27/01/2022

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Ex-ProPetro CEO Fined Over Undisclosed Perks

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Texas oilfield expert services agency ProPetro and previous CEO Dale Redman have settled rates that they understated his executive perks by failing to disclose ProPetro had reimbursed him for far more than $four hundred,000 in private and journey costs.

In accordance to the U.S. Securities and Exchange Fee, ProPetro did not include things like the costs, which include Redman’s use of his private Learjet for trips that had been not immediately similar to the functionality of his CEO duties, in its proxy statements for fiscal 2017 and 2018.

As a result, the statements recognized only $ten,800 in perks for 2017, as an alternative of $153,370, and $19,248 for 2018, as an alternative of $304,863, representing a whole understatement of $428,one hundred twenty five, the SEC said in an administrative order.

Redman also allegedly unsuccessful to disclose to ProPetro personnel that he had pledged all of his inventory in the firm as collateral for a personal authentic estate financial loan, ensuing in inaccurate disclosures of his inventory ownership in public filings.

The SEC’s administrative order did not mention the company’s CFO. Immediately after an audit committee investigation of a different make any difference, which did not result in any monetary restatements, in the drop of 2019 ProPetro named a new executive chair as well as a new interim CFO, typical counsel, and main accounting officer.

To settle the allegations close to executive perks, ProPetro and Redman agreed to cease-and-desist from additional violations, and Redman agreed to fork out a $195,046 penalty.

“The federal securities legislation are crystal distinct: issuers must properly disclose and history executive compensation and inventory ownership. ProPetro unsuccessful in the two respects,” David Peavler, director of the SEC’s Fort Well worth regional office, said in a information launch.

Redman served as CEO of ProPetro from August 2006 till his resignation in March 2020. He principally used his Learjet for company journey but in accordance to the SEC, ProPetro reimbursed him $42,519 in 2017 and $117,279 for private trips.

The SEC said Redman omitted his private trips on the Learjet in the administrators & officers questionnaires he submitted to ProPetro.

Additionally, he allegedly unsuccessful to disclose that he and customers of his family had used ProPetro credit score playing cards to cost $127,698 of private costs and ProPetro allegedly unsuccessful to adequately disclose $47,591 in more perks for Redman that had been licensed and paid out for immediately by the firm.

The improper disclosures of perks arrived to gentle, the SEC said, after ProPetro’s board initiated an interior investigation of a diverse make any difference. Redman reimbursed the firm for $345,636 in August 2019.

Dale Redman, perks, ProPetro, U.S. Securities and Exchange Fee

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