Sec Form 13D Filing - THRC Holdings LP filing for U.S. WELL SERVICES HOLDINGS LLC (USWS) - 2022-03-14

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

Under the Securities Exchange Act of 1934

(Amendment No. 2)*

U.S. WELL SERVICES, INC.

(Name of Issuer)

Class A Common Stock, par value $0.0001 per share

(Title of Class of Securities)

91274U101

(CUSIP Number)

Matt D. Wilks

C/O Wilks Brothers, LLC

17010 IH 20

Cisco, Texas 76437

Telephone: (817) 850-3600

(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)

March 1, 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. ☐

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7 for other parties to whom copies are to be sent.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

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EXPLANATORY NOTE

This Amendment No. 2 (this “Amendment”) amends and supplements the Schedule 13D filed with the Securities and Exchange Commission (the “SEC”) on July 7, 2021, as amended by Amendment No. 1 thereto filed with the SEC on July 15, 2021 (the “Schedule 13D”), by the Reporting Persons relating to shares of Class A Common Stock, par value $0.0001 per share (“Class A Common Stock”), of U.S. Well Services, Inc. (the “Issuer”).

Information reported in the Schedule 13D remains in effect except to the extent that it is amended, restated or superseded by information contained in this Amendment. Capitalized terms used but not defined in this Amendment have the respective meanings set forth in the Schedule 13D.

Item 3 of the Schedule 13D is hereby amended to include the following:

On March 1, 2022, the Issuer issued to THRC Holdings 6,976,744 warrants exercisable as described in Item 4 below (the “Warrants”) in connection with the entry by THRC Holdings into a Joinder to Senior Secured Term Loan Agreement dated March 1, 2022 (the “Loan Agreement Joinder”) by and among U.S. Well Services, LLC, as borrower (“Borrower”), the Issuer and its other subsidiaries, as guarantors (together with the Borrower, the “Loan Parties”), CLMG Corp., as administrative and collateral agent, and certain other lenders and financial institutions party thereto. The source of funds for such term loan and the Warrants was working capital of THRC Holdings.

Item 4 of the Schedule 13D is hereby amended to include the following:

On February 28, 2022, as a result of a Consent and Sixth Amendment (the “Term Loan Amendment”), the Senior Secured Term Loan Credit Agreement dated May 7, 2019 (as amended, the “Term Loan Agreement”) by and among the Loan Parties, CLMG Corp., as administrative and collateral agent, and certain lenders and financial institutions from time to time party thereto, was amended in order to, among other things, (i) provide for an additional tranche of last-out term loans (such additional last-out term loans, collectively, the “Term C Loans”) to be made to the Borrower by one or more Term C Loan lenders in an initial aggregate principal amount of $10.0 million, (ii) provide for incremental increases of up to $25.0 million in principal amount, but not to exceed $35.0 million in original principal amount in the aggregate for all such Term C Loans advanced under the Term Loan Agreement, and (iii) make certain modifications to the Term Loan Agreement on the terms and conditions set forth in the Term Loan Amendment. On March 1, 2022, the Borrower made an incremental increase election in the amount of $11.5 million, and THRC Holdings made to Borrower a Term C Loan of $10.0 million in principal amount in partial satisfaction thereof. The balance of such incremental increase election was funded by additional Term C Loans made by certain other new Term C Loan lenders.

The Warrants are subject to the terms and conditions of a Warrant Agreement dated February 28, 2022 by and between the Issuer and Continental Stock Transfer & Trust Company, as warrant agent (the “Warrant Agreement”). Subject to the terms and conditions of the Warrant Agreement, THRC Holdings may acquire shares of Class A Common Stock based on an exercise price of $1.10 per share, subject to adjustment, until February 28, 2028. The Warrants are required to be net settled in stock on a cashless basis based on the difference between (i) the volume weighted average price of the Class A Common Stock as reported during the 10 trading day period ending on the second trading day prior to the date on which the notice of exercise is delivered to the warrant agent and (ii) the then-applicable exercise price, in each case, at the time of exercise. As a result, the number of shares of Class A Common Stock issuable upon exercise of the Warrants cannot be determined at this time, though in no event will the Warrants be exercisable for more than 6,976,744 shares of Class A Common Stock (subject to adjustment for stock splits, combinations, certain distributions or similar events).

On March 1, 2022, in connection with the issuance of the Warrants, THRC Holdings entered into an amendment (the “Warrant Registration Rights Agreement Amendment”) to the Registration Rights Agreement dated February 28, 2022 (as so amended, the “Warrant Registration Rights Agreement”) with the Issuer and certain other holders of warrants listed on the signature pages thereto. The Warrant Registration Rights Agreement includes customary provisions relating to, among other things, “demand” registration rights and “piggy-back” registration rights. Pursuant to the Warrant Registration Rights Agreements, the Issuer will have certain obligations to register for resale under the Securities Act all or any portion of the shares of Class A Common Stock that the holders may acquire upon the exercise or exchange of the Warrants.

The foregoing descriptions of the Loan Agreement Joinder, the Term Loan Amendment, the Warrant Agreement, the Warrant Registration Rights Agreement Amendment and the Warrant Registration Rights Agreement do not purport to be complete and are qualified in their entirety by reference to the full text of the Loan Agreement Joinder, the Term Loan Amendment, the Warrant Agreement, the Warrant Registration Rights Agreement Amendment and the Warrant Registration Rights Agreement, which are filed as Exhibits 1 through 5 to this Amendment, respectively, and are incorporated herein by reference.

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Item 5 of the Schedule 13D is hereby amended by amending and replacing in its entirety each of Item 5(a), 5(b) and 5(c) as follows:

(a)–(b) Each Reporting Person’s beneficial ownership of the Class A Common Stock as of the date of this Amendment is reflected on that Reporting Person’s cover page. The Reporting Persons may be deemed to be the beneficial owners of an aggregate of 15,579,921 shares of Class A Common Stock.

THRC Holdings may be deemed to directly beneficially own 11,307,034 shares of Class A Common Stock, representing 17.8% of the issued and outstanding shares of Class A Common Stock, based on (i) 52,351,768 shares of Class A Common Stock issued and outstanding as of November 1, 2021, as reported in the Issuer’s Quarterly Report on Form 10-Q (“Quarterly Report”) filed with the SEC on November 12, 2021, plus (ii) 6,976,744 shares of Class A Common Stock issuable to THRC Holdings upon exercise of the Warrants, plus (iii) 4,272,887 shares of Class A Common Stock issuable to THRC Holdings upon conversion of $15,250,000 in aggregate principal amount of the Notes. THRC Management, as General Partner of THRC Holdings, has exclusive voting and investment power over securities beneficially owned by THRC Holdings, and therefore, may be deemed to share beneficial ownership of such securities. Dan Wilks, as sole Manager of THRC Management, together with his spouse, Staci Wilks, who share the same household, may be deemed to exercise voting and investment power over securities beneficially owned by THRC Holdings, and therefore may each be deemed to share beneficial ownership of such securities.

Farris Wilks may be deemed to directly beneficially own 4,272,887 shares of Class A Common Stock, representing 7.55% of the issued and outstanding shares of Class A Common Stock, based on (i) 52,351,768 shares of Class A Common Stock issued and outstanding as of November 1, 2021, as reported in the Issuer’s Quarterly Report filed with the SEC on November 12, 2021, plus (ii) 4,272,887 shares of Class A Common Stock issuable to Farris Wilks upon conversion of $15,250,000 in aggregate principal amount of the Notes.

(c) The information set forth in Item 3 and Item 4 of this Amendment is incorporated by reference into this Item 5(c).

Item 6 of the Schedule 13D is hereby amended to include the following:

The information set forth in Item 3 and Item 4 of this Amendment is incorporated by reference into this Item 6.

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SIGNATURES

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

Date: March 14, 2022