What changed in this filing

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Item 1. Business

2026-03-12 compared with 2025-03-13 · 74 added, 111 removed, 326 unchanged (36% of the section changed)

5 unchanged sentences

Each of the acquired businesses was regional in nature and brought one or two specific service capabilities to KLX Energy Services.

We were incorporated in Delaware on June 28, 2018, and on September 14, 2018, we completed our spin-off from KLX Inc.

We became incorporated in Delaware on June 28, 2018, and on September 14, 2018, we completed our spin-off from KLX Inc.

and became an independent, publicly traded company.

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As a result, the demand for our services and products is highly sensitive to current and expected commodity prices.

The oil and gas industry experienced significant increases in activity in late 2021 and 2022 due to the recovery from the novel coronavirus (“COVID-19”) pandemic and increasing demand for oil and gas.

Average oil prices and natural gas prices and activity subsequently decreased in 2023 and in 2024.

Since 2023, the oil and gas industry has been experiencing a slow decline in activity, as measured by US rig count, coupled with a decrease in oil prices.

In 2025, WTI prices dipped below $60/bbl amid oversupply from international producers, and finished the year on a downward trajectory.

Oil and natural gas prices have been, and may remain, volatile, which impacts demand for our business.

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Over time, when the industry recovers, we anticipate that our investments in large diameter coil tubing spreads will allow us to increase our share of spend as the large diameter coil tubing pulls through asset light services such as thru-tubing and pressure control services, while leveraging our enhanced cost structure.

Last year we continued to optimize the quality and performance of our magnesium alloy based line of dissolvable hydraulic fracturing plugs.

We continue to optimize the quality and performance of our magnesium alloy based line of dissolvable hydraulic fracturing plugs.

Our proprietary dissolvable plugs deliver all the benefits of a traditional hydraulic fracturing plug but without the need for bottom hole intervention for removal.

13 unchanged sentences

We own a large line of valves serving the North American onshore oil and gas market.

We have enhanced our hydraulic fracturing valve fleet line through the internal development of next generation technology, including our proprietary, patent pending hydraulic fracturing relief valve (“FRV”).

Introduced in 2016, the FRV was built and designed to replace older “pop-off” systems.

When tied into a hydraulic fracturing core (pumps), the FRV gives customers a safer and more reliable method for relieving surface pressure in the event of an unforeseen overpressure event.

By doing this, we believe we minimize operational risk, as well as greatly reduce health, safety and environmental concerns that are associated with hydraulic fracturing operations.

Additional technologies that we currently deploy on behalf of our customers include our (i) patented flotation collar, which assists customers in getting completion casing to the bottom of extended reach wells when friction prevents getting casing to depth, (ii) proprietary internal pressure actuated toe sleeve, which allows customers a consistent and reliable hydraulic fracturing initiation sleeve at the toe of the completion, (iii) composite hydraulic fracturing plug, a flow control device that is set in the wellbore at given intervals to divert fluid into the formation, and (iv) dissolvable plugs.

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The alternative is to “hot-tap” the tubing, which is a high-risk operation that most operators are not willing to employ.

Hydraulic Fracturing Protect Rod Hang Off Tool —This tool is developed to give customers the ability to “hang off” a rod string rather than tripping it out of the hole and laying it down.

The associated costs of tripping rods out of the hole coupled with the damage of laying them down and picking the string back, we believe, make this tool an excellent alternative option for customers.

The hang off tool allows an operator to easily hang the rod string in the wellhead and still gives them the ability to tie into the tubing, if need be, to monitor pressure or pump fluid.

Intervention :

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Given the unique geology and operating characteristics of each well, no two complications are the same, yet each complication our customers experience results in substantial disruption to their well operation and economics.

resolution is “mission critical” to our customers and superior outcomes can support premium pricing.

As a result, resolution is “mission critical” to our customers and superior outcomes can support premium pricing.

Those outcomes rely principally on the skill and experience of the technicians dedicated to resolving the issues and the availability of exactly the right tools for every eventuality.

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DXD Venturi Tool —The patent pending DXD (Debris Extraction Device) is an internally developed downhole tool that assists customers in removing unwanted debris from the wellbore.

Utilizing fluid dynamics, the tool consists of a jet section that accelerates fluid across a nozzle.

Utilizing fluid dynamics, the tool

consists of a jet section that accelerates fluid across a nozzle.

This increase in fluid velocity creates a pressure drop inside the tool, which draws fluid through an inlet.

20 unchanged sentences

Customers are identified as targets based on their drilling and completion activity, geographic location and economic viability.

Direction of the sales team is conducted through weekly meetings and daily

communication.

Direction of the sales team is conducted through weekly meetings and daily communication.

Our marketing activities are performed internally.

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Additionally, projects are often awarded on a bid basis, which tends to create a highly competitive environment.

To be successful, a company must provide services that meet the specific needs of oil and natural gas E&P companies and drilling, completions, production and intervention service contractors at competitive prices.

To be successful, a company must provide services that meet the specific needs of oil and

natural gas E&P companies and drilling, completions, production and intervention service contractors at competitive prices.

We provide our services across the United States and we compete against different companies in each service and product line we offer.

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We have dedicated resources focused on the internal development of new technology and equipment, as well as resources focused on sourcing and commercializing new technologies through strategic relationships.

Our sales and earnings are influenced by our ability to successfully introduce new or improved products and services to the market.

Our sales and

earnings are influenced by our ability to successfully introduce new or improved products and services to the market.

Although in the aggregate our patents and licenses are important to us, we do not regard any single patent, license or strategic relationship as critical or essential to our business as a whole.

17 unchanged sentences

In addition to the property and personal losses from these accidents, the frequency and severity of these incidents affect our operating costs and insurability, and our relationship with customers, employees and regulatory agencies.

In particular, in recent years many of our large customers have placed

an increased emphasis on the safety records of their service providers.

In particular, in recent years many of our large customers have placed an increased emphasis on the safety records of their service providers.

Any significant increase in the frequency or severity of these incidents, or the general level of compensatory payments, could adversely affect the cost of, or our ability to obtain, workers’ compensation and other forms of insurance, and could have other material adverse effects on our financial condition and results of operations.

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We retain the risk for any liability not indemnified by our customers and in excess of our insurance coverage.

These MSAs delineate our and our customers’ respective warranty and indemnification obligations with respect to the services we provide.

These MSAs delineate our and our customers’ respective warranty and indemnification obligations with respect to the

services we provide.

We endeavor to negotiate MSAs with our customers that provide, among other things, that we and our customers assume (without regard to fault) liability for damages to our respective personnel and property.

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Specifically, RCRA excludes from the definition of hazardous waste produced waters and other wastes intrinsically associated with the exploration, development, or production of crude oil and natural gas.

However, efforts have been made from time to time to remove this exclusion and thus it is possible that certain E&P waste now classified as non-hazardous waste and excluded from treatment as hazardous wastes may in the future be designated as “hazardous wastes” under RCRA or other applicable statutes.

However, efforts have been made from time to time to remove this exclusion and

thus it is possible that certain E&P waste now classified as non-hazardous waste and excluded from treatment as hazardous wastes may in the future be designated as “hazardous wastes” under RCRA or other applicable statutes.

Naturally Occurring Radioactive Materials (“NORM”) may contaminate extraction and processing equipment used in the oil and natural gas industry.

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The EPA has the power to make additional substances subject to CERCLA and RCRA, including certain Per- and Polyfluorinated Substances (PFAS).

For example, in May 2024, the EPA adopted a final rule to list two PFAS (i.e., PFOA and PFOS) as CERCLA hazardous substances, which could result in additional remediation costs at certain properties in the future and could impose additional costs on some of our customers.

For example, in May 2024, the EPA adopted a final rule to list two PFAS (i.e., PFOA and PFOS) as CERCLA hazardous substances.

This rule is currently subject to judicial challenge but could result in additional remediation costs at certain properties in the future and could impose additional costs on some of our customers.

The EPA has also announced its intention to develop a framework to guide future hazardous substance designations under CERCLA.

In addition, it is not uncommon for neighboring landowners and other third-parties to file claims for personal injury and property damage allegedly caused by the hazardous substances released into the environment.

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Further, in May 2024, FWS listed the Dunes Sagebrush Lizard as an endangered species under the ESA.

The listing of the Dunes

Sagebrush Lizard or designation of its habitat could impact the availability of frac sand used by our customers.

The listing of the Dunes Sagebrush Lizard or designation of its habitat could impact the availability of frac sand used by our customers.

Additionally, in April 2023, the FWS published a proposed rule to list the Greater Sage Grouse as threatened under the ESA.

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The NEPA review process has the potential to delay the permitting and subsequent development of oil and natural gas projects.

NEPA requirements have been subject to or influenced by regulations and guidance from the Council on Environmental Quality (“CEQ”), and the CEQ’s requirements and guidance for such reviews have altered several times during the past few years under different administrations, and are likely to continue to change.

For example, in January 2023 the CEQ issued new guidance on consideration of greenhouse gas ("GHG") emissions and climate change in NEPA environmental reviews.

The guidance followed the publication of a final rule in April 2022 revoking some modifications made to the regulations under the first Trump Administration and reincorporating consideration of direct, indirect, and cumulative effects of major federal actions.

It is uncertain to what extent the Trump Administration may take action to revise or revoke existing NEPA guidance.

In May 2024, the CEQ finalized a rule that revises the implementing regulations of the procedural provisions of NEPA and implements the amendments to NEPA included in the Fiscal Responsibility Act of 2023.

The final rule is being challenged by various states in the U.S.

District Court for the District of North Dakota, and in February 2025, the court issued an order vacating the May 2024 rule after determining that the CEQ lacks authority to issue binding NEPA regulations.

In November 2024, the U.S.

Court of Appeals for the D.C.

Circuit similarly determined that the CEQ lacks authority to issue binding NEPA regulations.

As a result of these rulings and the change in the U.S.

presidential administration, there is uncertainty with respect to current and future requirements for NEPA analyses.

While we cannot predict the ultimate impact of these legal challenges to the NEPA-implementing regulations or subsequent changes in the regulations, any restrictions or delays on our customers’ operations as a result of permitting or environmental impact analysis regulatory requirements could in turn adversely impact demand for our products and services.

Following an Executive Order from President Trump, in February 2025, the CEQ released an interim final rule rescinding its regulations implementing NEPA.

In May 2025, the Supreme Court issued its opinion in Seven County Infrastructure Coalition v.

Eagle County, emphasizing the “substantial judicial deference” that courts must grant agencies when considering NEPA challenges.

Federal agencies have begun the process of preparing their own new or updated NEPA-implementing rules or guidelines.

In September 2025, the CEQ issued new guidance to federal agencies implementing NEPA to encourage them to limit their NEPA reviews, rely more heavily on sponsor-prepared documents, and streamline the NEPA process.

While we cannot predict the ultimate impact of these recent changes, any restrictions or delays on our customers’ operations as a result of permitting or environmental impact analysis regulatory requirements could in turn adversely impact demand for our products and services.

Worker Health and Safety

We are subject to a number of federal and state laws and regulations, including the federal Occupational Safety and Health Act, which establishes requirements to protect the health and safety of workers.

Occupational Safety and Health Administration ("OSHA") hazard communication standard, the EPA community right-to-know regulations under Title III of the federal Superfund Amendment and Reauthorization Act and comparable state statutes require maintenance of information about hazardous materials used or

produced in operations and provision of this information to employees, state and local government authorities and citizens.

Occupational Safety and Health Administration (“OSHA”) hazard communication standard, the EPA community right-to-know regulations under Title III of the federal Superfund Amendment and Reauthorization Act and comparable state statutes require maintenance of information about hazardous materials used or produced in operations and provision of this information to employees, state and local government authorities and citizens.

The Federal Motor Carrier Safety Administration regulates and provides safety oversight of commercial motor vehicles, the EPA establishes requirements to protect human health and the environment, the federal Bureau of Alcohol, Tobacco, Firearms and Explosives (“ATF”) establishes requirements for the safe use and storage of explosives, and the federal Nuclear Regulatory Commission establishes requirements for the protection against ionizing radiation.

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These health risks have been, and may continue to be, a significant issue confronting the hydraulic fracturing industry.

Concerns over silicosis and other potential adverse health effects, as well as concerns regarding potential liability from the use of hydraulic fracturing sand, may have the effect of discouraging our customers' use of hydraulic fracturing sand.

Concerns over silicosis and

other potential adverse health effects, as well as concerns regarding potential liability from the use of hydraulic fracturing sand, may have the effect of discouraging our customers' use of hydraulic fracturing sand.

Transportation Safety and Compliance

3 unchanged sentences

The trucking industry is subject to possible regulatory and legislative changes that may affect the economics of the industry by requiring changes in operating practices (including for example, changes in fuel emissions limits, hours of service regulations that govern the amount of time a driver may drive or work in any specific period and limits on vehicle weight and size) or by reducing the demand for common or contract carrier services or the cost of providing truckload services.

Additional regulatory initiatives may be pursued relating to fuel quality, engine efficiency and GHG emissions, which could further increase our costs due to truck purchases and maintenance, impairment of equipment productivity, decreases in the residual value of vehicles, unpredictable fluctuations in fuel prices and increases in operating expenses.

Additional regulatory initiatives may be pursued relating to fuel quality, engine efficiency and greenhouse gas (“GHG”) emissions, which could further increase our costs due to truck purchases and maintenance, impairment of equipment productivity, decreases in the residual value of vehicles, unpredictable fluctuations in fuel prices and increases in operating expenses.

Our operations, including routing and weight restrictions, could be affected by road construction, road repairs, detours and state and local regulations and ordinances restricting access to certain roads and our increased truck traffic could contribute to deteriorating road conditions in some areas.

6 unchanged sentences

Army Corps of Engineers (“Corps”) or an analogous state agency.

There continues to be uncertainty on the federal government's applicable jurisdictional reach under the CWA over “waters of the United States”, including wetlands, as the EPA and the Corps under the Obama, Trump and Biden Administrations have pursued multiple rulemakings since 2015 in an attempt to define the scope of such reach.

While the EPA and Corps under the Trump Administration issued a final rule in January 2021 narrowing federal jurisdictional reach over waters of the United States, the EPA and the Corps under President Biden issued a new rule in January 2023, the EPA and the Corps released a final revised definition of “waters of the United States” that again broadened federal jurisdiction over these waters.

Judicial developments add further uncertainty as the Supreme Court invalidated certain parts of the January 2023 rule, resulting in a revised rule being issued in September 2023.

Due to the injunction of the rule in certain states, the implementation of the September 2023 rule currently varies by state.

The Trump Administration may seek to take additional action with respect to these regulations, although the substance and the timing of such action cannot be predicted.

There continues to be uncertainty on the federal government’s applicable jurisdictional reach under the CWA over “waters of the United States”, including wetlands, as the EPA and the Corps under recent presidential administrations have pursued multiple rulemakings since 2015 in an attempt to define the scope of such reach.

In September 2023, the EPA issued a final rule, the implementation of which varies by state due to ongoing litigation.

However, in November 2025, the EPA and the Corps proposed a rule to further update and narrow the September 2023 definition of “waters of the United States,” guided by the Sackett v.

EPA decision.

To the extent the scope of the CWA’s jurisdiction continues to change and expand in areas where we or our customers conduct operations, such developments could delay, restrict or halt the development of projects, result in longer permitting timelines, or increased compliance expenditures or mitigation costs for our customers’ operations, which may reduce our customers’ rate of production of oil and gas and reduce the demand for our products and services.

In other CWA matters, spill prevention, control and countermeasure requirements of federal laws require appropriate containment berms and similar structures to help prevent the contamination of navigable waters by a petroleum hydrocarbon tank spill, rupture or leak.

In addition, the CWA and analogous state laws require individual permits or coverage under general permits for discharges of storm water runoff from certain types of facilities.

In addition, the CWA and analogous state laws require individual permits or coverage under general permits for discharges of storm water runoff from certain types of

Federal and state regulatory agencies can impose administrative, civil and criminal penalties as well as other enforcement mechanisms for non-compliance with discharge permits or other requirements of the CWA and analogous state laws and regulations.

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These laws and regulations may require us or our customers to obtain pre-approval for the construction or modification of certain projects or facilities expected to produce or significantly increase air emissions, obtain and strictly comply with stringent air permit requirements or utilize specific equipment or technologies to control emissions of certain pollutants.

For example in 2015, the EPA lowered the National Ambient Air Quality Standard (“NAAQS”) for ground level ozone from 75 to 70 parts per billion.

Since that time, the EPA has issued area designations with respect to ground-level ozone and, on December 31, 2020, published notice of a final action that, upon conducting a periodic review of the ozone standard in accord with CAA requirements, elected to retain the 2015 ozone NAAQS without revision on a going-forward basis.

However, several groups challenged the December 2020 decision, and, in October 2021, the EPA announced it would reconsider the decision.

A draft assessment released in April 2022 indicated a preliminary conclusion that the December 2020 decision would stand, but uncertainty remains until a final decision is released.

In August 2023, the EPA announced a new review of the ozone NAAQS.

The EPA's review remains ongoing and is not expected to be completed before the EPA's five-year cycle for NAAQS review in December 2025.

More recently, in December 2024, the EPA issued a rule to revise the secondary NAAQS for sulfur oxides, but retained without revision the secondary standards for oxides of nitrogen and particulate matter.

For example in 2020, the EPA under the Trump Administration published a decision to retain the National Ambient Air Quality Standard (“NAAQS”) for ground level ozone that was set by the EPA in 2015.

Previously, in December 2024, the EPA issued a rule to revise the secondary NAAQS for sulfur oxides, but retained without revision the secondary standards for oxides of nitrogen and particulate matter.

We cannot predict what further actions, if any, or on what timeline, the Trump Administration may take with respect to this standard.

State implementation of the revised NAAQS could result in stricter permitting requirements, which in turn could delay or impair our or our customers’ ability to obtain air emission permits, and result in increased expenditures for pollution control equipment, the costs of which could be significant.

Federal and state regulatory agencies can impose administrative, civil and criminal penalties, as

well as injunctive relief, for non-compliance with air permits or other requirements of the CAA and associated state laws and regulations.

Federal and state regulatory agencies can impose administrative, civil and criminal penalties, as well as injunctive relief, for non-compliance with air permits or other requirements of the CAA and associated state laws and regulations.

Climate Change

The threat of climate change continues to attract considerable attention in the United States and around the world.

The threat of climate change has attracted considerable attention in the United States and around the world.

Numerous proposals have been made and could continue to be made at the international, national, regional and state levels of government to monitor and limit existing emissions of GHGs as well as to restrict or eliminate such future emissions.

Congress has not adopted comprehensive climate change legislation but did impose the first-ever fee on the emission of GHGs through a methane emissions charge.

The Inflation Reduction Act of 2022 (“IRA”) amends the CAA to impose a fee on the emission of methane from sources required to report their GHG emissions to the EPA, including those sources in the onshore petroleum and natural gas production and gathering and boosting source categories.

Congress has not adopted comprehensive climate change legislation, though certain federal laws, such as the Inflation Reduction Act of 2022 (“IRA”), have been enacted to advance numerous climate-related objectives.

However, certain of these initiatives have been paused, repealed or otherwise modified due to the passage of the One Big Beautiful Bill Act (“OBBBA”) in July 2025.

For example, the IRA amended the CAA to impose a fee on the emission of methane from sources required to report their GHG emissions to the EPA, including those sources in the onshore petroleum and natural gas production and gathering and boosting source categories.

However, the OBBBA delayed the implementation of the methane emissions fee until 2034.

While we will not be required to pay this fee, some of our customers may.

The methane emissions charge, starting in calendar year 2024 at $900 per ton of methane, will increase to $1,200 in 2025 and be set at $1,500 for 2026 and each year after.

In November 2024, the EPA finalized a rule, applicable to oil and gas facilities that emit more than 25,000 metric tons of CO2 per year, to implement the methane emissions fee provisions of the IRA.

The IRA also directed the EPA to revise GHG reporting requirements for segments of the oil and gas sector, including portions of our customer base, and in May 2024, the EPA finalized updates to the reporting requirements which will also impact the calculation of the methane emissions fee.

We cannot predict whether, how, or when the Trump Administration or a future Congress might take action to alter either of these rules.

The methane emissions charge and GHG reporting revisions could increase our customers' operating or compliance costs and adversely affect their businesses, thereby reducing demand for our products and services.

In September 2025, however, the EPA issued a proposed rule to delay GHG reporting for the oil and gas sector until 2034.

We cannot predict whether, how, or when a future administration or a future Congress might take action to alter either of these rules, though implementation of the methane emissions fee and GHG reporting revisions could increase our customers’ operating or compliance costs and adversely affect their businesses, thereby reducing demand for our products and services.

Additionally, the IRA contains hundreds of billions of dollars in incentives for the development of renewable energy, clean hydrogen, clean fuels, electric vehicles, and supporting infrastructure and carbon capture and sequestration, among other provisions.

However, in January 2025, President Trump issued an executive order pausing certain funding disbursements under the IRA;

the potential impact of this action and any future similar attempts to limit the incentives under the IRA are uncertain.

Although the President's action was challenged in court, to the extent funding disbursements under the IRA continue or any future similar legislation begins to provide such incentives, these incentives could accelerate the transition of the U.S.

However, the Trump Administration has taken steps to reduce or eliminate certain incentives, including those for zero-emission vehicles, and the OBBBA eliminates electric

vehicle credits previously available for new and used electric and commercial fleets.

We cannot predict whether or not these regulatory repeals will ultimately be successful or if future administrations may seek to restore related incentives.

To the extent any future similar legislation begins to provide such incentives, these incentives could accelerate the transition of the U.S.

economy away from the use of fossil fuels towards lower- or zero-carbon emissions alternatives, reduce demand for our customers’ products, and thereby reduce demand for our services.

The EPA has adopted rules that, among other things, establish construction and operating permit reviews for GHG emissions from certain large stationary sources, require the monitoring and annual reporting of GHG emissions from certain petroleum and natural gas system sources, and impose new standards reducing methane emissions from oil and gas operations through limitations on venting and flaring and the implementation of enhanced emission leak detection and repair requirements.

EPA has also announced enforcement initiatives aimed at reducing GHG emissions from the oil and gas sector, although the extent to which these initiatives will change under the Trump Administration is uncertain.

In December 2023, the EPA issued a final rule and establishing more stringent methane regulations for new, modified, and reconstructed facilities in the oil and gas sector, known as Quad Ob, as well as standards for existing sources for the first time ever, known as Quad Oc.

While these regulations do not apply directly to our operations, they will apply to many of our customers.

Under the final rules, states have two years to prepare and submit their plans to impose methane emission controls on existing sources and may take up to an additional three years to implement requirements.

The presumptive standards established under the final rule are generally the same for both new and existing sources and include enhanced leak detection survey requirements using optical gas imaging and other advanced monitoring to encourage the deployment of innovative technologies to detect and reduce methane emissions, reduction of emissions by 95% through capture and control systems, zero-emission requirements for certain devices, limitations on flaring, and the establishment of a “super emitter” response program that allows third parties to make reports to the EPA of

large methane emission events, triggering certain investigation and repair requirements.

Fines and penalties for violations of these rules can be substantial.

The final rule is currently being challenged by 23 states and a coalition of industry groups in the U.S.

Circuit Court of Appeals for the D.C.

During this challenge, Quad Ob remains in effect and we cannot predict the outcome or impact this case may have on the rule at this time.

The Trump Administration may also take action to alter the methane rule, but we cannot predict whether such action will occur or its timing.

In addition, some states where we operate, such as New Mexico and Colorado, have also imposed new or more stringent methane emission regulations.

The requirements of the EPA’s final methane rules and state methane emissions regulations could increase operating or compliance costs for our customers in these states and impact demand for our services.

However, following the change in U.S.

presidential administrations, proposals have been made to repeal or otherwise modify these requirements and the EPA’s GHG “Endangerment Finding,” which underpins the majority of EPA’s GHG regulations.

We cannot predict whether such efforts will ultimately be successful.

Previously, in December 2023, the EPA had issued a final rule and establishing more stringent methane regulations for new, modified, and reconstructed facilities in the oil and gas sector, known as Quad Ob, as well as standards for existing sources for the first time ever, known as Quad Oc.

However, in March 2025, the EPA announced plans to reconsider Quad Ob and Quad Oc.

Additionally, in November 2025, the EPA finalized an interim final rule extending the compliance deadlines for certain provisions provided in Quad Ob and Quad Oc.

Litigation challenging the EPA’s final interim rule extending such compliance deadlines for new and existing oil and gas sources remains pending.

While these regulations do not apply directly to our operations, they may apply to many of our customers.

Although the substance and timing of any reconsidered rule remains uncertain, any similar future methane emissions regulations could increase operating or compliance costs for our customers and impact demand for our services including because fines and penalties for violations of these rules can be substantial.

Some states where we operate, such as New Mexico and Colorado, have also imposed new or more stringent methane emission regulations.

Additionally, various states and groups of states have adopted or are considering adopting legislation, regulations or other regulatory initiatives that are focused on such areas as GHG cap and trade programs, carbon taxes, reporting and tracking programs, and restriction of emissions.

At the international level, the United Nations-sponsored Paris Agreement is a non-binding agreement for nations to limit their GHG emissions through individually-determined reduction goals every five years after 2020.

President Biden recommitted the United States to the Paris Agreement in January 2021 and announced in April 2021 a new, more rigorous nationally determined emissions reduction level of 50 percent to 52 percent from 2005 levels in economy-wide net GHG emissions by 2030.

Subsequent United Nations climate conferences have called for additional action to transition away from fossil fuels and control or otherwise reduce GHG emissions, though none have been legally binding.

The Trump Administration, however, has signed an executive order in January 2025 to re-withdraw from the Paris Agreement, and the United States' participation in future United Nations climate-related conferences cannot be predicted at this time.

Governmental, scientific, and public concern over the threat of climate change arising from GHG emissions has resulted in federal political risks in the United States under the Biden Administration.

There has also been action at the state level related to GHG emissions.

For example, both New York and Vermont have enacted “climate superfund” laws which seek to require compensatory payments from certain entities in the fossil fuel industry, including extractors and refiners, who are responsible for a certain amount of annual GHG emissions.

While these laws have been or are expected to be challenged, and neither are directly applicable to our business, they could result in significant financial obligations to our customers.

While these laws have been challenged, and neither are directly applicable to our business, they could result in significant financial obligations to our customers.

Additionally, in October 2023, the Governor of California signed the Climate Corporate Data Accountability Act (“CCDAA”) and Climate-Related Financial Risk Act (“CRFRA”) into law.

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The CRFRA requires the disclosure of a climate-related financial risk report (in line with the Task Force on the Climate-related Financial Disclosures recommendations or equivalent disclosure requirements under the International Sustainability Standards Board’s climate-related disclosure standards) every other year for public and private companies that are “doing business in California” and have total annual revenue of $500 million.

Reporting under both laws would begin in 2026.

Currently, the ultimate impact of these laws on our business is uncertain— both laws have been challenged in court and while the outcome of the challenges is uncertain at this time, the judge in the case declined to grant a temporary injunction of the laws while the litigation moves forward.

Absent clarification or revisions to the California laws, implementation may result in additional costs to comply with these disclosure requirements for us or our customers, as well as increased costs of and restrictions on access to capital for us or our customers.

Separately, these and other enhanced climate related disclosure requirements could lead to reputational or other harm with customers, regulators, investors or other stakeholders and could also increase our litigation risks relating to alleged climate-related damages resulting from our operations, statements alleged to have been made by us or others in our industry regarding climate change risks, or in connection with any future disclosures we may make regarding reported emissions, particularly given the inherent uncertainties and estimations with respect to calculating and reporting GHG emissions.

Reporting under both laws was to begin in 2026.

However, both laws are currently subject to legal challenges and the Ninth Circuit recently enjoined the implementation of the CRFRA.

Although the outcome of the legal challenges is uncertain at this time, implementation may result in additional costs to comply with these disclosure requirements for us or our customers, as well as increased costs of and restrictions on access to capital for us or our customers.

others in our industry regarding climate change risks, or in connection with any future disclosures we may make regarding reported emissions, particularly given the inherent uncertainties and estimations with respect to calculating and reporting GHG emissions.

Litigation risks are also increasing as a number of states, municipalities and other plaintiffs have sought to bring suit against the largest oil and natural gas E&P companies in state or federal court alleging, among other things, that such energy companies created public nuisances by producing fuels that contributed to global warming effects, such as rising sea levels, and therefore, are responsible for roadway and infrastructure damages as a result, or alleging that the companies have been aware of the adverse effects of climate change for some time but defrauded their investors by failing to adequately disclose those impacts.

Additionally, climate change and ESG policies may impact the Company or our customers’ access to capital.

Certain shareholders and bondholders currently invested in fossil-fuel energy companies are concerned about the potential effects of climate change and may elect in the future to shift some or all of their investments into non-fossil fuel energy related sectors.

Additionally, climate change and sustainability policies may impact the Company or our customers’ access to capital.

Certain shareholders and bondholders currently invested in fossil-fuel energy companies may be concerned about the potential effects of climate change and may elect in the future to shift some or all of their investments into non-fossil fuel energy related sectors.

Institutional lenders who provide financing to fossil-fuel energy companies also have become more attentive to sustainable lending and investment practice that favors “clean” power sources, such as wind and solar, making those sources more attractive, and some of them may elect not to provide funding for fossil fuel energy companies.

Many of the largest U.S.

banks have made "net zero" carbon emission commitments and, while some of the commitments may be in flux, certain of the banks have announced that they will be assessing financed emissions across their portfolios and taking steps to quantify and reduce those emissions.

These and other developments in the financial sector could lead to some lenders restricting access to capital for or divesting from certain industries or companies, including the oil and gas sector, or requiring that borrowers take additional steps to reduce their GHG emissions.

Additionally, there is the possibility that financial institutions will be pressured or required to adopt policies that limit funding for fossil fuel energy companies.

However, this trend has waned more recently.

While we cannot predict how or to what extent sustainable lending and investment practice may impact our operations, a material reduction in the capital available to us or our fossil fuel-related customers could make it more difficult to secure funding for exploration, development, production, transportation, and processing activities, which could reduce the demand for our products and services.

In March 2024, the SEC finalized a rule that requires registrants to make certain climate-related disclosures in registration statements and annual reports, including their governance of climate-related risks;

material climate-related impacts on strategy, outlook and business model;

climate risk management;

Scope 1 and 2 GHG emissions under certain circumstances;

and if the registrant has set them, climate-related targets and goals.

The SEC's final rule is being challenged in the U.S.

Court of Appeals for the Eighth Circuit and the implementation of the rule has been voluntarily stayed by the SEC pending the outcome of the legal challenge and may be revisited by the SEC in the future.

The SEC has previously announced that it is scrutinizing existing climate-change related disclosures in public filings, increasing the potential for enforcement if the SEC were to allege that an issuer's existing climate disclosures were misleading or deficient, although this focus is subject to change.

We cannot predict the impact that any future climate-related disclosure rule, if finalized, would have on our operations.

To the extent that requirements or enforcement initiatives impose significant additional costs on us or our customers, we could be negatively impacted by the SEC’s regulatory or enforcement actions.

Finally, increasing concentrations of GHGs in the Earth’s atmosphere may produce climate changes that could have significant physical effects, such as increased frequency and severity of storms, droughts, and floods and other climatic events, as well as chronic shifts in temperature and precipitation patterns.

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At the federal level, the EPA has asserted federal regulatory authority over certain hydraulic fracturing activities involving the use of diesel fuels and regarding certain wastewater discharges from onshore unconventional oil and gas extraction facilities under the Safe Drinking Water Act.

In late 2016, the EPA also released its final report on the potential impacts of hydraulic fracturing on drinking water resources, concluding that "water cycle" activities associated with hydraulic fracturing may impact drinking water resources under certain circumstances.

The federal Bureau of Land Management has issued rules governing hydraulic fracturing activities on federal lands, and the drilling and completion of oil and gas wells, including hydraulic fracturing operations, are subject to federal, state and local regulation on federal lands.

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The Biden Administration pursued various legislative and regulatory initiatives to restrict hydraulic fracturing activities on federal lands.

These or similar actions, if taken in the future, could impose additional hydraulic fracturing limitations on our customers that could ultimately result in decreased demand for our products and services.

These or similar actions, if taken in the future, could

impose additional hydraulic fracturing limitations on our customers that could ultimately result in decreased demand for our products and services.

At the state level, many states have adopted legal requirements that have imposed new or more stringent permitting, public disclosure or well construction requirements on hydraulic fracturing activities, including states where our customers operate.

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Available Information

Our filings with the SEC, including this Annual Report on Form 10-K, our Quarterly Reports on Form 10-Q, our Proxy Statement, Current Reports on Form 8-K and amendments to any of those reports are available free of charge on our website, https://www.klx.com, as soon as reasonably practicable after they are filed with, or furnished to, the SEC.

Our filings with the SEC, including this Annual Report, our Quarterly Reports on Form 10-Q, our Proxy Statement, Current Reports on Form 8-K and amendments to any of those reports are available free of charge on our website, https://www.klx.com, as soon as reasonably practicable after they are filed with, or furnished to, the SEC.

These reports may also be obtained on the SEC’s website, www.sec.gov, which contains reports, proxy statements, information statements, and other information regarding SEC registrants, including KLX Energy Services Holdings, Inc.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business