DEF: Select Water Solutions Announces 2025 Annual Meeting of Stockholders, Outlines Key Proposals

Select Water Solutions will hold its 2025 Annual Meeting of Stockholders on May 2, 2025, to vote on the election of directors, ratification of the independent auditor, and executive compensation.

Summary

• Select Water Solutions, Inc. is holding its Annual Meeting of Stockholders on May 2, 2025, in Gainesville, TX.
• Stockholders of record as of March 6, 2025, are entitled to vote.
• The proposals include the election of eight director nominees, ratification of Grant Thornton LLP as the independent auditor for fiscal year 2025, and a non-binding advisory vote on executive compensation.
• The Board recommends voting FOR all proposals.
• The Proxy Statement is dated March 18, 2025, and was made available to stockholders beginning on or about March 18, 2025.
• The company operates through three primary segments: Water Infrastructure, Water Services, and Chemical Technologies.
• In January 2025, Select entered into a new five-year senior secured sustainability-linked credit facility for $300 million of revolving commitments and $250 million of term loan commitments.
• The new credit facility maintains the reporting performance target mechanics that were included in the Prior Sustainability-Linked Credit Facility, Employee Health and Safety Metric ( i.e., TRIR) and the Water Stewardship Metric, while setting new, more ambitious threshold and target amounts for each of the reporting years, beginning in 2025.

Sentiment

Score: 8

Explanation: The document presents a positive outlook with strong performance metrics, a focus on sustainability, and a commitment to corporate governance. While there are some risks and related party transactions, the overall tone is optimistic and confident.

Positives

• The company is committed to sustainable water management solutions.
• The company is focused on reducing emissions and environmental impact.
• The company has a strong safety record and is committed to employee safety.
• The company offers competitive wages and benefits and is focused on employee retention.
• The company has a clawback policy in place.
• The company has stock ownership and retention guidelines for executives and directors.
• The company has an insider trading and anti-hedging policy.
• The company has a new sustainability-linked credit facility with more ambitious targets.
• The company has a strong focus on community outreach and emergency relief efforts.

Negatives

• The company has related party transactions that require careful review and oversight.
• The company has significant payment obligations under Tax Receivable Agreements.

Risks

• Forward-looking statements are subject to substantial risks and uncertainties.
• Sustainability plans and goals are developing and based on assumptions that continue to evolve.
• The company is subject to various environmental laws and regulations.
• The company faces competition from other service providers.

Future Outlook

The company aims to progressively reduce the proportion of produced water being reinjected into SWDs and is pursuing recycling solutions beyond traditional reuse for oil and gas operations.

Management Comments

• John D. Schmitz, Chairman of the Board, President, and Chief Executive Officer: 'Thank you for your continued support of Select Water Solutions, Inc.'

Industry Context

The company operates in the water management industry, serving the energy sector in the United States, and competes with other service providers based on safety, operational performance, technological innovation, process efficiencies, and reputational awareness.

Comparison to Industry Standards

• The document does not provide specific comparisons to industry standards or competitors regarding financial performance or operational metrics.
• However, it highlights the company's commitment to sustainability and responsible water management, which are increasingly important factors in the energy industry.
• The company's focus on water recycling and reuse aligns with broader industry trends towards reducing freshwater consumption and minimizing environmental impact.
• The company's technology solutions, such as WaterONE automation services and AquaView software platform, aim to improve efficiency and reduce costs for customers, which is a common goal in the oilfield services sector.

Management Changes

Corporate Governance

Related Party Transactions

• The company rented pumps and filter pod trailers from Aquacore Rental Company LLC, an entity indirectly owned by Cody Ortowski, for $15,165,325 and recorded sales in the amount of $8,454.
• The company paid property rental fees to Axis Energy Services, an entity owned by Mr. Schmitz, for $1,925,611 and recorded sales in the amount of $676,095.
• The company incurred charges for aviation services from B-29 Ups and Downs, LLC, owned by Mr. Schmitz, for $1,324,575.
• The company purchased parts and supplies from Bell Supply Company, controlled by Mr. Schmitz, for $511,595.
• The company incurred charges for appraisal services and tax consulting from Merit Appraisal & Tax Consulting, LP, controlled by Mr. Schmitz, for $956,307.
• The company incurred charges for MyWorkDoc Technologies LLC, owned by Mr. Schmitz, for $465,810.
• The company purchased pumps and related equipment from Orteq Energy Technologies, indirectly owned by Cody Ortowski, for $4,076,362.
• The company made tax benefit payments to Sunray Capital, LP, controlled by Mr. Schmitz, for $136,734.
• The company paid property rental fees to United Surface and Minerals LLC, owned by Mr. Schmitz and Cody Ortowski, for $241,386.

Stakeholder Impact

• Shareholders are asked to vote on key proposals that will shape the company's direction and governance.
• Employees are impacted by the company's commitment to safety, benefits, and career development.
• Customers benefit from the company's focus on sustainable water management solutions and technological innovation.
• Communities benefit from the company's commitment to environmental stewardship and community outreach.

Next Steps

• Stockholders are encouraged to review the materials and vote their shares prior to the Annual Meeting.
• The Board will consider the voting results when making future compensation decisions.

Key Dates