##### Table of Contents





UNITED STATES SECURITIES AND
    EXCHANGE COMMISSION
 Washington, D.C.
    20549
  Form l0-K
  (Mark One)þ

ANNUAL REPORT PURSUANT TO
    SECTION 13 OR 15(d)
    OF THE SECURITIES EXCHANGE ACT OF 1934For the Fiscal Year Ended December 31, 2008ORo

TRANSITION REPORT PURSUANT TO
    SECTION 13 OR 15(d)
    OF THE SECURITIES EXCHANGE ACT OF
    1934.   Commission File
    No. 000-51435
  SUPERIOR WELL SERVICES,
    INC.
 (Exact name of registrant as
    specified in its charter)
  Delaware

20-2535684(State or other jurisdiction
    of

(I.R.S. Employerincorporation or
    organization)

Identification
    No.)   1380 Rt. 286 East, Suite #121
 Indiana, Pennsylvania 15701
 (Address of principal executive
    offices)
 (Zip Code)
  (Registrants telephone number, including area code)
    (724) 465-8904
  SECURITIES
    REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
  Common Stock, $.01 par value(Title of class)

The NASDAQ Stock Market LLC(Exchange)   SECURITIES
    REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
    None
  o þ
  o þ
  þ o
  Regulation S-K Form 10-K form 10-K. o
  12b-2
  Large accelerated
    filer o

Accelerated
    filer þ

Non-accelerated
    filer o
    (Do not check if a smaller reporting company)

Smaller reporting
    company o   Rule 12b-2 o þ
      DOCUMENTS
    INCORPORATED BY REFERENCE







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##### 



SUPERIOR
    WELL SERVICES, INC.
    ANNUAL REPORT ON
    FORM 10-K
  TABLE OF
    CONTENTS
   
 PART IItem 1.


Business


3Item 1A.


Risk Factors


12Item 1B.


Unresolved Staff Comments


22Item 2.


Properties


22Item 3.


Legal Proceedings


23Item 4.


Submission of Matters to a Vote of Security
    Holders


23PART IIItem 5.


Market for the Registrants Common Equity
    and Related Stockholder Matters and Issuer Purchases of Equity
    Securities


24Item 6.


Selected Financial Data


25Item 7.


Managements Discussion and Analysis of
    Financial Condition and Results of Operations


27Item 7A.


Quantitative and Qualitative Disclosures about
    Market Risk


49Item 8.


Financial Statements and Supplementary
    Data


51Item 9.


Changes in and Disagreements With Accountants
    on Accounting and Financial Disclosure


77Item 9A.


Controls and Procedures


77Item 9B.


Other Information


77PART IIIItem 10.


Directors, Executive Officers and Corporate
    Governance


77Item 11.


Executive Compensation


78Item 12.


Security Ownership of Certain Beneficial
    Owners and Management and Related Stockholder Matters


78Item 13.


Certain Relationships,  Related Transactions
    and Director Independence


78Item 14.


Principal Accounting Fees and Services


78PART IVItem 15.


Exhibits and Financial Statement
    Schedules.


79EX-12.1EX-21.1EX-23.1EX-31.1EX-31.2EX-32.1EX-32.2




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##### Table of Contents



PART I  Item 1.
    Business  Our
    Company
          Our
    Services and Products
    Technical
    Services
  Technical pumping services.
  Stimulation Services.
 3




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Nitrogen Services.
    Cementing Services.
   4




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Completion Services.
  Plugging and Abandonment.
  Roustabout Services.
  Sale and Rental of Equipment.
  Down-Hole Surveying Services.
  Logging Services.
 5




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Perforating Services.
  Fluid
    Logistics Services
    Competition
    Customers
    and Markets
   6




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2006(1)


2007(2)


2008(3)Percent of





Percent of





Percent ofRegion

Revenue


Revenue


Revenue


Revenue


Revenue


RevenueAppalachian

$
118,943



48.6
%

$
158,894



45.3
%

$
179,173



34.4
%Southeast


58,491



23.9



66,690



19.0



92,971



17.8Southwest


6,832



2.8



37,565



10.7



82,857



15.9Mid-Continent


43,566



17.8



56,063



16.0



105,607



20.3Rocky Mountain


16,794



6.9



31,558



9.0



60,281



11.6Total

$
244,626



100
%

$
350,770



100
%

$
520,889



100
%     (1)
    
    We expanded the Appalachian region by establishing service
    centers in Buckhannon, West Virginia and Norton, Virginia during
    the first and second quarters of 2006, respectively. We expanded
    the Rocky Mountain and Southwest regions in the third quarter of
    2006 by establishing service centers in Farmington, New Mexico
    and Alvarado, Texas, respectively. Additionally, during the
    fourth quarter of 2006 we established our first down-hole
    surveying service center in the Rocky Mountain region when we
    acquired wireline assets in Trinidad, Colorado.(2)
    
    We expanded the Appalachian region by establishing a service
    center in Jane Lew, West Virginia during the second quarter of
    2007. We expanded the Southwest region in the fourth quarter by
    establishing a service center in Artesia, New Mexico. We
    expanded the Mid-Continent region by acquiring wireline assets
    in Hays, Kansas during the first quarter of 2007 and
    establishing a service center in Clinton, Oklahoma during the
    third quarter of 2007. We expanded the Rocky Mountain region by
    acquiring wireline assets in Williston, North Dakota and
    establishing service centers in Brighton, Colorado and Rock
    Springs, Wyoming during the fourth quarter of 2007. The
    Brighton, Colorado service center began generating revenues in
    January of 2008 and the Rock Springs, Wyoming location is
    expected to start generating revenues during the first quarter
    of 2009.(3)
    
    In July 2008, we expanded the Rocky Mountain region by acquiring
    the down-hole surveying assets of Nuex that expanded our
    presence in Brighton, Colorado. In November 2008, we purchased
    the pressure pumping, fluid logistics and completion, production
    and rental tools business lines from Diamondback. As part of the
    acquisition, we acquired 128,000 horsepower, 105 transports and
    trucks, 400 frac tanks and six water disposal wells. The assets
    that we purchased from Diamondback are operating in the
    Anadarko, Arkoma, and Permian Basins, as well as the Barnett
    Shale, Woodford Shale, West Texas, Southern Louisiana and Texas
    Gulf Coast.    Customer

Length of Relationship


% of 2008 RevenueAtlas America, Inc.(1)


10 years



13.1Customer B(2)


5 years



8.6Customer C(3)


1 year



5.9Customer D(4)


7 years



4.9Customer E(5)


7 years



3.3     (1)
    
    We service Atlas America, Inc. from our Appalachian region
    service centers.(2)
    
    We service Customer B from our Appalachian, Mid-Continent,
    Southwest and Southeast region service centers.(3)
    
    We service Customer C from our Appalachian, Mid-Continent,
    Southwest and Southeast region service centers.(4)
    
    We service Customer D from our Appalachian, Southwest and
    Southeast region service centers.(5)
    
    We service Customer E from our Appalachian region service
    centers. 7




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Suppliers
    Length of Relationship


% of 2008 PurchasesRaw Materials

with Largest Supplier


with Largest SupplierFracturing and Cementing Chemicals


12 years



7.8Fracturing Sand


12 years



7.6Nitrogen


10 year



5.2     Length of Relationship


% of 2008 PurchasesEquipment

with Largest Supplier


with Largest SupplierBlenders


12 years



5.2Frac Trailers


10 years



3.3     Operating
    Risks and Insurance
    
    personal injury or loss of life;
    damage to or destruction of property, equipment, the environment
    and wildlife; and
    suspension of operations.         8




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Safety
    Program
    Environmental
    Regulation
           9




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on-site
       10




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Employees
   11




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Available
    Information
  www.swsi.com Form 10-K, Form 10-Q, Form 8-K
  1-800-SEC-0330. at http://www.sec.gov.
  Item 1A 
    Risk
    Factors  Risks
    Related to Our Business and Our Industry
  Many
    of our customers activity levels and spending for our
    products and services may be impacted by a sustained decline of
    oil and natural gas prices and current deterioration in the
    credit and capital markets.
        Our
    ability to obtain funding for our capital projects may be
    limited due to the deterioration of the credit and capital
    markets.
   12




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Our
    business depends on domestic spending by the oil and natural gas
    industry, and this spending and our business may be adversely
    affected by industry conditions that are beyond our
    control.
    
    the supply of and demand for oil and natural gas and related
    products;
    domestic and worldwide economic conditions;
    political instability in oil producing countries;
    price of foreign imports of oil and natural gas, including
    liquefied natural gas;
    substantial lead times on our capital expenditures;
    weather conditions;
    technical advances affecting energy consumption;
    the price and availability of alternative fuels; and
    merger and divestiture activity among oil and natural gas
    producers.   13




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A
    decline in or substantial volatility of natural gas and crude
    oil commodity prices could adversely affect the demand for our
    services.
      We may
    incur substantial indebtedness or issue additional equity
    securities to execute our growth strategy, which may reduce our
    profitability and result in significant dilution to our
    stockholders.
    We
    have significantly higher levels of indebtedness following the
    Diamondback acquisition than we had before the
    acquisition.
   14




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
    limiting our ability to obtain additional financing on
    satisfactory terms to fund our working capital requirements,
    capital expenditures, acquisitions, investments, debt service
    requirements and other general corporate requirements;
    increasing our vulnerability to general economic downturns,
    competition and industry conditions, which could place us at a
    competitive disadvantage compared to our competitors that are
    less leveraged;
    increasing our exposure to rising interest rates because a
    portion of our borrowings are at variable interest rates;
    reducing the availability of our cash flow to fund our working
    capital requirements, capital expenditures, acquisitions,
    investments and other general corporate requirements because we
    will be required to use a substantial portion of our cash flow
    to service debt obligations; and
    limiting our flexibility in planning for, or reacting to,
    changes in our business and the industry in which we operate.  If we
    do not successfully manage the potential difficulties associated
    with our growth strategy, our operating results could be
    adversely affected.
    
    lack of sufficient experienced management personnel;
    failure to anticipate the actual cost and timing of establishing
    new service centers;
    increased administrative burden; and
    increased logistical problems common to large, expansive
    operations.       15




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We may
    face difficulties in achieving the expected benefits of the
    Diamondback acquisition.
      We
    depend on a relatively small number of customers for a
    substantial portion of our revenue. The inability of one or more
    of our customers to meet their obligations or the loss of our
    business with Atlas America, Inc. or Chesapeake Energy Corp., in
    particular, may adversely affect our financial
    results.
      Competition
    within the oilfield services industry may adversely affect our
    ability to market our services.
   16




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Our
    industry is prone to overcapacity, which results in increased
    competition and lower prices for our services.
    The
    loss of or interruption in operations of one or more of our key
    suppliers could have a material adverse effect on our
    operations.
      We may
    not be able to keep pace with the continual and rapid
    technological developments that characterize the market for our
    services, and our failure to do so may result in our loss of
    market share.
    
    improve our existing services and related equipment;
    address the increasingly sophisticated needs of our
    customers; and
    anticipate changes in technology and industry standards and
    respond to technological developments on a timely basis.   17




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Our
    industry has recently experienced shortages in the availability
    of qualified field personnel. Any difficulty we experience
    adding or replacing qualified field personnel could adversely
    affect our business.
      The
    loss of key members of our management or the failure to attract
    and motivate key personnel could have an adverse effect on our
    business, financial condition and results of
    operations.
    Our
    operations are subject to inherent risks, some of which are
    beyond our control, and these risks may not be fully covered
    under our insurance policies. The occurrence of a significant
    event that is not covered by insurance could have a material
    adverse effect on our financial condition and results of
    operations.
    
    personal injury or loss of life;
    destruction of property, equipment, the environment and
    wildlife; and
    suspension of operations.   18




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We are
    subject to federal, state and local laws and regulations
    regarding issues of health, safety and protection of the
    environment. Under these laws and regulations, we may become
    liable for penalties arising from non-compliance, property and
    natural resource damages or costs of performing remediation. Any
    changes in these laws and regulations could increase our costs
    of doing business.
           19




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Clean-up
  Our
    internal control over financial reporting may be or become
    insufficient to allow us to accurately report our financial
    results or prevent fraud, which could cause our financial
    statements to become materially misleading and adversely affect
    the trading price of our common stock.
    Diamondbacks
    management and auditors identified significant deficiencies
    that, in the aggregate, resulted in a material weakness in the
    operation of Diamondbacks internal controls during the
    period ended December 31, 2005 and the year ended
    December 31, 2006, which could result in its, and in the
    future, our, financial statements being materially
    misleading.
      Complying
    with Section 404 of the Sarbanes-Oxley Act of 2002 may
    strain our financial and management resources.
   20




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We are
    a holding company, with no revenue generating operations of our
    own. Any restrictions on our subsidiaries ability to make
    distributions to us would materially impact our financial
    condition and our ability to service our
    obligations.
      Our
    future indebtedness could restrict our operations and make us
    more vulnerable to adverse economic conditions.
      
    impair our ability to make investments and obtain additional
    financing for working capital, capital expenditures,
    acquisitions or other general corporate purposes;
    limit our ability to use operating cash flow in other areas of
    our business because we must dedicate a substantial portion of
    these funds to make principal and interest payments on our
    indebtedness;
    limit our ability to borrow funds that may be necessary to
    operate or expand our business;
    put us at a competitive disadvantage to competitors that have
    less debt;
    increase our vulnerability to interest rate increases; and
    hinder our ability to adjust to rapidly changing economic and
    industry conditions.    Unionization
    efforts could increase our costs or limit our
    flexibility.
    Severe
    weather could have a material adverse impact on our
    business.
    
    curtailment of services; 21




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
    weather-related damage to equipment resulting in suspension of
    operations;
    weather-related damage to our facilities;
    inability to deliver materials to jobsites in accordance with
    contract schedules; and
    loss of productivity.    A
    terrorist attack or armed conflict could harm our
    business.
    Item 1B.
    Unresolved
    Staff Comments    Item 2.
    Properties   22




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Is the Lease Renewable at Our Sole


Do We Have an Option to PurchaseLocation

Expiration Date

Option?


the Property?Bradford, PA

September, 2011


Yes



NoCleveland, OK

March, 2009


No



YesMercer, PA(1)

N/A


No



NoWooster, OH

December, 2009


Yes



NoGaylord, MI

November, 2010


Yes



YesBossier City, LA

December, 2012


Yes



NoEnid, OK(1)

N/A


No



NoBlack Lick, PA(1)

N/A


No



NoVernal, UT

September, 2017


No



NoVan Buren, AR

May, 2009


Yes



NoBuckhannon, WV

February, 2010


Yes



NoNorton, VA

March, 2009


Yes



NoAlvarado, TX

March, 2011


Yes



YesFarmington, NM

January, 2015


Yes



NoTrinidad, CO(1)

N/A


No



NoOklahoma City, OK(1)

N/A


No



NoHays, KS

August, 2010


Yes



NoJane Lew, WV

October, 2015


Yes



NoRock Springs, WY

March, 2017


Yes



NoBrighton, CO

September, 2010


Yes



NoWilliston, ND

October, 2012


Yes



NoArtesia, NM

June, 2010


Yes



YesOklahoma City, OK

August, 2009


No



NoSweetwater, OK

November, 2013


Yes



NoCoalgate, OK

January, 2012


Yes



NoCountyline, OK

November, 2013


Yes



NoMarlow, OK

November, 2013


Yes



NoCresson, TX

November, 2013


Yes



NoMidland, TX

June, 2015


No



NoTolar, TX

November, 2013


Yes



NoElk City, OK(1)

N/A


No



NoVictoria, TX

May, 2013


Yes



NoBroussard, LA

September, 2011


Yes



No     (1)
    
    The lease is month-to-month.  Item 3.
    Legal
    Proceedings    Item 4.
    Submission
    of Matters to a Vote of Security Holders   23




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##### Table of Contents



PART II  Item 5.
    Market
    for the Registrants Common Equity and Related Stockholder
    Matters and Issuer Purchases of Equity Securities  Market
    Information for Common Stock
    High


LowFiscal Year Ended December 31, 2008First Quarter

$
26.73


$
17.14Second Quarter

$
34.42


$
21.73Third Quarter

$
35.71


$
23.46Fourth Quarter

$
23.65


$
8.60Fiscal Year Ended December 31, 2007First Quarter

$
25.54


$
21.20Second Quarter

$
28.02


$
22.18Third Quarter

$
26.24


$
17.10Fourth Quarter

$
23.45


$
18.87   Dividend
    Policy
    Purchases
    of Equity Securities By the Issuer and Affiliated
    Purchases
   24




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Item 6.
    Selected
    Financial Data    Year Ended December 31,2005


2006


2007


20082004


(Superior Well


(Superior Well


(Superior Well


(Superior Well(Partnerships)


Services, Inc.)


Services, Inc.)


Services, Inc.)


Services, Inc.)(In thousands, except per share information)Statements of Income Data:Revenue

$
76,041


$
131,733


$
244,626


$
350,770


$
520,889Cost of revenue


54,447



90,258



165,877



252,539



406,044Gross profit


21,594



41,475



78,749



98,231



114,845Selling, general and administrative expenses


11,339



17,809



25,716



36,390



45,702Operating income


10,255



23,666



53,033



61,841



69,143Interest expense


310



566



478



282



2,834Other (expense) income


(148
)


193



159



766



(135
)Income tax expense






13,826



20,791



24,570



27,362Net income

$
9,797


$
9,467


$
31,923


$
37,755


$
38,812Pro Forma income tax expense (unaudited)(1)


(4,249
)














Net income adjusted for pro forma income tax expense (unaudited)

$
5,548


$



$



$



$
Net income per common share(2)Basic

$
0.29


$
0.49


$
1.63


$
1.63


$
1.67Diluted

$
0.29


$
0.49


$
1.63


$
1.63


$
1.64Average Shares OutstandingBasic


19,376,667



19,317,436



19,568,749



23,100,402



23,150,463Diluted


19,376,667



19,317,436



19,568,749



23,195,914



23,661,608Statements of Cash Flow Data:Net cash provided by operations

$
12,790


$
16,742


$
35,949


$
69,303


$
51,706Net cash used in investing


(19,290
)


(40,091
)


(78,902
)


(128,100
)


(174,060
)Net cash provided by financing


6,751



32,570



88,940



7,555



118,481Capital expenditures, net of construction payables


19,300



39,920



69,816



117,774



90,424Acquisitions, net of cash acquired










9,150



9,931



84,242Depreciation and amortization


5,057



8,698



14,453



25,277



41,806Balance Sheet Data (at period end):Cash and cash equivalents

$
1,544


$
10,765


$
56,752


$
5,510


$
1,637Property, plant and equipment, net


40,594



72,691



141,424



240,863



453,990Total assets


56,682



113,091



259,034



327,087



658,230Long-term debt


11,093



1,258



1,597



9,165



208,042Partners capital


33,819















Stockholders Equity






91,393



213,904



253,599



337,615Other Financial Data:EBITDA(3)

$
15,164


$
32,557


$
69,385


$
89,845


$
113,336  25




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(1)
    
    Prior to our initial public offering in August 2005, we were not
    subject to federal or state income taxes due to our partnership
    structure. Pro forma income tax expense (unaudited) has been
    computed at statutory rates to reflect the pro forma effect on
    net income for periods prior to our holding company
    restructuring in August 2005.(2)
    
    Share and per share data have been retroactively restated to
    reflect our holding company restructuring in connection with our
    initial public offering in August 2005. For the calculations of
    earnings per share for the year ended December 31, 2004,
    all shares are assumed to have been issued at the beginning of
    the period resulting in 19,376,667 average shares outstanding.(3)
    
    We define EBITDA as earnings (net income) before interest
    expense, income tax expense, non-cash stock compensation
    expense, depreciation and amortization. This term, as we define
    it, may not be comparable to similarly titled measures employed
    by other companies and is not a measure of performance
    calculated in accordance with GAAP. EBITDA should not be
    considered in isolation or as a substitute for operating income,
    net income, cash flows provided by operating, investing and
    financing activities or other income or cash flow statement data
    prepared in accordance with GAAP. Our management uses EBITDA:  
    as a measure of operating performance because it assists us in
    comparing our performance on a consistent basis, since it
    removes the impact of our capital structure and asset base from
    our operating results;
    as a measure for planning and forecasting overall expectations
    and for evaluating actual results against such expectations;
    to assess compliance with financial ratios and covenants
    included in credit facilities;
    in communications with lenders concerning our financial
    performance; and
    to evaluate the viability of potential acquisitions and overall
    rates of return.    Year Ended December 31,2005


2006


2007


20082004


(Superior Well


(Superior Well


(Superior Well


(Superior Well(Partnerships)


Services, Inc.)


Services, Inc.)


Services, Inc.)


Services, Inc.)Reconciliation of EBITDA to Net Income:Net income

$
9,797


$
9,467


$
31,923


$
37,755


$
38,812Income tax expense






13,826



20,791



24,570



27,362Interest expense


310



566



478



282



2,834Stock compensation expense










1,740



1,961



2,522Depreciation and amortization


5,057



8,698



14,453



25,277



41,806EBITDA

$
15,164


$
32,557


$
69,385


$
89,845


$
113,336  26




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Item 7.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations  The following discussion and analysis should be read in
    conjunction with the consolidated financial statements and notes
    thereto included elsewhere in this report. This discussion
    contains forward-looking statements that reflect
    managements current views with respect to future events
    and financial performance. Our actual results may differ
    materially form those anticipated in these forward-looking
    statements or as a result of certain factors such as those set
    forth below under Forward-Looking Statements.
  Overview
      Services
    Offered
    Year Ended December 31,2006


2007


2008(Dollars in thousands)Revenue:Technical services

$
244,626



100.0
%

$
350,770



100.0
%

$
514,568



98.8
%Fluid logistics


















6,321



1.2
%Total revenue

$
244,626



100.0
%

$
350,770



100.0
%

$
520,889



100.0
%  27




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Technical
    Services
  Technical
    Pumping Services
    Completion,
    Production and Rental Tool Services
    Down-Hole
    Surveying Services
    Fluid
    Logistics Services
   28




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How We
    Generate Our Revenue
    set-up set-up
    How We
    Evaluate Our Operations
    Operating
    Income per Operating Region.
     29




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Material
    and Labor Expenses as a Percentage of Revenue.
        Selling,
    General and Administrative Expenses as a Percentage of
    Revenue.
    EBITDA.
    
    as a measure of operating performance because it assists us in
    comparing our performance on a consistent basis, since it
    removes the impact of our capital structure and asset base from
    our operating results;
    as a measure for planning and forecasting overall expectations
    and for evaluating actual results against such expectations;
    to assess compliance with financial ratios and covenants
    included in credit facilities;
    in communications with lenders concerning our financial
    performance; and
    to evaluate the viability of potential acquisitions and overall
    rates of return.  How We
    Manage Our Operations
    Service
    Crew Performance.
   30




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Equipment
    Maintenance Performance.
    Customer
    Satisfaction.
    Safety
    Performance.
    Our
    Industry and Overview
     31




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##### Table of Contents



Business
    Outlook
    Our
    Growth Strategy
      2006


2007


2008Percent of





Percent of





Percent ofRegion

Revenue


Revenue


Revenue


Revenue


Revenue


RevenueAppalachian

$
118,943



48.6
%

$
158,894



45.3
%

$
179,173



34.4
%Southeast


58,491



23.9



66,690



19.0



92,971



17.8Southwest


6,832



2.8



37,565



10.7



82,857



15.9Mid-Continent


43,566



17.8



56,063



16.0



105,607



20.3Rocky Mountain


16,794



6.9



31,558



9.0



60,281



11.6Total

$
244,626



100
%

$
350,770



100
%

$
520,889



100
%    32




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##### Table of Contents



Our
    Results of Operations
    Historical
    market conditions are reflected in the table below:
  Three Months Ended December 31,


Year Ended December 31,2007


2008


% Change


2007


2008


% ChangeAverage rig count(1)Crude Oil


334



414



24.0
%


297



379



27.6
%Natural gas


1,451



1,479



1.9



1,466



1,491



1.7Total U.S. land rigs


1,785



1,893



6.1
%


1,763



1,870



6.1
%Commodity prices (avg.):Crude Oil (West Texas Intermediate) ($/bbl)

$
90.68


$
58.74



(35.2
)%

$
72.34


$
99.65



37.8
%Natural gas (Henry Hub) ($/mcf)


6.94



6.36



(8.4
)%


6.95



8.84



3.9
%     (1)
    
    Estimate of activity as measured by average active U.S. land
    drilling rigs based on Baker Hughes Inc. rig count information   33




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##### Table of Contents



Results
    for the three months ended December 31, 2007 and
    2008
    Three Months Ended December 31,2007


2008Statement of Operations DataRevenue:Technical pumping services

$
84,727


$
142,372Down-hole surveying services


10,211



10,855Completion services






2,158Total Technical Services


94,938



155,385Fluid logistics






6,321Total revenue


94,938



161,706Expenses:Cost of revenue


72,961



125,145Selling, general and administrative


9,768



14,088Total expenses


82,729



139,233Operating income

$
12,209


$
22,473   Revenue
    Three Months Ended December 31,$


%2007


2008


Change


ChangeRevenues by service type:Stimulation

$
49,798


$
108,358


$
58,560



117.6
%Cementing


19,734



24,558



4,824



24.4Nitrogen


15,195



9,456



(5,739
)


(37.8
)Technical pumping services


84,727



142,372



57,645



68.0Down-hole surveying services


10,211



10,855



644



6.3Completion services






2,158



2,158



100.0Total Technical Services


94,938



155,385



60,447



63.7Fluid logistics






6,321



6,321



100.0Total revenue

$
94,938


$
161,706


$
66,768



70.3
%  34




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##### Table of Contents



Three Months Ended December 31,$


%2007


2008


Change


ChangeRegion:Appalachian

$
45,633


$
43,791


$
(1,842
)


(4.0
)%Southeast


17,479



29,992



12,513



71.6Southwest


10,378



32,739



22,361



215.5Rocky Mountain


7,041



17,509



10,468



148.7Mid-Continent


14,407



37,675



23,268



161.5Total

$
94,938


$
161,706


$
66,768



70.3
%     Cost of
    Revenue
    Selling,
    General and Administrative Expenses
   35




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##### Table of Contents



Operating
    Income
    Results
    for the year ended December 31, 2007 and 2008
    Year Ended December 31,2006


2007


2008(In thousands)Statement of Operations DataRevenue:Technical pumping services

$
219,624


$
304,949


$
463,313Down-hole surveying services


25,002



45,821



49,097Completion services










2,158Total Technical Services


244,626



350,770



514,568Fluid logistics










6,321Total revenue


244,626



350,770



520,889Expenses:Cost of revenue


165,877



252,539



406,044Selling, general and administrative


25,716



36,390



45,702Total expenses


191,593



288,929



451,746Operating income

$
53,033


$
61,841


$
69,143  36




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##### Table of Contents



Revenue
    Year Ended December 31,$


%2007


2008


Change


ChangeRevenues by service type:Stimulation

$
190,678


$
334,571


$
143,893



75.5
%Cementing


72,337



93,954



21,617



29.9Nitrogen


41,934



34,788



(7,146
)


(17.0
)Technical pumping services


304,949



463,313



158,364



51.9Down-hole surveying services


45,821



49,097



3,276



7.1Completion services






2,158



2,158



100.0Total Technical Services


350,770



514,568



163,798



46.7Fluid logistics






6,321



6,321



100.0Total revenue

$
350,770


$
520,889


$
170,119



48.5
%     Year Ended December 31,$


%2007


2008


Change


ChangeRegion:Appalachian

$
158,894


$
179,173


$
20,279



12.8
%Southeast


66,690



92,971



26,281



39.4Southwest


37,565



82,857



45,292



120.6Rocky Mountain


31,558



60,281



28,723



91.0Mid-Continent


56,063



105,607



49,544



88.4Total

$
350,770


$
520,889


$
170,119



48.5
%    37




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##### Table of Contents



Cost of
    Revenue
    Selling,
    General and Administrative Expenses (SG&A)
    Operating
    Income
   38




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##### Table of Contents



Year
    Ended December 31, 2007 Compared to Year Ended
    December 31, 2006
  Revenue
    Year Ended December 31,$


%2006


2007


Change


ChangeRevenues by service type:Stimulation

$
142,846


$
190,678


$
47,832



33.5
%Cementing


51,419



72,337



20,918



40.7Nitrogen


25,359



41,934



16,575



65.4Total Technical pumping revenues


219,624



304,949



85,325



38.9Down-hole surveying services


25,002



45,821



20,819



83.3Total revenue

$
244,626


$
350,770


$
106,144



43.4
%     Year Ended December 31,$


%2006


2007


Change


ChangeRegion:Appalachian

$
118,943


$
158,894


$
39,951



33.6
%Southeast


58,491



66,690



8,199



14.0Southwest


6,832



37,565



30,733



449.8Rocky Mountain


16,794



31,558



14,764



87.9Mid-Continent


43,566



56,063



12,497



28.7Total

$
244,626


$
350,770


$
106,144



43.4
%   start-up start-up (Mid-Continent), Mid-Continent,
   39




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##### Table of Contents



Cost of
    Revenue
      Selling,
    General and Administrative Expenses
   40




---



##### Table of Contents



Operating
    Income and EBITDA
  start-up start-up
  Items Impacting
    Comparability of Our Financial Results
  Changes
    in Our Legal Structure
       41




---



##### Table of Contents



Non-cash
    Compensation Expense
    Liquidity
    and Capital Resources
    Financial
    Condition and Cash Flows
  Financial
    Condition
    Cash
    flows from operations
   42




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##### Table of Contents



Cash
    flows used in investing activities
    Cash
    flows from financing activities
    Capital
    Requirements
    
    expansion capital expenditures, such as those to acquire
    additional equipment and other assets or upgrade existing
    equipment to grow our business; and
    maintenance or upgrade capital expenditures, which are capital
    expenditures made to extend the useful life of partially or
    fully depreciated assets or to maintain the operational
    capabilities of existing assets.     43




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##### Table of Contents



Less Than








After 5Contractual Cash Obligations

Total


1 Year


1-3 Years


4-5 Years


YearsLong term and short term debt

$
261,179


$
5,879


$
14,064


$
240,616


$
620Capital leases


3,632



1,382



2,250







Operating leases


32,333



9,396



13,858



6,883



2,196Purchase obligations


103,070



10,545



24,509



30,670



37,346Total

$
400,214


$
27,202


$
54,681


$
278,169


$
40,162   Form 10-K.
  Off-Balance
    Sheet Arrangements
    Description
    of Our Indebtedness
           44




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##### Table of Contents



Accounting
    standards not yet adopted
  SFAS 157-1, SFAS 157-2, SFAS 157-3,
  Noncontrolling Interests in Consolidated Financial
    Statements, an Amendment of ARB No. 51
  Business Combinations
  14-a, Accounting for Convertible Debt Instruments That May Be
    Settled in Cash upon Conversion (Including Partial Cash
    Settlement) 14-a) 14-a
 45




---



##### Table of Contents



14-a 14-a.
  No. FAS 142-3, Determination of the Useful Life of Intangible
    Assets No. FAS 142-3). No. FAS 142-3 No. FAS 142-3 No. FAS 142-3.
  No. EITF 03-6-1, Determining Whether Instruments Granted in Share-Based
    Payment Transactions Are Participating Securities No. EITF 03-6-1). No. EITF 03-6-1 No. EITF 03-6-1 No. EITF 03-6-1.
  Critical
    Accounting Policies
      Revenue
    Recognition
     46




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##### Table of Contents



Property,
    Plant and Equipment
    Impairment
    of Long-Lived Assets
  Accounting
    for the Impairment or Disposal of Long-Lived Assets
    
    changes in general economic conditions in regions in which our
    services are located;
    the price of natural gas and crude oil;
    our ability to negotiate favorable sales arrangements; and
    our competition from other service providers.    Goodwill
    and Other Intangible Assets
  Goodwill and
    Other Intangible Assets
 47




---



##### Table of Contents



Contingent
    Liabilities
    Insurance
    Expenses
    Stock-Based
    Compensation
  Share-Based
    Payment
  Impact
    of Inflation
    Forward-Looking
    Statements and Risk Factors
  Form 10-K
 48




---



##### Table of Contents



Form 10-K:
  
    a decrease in domestic spending by the oil and natural gas
    exploration and production industry;
    a decline in or substantial volatility of natural gas and crude
    oil commodity prices;
    current weaknesses in the credit and capital markets and lack of
    credit availability;
    overcapacity and competition in our industry;
    unanticipated costs, delays and other difficulties in executing
    our growth strategy, including difficulties associated with the
    integration of the Diamondback acquisition;
    the loss of one or more significant customers;
    the increased credit risk of our customers;
    the loss of or interruption in operations of one or more key
    suppliers;
    the incurrence of significant costs and liabilities in the
    future resulting from our failure to comply with new or existing
    environmental regulations or an accidental release of hazardous
    substances into the environment; and
    other financial, operational and legal risks and uncertainties
    detailed from time to time in our Securities and Exchange
    Commission filings.  Item 7A.
    Quantitative
    and Qualitative Disclosures about Market Risk  Quantitative
    and Qualitative Disclosures about Market Risk
    Interest Rate Risk.
  Concentration of Credit Risk.
  Commodity Price Risk.
 49




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##### Table of Contents



50




---



##### Table of Contents



Item 8.
    Financial
    Statements and Supplementary Data  MANAGEMENTS
    REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
     Rules 13a-15(f)
  Internal Control  Integrated Framework.
  By:

/s/  David
    E. Wallace

By:

/s/  Thomas
    W. StoelkDavid E. Wallace



Thomas W. StoelkChief Executive Officer



Chief Financial Officer     51




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##### Table of Contents



REPORT
    OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
  To the Board
    of Directors and Stockholders of
   Internal Control 
    Integrated Framework
         52




---



##### Table of Contents



Internal Control  Integrated
    Framework
  Schneider
    Downs & Co., Inc.
    53




---



##### Table of Contents



SUPERIOR
    WELL SERVICES, INC. AND SUBSIDIARIES
  CONSOLIDATED
    BALANCE SHEETS
  December 31,


December 31,2007


2008(In thousands, exceptper share data)Current Assets:Cash and cash equivalents

$
5,510


$
1,637Trade accounts receivable, net of allowance of $1,629 and
    $2,755, respectively


54,002



104,549Inventories


9,933



27,781Prepaid expenses and other current assets


1,027



3,860Assets held for sale






1,440Advances on materials for future delivery






3,732Income taxes receivable


3,722



1,934Deferred income taxes


1,827



3,746Total current assets


76,021



148,679Property, plant and equipment, net


240,863



453,990Goodwill


5,850



31,726Intangible assets, net of accumulated amortization of $1,815 and
    $2,953, respectively


3,242



10,120Deferred income taxes


366



530Other assets


745



13,185Total assets

$
327,087


$
658,230Current Liabilities:Accounts and construction payable-trade

$
31,497


$
43,330Current portion of long-term obligations


390



1,291Advance payments on servicing contracts


70



405Accrued wages and health benefits


2,126



5,481Other accrued liabilities


3,546



10,370Total current liabilities


37,629



60,877Long-term debt


9,165



208,042Deferred income taxes


26,694



49,082Long-term capital leases






2,171Asset retirement obligation






443Stockholders Equity:Preferred stock, non-voting, par $0.01 per share,
    10,000,000 shares authorized Series A
    4% Convertible Preferred stock, non-voting,
    75,000 shares issued at December 31, 2008 (liquidation
    preference $75 million)






1Common stock, voting, par $.01 per share, 70,000,000 shares
    authorized, 23,474,552 and 23,620,578 shares issued at
    December 31, 2007 and 2008, respectively


234



236Additional paid-in capital


184,432



229,741Retained earnings


68,933



107,637Total stockholders equity


253,599



337,615Total liabilities and stockholders equity

$
327,087


$
658,230    54




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##### Table of Contents



SUPERIOR
    WELL SERVICES, INC. AND SUBSIDIARIES
  CONSOLIDATED
    STATEMENTS OF INCOME
  Years Ended December 31,2006


2007


2008Revenue

$
244,626


$
350,770


$
520,889Cost of revenue


165,877



252,539



406,044Gross profit


78,749



98,231



114,845Selling, general and administrative expenses


25,716



36,390



45,702Operating income


53,033



61,841



69,143Interest expense


(478
)


(282
)


(2,834
)Other income (expense)


159



766



(135
)Income before income taxes


52,714



62,325



66,174Income taxesCurrent


16,033



14,110



7,058Deferred


4,758



10,460



20,30420,791



24,570



27,362Net income before dividends on preferred stock


31,923



37,755



38,812Dividends on preferred stock










(108
)Net income available to common stockholders

$
31,923


$
37,755


$
38,704Earnings per common share:Basic

$
1.63


$
1.63


$
1.67Diluted

$
1.63


$
1.63


$
1.64Weighted average shares outstanding-basic


19,568,749



23,100,402



23,150,463Weighted average shares outstanding-diluted


19,568,749



23,195,914



23,661,608    55




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##### Table of Contents



SUPERIOR
    WELL SERVICES, INC. AND SUBSIDIARIES
  CONSOLIDATED
    STATEMENTS OF CHANGES IN STOCKHOLDERS EQUITY
  Superior Well Services, Inc.Additional


RetainedPreferred


Common


Paid-in


EarningsStock


Stock


Capital


(Deficit)


Total(In thousands)BALANCE, DECEMBER 31, 2005

$



$
194


$
91,944


$
(745
)

$
91,393Net income














31,923



31,923Issuance of restricted stock awards






3



286







289Share-based compensation










1,740







1,740Issuance of common stock in
    connection with initial public offering






37



88,522







88,559BALANCE, DECEMBER 31, 2006






234



182,492



31,178



213,904Net income














37,755



37,755Issuance of restricted stock awards






1



135







136Restricted stock retired






(1
)


(156
)






(157
)Share-based compensation










1,961







1,961BALANCE, DECEMBER 31, 2007






234



184,432



68,933



253,599Net income














38,812



38,812Issuance of preferred stock in
    connection with acquisition, net of offering expenses


1







42,844







42,845Issuance of restricted stock awards






2



175







177Restricted stock retired










(232
)






(232
)Share-based compensation










2,522







2,522Preferred stock dividends














(108
)


(108
)BALANCE, DECEMBER 31, 2008

$
1


$
236


$
229,741


$
107,637


$
337,615    56




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##### Table of Contents



SUPERIOR
    WELL SERVICES, INC. AND SUBSIDIARIES
  CONSOLIDATED
    STATEMENTS OF CASH FLOWS
  Year Ended December 31,2006


2007


2008(In thousands)Cash flows from operations:Net income

$
31,923


$
37,755


$
38,812Adjustments to reconcile net income to net cash provided by
    operations:Deferred income taxes


4,758



10,460



20,304Depreciation and amortization


14,453



25,277



41,806Loss on disposal of equipment


224



302



221Stock-based compensation


1,740



1,961



2,522Changes in assets and liabilities:Trade accounts receivable


(23,944
)


(6,677
)


(50,471
)Advance on materials for future delivery










(14,992
)Inventory


(3,190
)


(2,982
)


(6,461
)Prepaid expenses and other assets


249



(119
)


(1,931
)Income tax receivable






(3,722
)


1,788Accounts payable


6,220



7,759



13,717Income taxes payable


542



(542
)


Advance payments on servicing contracts


324



(733
)


335Accrued wages and health benefits


621



664



2,393Other accrued liabilities


2,029



(100
)


3,663Net cash provided by operations


35,949



69,303



51,706Cash flows from investing:Expenditure for property, plant and equipment, net of
    construction payables


(69,816
)


(117,774
)


(90,424
)Acquisition of businesses, net of cash acquired


(9,150
)


(9,931
)


(84,242
)Purchase of short-term investments






(18,967
)


Proceeds from sales of short-term investments






18,967



Proceeds (expenditures) for other assets


(15
)


(429
)


(1,183
)Proceeds from sale of property, plant and equipment


79



34



1,789Net cash used in investing


(78,902
)


(128,100
)


(174,060
)Cash flows from financing:Principal payments on long-term debt


(27,019
)


(52,274
)


(212,276
)Proceeds from long-term borrowings


27,111



59,850



330,920Net proceeds from common stock offerings


88,559







Issuance/retirement of restricted stock, net


289



(21
)


(55
)Payment of preferred dividends










(108
)Net cash provided by financing


88,940



7,555



118,481Net increase (decrease) in cash and cash equivalents


45,987



(51,242
)


(3,873
)Cash and cash equivalents, beginning of period


10,765



56,752



5,510Cash and cash equivalents, end of period

$
56,752


$
5,510


$
1,637Supplemental disclosure of cash flow data:Interest paid

$
437


$
292


$
1,000Income taxes paid

$
15,008


$
18,262


$
5,270Equipment acquired through seller financed debt

$
450


$



$
Second lien notes issued in acquisition

$



$



$
80,000Preferred stock issued in acquisition

$



$



$
42,945    57




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##### Table of Contents



SUPERIOR
    WELL SERVICES, INC. AND SUBSIDIARIES
  NOTES TO
    CONSOLIDATED FINANCIAL STATEMENTS
  1.
    Organization        2.
    Summary
    of Significant Accounting Policies  Basis
    of Presentation
      Estimates
    and Assumptions
    Cash
    and Cash Equivalents
    Trade
    Accounts Receivable
   58




---



##### Table of Contents



Assets
    held for sale
    Advances
    on Material for Future Delivery
    Property,
    Plant and Equipment
        Revenue
    Recognition
   59




---



##### Table of Contents



Inventories
  first-in,
  Insurance
    Expense
    Income
    Taxes
  Accounting for
    Income Taxes (SFAS 109).
  Accounting for Uncertainty in Income Taxes, an
    interpretation of FASB Statement No. 109 FIN 48-1, Definition of Settlement in FASB
    Interpretation No. 48,
    Asset
    Retirement Obligations
   60




---



##### Table of Contents



Fair
    Value of Financial Instruments
  The Fair Value Option for Financial Assets and
    Financial Liabilities  Including an amendment of FASB
    Statement No. 115
  Fair Value Measurements,
    Level 1
    quoted prices in active markets for identical assets or
    liabilities;Level 2
    quoted prices in active markets for similar assets and
    liabilities and inputs that are observable for the asset or
    liability; orLevel 3
    unobservable inputs for the asset or liability, such as
    discounted cash flow models or valuations.      Acquisitions
    Goodwill
    and Other Intangible Assets
  Goodwill and
    Other Intangible Assets
 61




---



##### Table of Contents



Concentration
    of Credit Risk
    Stock
    Based Compensation
  Share-Based Payment
  Weighted
    average shares outstanding
       62




---



##### Table of Contents



Accounting
    Standards Not Yet Adopted
  SFAS 157-1, SFAS 157-2, SFAS 157-3,
      14-a, 14-a), 14-a 14-a
 63




---



##### Table of Contents



14-a.;
  No. FAS 142-3, No. FAS 142-3). No. FAS 142-3 No. FAS 142-3 No. FAS 142-3;
  No. EITF 03-6-1, No. EITF 03-6-1). No. EITF 03-6-1 No. EITF 03-6-1 No. EITF 03-6-1.
  3.
    Business
    Combinations    Acquisitions
    During the Year ended December 31, 2007:
     64




---



##### Table of Contents



Acquisitions
    During the Year ended December 31, 2008:
        Property, plant & equipment

$
165,165Inventory and other current assets


12,364Trade names


4,240Customer relationships


2,800Goodwill


22,294Accrued paid time off


(1,018
)Capital lease obligations


(3,434
)Asset retirement obligation


(443
)Net assets acquired

$
201,968        65




---



##### Table of Contents



Year Ended December 31,2007


2008Revenues

$
565,255


$
758,536Income from continuing operations

$
72,145


$
85,477Net income

$
43,704


$
50,133Per share data:Income from continuing operations-basic

$
3.12


$
3.69Income from continuing operations-diluted

$
2.75


$
3.25Net income-basic

$
1.76


$
2.04Net income-diluted

$
1.67


$
1.91     4.
    Property,
    Plant and Equipment    December 31, 2007


December 31, 2008(In thousands)Property, Plant and Equipment:Land

$
420


$
453Building and improvements


4,776



16,621Equipment and vehicles


266,444



500,101Disposal wells and equipment






8,764Construction in progress


29,814



28,065301,454



554,004Accumulated depreciation


(60,591
)


(100,014
)Total property, plant and equipment, net

$
240,863


$
453,990   5.
    Short and
    Long-term Obligations  Debt
       66




---



##### Table of Contents



67




---



##### Table of Contents



2007


2008Syndicated credit facility with interest rates at either LIBOR
    plus a spread of 1.5-2.5% or the prime lending rate plus a
    spread of 0-0.25% due March 2013, collateralized by cash,
    investment property, accounts receivable, inventory, intangibles
    and equipment

$



$
127,000Second lien notes due November 2013 with an initial interest
    rate of 7.0% per annum which increases 1% per annum on the
    anniversary date of the indenture, collateralized by a second
    priority lien on the Companys assets secured by the
    Syndicated Credit Facility






80,000Revolving credit facility with interest rates at LIBOR plus a
    spread of 1-1.25% due October 2009, collateralized by accounts
    receivable, inventory and equipment


7,957



Mortgage notes payable to a bank with interest at the
    banks prime lending rate minus 1%, payable in monthly
    installments of $8,622 plus interest through January 2021,
    collateralized by real property


1,221



1,109Note payable to sellers with an interest rate of 7% due through
    September 2008, collateralized by equipment


233



Notes payable to sellers with nominal interest rates due through
    December 2010, collateralized by specific buildings and equipment


144



909,555



208,199Less  Payments due within one year


390



157Total.

$
9,165


$
208,042     Capital
    Lease Obligations
      2009

$
1,3822010


1,9612011


289Total minimum payments


3,632Less amounts representing interest


327Total obligation under capital leases


3,305Less current portion


1,134Long-term portion

$
2,171  68




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##### Table of Contents



6.
    Stockholders
    equity  Common
    Stock
          Preferred
    Stock
      Dividends
      Liquidation
    Preference
   69




---



##### Table of Contents



Redemption
    Voting
    Rights
    Conversion
    Stock
    Incentive Plan
       70




---



##### Table of Contents



Percentage of Total Number ofRestricted Shares as to WhichNumber of Full Years

Forfeiture Restrictions LapseLess than 1 year


0
%1 year


15
%2 years


30
%3 years


45
%4 years


60
%5 years or more


100
%     Weighted AverageNumber of


Grant Date FairShares


Value per ShareNonvested at December 31, 2005





$
Granted


290,900



28.48Vested






Forfeited


(5,000
)


28.56Nonvested at December 31, 2006


285,900



28.47Granted


135,200



23.05Vested


(36,770
)


28.22Forfeited


(5,450
)


25.54Retired


(7,465
)


28.29Nonvested at December 31, 2007


371,415



26.57Granted


176,400



16.98Vested


(50,479
)


26.92Forfeited


(22,870
)


24.26Retired


(11,380
)


27.28Nonvested at December 31, 2008


463,086


$
22.97     7.
    Income
    taxes     71




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##### Table of Contents



For the Year Ended December 31,2006


2007


2008(Amounts in thousands)Current:State and local

$
2,524


$
2,246


$
1,602U.S. federal


13,509



11,864



5,456Total current


16,033



14,110



7,058Deferred:State and local


842



1,851



3,169U.S. federal


3,916



8,609



17,135Total deferred


4,758



10,460



20,304Provision for income tax expense

$
20,791


$
24,570


$
27,362     For the Year Ended December 31,2007


2008(Amounts in thousands)Deferred tax assets:Restricted stock

$
1,014


$
1,233Accrued expenses and other


544



1,516Alternative minimum tax






505Allowance for doubtful accounts receivable


635



1,022Total deferred tax assets


2,193



4,276Deferred tax liabilities:Depreciation differences on property, plant and equipment


(26,694
)


(49,082
)Total deferred tax liabilities


(26,694
)


(49,082
)Net deferred taxes

$
(24,501
)

$
(44,806
)     For the Year Ended December 31,2006


2007


2008Federal statutory tax rate


35
%


35
%


35
%Impact of vesting of restricted stock










1State income taxes, net of federal benefit


4



4



5Effective income tax rate


39
%


39
%


41
%    72




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##### Table of Contents



8.
    401(k)
    Plan    9.
    Related-Party
    Transactions         73




---



##### Table of Contents



10.
    Business
    segment information    Year ended December 31, 2008Technical


FluidServices


Logistics


Corporate


Total(In thousands)Net revenue

$
514,568


$
6,321


$



$
520,889Depreciation and amortization

$
41,073


$
484


$
249


$
41,806Operating income (loss)

$
79,056


$
715


$
(10,628
)

$
69,143Capital expenditures

$
89,383


$
8


$
1,033


$
90,424As of December 31, 2008 Segment assets

$
581,662


$
68,775


$
7,793


$
658,230     Technical


FluidServices


Logistics


TotalAs of December 31, 2007

$
5,850


$



$
5,850Goodwill acquired


19,009



6,867



25,876As of December 31, 2008

$
24,859


$
6,867


$
31,726     2008(In thousands)Segment operating income

$
69,143Interest expense


2,834Other expense


135Income taxes


27,362Net income

$
38,812       11.
    Commitments
    and Contingencies  2011-$6,007,000;
 74




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##### Table of Contents



12.
    Fair
    Value of Financial Instruments        13.
    Guarantees
    of Securities Registered  Form S-3
 75




---



##### Table of Contents



14.
    Quarterly
    Financial Information (Unaudited)    2008First


Second


Third


FourthQuarter


Quarter


Quarter


Quarter(In thousands, except share information)Revenue

$
93,441


$
119,734


$
146,008


$
161,706Cost of revenue(1)


78,778



92,435



109,686



125,145Gross profit


14,663



27,299



36,322



36,561Selling, general and administrative expenses(1)


9,544



10,682



11,388



14,088Operating income


5,119



16,617



24,934



22,473Interest expense


(177
)


(233
)


(466
)


(1,958
)Other income (expense)


(343
)


(40
)


246



2Income tax expense


(2,196
)


(6,753
)


(9,806
)


(8,607
)Net income before dividends on preferred stock


2,403



9,591



14,908



11,910Dividends on preferred stock














(108
)Net income available to common stockholders

$
2,403


$
9,591


$
14,908


$
11,802Net income per common shareBasic

$
0.10


$
0.41


$
0.64


$
0.51Diluted

$
0.10


$
0.41


$
0.64


$
0.48Average Shares OutstandingBasic


23,141



23,153



23,154



23,154Diluted


23,226



23,269



23,321



24,589     (1)
    
    The Company had a $1.7 million reduction in compensation
    accruals in the fourth quarter of 2008. As a result, cost of
    revenue and selling, general and administrative expense were
    reduced by $1.4 million and $0.3 million, respectively.  2007First


Second


Third


FourthQuarter


Quarter


Quarter


Quarter(In thousands, except share information)Revenue

$
76,708


$
84,807


$
94,317


$
94,938Cost of revenue


53,986



59,480



66,112



72,961Gross profit


22,722



25,327



28,205



21,977Selling, general and administrative expenses


8,448



8,844



9,330



9,768Operating income


14,274



16,483



18,875



12,209Interest expense


(59
)


(47
)


(71
)


(105
)Other income (expense)


559



209



33



(35
)Income tax expense


(5,765
)


(6,485
)


(7,207
)


(5,113
)Net income

$
9,009


$
10,160


$
11,630


$
6,956Net income per common shareBasic

$
0.39


$
0.44


$
0.50


$
0.30Diluted

$
0.39


$
0.44


$
0.50


$
0.30Average Shares OutstandingBasic


23,102



23,102



23,102



23,104Diluted


23,116



23,166



23,142



23,150  76




---



##### Table of Contents



Item 9.  Changes
    in and Disagreements With Accountants on Accounting and
    Financial Disclosure    Item 9A.
    Controls
    and Procedures  Rules 13a-15(f) 15d-15(f)).
       Item 9B.  Other
    Information  Form 8-K Form 8-K
 PART III  Item 10.
    Directors,
    Executive Officers and Corporate Governance  Regulation S-K
 77




---



##### Table of Contents



Item 11.
    Executive
    Compensation  Regulation S-K
  Item 12.
    Security
    Ownership of Certain Beneficial Owners and Management and
    Related Stockholders Matters  Regulation S-K
 Item 13.  Certain
    Relationships, Related Transactions, and Director
    Independence  Regulation S-K
  Item 14.
    Principal
    Accounting Fees and Services   78




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##### Table of Contents



PART IV Item 15.  Exhibits
    and Financial Statement Schedules.  (a)
    Exhibits  3
.1

Amended and Restated Certificate of Incorporation (incorporated
    by reference to Exhibit 3.1 to
    Form 8-K
    filed on August 3, 2005).3
.2

Amended and Restated Bylaws (incorporated by reference to
    Exhibit 3.2 to
    Form 8-K
    filed on August 3, 2005).3
.3

Certificate of Designations for Series A
    4% Convertible Preferred Stock (incorporated by reference
    to Exhibit 3.1 to
    Form 8-K
    filed on November 21, 2008).4
.1

Specimen Stock Certificate representing our common stock
    (incorporated by reference to Exhibit 4.1 to Registration
    Statement on
    Form S-1/A
    (Registration
    No. 333-124674)
    filed on June 24, 2005).4
.2

Registration Rights Agreement dated as of July 28, 2005 by
    and among the Company and the stockholders signatory thereto
    (incorporated by reference to Exhibit 10.1 to
    Form 8-K
    filed on August 3, 2005).4
.3

Form of Restricted Stock Agreement for Employees without
    Employment Agreements (filed as Exhibit 4.1 to the
    Companys Registration Statement on
    Form S-8(Registration
    No. 333-130615)
    filed on December 22, 2005).4
.4

Form of Restricted Stock Agreement for Executives with
    Employment Agreements (filed as Exhibit 4.2 to the
    Companys Registration Statement on
    Form S-8(Registration
    No. 333-130615)
    filed on December 22, 2005).4
.5

Form of Restricted Stock Agreement for Non-Employee Directors
    (filed as Exhibit 4.3 to the Companys Registration
    Statement on
    Form S-8(Registration
    No. 333-130615)
    filed on December 22, 2005).4
.6

2005 stock Incentive Plan (incorporated by reference to
    Exhibit 10.1 to the Companys Quarterly Report on
    Form 10-Q
    filed on September 1, 2005).4
.7

Indenture, dated as of November 18, 2008, between Superior
    Well Services Inc. and its Subsidiaries and Wilmington
    Trust FSB (as Trustee and Collateral Agent), relating to
    the Second Lien due 2013 (incorporated by reference to
    Exhibit 4.1 to
    Form 8-K
    filed on November 21, 2008).10
.1

Amended and Restated Employment Agreement between David E.
    Wallace and Superior Well Services Inc. dated September 15,
    2008 (incorporated by reference to Exhibit 10.1 to
    Form 8-K
    filed on September 18, 2008).10
.2

Amended and Restated Employment Agreement between Jacob
    Linaberger and Superior Well Services Inc. dated
    September 15, 2008 (incorporated by reference to
    Exhibit 10.2 to
    Form 8-K
    filed on September 18, 2008).10
.3

Amended and Restated Employment Agreement between Thomas W.
    Stoelk and Superior Well Services Inc. dated September 15,
    2008 (incorporated by reference to Exhibit 10.4 to
    Form 8-K
    filed on September 18, 2008).10
.4

Amended and Restated Employment Agreement between Rhys R. Reese
    and Superior Well Services Inc. dated September 15, 2008
    (incorporated by reference to Exhibit 10.3 to
    Form 8-K
    filed on September 18, 2008).10
.5

Indemnification Agreement between David E. Wallace and Superior
    Well Services, Inc., dated August 3, 2005 (incorporated by
    reference to Exhibit 10.7 to
    Form 8-K
    filed on August 3, 2005).10
.6

Indemnification Agreement between Jacob B. Linaberger and
    Superior Well Services, Inc., dated August 3, 2005
    (incorporated by reference to Exhibit 10.8 to
    Form 8-K
    filed on August 3, 2005).10
.7

Indemnification Agreement between Thomas W. Stoelk and Superior
    Well Services, Inc., dated August 3, 2005 (incorporated by
    reference to Exhibit 10.9 to
    Form 8-K
    filed on August 3, 2005).10
.8

Indemnification Agreement between Rhys R. Reese and Superior
    Well Services, Inc., dated August 3, 2005 (incorporated by
    reference to Exhibit 10.10 to
    Form 8-K
    filed on August 3, 2005).10
.9

Indemnification Agreement between Mark A. Snyder and Superior
    Well Services, Inc., dated August 3, 2005 (incorporated by
    reference to Exhibit 10.12 to
    Form 8-K
    filed on August 3, 2005).10
.10

Indemnification Agreement between David E. Snyder and Superior
    Well Services, Inc., dated August 3, 2005 (incorporated by
    reference to Exhibit 10.13 to
    Form 8-K
    filed on August 3, 2005).10
.11

Indemnification Agreement between Charles C. Neal and Superior
    Well Services, Inc., dated August 3, 2005 (incorporated by
    reference to Exhibit 10.14 to
    Form 8-K
    filed on August 3, 2005). 79




---



##### Table of Contents



10
.12

Indemnification Agreement between John A. Staley, IV and
    Superior Well Services, Inc., dated August 3, 2005
    (incorporated by reference to Exhibit 10.15 to
    Form 8-K
    filed on August 3, 2005).10
.13

Indemnification Agreement between Anthony J. Mendicino and
    Superior Well Services, Inc. dated August 30, 2005
    (incorporated by reference to Exhibit 10.16 to the
    Companys Quarterly Report on
    Form 10-Q
    filed on September 1, 2005).10
.14

Employment Agreement between Daniel Arnold and Superior Well
    Services, Inc., dated May 14, 2007 (incorporated by
    reference to Exhibit 10.1 to the Companys Quarterly
    Report on
    Form 10-Q
    filed on August 8, 2007).10
.15

Indemnification Agreement between Daniel Arnold and Superior
    Well Services, Inc. dated May 14, 2007 (incorporated by
    reference to Exhibit 10.2 to the Companys Quarterly
    Report on
    Form 10-Q
    filed on August 8, 2007).10
.16

Employment Agreement between Arty Straehla and Superior Well
    Services Inc. dated November 18, 2008. (incorporated by
    reference to Exhibit 10.1 to
    Form 8-K
    filed on March 4, 2009).10
.17

Indemnification Agreement between Arty Straehla and Superior
    Well Services Inc. dated November 18, 2008. (incorporated
    by reference to Exhibit 10.2 to
    Form 8-K
    filed on March 4, 2009).10
.18

Non-Employee Director Compensation Summary (incorporated by
    reference to Exhibit 10.30 to the Companys Annual
    Report on
    Form 10-K
    filed on March 11, 2008).10
.19

Agreement dated October 2, 2007 between U.S. Silica and
    Superior Well Services, Inc. (incorporated by reference to
    Exhibit 10.30 to the Companys Annual Report on
    Form 10-K
    filed on March 11, 2008).10
.20

Revolving Credit Agreement among Superior Well Services Inc.,
    Lenders Party, Citizens Bank of Pennsylvania (as Administrative
    Agent) and RBS Securities Corporation dated as of
    September 30, 2008 (incorporated by reference to
    Exhibit 10.1 to
    Form 8-K
    filed on October 3, 2008).10
.21

Asset Purchase Agreement among Superior Well Services Inc.,
    Superior Well Services, Limited, Diamondback Holdings, LLC and
    Diamondbacks Subsidiaries dated September 15, 2008
    (incorporated by reference to Exhibit 10.1 to
    Form 8-K
    filed on September 18, 2008).10
.22

First Amendment to Asset Purchase Agreement entered into by
    Superior Well Services Inc. and Superior Well Services, Limited
    and Diamondback Holdings, LLC and its Subsidiaries on
    November 18, 2008 (incorporated by reference to
    Exhibit 10.1 to
    Form 8-K
    filed on November 21, 2008).10
.23

Registration Rights Agreement dated November 18, 2008 among
    Superior Well Services Inc., Designated Holders and Diamondback
    Holdings, LLC (incorporated by reference to Exhibit 10.2 to
    Form 8-K
    filed on November 21, 2008).10
.24

Sand Purchase Agreement dated October 10, 2008 between
    Superior Well Services Inc. and Preferred Rocks USS, Inc. and
    U.S. Silica Company (incorporated by reference to
    Exhibit 10.1 to
    Form 10-Q
    filed on November 4, 2008).12
.1*

Ratio of Earnings to Fixed Charges and Earnings to Fixed Charges
    and Preference Securities Dividends23
.1*

Consent of Independent Registered Public Accounting Firm24
.1*

Power of Attorney (included on signature page hereto).31
.1*

Sarbanes-Oxley Section 302 certification of David E.
    Wallace for Superior Well Services, Inc. for the Annual Report
    on
    Form 10-K
    for the year ended December 31, 2008.31
.2*

Sarbanes-Oxley Section 302 certification of. Thomas W.
    Stoelk for Superior Well Services, Inc. for the Annual Report on
    Form 10-K
    for the year ended December 31, 2008.32
.1**

Sarbanes-Oxley Section 906 certification of David E.
    Wallace for Superior Well Services, Inc. for the Annual Report
    on
    Form 10-K
    for the year ended December 31, 2008.32
.2**

Sarbanes-Oxley Section 906 certification of Thomas W.
    Stoelk for Superior Well Services, Inc. for the Annual Report on
    Form 10-K
    for the year ended December 31, 2008.    *
    
    Filed herewith.**
    
    Furnished herewith.
    
    Management contract or compensatory plan or arrangement.(b) SchedulesSchedule II Valuation and qualifying accounts. 80




---



##### Table of Contents



SIGNATURES
  th
    By:
    /s/  Thomas
    W. Stoelk   Vice President and Chief Financial Officer
 (principal financial officer)
  Form 10-K,
  Pursuant to the requirements of the Securities Exchange Act
    of 1934, this report has been signed below by the persons on
    behalf of the registrant in the capacities and on the dates
    indicated.
  Signature

Title/Capacity

Date/s/  David
    E. WallaceDavid
    E. Wallace

Chief Executive Officer and Chairman of the Board (principal
    executive officer)

March 12, 2009/s/  Jacob
    B. LinabergerJacob
    B. Linaberger

President

March 12, 2009/s/  Thomas
    W. StoelkThomas
    W. Stoelk

Vice President & Chief Financial Officer (principal
    financial officer and
    principal accounting officer)

March 12, 2009/s/  Rhys
    R. ReeseRhys
    R. Reese

Executive Vice President, Chief Operating Officer &
    Secretary

March 12, 2009/s/  David
    E. SnyderDavid
    E. Snyder

Director

March 12, 2009/s/  Mark
    A. SnyderMark
    A. Snyder

Director

March 12, 2009/s/  Charles
    C. NealCharles
    C. Neal

Director

March 12, 2009/s/  John
    A. Staley, IVJohn
    A. Staley, IV

Director

March 12, 2009 81




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##### Table of Contents



Signature

Title/Capacity

Date/s/  Edward
    J. DiPaoloEdward
    J. DiPaolo

Director

March 12, 2009/s/  Anthony
    J. MendicinoAnthony
    J. Mendicino

Director

March 12, 2009  82




---



##### Table of Contents



Schedule II
  Valuation
    and Qualifying Accounts
  Allowance
    for Uncollectible Accounts Receivable
  Col. A

Col. B


Col. C


Col. D


Col. EBalance at


AdditionsBeginning


Charged to Costs


Charged to Other





Balance at endDescription

of Period


and Expenses


Accounts


Deductions


of PeriodYear Ended December 31, 2006

$
134,000



637,636










$
771,636Year Ended December 31, 2007

$
771,636



857,130










$
1,628,757Year Ended December 31, 2008

$
1,628,757



1,171,920







45,677


$
2,755,000  83