KLX Energy Services Holdings, Inc.

Current report

After giving effect to the Rights Offering and the Backstop Exchange, affiliates of Cross Ocean Partners Management LP (“Cross Ocean”) and Whitebox Advisors LLC (“Whitebox”) hold 22,495,104 and 13,055,633 shares of Common Stock, respectively (representing 21.3% and 12.4%, respectively, of our outstanding Common Stock as of October 31, 2026), according to Schedule 13D filings made by each of them on October 6, 2026.

Current report

Our stockholder protection rights plan, or “poison pill,” includes terms and conditions that could discourage a takeover or other transaction that stockholders may consider favorable.

Current report

In order to provide the Board with time to make informed decisions that are in the best long-term interests of the Company and its stockholders, on September 23, 2026, our Board adopted a stockholder protection rights plan, which could discourage, delay or prevent an acquisition of the Company at a premium price. The rights plan provides for preferred stock purchase rights attached to each share of our Common Stock, which will cause substantial dilution to a person or group that becomes the beneficial owner of 10% or more of our outstanding Common Stock without the prior approval of our Board. As a result, the overall effect of the rights plan may be to render more difficult or discourage a merger, tender or exchange offer or other business combination involving our Company that is not approved by the Board even if the offer may be considered beneficial by some stockholders. The Rights will expire no later than the close of business on September 23, 2027, unless such date is extended by the Board prior to the expiration of the Rights.

Previous report

The Rights Offering may not be consummated on the terms described herein, or at all, and the anticipated benefits of the Rights Offering may not be realized.

Previous report

The Rights Offering and the Backstop Exchange are subject to the satisfaction of various closing conditions, including the accuracy of representations and warranties, compliance with covenants, and execution of ancillary documents. There can be no assurance that these conditions will be satisfied or waived, that the Rights Offering will be consummated on the terms described herein or at all, or that the anticipated benefits of the Rights Offering, including deleveraging of the Company’s balance sheet, will be realized. If the Rights Offering is not completed, we may not have sufficient liquidity to meet our obligations as they become due or to comply with the covenants in our debt instruments, and we may need to pursue alternative financing or restructuring transactions on terms that may be less favorable to the Company and its stockholders. Additionally, the consummation of the Rights Offering is subject to prevailing market conditions, and holders of record may not exercise their subscription rights to purchase Common Stock if the trading price of the Common Stock is below the subscription price. While the Backstop Parties have committed to purchase unsubscribed shares through the Backstop Exchange, such purchases would be made through an exchange of 2030 Senior Notes for Common Stock rather than through the payment of cash, and would not bring additional cash proceeds to the Company.

Previous report

If you do not fully exercise your subscription rights, your proportionate voting interest may be reduced and your relative ownership interest in the Company may be diluted.

Previous report

As described above, we intend to offer transferable subscription rights to purchase up to $125.0 million in shares of Common Stock, which will result in the issuance of additional shares of our Common Stock. If stockholders choose not to fully exercise their subscription rights prior to the expiration of the Rights Offering, their proportionate voting interest may be reduced and their relative ownership interest in the Company may be diluted.

Previous report

The Company will have broad discretion in determining how the net proceeds from the Rights Offering will be used.

Previous report

Although we intend to use any net cash proceeds we receive in connection with the Rights Offering for general corporate purposes, and for any amounts over $31.0 million, to repurchase 2030 Senior Notes at par, we will have broad discretion in determining how the remaining net proceeds from the Rights Offering will be used. Our flexibility in the use of the remaining net proceeds may result in increased risks to the investors in our Common Stock, as our stockholders may not agree with the manner in which we choose to allocate and spend the net proceeds.

Previous report

Under the Backstop Agreement, the Backstop Parties have committed, severally and not jointly, to purchase from the Company any shares of Common Stock not otherwise sold in the Rights Offering through an exchange of their 2030 Senior Notes for shares of Common Stock at the subscription price. Pursuant to the Backstop Agreement, the aggregate backstop commitment amount is $94.0 million, which may be increased to up to $125.0 million prior to August 21, 2026, and each individual Backstop Party is subject to an aggregate 30% ownership limitation. If stockholders do not fully subscribe in the Rights Offering, we will issue all of the unsubscribed shares of Common Stock offered in the Rights Offering to the Backstop Parties pursuant to the Backstop Exchange, and our stockholders could experience significant and immediate dilution.