What changed in this filing

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Item 1A. Risk Factors

2025-03-04 compared with 2024-03-05 · 48 added, 52 removed, 375 unchanged (21% of the section changed)

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These risks may be self‑insured, or may not be fully covered under our insurance policies.

Our operations are subject to hazards inherent in the oil and natural gas industry, such as, but not limited to, accidents, blowouts, explosions, craterings, fires, oil spills and releases of drilling, completion or fracturing fluids or hazardous materials or pollutants into the environment.

Our operations are subject to hazards inherent in the oil and natural gas industry, such as, but not limited to, accidents, blowouts, unusual or unexpected geological formations or pressures, explosions, craterings, fires, oil spills and releases of drilling, completion or fracturing fluids or hazardous materials or pollutants into the environment.

These conditions can cause:

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• environmental pollution, including groundwater contamination;

• unusual or unexpected geological formations or pressures and industrial accidents;

• industrial accidents;

• substantial revenue loss.

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During periods of heavy snow, ice, wind or rain, we may be unable to move our equipment between locations, thereby reducing our ability to provide services and generate revenue, or we could suffer weather‑related damage to our facilities and equipment, resulting in delays in operations.

The exploration activities of our customers may also be affected during such periods of adverse weather conditions.

The E&P activities of our customers may also be affected during such periods of adverse weather conditions.

Additionally, extended drought conditions in our operating regions could impact our ability or our customers’ ability to source sufficient water or increase the cost for such water.

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inclement weather conditions could severely disrupt the normal operation of our business and adversely impact our financial condition and results of operations.

Moreover, climate change may result in various physical risks, such as the increased frequency or intensity of extreme weather events or changes in meteorological and hydrological patterns that could adversely impact us, our customers’, and our suppliers’ operations.

Such physical risks may result in damage to our customers’ facilities or otherwise adversely impact our operations, such as if facilities are subject to water use curtailments in response to drought, or demand for our customers’ products, such as to the extent warmer winters reduce the demand for energy for heating purposes, which may ultimately reduce demand for the products and services we provide.

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Our business could be harmed by geographical and terrorist threats, armed conflicts or civil unrest.

The occurrence or threat of geographical or terrorist threats in the United States or other countries, anti-terrorist efforts and other armed conflicts involving the United States or other countries, including continued hostilities in the Middle East or domestic civil unrest, may adversely affect the United States and global economies and could prevent us from meeting our financial and other obligations.

The occurrence or threat of geographical or terrorist threats in the United States or other countries, anti-terrorist efforts and other armed conflicts involving the United States or other countries, including continued hostilities in the Middle East, Russia, or domestic civil unrest, may adversely affect the United States and global economies and could prevent us from meeting our financial and other obligations.

For example, on February 24, 2022, Russia launched a large-scale invasion of Ukraine that has led to significant armed hostilities.

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• the level of prices, and expectations about future prices, of oil and natural gas;

• the level and cost of global and domestic oil and natural gas exploration, production, transportation of reserves and delivery;

• the level and cost of global and domestic oil and natural gas exploration, production, transportation and delivery;

• taxes and governmental regulations, including the policies of governments regarding the exploration for and production and development of their oil and natural gas reserves;

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The risks associated with our business are more acute during periods of economic slowdown or recession because such periods may be accompanied by decreased spending by our customers and decreased demand and prices for oil and natural gas.

Inflationary factors, such as increases in the labor costs, material costs, and overhead costs, may also adversely affect our financial position and operating results.

Inflationary factors, such as increases in labor costs, material costs, and overhead costs, may also adversely affect our financial position and operating results.

The volatility of oil and natural gas prices may adversely affect the demand for our services and negatively impact our results of operations.

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It is likely that we will continue to derive a significant portion of our revenue from a relatively small number of customers in the future.

During the year ended December 31, 2023, two customers accounted for approximately 10% each of our consolidated revenues.

During the year ended December 31, 2024, four customers accounted for approximately 22%, 13%, 13% and 11%, respectively, each of our consolidated revenues.

The table below presents the percentage of revenue, for each respective segment, from our top five customers for the years ended December 31, 2024 and 2023.

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Our customers may be forced to curtail or shut in production due to a lack of storage capacity.

The marketing of oil, natural gas and NGLs production depends in large part on the availability, proximity and capacity of trucks, pipelines and storage facilities, gas gathering systems and other transportation, processing and refining facilities, as well as the existence of adequate markets.

Reduced demand for oil and natural gas and/or oversupply of oil and natural gas in the market may limit or make up available storage and transportation capacity for our customers’ production.

The marketing of oil, natural gas and NGLs depends in large part on the availability, proximity and capacity of trucks, pipelines and storage facilities, gas gathering systems and other transportation, processing and refining facilities, as well as the existence of adequate markets.

Reduced demand for oil and natural gas and/or oversupply of oil and natural gas in the market may limit or fill available storage and transportation capacity for our customers’ production.

If there is insufficient capacity available on these systems, if these systems are unavailable to our customers, or if these systems are unavailable to our customers on commercially reasonable terms, the prices our customers receive for their production could be significantly depressed.

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In addition, it is possible that we will experience multiple or particularly severe accidents in the future, causing our safety record to deteriorate.

This may be more likely as we continue to grow, if we experience high employee turnover or labor shortage, or hire inexperienced personnel to bolster our staffing needs.

This may be more likely as we continue to grow, if we experience high employee turnover or labor shortage, or hire inexperienced personnel to meet our staffing needs.

We may be subject to claims for personal injury and property damage, or for catastrophic events, which could materially and adversely affect our financial condition, results of operations and prospects.

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We maintain what we believe is customary and reasonable insurance to protect our business against these potential losses, but such insurance may not be adequate to cover our liabilities, and we are not fully insured against all risks.

Subject to certain exceptions, our customers typically assume responsibility for, including control and removal of, all other pollution or contamination which may occur during operations and originate below the surface, including that which may result from blowout, seepage or any other uncontrolled flow of drilling and completion fluids.

We may have liability in such cases if we are negligent or commit willful acts.

Subject to certain exceptions, our customers typically assume responsibility for, including control and removal of, all pollution or contamination which may occur during operations and originate below the surface, including that which may result from blowout, seepage or any other uncontrolled flow of drilling and completion fluids.

However, we may have liability in such cases if we are negligent or commit willful acts.

Our customers generally agree to indemnify and defend us against claims relating to damage or loss of a well, reservoir, geological formation, underground strata, or water resources, or the loss of oil, gas, mineral, or water, but sometimes such indemnity and defense is subject to exceptions for claims for gross negligence or willful misconduct, or our assumption of capped liability.

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Further, our operations could be affected by road construction, road repairs, detours and state and local regulations and ordinances restricting access to certain roads, including through routing and weight restrictions.

In recent years, certain states, such as North Dakota and Texas, and certain counties have increased enforcement of weight limits on trucks used to transport raw materials, such as the fluids that we transport in connection with our fluids management services, on their public roads.

Certain states, such as North Dakota and Texas, and certain counties have increased enforcement of weight limits on trucks used to transport raw materials, such as the fluids that we transport in connection with our fluids management services, on their public roads.

It is possible that the states, counties and cities in which we operate our business may modify their laws to further reduce truck weight limits or impose curfews or other restrictions on the use of roadways.

Such legislation and enforcement efforts could result in delays, and increased costs, in transporting fluids and otherwise conduct our business.

Such legislation and enforcement efforts could result in delays, and increased costs, in transporting fluids and otherwise conducting our business.

Proposals to increase federal, state or local taxes, including taxes on motor fuels, are also made from time to time, and any such increase would increase our operating costs.

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In addition, private parties, including the owners of properties upon which we perform services and facilities where our wastes are taken for reclamation or disposal, also may have the right to pursue legal actions to enforce compliance as well as to seek damages for noncompliance with environmental laws and regulations or for personal injury or property or natural resource damages.

Some environmental laws and regulations may impose strict liability, which means that in some situations we could be exposed to liability even if our conduct was lawful at the time it occurred or the conduct of, or conditions caused by, prior operators or other third parties.

Some environmental laws and regulations may impose strict liability, which means that in some situations we could be exposed to liability even if our conduct was lawful at the time it occurred or the alleged damages resulted from the conduct of, or conditions caused by, prior operators or other third parties.

The trend in environmental regulation has been to place more restrictions and limitations on activities that may adversely affect the environment, and thus any changes in environmental laws and regulations or reinterpretation of

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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 GHG emissions, as well as to restrict or eliminate future emissions.

As a result, our operations as well as the operations of our oil and natural gas exploration and production customers are subject to a series of regulatory, political, litigation, and financial risks associated with the production and processing of fossil fuels and emission of GHG.

As a result, our operations as well as the operations of our oil and natural gas E&P customers are subject to a series of regulatory, political, litigation, and financial risks associated with the production and processing of fossil fuels and emission of GHG.

In the United States, no comprehensive climate change legislation has been implemented at the federal level.

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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.

International developments focused on restricting

GHG emissions include the United Nations Framework Convention on Climate Change, which includes implementation of the Paris Agreement and the Kyoto Protocol by the signatories.

International developments focused on restricting GHG emissions include the United Nations Framework Convention on Climate Change, which includes implementation of

the Paris Agreement and the Kyoto Protocol by the signatories.

Caps or fees on carbon emissions, including in the U.S., have been and may continue to be established and the cost of such caps or fees could disproportionately affect the fossil-fuel sectors.

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One or more of these developments could have a material adverse effect on our business, financial condition and results of operation.

For more information, see our risk factor titled “Seasonal weather conditions and natural disasters could severely disrupt normal operations and harm our business.”

For more information, see our risk factor titled “Seasonal weather conditions, climate change, severe weather events and natural disasters could disrupt normal operations and harm our business.”

Increased attention to sustainability, environmental, social, and governance (“ESG”) matters and conservation measures may adversely impact our or our customers’ business.

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To the extent that societal pressures or political or other factors are involved, it is possible that such liability could be imposed without regard to our causation of or contribution to the asserted damage, or to other mitigating factors.

For more information, see our risk factor titled “Our operations, and those of our suppliers and customers, are subject to a series of risks arising from climate change.”

For more information, see our risk factor titled “Our operations, and those of our customers, are subject to a series of risks arising from climate change.”

Moreover, while we may create and publish voluntary disclosures regarding sustainability and ESG matters from time to time, certain statements in those voluntary disclosures may be based on hypothetical expectations and assumptions that may or may not be representative of current or actual risks or events or forecasts of expected risks or events, including the costs associated therewith.

Such expectations and assumptions are necessarily uncertain and may be prone to error or subject to misinterpretation given the long timelines involved and the lack of an established single approach to identifying, measuring

and reporting on many sustainability and ESG matters.

Additionally, we may announce various targets or product and service offerings in an attempt to improve our sustainability and ESG profile.

Additionally, we may announce various targets or product and service

offerings in an attempt to improve our sustainability and ESG profile.

However, we cannot guarantee that we will be able to meet any such targets or that such targets or offerings will have the intended results on our ESG profile, including but not limited to as a result of unforeseen costs, consequences, or technical difficulties associated with such targets or offerings.

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Permanent restrictions imposed to protect endangered species could prohibit drilling in certain areas or require the implementation of expensive mitigation measures.

For example, to the extent species that are listed under the Endangered Species Act or similar state laws, or are protected under the Migratory Bird Treaty Act, or the designation of previously unprotected species as threatened or endangered in areas where we or our customers operate could cause us or our customers to incur increased costs arising from species protection measures and could result in delays or limitations in our or our customers’ performance of operations, which could adversely affect or reduce demand for our services.

For example, to the extent that species are listed under the Endangered Species Act or similar state laws, or are protected under the Migratory Bird Treaty Act, previously unprotected species are designated as threatened or endangered in areas where we or our customers operate, we or our customers could incur increased costs and could face delays or limitations in our or their operations, which could adversely affect or reduce demand for our services.

Anti‑indemnity provisions enacted by many states may restrict or prohibit a party’s indemnification of us.

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We depend on information technology systems that we manage, and others that are managed by third-party service and equipment providers, to conduct our day-to-day operations, including critical systems, and these systems are subject to risks associated with cyber incidents or attacks, especially originating from countries such as China, Russia, Iran, and North Korea as broadly reported in the media.

Our technology systems and networks, and those of our vendors, suppliers and other

business partners, may become the target of cyberattacks or information security breaches.

Our technology systems and networks, and those of our vendors, suppliers and other business partners, may become the target of cyberattacks or information security breaches.

A cyber incident could negatively impact the Company in a number of ways, including but not limited to;

(i) remediation costs, such as liability for stolen assets or information and repairs of system damage;

(i) remediation costs, such as liability for stolen assets

or information and repairs of system damage;

(ii) increased cybersecurity protection costs, which may include the costs of making organizational changes, deploying additional personnel and protection technologies, training employees, and engaging third party experts and consultants;

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These restrictions may limit our operational or financial flexibility and could subject us to potential defaults under our Wells Fargo Revolving Credit Facility.

Our Wells Fargo Revolving Credit Facility subjects us to significant financial and other restrictive covenants, such that our ability to comply with financial condition tests can be affected by events beyond our control, including economic, financial and industry conditions.

On May 31, 2023, we entered into a Credit Agreement with Wells Fargo Bank, N.A., which provides a secured, revolving credit facility (the “Wells Fargo Revolving Credit Facility.”) in an aggregate principal amount of up to $75.0 million.

The Wells Fargo Revolving Credit Facility subjects us to significant financial and other restrictive covenants, such that our ability to comply with financial condition tests can be affected by events beyond our control, including economic, financial and industry conditions.

If market or other economic conditions deteriorate, our ability to comply with these covenants may be impaired.

Further, the borrowing base of our Wells Fargo Revolving Credit Facility is dependent upon our receivables, which may be significantly lower in the future due to reduced activity levels or decreases in pricing for our services.

Further, the borrowing base of our Wells Fargo Revolving Credit Facility is dependent upon our receivables and unbilled revenue less certain reserves, which may be significantly lower in the future due to reduced activity levels or decreases in pricing for our services.

Changes to our operational activity levels have an impact on our total eligible accounts receivable, which could result in significant changes to our borrowing base and therefore our availability under our Wells Fargo Revolving Credit Facility.

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A lack of capital could result in a decrease in our operations, subject us to claims of breach under customer and supplier contracts and may force us to sell some of our assets or issue additional equity on an untimely or unfavorable basis, each of which could adversely affect our business, financial condition, results of operations and cash flows.

Our Wells Fargo Revolving Credit Facility contains certain financial and other restrictive covenants, including a certain minimum fixed charge coverage ratio during certain testing periods.

The Wells Fargo Revolving Credit Facility is

subject to a borrowing base that is calculated based upon a percentage of the Company’s eligible accounts receivable less certain reserves.

Our Wells Fargo Revolving Credit Facility contains certain financial and other restrictive covenants, including a minimum fixed charge coverage ratio during certain testing periods.

The Wells Fargo Revolving Credit Facility is subject to a borrowing base that is calculated based upon a percentage of the Company’s eligible accounts receivable less certain reserves.

The Company’s eligible accounts receivable serve as collateral for the borrowings under the Wells Fargo Revolving Credit Facility, which is scheduled to mature on May 31, 2028.

The Wells Fargo Revolving Credit Facility includes an acceleration clause and cash dominion provisions under certain circumstances that permits the administrative agent to sweep cash daily from certain bank accounts into an account of the administrative agent to repay the Company’s obligations under the Wells Fargo Revolving Credit Facility.

The growth of our business through potential future acquisitions or mergers may expose us to various risks, including those relating to difficulties in identifying suitable, accretive acquisition or merger opportunities and integrating businesses, assets and personnel, as well as difficulties in obtaining financing for targeted acquisitions and the potential for increased leverage or debt service requirements.

The Wells Fargo Revolving Credit Facility includes an acceleration clause and cash dominion provisions under certain circumstances that permits the administrative agent to sweep cash daily from certain bank accounts into an account of the administrative agent to repay our obligations under the Wells Fargo Revolving Credit Facility.

The growth of our business through potential future acquisitions or mergers may expose us to various risks, including those relating to difficulties in integrating businesses, assets and personnel, as well as difficulties in obtaining financing for targeted acquisitions and the potential for increased leverage or debt service requirements.

We will continue to pursue selected, accretive acquisitions of complementary assets and businesses.

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Our ability to achieve the anticipated benefits of any acquisition will depend, in part, upon whether we can integrate the acquired or merged business and/or assets into our existing business in an efficient and effective manner.

The process of integrating an acquired or merged business, including in connection with our corporate reorganization, may involve unforeseen costs and delays or other operational, technical and financial difficulties and may require a significant amount of time and resources.

The process of integrating an acquired or merged business, may involve unforeseen costs and delays or other operational, technical and financial difficulties and may require a significant amount of time and resources.

Our failure to incorporate the acquired or merged business and assets into our existing operations successfully or to minimize any unforeseen operational difficulties could have a material adverse effect on our business, liquidity position, financial condition, results of operations and prospects.

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A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.

Any newly identified material weakness could limit our ability to prevent or detect a misstatement of our accounts or disclosures that could result in a material misstatement of our annual or interim financial statements.

In such case, we may be unable to maintain compliance with securities law requirements regarding timely filing of periodic reports in addition to applicable stock exchange listing requirements, we may be unable to prevent fraud, investors may lose confidence in our financial reporting, and our stock price may decline as a result.

Any material weakness could limit our ability to prevent or detect a misstatement of our accounts or disclosures that could result in a material misstatement of our annual or interim financial statements.

In such case, we may be unable to maintain compliance with securities law requirements regarding timely filing of periodic reports and applicable stock exchange listing requirements, we may be unable to prevent fraud, investors may lose confidence in our financial reporting, and our stock price may decline as a result.

We cannot ensure that the measures we have taken to date, or any measures we may take in the future, will be sufficient to avoid potential future material weaknesses.

Our failure to implement and maintain effective internal control over financial reporting could result in errors in our financial statements that could result in a restatement of our financial statements and cause us to fail to meet our reporting obligations.

Ineffective internal controls could also cause investors to lose confidence in our reported financial information, which could have a negative effect on the trading price of our Class A Common Stock.

Our Wells Fargo Revolving Credit Facility places certain restrictions on our ability to pay cash dividends on our Class A Stock.

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In 2023, we initiated a quarterly dividend to holders of our Class A Common Stock.

However, our Wells Fargo Revolving Credit Facility places certain restrictions on our ability to pay cash dividends on our Class A Common Stock, and, if, in the future, we no longer meet the criteria specified in our Wells Fargo Resolving Credit Facility that allows for cash dividend payments, our ability to pay a dividend will be restricted until such a time that the Company is once again in compliance with the necessary criteria.

However, our Wells Fargo Revolving Credit Facility places certain restrictions on our ability to pay cash dividends on our Class A Common Stock, and, if, in the future, we no longer meet the criteria specified in our Wells Fargo Resolving Credit Facility which allow for cash dividend payments, our ability to pay a dividend will be restricted until we are once again in compliance with the necessary criteria.

During any period where dividends are restricted, your only opportunity to achieve a return on your investment is if the price of our Class A Common Stock appreciates.

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As of February 28, 2025, we had 22,252,946 shares of Class A Common Stock outstanding, which may be resold immediately in the public market.

The Legacy Owners and the Bridge Loan Lenders are parties to a registration rights agreement, which requires us to affect the registration of any shares of Class A Common Stock held by a Legacy Owner or Bridge Loan Lender or that a Legacy Owner or Bridge Loan Lender receives upon redemption of its shares of Class B Common Stock.

The Legacy Owners and the certain other entities are parties to a registration rights agreement, which requires us to affect the registration of any shares of Class A Common Stock held by them or which they receive upon redemption of any shares of Class B Common Stock that they may hold.

We cannot predict the size of future issuances of our Class A Common Stock or preferred stock convertible into Class A Common Stock or the effect, if any, that future issuances and sales of shares of our Class A Common Stock will have on the market price of our Class A Common Stock.

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We will remain a smaller reporting company until the aggregate market value of our outstanding common stock held by non-affiliates, calculated as of the end of our most recently complete second fiscal quarter, exceeds $250 million.

We cannot predict whether investors will find our common stock less attractive because we are no longer able to rely upon any certain reduced disclosure requirements and exemptions.

If some investors find our common stock less attractive, there may be a less active trading market for our common stock and our stock price may be more volatile.

To the extent that we rely on any of the exemptions available to small reporting companies, you will receive less information about our executive compensation and internal control over financial reporting than issuers that are not small reporting companies.

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• permits CSL, Bayou Holdings and their respective affiliates to conduct business that competes with us and to make investments in any kind of property in which we may make investments;

officers, becomes aware of a potential business opportunity, transaction or other matter, they will have no duty to communicate or offer that opportunity to us.

CSL, Bayou Holdings or their respective affiliates may become aware, from time to time, of certain business opportunities and may direct such opportunities to other businesses in which they have invested, in which case we may not become aware of or otherwise have the ability to pursue such opportunity.

As a result, our renouncing our interest and expectancy in any business opportunity that may be from time to time presented to CSL, Bayou Holdings and their respective affiliates could adversely impact our business or prospects if attractive business opportunities are procured by such parties for their own benefit rather than for ours.

• provides that if CSL, Bayou Holdings or their respective affiliates, or any employee, partner, member, manager, officer or director of CSL, Bayou Holdings or their respective affiliates who is also one of our directors or officers, becomes aware of a potential business opportunity, transaction or other matter, they will have no duty to communicate or offer that opportunity to us.

become aware of or otherwise have the ability to pursue such opportunity.

If attractive business opportunities are procured by such parties for their own benefit rather than for ours, it could adversely impact our business or prospects.

CSL owns a significant portion of our voting stock, and their interests may conflict with those of our other stockholders.

CSL and its affiliates beneficially own an aggregate of approximately 17% of the outstanding shares of our Common Stock.

CSL and its affiliates beneficially own an aggregate of approximately 16% of the outstanding shares of our Class A Common Stock.

As long as CSL owns a large portion of our voting stock, it may be able to significantly influence the election of the Board of Directors and the outcome of all matters involving a stockholder vote.

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Certain of our directors have significant duties with, and spend significant time serving, entities that may compete with us in seeking acquisitions and business opportunities and, accordingly, may have conflicts of interest in allocating time or pursuing business opportunities.

Certain of our directors, who are responsible for managing the direction of our operations, hold positions of responsibility with other entities (including affiliated entities) that are in the oil and natural gas industry.

These executive officers and directors may become aware of business opportunities that may be appropriate for presentation to us as well as to the other entities with which they are or may become affiliated.

Certain of our directors, who are responsible for managing the direction of our operations, hold positions of responsibility with, or are otherwise affiliated with, other entities that are in the oil and natural gas industry.

These directors may become aware of business opportunities that may be appropriate for presentation to us as well as to the other entities with which they are or may become affiliated.

Due to these existing and potential future affiliations, these individuals may present potential business opportunities to other entities prior to presenting them to us, which could cause additional conflicts of interest.

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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 1A. Risk Factors