Subsequent Events |
4 Months Ended | 9 Months Ended |
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Sep. 30, 2021 |
Sep. 30, 2021 |
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| Subsequent Events | ||
| Subsequent Events |
4.Subsequent Events Initial Public Offering On October 26, 2021, we closed the Offering of 20,297,500 shares of Class A common stock (including 2,647,500 shares of Class A common stock issued and sold pursuant to the underwriters’ exercise of their option in full to purchase additional shares of Class A common stock), at a price to the public of $13.00 per share ($12.22 per share net of underwriting discounts and commissions), resulting in gross proceeds of $263.9 million, or net proceeds of $246.1 million after deducting underwriting discounts and commissions pursuant to the Offering. We contributed all the net proceeds of the IPO, including the net proceeds from the underwriters’ exercise of their option in full to purchase additional shares of Class A common stock, to Solaris LLC in exchange for 20,297,500 units of Solaris LLC. Equity Incentive Plan Effective October 26, 2021, our Board of Directors adopted the Aris Water Solutions, Inc. 2021 Equity Incentive Plan. The 2021 Plan will allow for the grant of stock options, both incentive stock options and “non-qualified” stock options; stock appreciation rights, restricted stock and restricted stock units; incentive bonuses, which may be paid in cash, stock, or a combination thereof; and other stock-based awards. A total of 5,350,000 shares of Class A common stock are issuable under our 2021 Equity Incentive Plan.
Tax Receivable Agreement On October 26, 2021, in connection with the initial public offering, we entered into a Tax Receivable Agreement (“TRA”) with the existing owners of Solaris LLC. The TRA generally provides that we pay 85% of the net cash savings, if any, in U.S. federal, state and local income tax and franchise tax that we realize from certain increases in tax basis that occur as a result of our acquisition of the existing owners’ tax attributes. Additionally, the TRA contains terms that in the event we experience a change of control or there is an early termination under the TRA, we could be required to make an immediate payment to the existing owners. |
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| Solaris Midstream Holdings, LLC and Subsidiaries | ||
| Subsequent Events | ||
| Subsequent Events |
13.Subsequent Events Initial Public Offering and Corporate Reorganization On October 21, 2021, Aris announced the pricing of its initial public offering of 17,650,000 shares of its Class A common stock at a price to the public of $13.00 per share. In addition, Aris granted the underwriters a 30-day option to purchase up to an additional 2,647,500 shares of its Class A common stock at the public offering price, less underwriting discounts and commissions. On October 22, 2021, the underwriters fully exercised such option to purchase an additional 2,647,500 shares of Class A common stock. The offering, including the underwriters’ option, closed on October 26, 2021. The closing of the initial public offering, including the underwriters’ option, resulted in net proceeds of approximately $246.1 million, after deducting underwriting discounts and commissions and estimated expenses payable by Aris. Aris contributed all of the net proceeds of the initial public offering to Solaris LLC in exchange for a single class of units in Solaris LLC and shares of the Company’s Class B common stock. Solaris LLC distributed approximately $213.3 million of the net proceeds to the existing owners of Solaris LLC and retained the remaining $32.8 million of the net proceeds for general corporate purposes, which may include capital expenditures, working capital and potential acquisitions and strategic transactions. Amended and Restated LLC Agreement On October 26, 2021, in connection with Aris’ IPO, the Company amended and restated the LLC Agreement. The amendments to the LLC Agreement, include among other things, (i) provisions to convert all of the membership interests in Solaris LLC into (a) a single class of units in Solaris LLC representing in the aggregate 33,202,500 Solaris LLC Units and (b) the right to receive the distributions of proceeds described above and an aggregate of 33,202,500 shares of Aris’ Class B Common Stock and (ii) admitted Aris as the sole managing member of Solaris LLC. In accordance with the terms of the amended and restated LLC Agreement, the holders of Solaris LLC Units will generally have the right to exchange their Solaris LLC Units (and a corresponding number of shares of the Class B Common Stock), for an aggregate of 33,202,500 shares of the Class A Common Stock at an exchange ratio of one share of Class A Common Stock for each Solaris LLC Unit (and corresponding share of Class B Common Stock) exchanged, subject to conversion rate adjustments for stock splits, stock dividends and reclassifications.
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