# EDGAR Filing Document

**Accession Number:** 0000928054
**File Stem:** 0000928054-23-000020
**Filing Date:** 2023-2
**Character Count:** 16595
**Document Hash:** 92548670582b892e5db6f497f152c743
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0000928054-23-000020.hdr.sgml**: 20230206

**ACCESSION NUMBER**: 0000928054-23-000020

**CONFORMED SUBMISSION TYPE**: 8-K

**PUBLIC DOCUMENT COUNT**: 14

**CONFORMED PERIOD OF REPORT**: 20230201

**ITEM INFORMATION**: Entry into a Material Definitive Agreement

**ITEM INFORMATION**: Financial Statements and Exhibits

**FILED AS OF DATE**: 20230206

**DATE AS OF CHANGE**: 20230206

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** FLOTEK INDUSTRIES INC/CN/
- **CENTRAL INDEX KEY:** 0000928054
- **STANDARD INDUSTRIAL CLASSIFICATION:** MISCELLANEOUS CHEMICAL PRODUCTS [2890]
- **IRS NUMBER:** 900023731
- **STATE OF INCORPORATION:** DE
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 8-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-13270
- **FILM NUMBER:** 23591333

**BUSINESS ADDRESS:**
- **STREET 1:** 8846 N. SAM HOUSTON PARKWAY W.
- **CITY:** HOUSTON
- **STATE:** TX
- **ZIP:** 77064
- **BUSINESS PHONE:** 7138499911

**MAIL ADDRESS:**
- **STREET 1:** 8846 N. SAM HOUSTON PARKWAY W.
- **CITY:** HOUSTON
- **STATE:** TX
- **ZIP:** 77064

?xml version="1.0" ? usgaap-20230201

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**Washington, D.C. 20549**

**FORM 8-K**

**CURRENT REPORT**

**Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934**

**February 1, 2023**

Date of Report (Date of earliest event reported)

**Flotek Industries, Inc.**

(Exact name of registrant as specified in its charter)

---

| | | |
|:---|:---|:---|
| **Delaware** | **001-13270** | **90-0023731** |
| (State or Other Jurisdiction of Incorporation) | (Commission File Number) | (IRS Employer Identification No.) |

---

**8846 N. Sam Houston Parkway W., Houston, TX 77064**

(Address of principal executive office and zip code)

**(713) 849-9911**

(Registrant's telephone number, including area code)

**(Not applicable)**

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐&nbsp;&nbsp;&nbsp;&nbsp;Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐&nbsp;&nbsp;&nbsp;&nbsp;Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐&nbsp;&nbsp;&nbsp;&nbsp;Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐&nbsp;&nbsp;&nbsp;&nbsp;Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

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| | | |
|:---|:---|:---|
| **<u>Title of each class</u>** | **<u>Trading Symbol(s)</u>** | **<u>Name of Exchange on which registered</u>** |
| Common Stock, $0.0001 par value | FTK | NYSE |

---

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. ☐

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**Item 1.01&nbsp;&nbsp;&nbsp;&nbsp;Entry Into a Material Definitive Agreement.**

On February 1, 2023, Flotek Chemistry, LLC ("Flotek Chemistry"), a wholly owned subsidiary of Flotek Industries, Inc. (the "Company"), entered into an amendment ("Amendment No. 2") to the Chemical Products Supply Agreement between Flotek Chemistry and ProFrac Services, LLC ("ProFrac") dated February 2, 2022, as amended (the "Supply Agreement"). Amendment No. 2 has an effective date of January 1, 2023. Pursuant to Amendment No. 2, the Parties agree (1) to a ramp-up period from January 1, 2023 to May 31, 2023 for ProFrac to increase the number of active fleets to 30 fleets, (2) that the order shortfall payment accrued prior to January 1, 2023 is waived for that period, (3) to add additional fees to certain products, and (4) to provide margin increases based on revenue percentages from non-ProFrac customers. The Company believes the net present value of the economic benefit attributable to Amendment No. 2 will exceed the value of the order shortfall payments that would have been received for the period from April 1, 2022 through December 31, 2022.

Certain affiliates of ProFrac are holders of the Company's 10% Convertible PIK Notes and Prefunded Warrants as described in the Company's Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2022.

The foregoing description of Amendment No. 2 does not purport to be complete and is qualified by reference to the complete text thereof. Amendment No. 2 is filed herewith as Exhibit 10.1 and is incorporated herein by reference. The Supply Agreement was filed as Exhibit 10.3 to the Company's Current Report on Form 8-K filed on February 4, 2022, and is incorporated herein by reference. Amendment No. 1 to the Supply Agreement dated May 17, 2022 was filed as Exhibit 10.1 to the Company's Current Report on Form 8-K filed on May 18, 2022 and is incorporated herein by reference.

***Forward-Looking Statements***

Certain statements set forth in this Current Report on Form 8-K constitute forward-looking statements (within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of tile Securities Exchange Act of 1934) regarding the Company's business, financial condition, results of operations and prospects. Words such as will, continue, expects, anticipates, intends, plans, believes, seeks, estimates and similar expressions or variations of such words are intended to identify forward-looking statements, but are not the exclusive means of identifying forward-looking statements in this press release. Forward-looking statements include, but are not limited to, statements regarding the anticipated performance under the Amendment No. 2 to the Supply agreement, as amended, the amount of the potential backlog or value thereof, the consideration for the Amendment No. 2, the economic benefit attributable to the Amendment No. 2, among others. Although forward-looking statements in this press release reflect the good faith judgment of management, such statements can only be based on facts and factors currently known to management. Consequently, forward-looking statements are inherently subject to risks and uncertainties, and actual results and outcomes may differ materially from the results and outcomes discussed in the forward-looking statements. Further information about the risks and uncertainties that may impact the company are set forth in the Company's most recent filing with the Securities and Exchange Commission on Form 10-K (including, without limitation, in the "Risk Factors" section thereof), and in the Company's other SEC filings and publicly available documents. Readers are urged not to place undue reliance on these forward-looking statements, which speak only as of the date of this Current Report on Form 8-K. The Company undertakes no obligation to revise or update any forward-looking statements in order to reflect, any event or circumstance that may arise after the date hereof.

**Item 9.01.&nbsp;&nbsp;&nbsp;&nbsp;Financial Statements and Exhibits.**

&nbsp;&nbsp;&nbsp;&nbsp;(d)&nbsp;&nbsp;&nbsp;&nbsp;Exhibits.

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| | |
|:---|:---|
| **<u>Exhibit Number</u>** | **<u>Description</u>** |
| 10.1 | <u>[\*](chemsupply-2ndamendmentsec.htm)[Amendment No. 2 to Chemical Supply Agreement dated February 1, 2023](chemsupply-2ndamendmentsec.htm)</u> |

---

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\* Certain identified information has been excluded from this exhibit because it is not material and is the type that the Company customarily treats as private and confidential. Redacted information is indicated by [\*\*\*].

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**SIGNATURES**

&nbsp;&nbsp;&nbsp;&nbsp;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 hereunto duly authorized.

---

| | | |
|:---|:---|:---|
| | **FLOTEK INDUSTRIES, INC.** | **FLOTEK INDUSTRIES, INC.** |
| Date: February 6, 2023 | /s/ Bond Clement | /s/ Bond Clement |
| | Name: | Bond Clement |
| | Title: | Chief Financial Officer |

---

## Exhibit 10.1

Exhibit 10.1

![image_0.jpg](image_0.jpg)

CERTAIN IDENTIFIED INFORMATION HAS BEEN EXCLUDED FROM THIS EXHIBIT BECAUSE IT IS NOT MATERIAL AND IS THE TYPE OF INFORMATION THAT THE REGISTRANT CUSTOMARILY AND ACTUALLY TREATS AS PRIVATE AND CONFIDENTIAL. REDACTED INFORMATION IS INDICATED BY [\*\*\*]

**<u>AMENDMENT No. 2 to CHEMICAL PRODUCTS SUPPLY AGREEMENT</u>**

This Amendment No. 2 to Chemical Products Supply Agreement (the "**Amendment**") is made and entered this 1st day of February 2023 but effective as of January 1, 2023 ("**Effective Date**"), by and between **Flotek Chemistry, LLC**, an Oklahoma limited liability company ("**Supplier**"), and **PROFRAC SERVICES, LLC**, a Texas limited liability company ("**Purchaser**"). Supplier and Purchaser are individually referred to as a "**Party**" and collectively as the "**Parties**."

**WHEREAS**, the Parties have previously entered into that certain Chemical Products Supply Agreement dated as of February 2, 2022, as amended from time to time (the "**Agreement**");

**WHEREAS**, the Parties wish to amend the Agreement as more particularly set forth below;

**NOW, THEREFORE**, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties agree as follows.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.**<u>Amendment</u>**. The Agreement is hereby amended as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a.Section 2(b) of the Agreement is hereby deleted in its entirety and replaced with the following:

**<u>Minimum Baseline.</u>** The Minimum Purchase Obligation is subject to the lower limit provided in this Section 2(b). Purchaser will calculate the average quantity of Purchaser's and its subsidiary's total requirement of Product based the number of Active Fleets (as defined below) during each calendar year ("**Baseline Quantity**"). "Active Fleets" shall mean: (i) for the period of time between January 1, 2023 through May 31, 2023 (the "**Ramp-Up Period**"), the actual number of fleets being utilized by Purchaser; or (ii) at all times from June 1, 2023, thirty (30) fleets. During the Ramp Up Period, Active Fleets shall only be added to the Baseline Quantity upon mutual Agreement of the Parties. The Minimum Purchase Obligation shall be deemed to equal the higher of (i) seventy percent (70%) of Purchaser's and its subsidiary's actual requirements for Product aggregated over the Term or (ii) the Baseline Quantity.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b.The following sentence shall be added as a new sentence immediately following the first sentence in Section 11(a) of the Agreement:

The Parties shall meet once per calendar quarter to determine Supplier's qualification for a Price adjustment in accordance with the Price Adjustment Schedule attached hereto as **Exhibit "B**."

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c.Exhibit A shall be deleted in its entirety and replaced with the Exhibit A attached hereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d.Exhibit B, attached hereto, shall be added as a new exhibit to the Agreement immediately following Exhibit A.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.**<u>Waiver.</u>** The Parties agree that any and all Order Shortfall Payment accrued prior to the Effective Date of this Amendment shall be null and void.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.**<u>Effect</u>**. Except as amended by this Amendment, the Agreement shall remain in full force and effect, and this Amendment shall not operate as a waiver or amendment thereto except as expressly specified herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.**<u>Applicable Law.</u>** This Amendment shall be governed by the laws of the State of Texas (excluding conflicts of law rules). Tarrant County, Texas shall be the exclusive jurisdiction and venue for the resolution of any dispute hereunder, or that is related hereto, or that arises out of the relationship between the Parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.**<u>Severability</u>**. If any part of this Amendment is judicially declared invalid, unenforceable, or to be void because inconsistent with, violative of, or contrary to any Applicable Law, such declaration shall not affect any other part herein and the part so affected shall be reformed to the extent (and only to the extent) necessary to make this Amendment enforceable or, if necessary, the Amendment shall be deemed to be amended to delete the unenforceable part, and the remainder shall have the same force and effect as if such part had never been included herein. The invalidity or unenforceability of any part herein in any jurisdiction shall not affect the validity or enforceability of any such part in any other jurisdiction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.**<u>Execution</u>**. This Amendment may be executed in multiple counterparts, each of which shall, for all purposes, be deemed an original, but that together shall constitute one and the same instrument. A scanned, executed Amendment may serve as an original document.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.**<u>Authority to Sign</u>**. Each Party represents and warrants that the person signing on its behalf has authority to sign this Agreement and bind the Party thereto, as of the date first written above.

*Signature Page Follows*

ProFrac Services, LLC – Amendment No. 2 to Supply Agreement

Page 2 of 5

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| | |
|:---|:---|
| **PURCHASER: PROFRAC SERVICES, LLC** | **SUPPLIER: FLOTEK CHEMISTRY, LLC** |
| Representative: <u>/s/ Matt Wilks</u>_______________  | Representative: <u>/s/ Ryan Ezell</u>_______________  |
| Name: Matt Wilks | Name: Ryan Ezell |
| Title: President | Title: President |

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ProFrac Services, LLC – Amendment No. 2 to Supply Agreement

Page 3 of 5

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**<u>EXHIBIT A</u>**

**<u>PRODUCTS & PRICING</u>**

1. Friction reducers, to be provided at Supplier's cost of good sold (based on delivery to the wellsite) plus [\*\*\*]. For illustrative purposes only, friction reducer pricing as of the original date of this Agreement of February 2, 2022 would be as follows (with Dry FR quoted as palletized super sack containers):

[\*\*\*]

2.&nbsp;&nbsp;&nbsp;&nbsp;Biocides, clay control, surfactants, microemulsions, iron control, corrosion inhibitors, breakers, guar, crosslinkers, buffers and other products listed below, with prices effective as of the date of this Agreement and to be reviewed quarterly pursuant to Section 11(a) of this Agreement, as listed below. Pricing below is based on bulk delivery; prices for other forms of delivery to reflect associated packing and transportation costs incurred.

&nbsp;&nbsp;&nbsp;&nbsp;[\*\*\*]

3.&nbsp;&nbsp;&nbsp;&nbsp;Other products as may be offered by Supplier and used by Purchaser from time to time at prices to be mutually agreed by the Parties, subject at all times to the provisions of Section 11(b) of this Agreement.

4.&nbsp;&nbsp;&nbsp;&nbsp;A service fee of [\*\*\*] per gallon will be added to all friction reducers and guar slurry products.

The above pricing does not include any hydration units or any associated services.

ProFrac Services, LLC – Amendment No. 2 to Supply Agreement

Page 4 of 5

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**Exhibit B**

Price Adjustment Schedule

[\*\*\*]

\* This Price Adjustment Schedule shall only be applicable to those Products the Parties have agreed to be at cost plus pricing.

\*\* Supplier's revenue attributable to third party sale of Product shall only qualify as revenue for the purpose of this Price Adjustment Schedule if such sales include a product margin of at least [\*\*\*].

ProFrac Services, LLC – Amendment No. 2 to Supply Agreement

Page 5 of 5