Insider filing report for Changes in Beneficial Ownership
- Schedule 13G & 13D forms are used to report a party's ownership of stock which exceeds 5% of a company's total stock issue.
- Schedule 13G is a shorter version of Schedule 13D with fewer reporting requirements.
"Insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise"
- Peter Lynch
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- Peter Lynch
What is insider trading>>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 3)
FLOTEK INDUSTRIES, INC
(Name of Issuer)
Common Stock
(Title of Class of Securities)
343389102
(CUSIP Number)
David Nierenberg
The D3 Family Funds
19605 NE 8th Street
Camas, WA 98607
(360) 604-8600
The D3 Family Funds
19605 NE 8th Street
Camas, WA 98607
(360) 604-8600
With a copy to:
Christopher P. Davis
Kleinberg, Kaplan, Wolff & Cohen, P.C.
551 Fifth Avenue
New York, NY 10176
(212) 986-6000
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
Authorized to Receive Notices and Communications)
March 22, 2022
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D and is filing this schedule because of §§ 240.13d-1(e), 240.13d-1(f) or
240.13d-1(g), check the following box [ ].
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1
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NAME OF REPORTING PERSONS
The D3 Family Fund, L.P.
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2
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)
(a) [X]
(b) [ ]
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3
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SEC USE ONLY
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4
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SOURCE OF FUNDS (See Instructions)
WC
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5
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CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ]
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6
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CITIZENSHIP OR PLACE OF ORGANIZATION
Washington
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NUMBER OF SHARES
BENEFICIALLY
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7
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SOLE VOTING POWER
0
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OWNED BY
EACH
REPORTING
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8
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SHARED VOTING POWER
2,595,383
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PERSON
WITH
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9
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SOLE DISPOSITIVE POWER
0
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10
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SHARED DISPOSITIVE POWER
2,595,383
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11
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AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
2,595,383
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12
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CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11)
EXCLUDES CERTAIN SHARES [ ] |
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13
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PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
3.1%
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14
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TYPE OF REPORTING PERSON (See Instructions)
PN
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1
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NAME OF REPORTING PERSONS
The D3 Family Bulldog Fund, L.P.
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2
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)
(a) [X]
(b) [ ]
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3
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SEC USE ONLY
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4
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SOURCE OF FUNDS (See Instructions)
WC
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5
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CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ]
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6
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CITIZENSHIP OR PLACE OF ORGANIZATION
Washington
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NUMBER OF SHARES
BENEFICIALLY
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7
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SOLE VOTING POWER
0
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OWNED BY
EACH
REPORTING
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8
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SHARED VOTING POWER
4,795,960
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PERSON
WITH
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9
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SOLE DISPOSITIVE POWER
0
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10
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SHARED DISPOSITIVE POWER
4,795,960
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11
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AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
4,795,960
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12
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CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11)
EXCLUDES CERTAIN SHARES [ ] |
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13
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PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
5.8%
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14
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TYPE OF REPORTING PERSON
PN
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1
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NAME OF REPORTING PERSONS
Haredale Ltd.
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2
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)
(a) [X]
(b) [ ]
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3
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SEC USE ONLY
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4
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SOURCE OF FUNDS (See Instructions)
WC
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5
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CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ]
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6
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CITIZENSHIP OR PLACE OF ORGANIZATION
Bahamas
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NUMBER OF SHARES
BENEFICIALLY
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7
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SOLE VOTING POWER
242,656
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OWNED BY
EACH
REPORTING
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8
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SHARED VOTING POWER
0
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PERSON
WITH
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9
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SOLE DISPOSITIVE POWER
0
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10
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SHARED DISPOSITIVE POWER
242,656
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11
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AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
242,656
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12
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CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11)
EXCLUDES CERTAIN SHARES [ ] |
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13
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PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
Less than 1%
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14
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TYPE OF REPORTING PERSON
CO
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1
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NAME OF REPORTING PERSONS
Nierenberg Investment Management Company, Inc.
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2
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)
(a) [X]
(b) [ ]
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3
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SEC USE ONLY
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4
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SOURCE OF FUNDS (See Instructions)
WC
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5
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CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ]
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6
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CITIZENSHIP OR PLACE OF ORGANIZATION
Washington
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NUMBER OF SHARES
BENEFICIALLY
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7
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SOLE VOTING POWER
0
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OWNED BY
EACH
REPORTING
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8
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SHARED VOTING POWER
7,391,343
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PERSON
WITH
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9
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SOLE DISPOSITIVE POWER
0
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10
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SHARED DISPOSITIVE POWER
7,633,999
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11
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AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
7,633,999
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12
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CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11)
EXCLUDES CERTAIN SHARES [ ] |
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13
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PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
9.3%
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14
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TYPE OF REPORTING PERSON
CO
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1
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NAME OF REPORTING PERSONS
David Nierenberg
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2
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)
(a) [X]
(b) [ ]
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3
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SEC USE ONLY
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4
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SOURCE OF FUNDS (See Instructions)
AF
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5
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CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ]
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6
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CITIZENSHIP OR PLACE OF ORGANIZATION
United States of America
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NUMBER OF SHARES
BENEFICIALLY
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7
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SOLE VOTING POWER
155,774(1)
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OWNED BY
EACH
REPORTING
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8
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SHARED VOTING POWER
7,391,343
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PERSON
WITH
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9
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SOLE DISPOSITIVE POWER
155,774(1)
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10
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SHARED DISPOSITIVE POWER
7,633,999
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11
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AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
7,789,773 (1)
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12
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CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11)
EXCLUDES CERTAIN SHARES [ ]
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13
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PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
9.5%
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14
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TYPE OF REPORTING PERSON
IN
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(1) Includes 155,774 shares of Common Stock granted to Mr. Nierenberg in his capacity as a director of the Issuer, of which 52,000 shares of Common Stock are vested and 103,774 shares of Common Stock that have not yet
vested.
This Amendment No. 3 to Schedule 13D (this “Amendment”) amends the below-indicated items from the Schedule 13D with respect to the shares of
common stock (the “Common Stock”) of Flotek Industries Inc, (the “Issuer”) previously filed by or on behalf of the Reporting Persons (as defined below) (the “Schedule 13D”), by amending and/or supplementing such Items as indicated below.
Item 4. Purpose of Transaction
Item 4 of the Schedule 13D is hereby amended to add the following:
On March 22, 2022, the Notes held by the Family Fund, the Bulldog Fund and the Managed Account were converted at the option of the Reporting
Persons into shares of Common Stock.
The Reporting Persons elected to convert the Notes held by the Family Fund, the Bulldog Fund and the Managed Account because:
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The Reporting Persons hope that the two long term chemical supply contracts which the Issuer signed with ProFrac Holdings, LLC (“ProFrac”) may enable the Issuer to become a scale player in fracking chemistry, with
sufficient cost reduction and absorption opportunities for the Issuer to attain positive EBITDA sometime during the second half of this year and to grow in years ahead.
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Both the Issuer and ProFrac are green leaders which the Reporting Persons believe should make them attractive vendors to operators who increasingly are compelled by regulation and shareholders to mitigate
environmental harm associated with the drilling and production of hydrocarbons.
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The Issuer recently strengthened its balance sheet with a $21.2M PIPE.
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The Reporting Persons believe that that the Issuer has a strong, experienced board of directors.
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The Issuer recently promoted Ryan Ezell to Chief Operating Officer in recognition of the quality of the operations team which he built and leads.
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The Reporting Persons believe that current the current geo-political environment demonstrates that American hydro-carbon production is a national asset which probably enjoys a much longer, and more essential,
production runway than previously had been expected. For example, American natural gas is vital to weaning Europe from Russian dependency. While solar and wind energy will continue growing, the Reporting Persons believe that back-up sources
are absolutely necessary today, and will continue to be, for a considerable period of time until renewables demonstrate that they are sufficiently reliable, storable, and transportable as sources of power, which, in the opinion of the
Reporting Persons, is all the more reason for operators to embrace the Issuer and ProFrac as responsible providers of environmental solutions to our current energy needs.
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Item 5. Interest in Securities of the Issuer.
Item 5 of the Schedule 13D is hereby amended and restated in its entirety as follows:
(a) The aggregate percentage of Shares reported owned by each person named herein is based upon 79,617,743 Shares outstanding as of November 8, 2021, which is the total number of Shares outstanding as reported in the Issuer’s Quarterly Report on
Form 10-Q filed with the Securities and Exchange Commission on November 9, 2021, plus 2,793,030 shares of Common Stock issued upon the conversion of the Notes (as described more fully in Items 4 and 6).
As of the close of business on the date hereof, the Family Fund individually beneficially owned 2,595,383 Shares, constituting approximately
3.1% of all of the outstanding Shares.
As of the close of business on the date hereof, the Bulldog Fund individually beneficially owned 4,795,960 Shares, constituting
approximately 5.8% of all of the outstanding Shares.
As of the close of business on the date hereof, Haredale Limited individually beneficially owned 242,656 Shares, constituting less than 1%
of all of the outstanding Shares.
By virtue of its relationships with each of the Family Fund, the Bulldog Fund and the Managed Account, as discussed in further detail in
Item 2, NIMCO may be deemed to be the beneficial owner of the 7,633,999 Shares, beneficially owned in the aggregate by the Family Fund, the Bulldog Fund and the Managed Account, constituting approximately 9.3% of all of the outstanding Shares.
By virtue of his relationship with NIMCO, as discussed in further detail in Item 2, Mr. Nierenberg may be deemed to be the beneficial owner
of the 7,789,773 Shares, consisting of (i) 155,774 Shares held directly and (ii) the 7,633,999 Shares beneficially owned by NIMCO, constituting approximately 9.5% of all of the outstanding Shares.
The Reporting Persons, in the aggregate, beneficially own 7,789,773 Shares, constituting approximately 9.5% of the outstanding Shares.
Each Reporting Person, as a member of a “group” with the other Reporting Persons for the purposes of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended, may be deemed the beneficial owner of the Shares directly owned by the other
Reporting Persons. Each Reporting Person disclaims beneficial ownership of such Shares except to the extent of his or its pecuniary interest therein.
(b) The Family
Fund, NIMCO and Mr. Nierenberg have shared power (i) to vote or direct the vote of, and (ii) to dispose or direct the disposition of, the Shares held by the Family Fund.
The Bulldog Fund, NIMCO and Mr. Nierenberg have shared power (i) to vote or direct the vote of, and (ii) to dispose or direct the disposition of, the Shares held
by the Bulldog Fund.
The Managed Account has sole power to vote or direct the vote of the Shares held by the Managed account, and the Managed Account, NIMCO and Mr. Nierenberg have
shared power to dispose or direct the disposition of, the Shares held by the Managed Account.
Mr. Nierenberg has sole power (i) to vote or direct the vote of, and (ii) to dispose or direct the disposition of, the Shares held directly by him.
(c) During the
past sixty (60) days, other than the acquisition and conversion of the Notes described more fully in Items 4 and 6, the Reporting Persons did not trade in the securities of the Issuer.
(d) No Person other than the Reporting Persons has the right to receive or the power to direct the receipt of distributions or dividends from, or the proceeds from the transfer
of, the reported securities.
(e) Not Applicable.
Item 6. Interest in Securities of the Issuer.
Item 6 of the Schedule 13D is hereby amended to add the following:
On March 22, 2022, the Notes held by the Family Fund, the Bulldog Fund and the Managed Account were fully converted into Common Stock in
accordance with their terms.
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, each of the undersigned certifies that the information set forth in the Statement is true, complete and correct.
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D3 Family Fund, L.P., D3 Family Bulldog Fund, L.P.,
By: Nierenberg Investment Management Company, Inc.
Its: General Partner
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March 23, 2022
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By:
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/s/ David Nierenberg
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David Nierenberg, President
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Haredale Ltd.
By: Nierenberg Investment Management Company, Inc.
Its: Investment Manager
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March 23, 2022
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By:
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/s/ David Nierenberg
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David Nierenberg, President
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Nierenberg Investment Management Company, Inc.
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March 23, 2022
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By:
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/s/ David Nierenberg
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David Nierenberg, President
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March 23, 2022
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/s/ David Nierenberg
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David Nierenberg
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