UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended
or
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from [ ] to [ ]
Commission file number
(Exact name of registrant as specified in its charter)
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(State or other jurisdiction of |
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(I.R.S. Employer |
organization) |
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Identification No.) |
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(Address of principal executive offices) |
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(Zip Code) |
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(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☑
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☑
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer |
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Accelerated filer |
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Smaller reporting company |
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Emerging growth company |
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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.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). ☐ Yes
As of May 5, 2022, the registrant had
TABLE OF CONTENTS
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Management’s Discussion and Analysis of Financial Condition and Results of Operations |
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2
PART I
ITEM 1. FINANCIAL STATEMENTS
U.S. WELL SERVICES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share amounts)
(unaudited)
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March 31, 2022 |
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December 31, 2021 |
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ASSETS |
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Current assets: |
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Cash and cash equivalents |
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$ |
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$ |
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Restricted cash |
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Accounts receivable (net of allowance for doubtful accounts of $ |
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Inventory, net |
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Assets held for sale |
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Prepaids and other current assets |
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Total current assets |
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Property and equipment, net |
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Operating lease right-of-use assets |
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Finance lease right-of-use assets |
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Intangible assets (net of accumulated amortization of $ |
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Goodwill |
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Other assets |
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TOTAL ASSETS |
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$ |
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$ |
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LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS' DEFICIT |
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Current liabilities: |
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Accounts payable |
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$ |
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$ |
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Accrued expenses and other current liabilities |
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Notes payable |
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Current portion of long-term debt |
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Current portion of equipment financing |
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Current portion of capital lease obligations |
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Current portion of operating lease liabilities |
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Current portion of finance lease liabilities |
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Total current liabilities |
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Warrant liabilities |
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Convertible senior notes |
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Long-term debt |
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Long-term equipment financing |
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Long-term capital lease obligations |
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Long-term operating lease liabilities |
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Long-term finance lease liabilities |
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Other long-term liabilities |
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Total liabilities |
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Mezzanine equity: |
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Series A Redeemable Convertible Preferred Stock, par value $ |
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Stockholders' deficit: |
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Class A Common Stock, par value of $ |
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Additional paid in capital |
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Accumulated deficit |
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( |
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( |
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Total Stockholders' deficit |
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( |
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( |
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TOTAL LIABILITIES, MEZZANINE EQUITY AND STOCKHOLDERS' DEFICIT |
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$ |
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$ |
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The accompanying notes are an integral part of these condensed consolidated financial statements.
3
U.S. WELL SERVICES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
(unaudited)
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Three Months Ended |
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March 31, |
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2022 |
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2021 |
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Revenue |
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$ |
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$ |
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Costs and expenses: |
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Cost of services (excluding depreciation and amortization) |
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Depreciation and amortization |
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Selling, general and administrative expenses |
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Loss on disposal of assets |
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Loss from operations |
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( |
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Interest expense, net |
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( |
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Change in fair value of warrant liabilities |
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( |
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Loss on extinguishment of debt |
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- |
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Other income |
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Loss before income taxes |
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Income tax benefit |
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- |
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- |
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Net loss |
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( |
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( |
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Net loss attributable to noncontrolling interest |
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- |
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( |
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Net loss attributable to U.S. Well Services, Inc. |
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( |
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( |
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Dividends accrued on Series A preferred stock |
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( |
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( |
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Dividends accrued on Series B preferred stock |
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- |
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( |
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Deemed and imputed dividends on Series A preferred stock |
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- |
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( |
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Deemed dividends on Series B preferred stock |
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- |
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( |
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Net loss attributable to U.S. Well Services, Inc. common stockholders |
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$ |
( |
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$ |
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Loss per common share (See Note 15): |
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Basic and diluted (1) |
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$ |
( |
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$ |
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Weighted average common shares outstanding: |
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Basic and diluted (1) |
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(1) Prior periods have been adjusted to reflect the 1-for- reverse stock split on September 30, 2021. See Note 2, Reverse Stock Split, for details.
The accompanying notes are an integral part of these condensed consolidated financial statements.
4
U.S. WELL SERVICES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
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Three Months Ended |
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March 31, |
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2022 |
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2021 |
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CASH FLOWS FROM OPERATING ACTIVITIES: |
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Net loss |
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$ |
( |
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$ |
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Adjustments to reconcile net loss to cash used in operating activities: |
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Depreciation and amortization |
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Change in fair value of warrant liabilities |
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Provision for losses on accounts receivable |
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Provision for losses on inventory obsolescence |
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Loss on disposal of assets |
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Non-cash lease expense |
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Amortization of debt discount, premium and issuance costs |
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Paid-in-kind interest |
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Loss on extinguishment of debt, net |
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Share-based compensation expense |
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Changes in assets and liabilities: |
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Accounts receivable |
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( |
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Inventory |
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( |
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( |
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Prepaids and other current assets |
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( |
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( |
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Accounts payable |
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( |
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Accrued liabilities |
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( |
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Accrued interest |
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Net cash used in operating activities |
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( |
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( |
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CASH FLOWS FROM INVESTING ACTIVITIES: |
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Purchase of property and equipment |
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Proceeds from sale of property and equipment and insurance proceeds from damaged property and equipment |
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Net cash provided by (used in) investing activities |
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( |
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CASH FLOWS FROM FINANCING ACTIVITIES: |
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Proceeds from revolving credit facility |
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Repayments of revolving credit facility |
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( |
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( |
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Proceeds from issuance of long-term debt |
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Proceeds from issuance of long-term debt and warrants |
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Repayments of long-term debt |
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( |
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( |
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Payment of fees related to debt extinguishment |
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( |
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Proceeds from issuance of notes payable |
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Repayments of notes payable |
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( |
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Repayments of amounts under equipment financing |
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( |
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( |
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Principal payments under capital lease obligations |
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( |
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Principal payments on finance lease liabilities |
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( |
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Proceeds from issuance of common stock and warrants in registered direct offering, net |
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Proceeds from issuance of common stock via the ATM Agreement, net |
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Deferred financing costs |
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( |
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Net cash provided by financing activities |
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Net increase in cash and cash equivalents and restricted cash |
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Cash and cash equivalents and restricted cash, beginning of period |
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Cash and cash equivalents and restricted cash, end of period |
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$ |
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$ |
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The accompanying notes are an integral part of these condensed consolidated financial statements.
5
U.S. WELL SERVICES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)
(in thousands)
(unaudited)
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Three Months Ended |
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March 31, |
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2022 |
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2021 |
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Supplemental cash flow disclosure: |
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Interest paid |
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$ |
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$ |
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Non-cash investing and financing activities: |
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Issuance of warrants to term C loan lenders |
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Issuance of warrants to purchasers of Class A common stock in registered direct offering |
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Issuance of warrants to placement agent in registered direct offering |
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Conversion of Series B preferred stock to Class A common stock |
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Deemed and imputed dividends on Series A preferred stock |
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Accrued Series A preferred stock dividends |
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Accrued Series B preferred stock dividends |
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Changes in accrued and unpaid capital expenditures |
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Assets under capital lease obligations |
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The accompanying notes are an integral part of these condensed consolidated financial statements.
6
U.S. WELL SERVICES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT
(in thousands, except share amounts)
(unaudited)
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Class A Common |
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Class B Common |
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Additional |
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Accumulated |
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Noncontrolling |
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Total |
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Shares |
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Amount |
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Shares |
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Amount |
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Capital |
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Deficit |
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Interest |
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Deficit |
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Balance at December 31, 2021 |
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$ |
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- |
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$ |
- |
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$ |
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$ |
( |
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$ |
- |
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$ |
( |
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Adoption of ASC 842, Leases on January 1, 2022 |
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- |
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- |
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- |
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- |
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- |
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( |
) |
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- |
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( |
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Class A common stock issuance |
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- |
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- |
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- |
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- |
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Warrants issuance |
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- |
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- |
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- |
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- |
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- |
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- |
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Share-based compensation |
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- |
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- |
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- |
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- |
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- |
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- |
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Tax withholding related to vesting of share-based compensation |
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( |
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- |
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- |
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- |
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( |
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- |
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- |
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( |
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Restricted stock forfeitures |
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( |
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- |
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- |
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- |
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- |
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- |
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- |
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- |
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Accrued Series A preferred stock dividends |
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- |
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- |
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- |
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- |
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( |
) |
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- |
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- |
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( |
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Net loss |
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- |
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- |
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- |
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- |
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- |
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( |
) |
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- |
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( |
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Balance at March 31, 2022 |
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$ |
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- |
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$ |
- |
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$ |
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$ |
( |
) |
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$ |
- |
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$ |
( |
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Class A Common |
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Class B Common |
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Additional |
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Accumulated |
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Noncontrolling |
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Total |
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Shares |
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Amount |
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Shares |
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Amount |
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Capital (1) |
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Deficit |
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Interest |
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Deficit |
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Balance at December 31, 2020 |
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$ |
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$ |
- |
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$ |
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$ |
( |
) |
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$ |
- |
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$ |
( |
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Class A common stock issuance |
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- |
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- |
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