be adjusted from time to time in the same manner as the Conversion Price as set forth in Section 7(g).
2. CoC Forced Conversion. The following shall be added at the beginning of Section 7(d) of the Certificate of Designations: “Subject to a holder’s right to elect a Merger Conversion,”.
3. Effective Date.
This First Amendment to the Certificate of Designations shall become effective on October 31, 2022.
[The Remainder of this Page Intentionally Left Blank]
2
IN WITNESS WHEREOF, U.S. Well Services, Inc. has caused this First Amendment to the Certificate of Designations to be duly executed this 31st day of October, 2022.
| U.S. WELL SERVICES, INC. | ||
| By: | /s/ Kyle O’Neill | |
| Name: | Kyle O’Neill | |
| Title: | President & Chief Executive Officer | |
[Signature Page to First Amendment to Certificate of Designations]