Texas oilfield expert services agency ProPetro and previous CEO Dale Redman have settled charges that they understated his executive perks by failing to disclose ProPetro had reimbursed him for additional than $four hundred,000 in personalized and vacation costs.
In accordance to the U.S. Securities and Exchange Fee, ProPetro did not involve the costs, which include Redman’s use of his personalized Learjet for trips that had been not right related to the functionality of his CEO responsibilities, in its proxy statements for fiscal 2017 and 2018.
As a consequence, the statements recognized only $10,800 in perks for 2017, as a substitute of $153,370, and $19,248 for 2018, as a substitute of $304,863, representing a full understatement of $428,125, the SEC said in an administrative order.
Redman also allegedly unsuccessful to disclose to ProPetro staff that he had pledged all of his inventory in the corporation as collateral for a non-public true estate financial loan, resulting in inaccurate disclosures of his inventory possession in public filings.
The SEC’s administrative order did not point out the company’s CFO. Following an audit committee investigation of a independent subject, which did not consequence in any fiscal restatements, in the fall of 2019 ProPetro named a new executive chair as nicely as a new interim CFO, common counsel, and main accounting officer.
To settle the allegations close to executive perks, ProPetro and Redman agreed to stop-and-desist from further more violations, and Redman agreed to pay a $195,046 penalty.
“The federal securities guidelines are crystal crystal clear: issuers should precisely disclose and report executive compensation and inventory possession. ProPetro unsuccessful in each respects,” David Peavler, director of the SEC’s Fort Truly worth regional office, said in a information launch.
Redman served as CEO of ProPetro from August 2006 until eventually his resignation in March 2020. He principally made use of his Learjet for small business vacation but according to the SEC, ProPetro reimbursed him $42,519 in 2017 and $117,279 for personalized trips.
The SEC said Redman omitted his personalized trips on the Learjet in the directors & officers questionnaires he submitted to ProPetro.
On top of that, he allegedly unsuccessful to disclose that he and users of his loved ones had made use of ProPetro credit cards to charge $127,698 of personalized costs and ProPetro allegedly unsuccessful to appropriately disclose $47,591 in extra perks for Redman that had been approved and paid out for right by the corporation.
The inappropriate disclosures of perks came to gentle, the SEC said, just after ProPetro’s board initiated an inside investigation of a unique subject. Redman reimbursed the corporation for $345,636 in August 2019.