Catcus Annual Report 2020 PDF

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
☑ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2019
or
☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number: 001‑38390
Cactus, Inc.
(Exact name of registrant as specified in its charter)
Delaware 35‑2586106
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
920 Memorial City Way, Suite 300
Houston, Texas 77024
(Address of principal executive offices) (Zip code)
(713) 626‑8800
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act
Title of each class Trading Symbol(s) Name of each exchange on which registered
Class A Common Stock, par value $0.01 WHD New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if the registrant is a well‑known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☑ No ☐
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☑
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes ☑ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of
Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an
emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth
company” in Rule 12b‑2 of the Exchange Act.
Large accelerated filer ☑ Accelerated filer ☐
Non-accelerated filer ☐ Smaller reporting company ☐
Emerging growth company ☐
If an emerging growth company indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new
or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b‑2 of the Exchange Act). Yes ☐ No ☑
As of June 30, 2019, the aggregate market value of the common stock of the registrant held by non-affiliates of the registrant was $1.6 billion.
As of February 24, 2020, the registrant had 47,339,551 shares of Class A common stock, $0.01 par value per share, and 27,957,699 shares of Class B
common stock, $0.01 par value per share, outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
None.
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TABLE OF CONTENTS
Cautionary Statement Regarding Forward-Looking Statements ii
PART I 1
Item 1. Business 1
Item 1A. Risk Factors 9
Item 1B. Unresolved Staff Comments 23
Item 2. Properties 23
Item 3. Legal Proceedings 23
Item 4. Mine Safety Disclosures 23
PART II 24
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases 24
of Equity Securities
Item 6. Selected Financial Data 26
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 27
Item 7A. Quantitative and Qualitative Disclosures about Market Risk 34
Item 8. Financial Statements and Supplementary Data 35
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 63
Item 9A. Controls and Procedures 63
Item 9B. Other Information 63
PART III 64
Item 10. Directors, Executive Officers and Corporate Governance 64

Item 11. Executive Compensation 71
Security Ownership of Certain Beneficial Owners and Management and Related
Item 12. Stockholder Matters 91
Item 13. Certain Relationships and Related Transactions, and Director Independence 94
Item 14. Principal Accounting Fees and Services 101
PART IV 103
Item 15. Exhibits, Financial Statement Schedules 103

Item 16. Form 10‑K Summary 106
Signatures 107
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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This Annual Report on Form 10‑K (this “Annual Report”) contains “forward-looking statements”
within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”). When used in this Annual Report, the words “could,” “believe,” “anticipate,” “intend,” “estimate,”
“expect,” “project” and similar expressions are intended to identify forward‑looking statements, although
not all forward‑looking statements contain such identifying words. These forward‑looking statements are
based on our current expectations and assumptions about future events and are based on currently available
information as to the outcome and timing of future events. When considering forward‑looking statements,
you should keep in mind the risk factors and other cautionary statements described under the heading
“Item 1A. Risk Factors” included in this Annual Report. These forward‑looking statements are based on
management’s current belief, based on currently available information, as to the outcome and timing of
future events.
Forward‑looking statements may include statements about:
· demand for our products and services, which is affected by, among other things, changes in the
price of crude oil and natural gas in domestic and international markets;
· the level of growth in number of rigs, pad sizes, well spacings and associated well count and
availability of takeaway capacity;
· capital spending discipline exercised by customers;
· changes in the number of drilled but uncompleted wells (“DUC’s”) and the level of
completion activity;
· the size and timing of orders;
· availability of raw materials and imported items;
· transportation differentials associated with reduced capacity in and out of the storage hub in
Cushing, Oklahoma;
· expectations regarding raw materials, overhead and operating costs and margins;
· availability of skilled and qualified workers;
· potential liabilities such as warranty and product liability claims arising out of the installation,
use or misuse of our products;
· the possibility of cancellation of orders;
· our business strategy;
· our financial strategy, operating cash flows, liquidity and capital required for our business;
· our future revenue, income and operating performance;
· the ability to pay dividends and the amount of any such dividends;
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· the termination of relationships with major customers or suppliers;
· laws and regulations, including environmental regulations, that may increase our costs, limit
the demand for our products and services or restrict our operations;
· disruptions in the political, regulatory, economic and social conditions domestically or

internationally;
· outbreaks of pandemic or contagious diseases that may disrupt our suppliers or facilities or
impact demand for oil and gas;
· increases in import tariffs assessed on products from China and imported raw materials used
in the manufacture of our goods in the United States which could negatively impact margins
and our working capital;
· the significance of future liabilities under the Tax Receivable Agreement (the “TRA”) we
entered into with certain current or past direct and indirect owners of Cactus LLC (the “TRA
Holders”) in connection with our initial public offering;
· a failure of our information technology infrastructure or any significant breach of security;
· potential uninsured claims and litigation against us;
· competition within the oilfield services industry;
· our dependence on the continuing services of certain of our key managers and employees;
· currency exchange rate fluctuations associated with our international operations; and
· plans, objectives, expectations and intentions contained in this Annual Report that are not
historical.
We caution you that these forward‑looking statements are subject to all of the risks and
uncertainties, most of which are difficult to predict and many of which are beyond our control, incident to
the operation of our business. These risks include, but are not limited to the risks described in this Annual
Report under “Item 1A. Risk Factors.”
Should one or more of the risks or uncertainties described in this Annual Report occur, or should
underlying assumptions prove incorrect, our actual results and plans could differ materially from those
expressed in any forward‑looking statements.
All forward‑looking statements, expressed or implied, included in this Annual Report are expressly
qualified in their entirety by this cautionary statement. This cautionary statement should also be considered
in connection with any subsequent written or oral forward‑looking statements that we or persons acting on
our behalf may issue.
Except as otherwise required by applicable law, we disclaim any duty to update any
forward‑looking statements, all of which are expressly qualified by the statements in this section, to reflect
events or circumstances after the date of this Annual Report.
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PART I
Except as otherwise indicated or required by the context, all references in this Annual Report to “the
Company,” “Cactus,” “we,” “us” and “our” refer to (i) Cactus Wellhead, LLC (“Cactus LLC”) and its
consolidated subsidiaries prior to the completion of our initial public offering and (ii) Cactus, Inc.
(“Cactus Inc.”) and its consolidated subsidiaries (including Cactus LLC) following the completion of our initial
public offering on February 12, 2018.
Item 1. Business
Our History
Cactus Inc. was incorporated on February 17, 2017 as a Delaware corporation for the purpose of
completing an initial public offering of equity and related transactions (our “IPO”). Cactus LLC is a Delaware
limited liability company and was formed on July 11, 2011. We began operating in August 2011, following the
formation of Cactus LLC by Scott Bender and Joel Bender, who have owned or operated wellhead
manufacturing businesses since the late 1970s, and Cadent Energy Partners II, L.P. (“Cadent”), an affiliate of
Cadent Energy Partners LLC, as its equity sponsor. We acquired our primary manufacturing facility in Bossier
City, Louisiana in September 2011 and established our other production facility, located in Suzhou, China in
December 2013 through our subsidiary there. Since we began operating, we have grown to 14 U.S. service
centers located in Texas, Pennsylvania, Oklahoma, North Dakota, New Mexico, Louisiana, Colorado and
Wyoming as well as three service centers in Eastern Australia. Our corporate headquarters are located in
Houston, Texas.
Cactus Inc. and its consolidated subsidiaries, including Cactus LLC, are primarily engaged in the
design, manufacture and sale of wellhead and pressure control equipment. In addition, we maintain a fleet of
frac valves and ancillary equipment for short-term rental. Our products are sold and rented principally for
onshore unconventional oil and gas wells and are utilized during the drilling, completion and production phases
of our customers’ wells. We also provide field services for all of our products and rental items to assist with the
installation, maintenance and handling of the wellhead and pressure control equipment as well as offer repair
and refurbishment services.
Organization Structure
On February 12, 2018, we completed our initial public offering of 23.0 million shares of Class A
common stock, par value $0.01 per share (“Class A common stock”), at a price to the public of $19.00 per
share. We received net proceeds of $408.0 million after deducting underwriting discounts and commissions and
payment of $2.8 million in offering expenses for the IPO. We also paid $2.2 million in offering expenses during
2017. On February 14, 2018 we completed the sale of an additional 3.5 million shares of Class A common stock
pursuant to the exercise in full by the underwriters of their option to purchase additional shares of Class A
common stock (the “Option”), from which we received an additional $61.6 million net proceeds after deducting
underwriting discounts and commissions. We contributed all of the net proceeds of our IPO (including from the
Option) to Cactus LLC in exchange for CW Units. Cactus LLC used the $469.6 million of the net proceeds
from our IPO to (i) repay all of the borrowings outstanding under its term loan facility, including accrued
interest, of $251.0 million and (ii) redeem $216.4 million of CW Units from certain direct and indirect owners
of Cactus LLC. The remaining $2.2 million was retained by Cactus LLC to cover offering expenses previously
paid in 2017.
Cactus Inc. is a holding company whose only material asset is an equity interest consisting of units
representing limited liability company interests in Cactus LLC (“CW Units”). Cactus Inc. became the sole
managing member of Cactus LLC upon completion of our IPO and is responsible for all operational,
management and administrative decisions relating to Cactus LLC’s business. The Limited Liability Company
Operating Agreement of Cactus LLC was amended and restated as the First Amended and Restated Limited
Liability Company Operating Agreement of Cactus LLC (the “Cactus Wellhead LLC Agreement”) to, among
other things, admit Cactus Inc. as the sole managing member of Cactus LLC. Pursuant to the Cactus Wellhead
LLC Agreement, holders of CW Units are entitled to redeem their CW Units, which results in a corresponding
increase in Cactus Inc.’s membership interest in Cactus LLC and an increase in the number of shares of
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Class A common stock outstanding. The following is a rollforward of ownership of legacy CW Units by legacy
CW Unit Holders:
CW Units
(in thousands)
CW Units held by legacy CW Unit Holders as of February 7, 2018 60,558
IPO (12,118)
July 2018 Follow-on Offering (11,197)
Other CW Unit redemptions (7)
CW Units held by legacy CW Unit Holders as of December 31, 2018 37,236
March 2019 Secondary Offering (8,474)
On July 16, 2018, we completed a public offering of 11.2 million shares (consisting of 10.0 million
base shares and 1.2 million shares sold pursuant to the underwriters’ option to purchase additional shares) of
Class A common stock (the “Follow-on Offering”) at a price to the public of $33.25 per share and received
$359.3 million of net proceeds after deducting underwriting discounts and commissions. Cactus Inc. contributed
these net proceeds to Cactus LLC in exchange for CW Units. Cactus LLC then used the net proceeds to redeem
11.2 million CW Units from certain of the owners of Cactus LLC, and Cactus Inc. canceled a corresponding
number of shares of Class B common stock, par value $0.01 per share (“Class B common stock”).
On March 19, 2019, Cactus Inc. entered into an underwriting agreement by and among Cactus Inc.,
Cactus LLC, certain selling stockholders of Cactus (the “Selling Stockholders”) and the underwriters named
therein, providing for the offer and sale of Class A common stock by the Selling Stockholders (the “March 2019
Secondary Offering”). As described in the prospectus supplement dated March 19, 2019 and filed with the
Securities and Exchange Commission on March 20, 2019, in connection with the March 2019 Secondary
Offering, certain Selling Stockholders owning CW Units exercised their Redemption Right with respect to 8.5
million CW Units, together with a corresponding number of shares of Class B common stock, as provided in the
Cactus LLC Agreement. The March 2019 Secondary Offering closed on March 21, 2019, at which time, in
exercise of its Call Right, Cactus Inc. acquired the redeemed CW Units and a corresponding number of shares
of Class B common stock (which shares of Class B common stock were then canceled) and issued 8.5 million
shares of Class A common stock to the underwriters at the direction of the redeeming Selling Stockholders, as
provided in the Cactus LLC Agreement. In addition, certain other Selling Stockholders sold 26 thousand shares
of Class A common stock in the March 2019 Secondary Offering, which shares were owned by them directly
prior to the closing of this offering. Cactus did not receive any of the proceeds from the sale of common stock in
the March 2019 Secondary Offering. Cactus incurred $1.0 million in offering expenses which were recorded in
other income (expense), net, in the consolidated statement of income.
In this Annual Report, we refer to the owners of CW Units, other than Cactus Inc., (along with their
permitted transferees) as “CW Unit Holders.” CW Unit Holders also own one share of our Class B common
stock for each CW Unit such CW Unit Holder owns. As of December 31, 2019, after giving effect to our IPO,
Follow-on Offering, the March 2019 Secondary Offering and additional redemptions pursuant to the Cactus
Wellhead LLC Agreement, Cactus Inc. owns an approximate 62.8% interest in Cactus LLC, and the CW Unit
Holders own an approximate 37.2% interest in Cactus LLC as of December 31, 2019, which is based on 47.2
million shares of Class A common stock and 28.0 million shares of Class B common stock issued and
outstanding.
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The following diagram indicates our simplified ownership structure as of December 31, 2019:
Overview
Our principal products include our Cactus SafeDrill® wellhead systems as well as frac stacks, our
Cactus SafeLinkTM system, zipper manifolds and production trees that we design and manufacture. Every oil and
gas well requires a wellhead, which is installed at the onset of the drilling process and remains with the well
through its entire productive life. The Cactus SafeDrill® wellhead systems employ technology which allows
technicians to land and secure casing strings more safely from the rig floor, reducing the need to descend into
the cellar. We believe we are a market leader in the application of such technology, with thousands of our
products sold and installed across the United States since 2011. During the completion phase of a well, we rent
frac stacks, zipper manifolds and other high-pressure equipment that are used for well control and for managing
the transmission of frac fluids and proppants during the hydraulic fracturing process. These severe service
applications require robust and reliable equipment. For the subsequent production phase of a well, we sell
production trees and the equipment to interface with various forms of artificial lift that regulate hydrocarbon
production, which are installed on the wellhead after the frac stack has been removed. In addition, we provide
mission-critical field services for all of our products and rental items, including 24-hour service crews to assist
with the installation, maintenance, repair and safe handling of the wellhead and pressure control equipment.
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Our innovative wellhead products and pressure control equipment are developed internally. We believe
our close relationship with our customers provides us with insight into the specific issues encountered in the
drilling and completion processes, allowing us to provide them appropriate product and service solutions. We
have achieved significant market share, as measured by the percentage of total active U.S. onshore rigs that we
follow (which we define as the number of active U.S. onshore drilling rigs to which we are the primary provider
of wellhead products and corresponding services during drilling), and brand name recognition with respect to
our engineered products, which we believe is due to our focus on safety, reliability, cost effectiveness and time
saving features. We optimize our products for pad drilling (i.e., the process of drilling multiple wellbores from a
single surface location) to reduce rig time and provide operators with significant efficiencies that translate to
cost savings at the wellsite.
We operate through service centers in the United States, which are strategically located in the key oil
and gas producing regions, including the Permian, SCOOP/STACK, Marcellus, Utica, Eagle Ford, and Bakken,
among other active oil and gas regions in the United States, and in Eastern Australia. These service centers
support our field services and provide equipment assembly and repair services. Our manufacturing and
production facilities are located in Bossier City, Louisiana and Suzhou, China.
How We Generate Our Revenues
We operate in one business segment. Our revenues are derived from three sources: products, rentals,
and field service and other. Product revenues are primarily derived from the sale of wellhead systems and
production trees. Rental revenues are primarily derived from the rental and associated repair of equipment used
for well control during the completion process as well as the rental of drilling tools. Field service and other
revenues are primarily earned when we provide installation and other field services for both product sales and
equipment rental. Additionally, other revenues are derived from providing repair and reconditioning services to
customers that have previously installed wellheads or production trees on their wellsite. Items sold or rented
generally have an associated service component. As a result, there is some level of correlation between field
service and other revenues and revenues from product sales and rentals.
For the year ended December 31, 2019, we derived 57% of our total revenues from the sale of our
products, 22% from rental and 21% from field service and other. In 2018, we derived 53% of our total revenues
from the sale of our products, 25% from rental and 22% from field service and other. In 2017, we derived 55%
of our total revenues from the sale of our products, 23% from rental and 22% from field service and other. We
have predominantly domestic operations, with a small amount of sales being generated in Australia.
Most of our sales are made on a call out basis pursuant to agreements, wherein our clients provide
delivery instructions for goods and/or services as their operations require. Such goods and/or services are most
often priced in accordance with a preapproved price list. The actual pricing of our products and services is
impacted by a number of factors including competitive pricing pressure, the level of utilized capacity in the oil
service sector, maintenance of market share, cost of producing the product and general market conditions.
Costs of Conducting Our Business
The principal elements of cost of sales for our products are the direct and indirect costs to manufacture
and supply the product, including labor, materials, machine time, tariffs and duties, freight and lease expense
related to our facilities. The principal elements of cost of sales for rentals are the direct and indirect costs of
supplying rental equipment, including depreciation, repairs specifically performed on such rental equipment and
freight. The principal elements of cost of sales for field service and other are labor, equipment depreciation and
repair, equipment lease expense, fuel and supplies.
Selling, general and administrative expense is comprised of costs such as sales and marketing,
engineering, general corporate overhead, business development, compensation, employment benefits,
information technology, safety and environmental, legal and professional.
Interest income (expense), net includes interest expense associated with our credit facility, finance
leases and accrued interest on deferred payments under the TRA.
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Impact of Section 232 of the Trade Expansion Act of 1962 (“Section 232”)
On March 8, 2018, the President of the United States issued two proclamations imposing tariffs on
imports of certain steel and aluminum products, effective March 23, 2018. The decision was made in response
to the Department of Commerce's findings and recommendations in its reports of its investigations into the
impact of imported steel and aluminum on the national security of the United States pursuant to Section 232.
Specifically, the President imposed a 25% global tariff on certain imported steel mill products and a 10% global
tariff on certain imported aluminum products. The President subsequently has issued proclamations
permanently excluding Argentina, Australia, Brazil, Canada, Mexico and South Korea from the steel tariff and
Argentina, Australia, Canada and Mexico from the aluminum tariff, though imports of steel from Argentina,
Brazil and South Korea, and imports of aluminum from Argentina, are subject to absolute quotas. The tariffs
and quotas have caused the cost of raw materials to increase.
Impact of Section 301 of the Trade Act of 1974 (“Section 301”)
On May 10, 2019, the U.S. Trade Representative announced that it was increasing the level of tariffs
on approximately $200 billion worth of Chinese imports pursuant to Section 301. The tariff rate on covered
products that were exported on or after May 10, 2019 was raised from 10% to 25%. Covered products that
were exported from China to the United States prior to May 10, 2019 remained subject to an additional 10%
tariff if they entered the U.S. before June 15, 2019. Substantially all of the products and frac rental equipment
that we import through our Chinese supply chain are subject to the tariffs. For the year ended December 31,
2019, we estimate that approximately 50% of our goods received were sourced through our Chinese supply
chain.
We believe further increases in the tariff rate above 25% may adversely affect our business, but a
combination of factors may mitigate some of the impact of any future increases in tariff rates on our results of
operations. These include, among other things, use of product received prior to the introduction of tariffs, our
negotiations with suppliers, use of alternative supply chains and favorable currency exchange movements.
Suppliers and Raw Materials
Forgings, castings and bar stock represent the principal raw materials used in the manufacture of our
products and rental equipment. In addition, we require accessory items (such as elastomers, ring gaskets, studs
and nuts) and machined components. We purchase these items from vendors in the United States, China and
Australia. For the years ended December 31, 2019, 2018 and 2017, approximately $36.5 million, $46.7 million
and $33.4 million, respectively, of machined component purchases were made from a vendor located in China,
representing approximately 16%, 21% and 22%, respectively, of our total third-party vendor purchases. We do
not believe that we are overly dependent on any individual vendor to supply our required materials or services.
The materials and services essential to our business are normally readily available and, where we use one or a
few vendors as a source of any particular materials or services, we believe that we can, within a reasonable
period of time, make satisfactory alternative arrangements in the event of an interruption of supply from any
vendor. We believe that our materials and services vendors have the capacity to meet additional demand should
we require it, although likely at higher costs and delayed deliveries.
Manufacturing
Our manufacturing and production facilities are located in Bossier City, Louisiana and Suzhou, China.
Although both facilities can produce our full range of products, our Bossier City facility has advanced
capabilities and is designed to support time-sensitive and rapid turnaround orders, while our facility in China is
optimized for longer lead time orders and outsources its machining requirements. Both our Bossier City and
China facilities are licensed to the latest American Petroleum Institute (“API”) 6A specification for both
wellheads and valves and API Q1 and ISO 9001:2015 quality management systems. Our Bossier City facility is
configured to provide rapid-response production of made-to-order equipment. Where traditional manufacturing
facilities are designed to run in batches with different machining processes occurring in stages, this facility uses
advanced computer numeric control machines to perform multiple machining operations in a single step. We
believe eliminating the setup and queue times between machining processes allows us to offer significantly
shorter order-to-delivery time for equipment than our competitors, albeit at higher costs than China.
Responsiveness to urgent needs strengthens our relationship with key customers.
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Our Bossier City manufacturing facility also functions as a repair and testing facility with its API 6A
certification and full Quality Assurance and Quality Control department. The facility also has the ability to
perform hydrostatic testing, phosphate and oiling, copper coating and frac valve remanufacturing.
Our production facility in China is configured to efficiently produce our range of pressure control
products and components for less time-sensitive, higher-volume orders. All employees in our Suzhou facility
are Cactus employees, which we believe is a key factor in ensuring high quality. Our Suzhou facility currently
assembles and tests machined components before shipment to Cactus facilities in the United States and
Australia.
Trademarks and Other Intellectual Property
Trademarks are important to the marketing of our products. We consider the Cactus Wellhead
trademark to be important to our business as a whole. The Company has numerous trademarks registered with
the U.S. Patent and Trademark Office and has also applied for registration status of numerous trademarks which
are pending.
We also rely on trade secret protection for our confidential and proprietary information. To protect our
information, we customarily enter into confidentiality agreements with our employees and suppliers. There can
be no assurance, however, that others will not independently obtain similar information or otherwise gain access
to our trade secrets.
We have been awarded several U.S. patents and currently have patent applications pending. We seek to
protect our technology through use of patent protections, although we do not deem patents to be critical to our
success.
Cyclicality
We are substantially dependent on conditions in the oil and gas industry, including the level of
exploration, development and production activity of, and the corresponding capital spending by, oil and natural
gas companies. The level of exploration, development and production activity is directly affected by trends in
oil and natural gas prices, which have historically been volatile, and by the availability of capital and the
associated capital spending discipline exercised by customers. Declines, as well as anticipated declines, in oil
and gas prices could negatively affect the level of these activities and capital spending, which could adversely
affect demand for our products and services and, in certain instances, result in the cancellation, modification or
rescheduling of existing and expected orders and the ability of our customers to pay us for our products and
services. These factors could have an adverse effect on our revenue and profitability.
Seasonality
Our business is not significantly impacted by seasonality, although our fourth quarter has historically
been impacted by holidays and our clients’ budget cycles.
Customers
We serve over 200 customers representing majors, independents and other oil and gas companies with
operations in the key U.S. oil and gas producing basins including the Permian, SCOOP/STACK, Marcellus,
Utica, Eagle Ford, Bakken and other active oil and gas basins, as well as in Australia. Pioneer Natural
Resources represented approximately 10% of total revenues for the year ended December 31, 2019 and 11%
during each of the years ended December 31, 2018 and 2017.
Competition
The markets in which we operate are highly competitive. We believe that we are one of the largest
suppliers of wellheads in the United States. We compete with divisions of Schlumberger, Baker Hughes
and TechnipFMC, as well as with a number of other companies. Similar to Cactus, each of Schlumberger, Baker
Hughes and TechnipFMC manufacture their own engineered products.
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We believe that the rental market for frac stacks and related flow control equipment is more
fragmented than the wellhead product market. Cactus does not believe that any individual company represents
more than 20% of the U.S. market.
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As is the case in the wellhead market, Cactus, Schlumberger, Baker Hughes and TechnipFMC rent internally
engineered and manufactured products. Other competitors generally rent foreign manufactured generic
products.
We believe that the principal competitive factors in the markets we serve are technical features,
equipment availability, work force competency, efficiency, safety record, reputation, experience and price.
Additionally, projects are often awarded on a bid basis, which tends to create a highly competitive environment.
While we seek to be competitive in our pricing, we believe many of our customers elect to work with us based
on product features, safety, performance and quality of our crews, equipment and services. We seek to
differentiate ourselves from our competitors by delivering the highest‑quality services and equipment possible,
coupled with superior execution and operating efficiency in a safe working environment.
Environmental, Health and Safety Regulation
We are subject to stringent governmental laws and regulations, both in the United States and other
countries, pertaining to protection of the environment and occupational safety and health. Compliance with
environmental legal requirements in the United States at the federal, state or local levels may require acquiring
permits to conduct regulated activities, incurring capital expenditures to limit or prevent emissions, discharges
and any unauthorized releases, and complying with stringent practices to handle, recycle and dispose of certain
wastes. These laws and regulations include, among others:
· the Federal Water Pollution Control Act (the “Clean Water Act”);
· the Clean Air Act;
· the Comprehensive Environmental Response, Compensation and Liability Act;
· the Resource Conservation and Recovery Act;
· the Occupational Safety and Health Act; and
· national and local environmental protection laws in the People’s Republic of China.
New, modified or stricter enforcement of environmental laws and regulations could be adopted or
implemented that significantly increase our compliance costs, pollution mitigation costs, or the cost of any
remediation of environmental contamination that may become necessary, and these costs could be material. Our
clients are also subject to most, if not all, of the same laws and regulations relating to environmental protection
and occupational safety and health in the United States and in foreign countries where we operate.
Consequently, to the extent these environmental compliance costs, pollution mitigation costs or remediation
costs are incurred by our clients, those clients could elect to delay, restrict or cancel drilling, exploration or
production programs, which could reduce demand for our products and services and, as a result, have a material
adverse effect on our business, financial condition, results of operations, or cash flows.
Consistent with our quality assurance and control principles, we have established proactive
environmental and worker safety policies in the United States and foreign countries for the management,
handling, recycling or disposal of chemicals and gases and other materials and wastes resulting from our
operations. Substantial fines and penalties can be imposed and orders or injunctions limiting or prohibiting
certain operations may be issued in connection with any failure to comply with laws and regulations relating to
worker health and safety.
API Certifications. Our manufacturing facility and our production facility are currently certified by the
API as being in compliance with API 6A, 21st Edition product specification for both wellheads and valves and
API Q1, 9th Edition, Addendum 2, and ISO 9001:2015 quality management systems. API’s standards are
subject to revision, however, and there is no guarantee that future amendments or substantive changes to the
standards would not require us to modify our operations or manufacturing processes to meet the new standards.
Doing so may materially affect our operational costs. We also cannot guarantee that changes to the standards
would not lead to the rescission of our licenses should we be unable to make the changes necessary to meet the
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new standards. Furthermore, these facilities are subjected to annual audits by the API. Loss of our API licenses
could materially affect demand for these products.
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Hydraulic Fracturing. Many of our customers utilize hydraulic fracturing in their operations.
Environmental concerns have been raised regarding the potential impact of hydraulic fracturing on underground
water supplies and seismic activity. These concerns have led to several regulatory and governmental initiatives
in the United States to restrict the hydraulic fracturing process, which could have an adverse impact on our
customers’ completions or production activities.
Although we do not conduct hydraulic fracturing, increased regulation and attention given to the
hydraulic fracturing process could lead to greater opposition to oil and gas production activities using hydraulic
fracturing techniques. In addition, the adoption of new laws or regulations at the federal, state, local or foreign
level imposing reporting obligations on, or otherwise limiting, delaying or banning, the hydraulic fracturing
process or other processes on which hydraulic fracturing and subsequent hydrocarbon production relies, such as
water disposal, could make it more difficult to complete oil and natural gas wells. Further, it could increase our
customers’ costs of compliance and doing business, and otherwise adversely affect the hydraulic fracturing
services they perform, which could negatively impact demand for our products.
Climate Change. State, national and international governments and agencies continue to evaluate, and
in some instances adopt, climate-related legislation and other regulatory initiatives that would restrict emissions
of greenhouse gases. Changes in environmental requirements related to greenhouse gases, climate change and
alternative energy sources may negatively impact demand for our services. For example, oil and natural gas
exploration and production may decline as a result of environmental requirements, including land use policies
responsive to environmental concerns. Because our business depends on the level of activity in the oil and
natural gas industry, existing or future laws, regulations, treaties or international agreements related to
greenhouse gases and climate change, including incentives to conserve energy or use alternative energy sources,
may reduce demand for oil and natural gas and could have a negative impact on our business. Likewise, such
restrictions may result in additional compliance obligations that could have a material adverse effect on our
business, consolidated results of operations and consolidated financial condition.
Insurance and Risk Management
We rely on customer indemnifications and third‑party insurance as part of our risk mitigation strategy.
However, our customers may be unable to satisfy indemnification claims against them. In addition, we
indemnify our customers against certain claims and liabilities resulting or arising from our provision of goods
or services to them. Our insurance may not be sufficient to cover any particular loss or may not cover all losses.
We carry a variety of insurance coverages for our operations, and we are partially self‑insured for certain
claims, in amounts that we believe to be customary and reasonable. Historically, insurance rates have been
subject to various market fluctuations that may result in less coverage, increased premium costs, or higher
deductibles or self‑insured retentions.
Our insurance includes coverage for commercial general liability, damage to our real and personal
property, damage to our mobile equipment, sudden and accidental pollution liability, workers’ compensation
and employer’s liability, auto liability, foreign package policy, commercial crime, fiduciary liability
employment practices, cargo, excess liability, and directors and officers’ insurance. We also maintain a partially
self-insured medical plan that utilizes specific and aggregate stop loss limits. Our insurance includes various
limits and deductibles or self‑insured retentions, which must be met prior to, or in conjunction with, recovery.
Employees
As of December 31, 2019, we employed over 1,100 people. Our future success will depend partially on
our ability to attract, retain and motivate qualified personnel. We are not a party to any collective bargaining
agreements and have not experienced any strikes or work stoppages. We consider our relations with our
employees to be good.
Available Information
Our principal executive offices are located at 920 Memorial City Way, Suite 300, Houston, TX 77024,
and our telephone number at that address is (713) 626‑8800. Our website address is www.CactusWHD.com.
Our periodic reports and other information filed with or furnished to the Securities and Exchange Commission
(“SEC”) are available, free of charge, through our website, as soon as reasonably practicable after those reports
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and other information are electronically filed with or furnished to the SEC. Information on our website or any
other website is not incorporated by reference into this Annual Report and does not constitute a part of this
Annual Report.
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Item 1A. Risk Factors
Investing in our Class A common stock involves risks. You should carefully consider the information in
this Annual Report, including the matters addressed under “Cautionary Statement Regarding Forward‑Looking
Statements,” and the following risks before making an investment decision. Our business, results of operations
and financial condition could be materially and adversely affected by any of these risks. Additional risks or
uncertainties not currently known to us, or that we deem immaterial, may also have an effect on our business,
results of operations and financial condition. The trading price of our Class A common stock could decline due
to any of these risks, and you may lose all or part of your investment.
Risks Related to the Oilfield Services Industry and Our Business
Demand for our products and services depends on oil and gas industry activity and customer
expenditure levels, which are directly affected by trends in the demand for and price of crude oil and
natural gas and availability of capital.
Demand for our products and services depends primarily upon the general level of activity in the oil
and gas industry, including the number of drilling rigs in operation, the number of oil and gas wells being
drilled, the depth and drilling conditions of these wells, the volume of production, the number of well
completions and the level of well remediation activity, and the corresponding capital spending by oil and gas
companies. Oil and gas activity is in turn heavily influenced by, among other factors, current and anticipated oil
and natural gas prices locally and worldwide, which have historically been volatile.
Declines, as well as anticipated declines, in oil and gas prices could negatively affect the level of these
activities and capital spending, which could adversely affect demand for our products and services and, in
certain instances, result in the cancellation, modification or rescheduling of existing and expected orders and the
ability of our customers to pay us for our products and services. These factors could have an adverse effect on
our results of operations, financial condition and cash flows.
Factors affecting the prices of oil and natural gas include, but are not limited to, the following:
· demand for hydrocarbons, which is affected by worldwide population growth, economic growth
rates and general economic and business conditions;
· available excess production capacity within the Organization of Petroleum Exporting Countries
(“OPEC”) and the level of oil and gas production by non‑OPEC countries;
· the continued development of shale plays which may influence worldwide supply;
· transportation differentials associated with reduced capacity in and out of the storage hub in
Cushing, Oklahoma;
· costs of exploring for, producing and delivering oil and natural gas;
· political and economic uncertainty and sociopolitical unrest;
· oil refining capacity and shifts in end‑customer preferences toward fuel efficiency and the use of
natural gas;
· conservation measures and technological advances affecting energy consumption;
· potential acceleration of the commercial development of alternative energy sources (such as wind,
solar, geothermal, tidal, fuel cells and biofuels);
· access to capital and credit markets, which may affect our customers’ activity levels and spending
for our products and services;
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· changes in laws and regulations related to hydraulic fracturing activities;
· changes in environmental laws and regulations (including relating to the use of coal in power
plants); and
· natural disasters.
The oil and gas industry is cyclical and has historically experienced periodic downturns, which have
been characterized by diminished demand for our products and services and downward pressure on the prices
we charge. These downturns cause many exploration and production (“E&P”) companies to reduce their capital
budgets and drilling activity. Any future downturn or expected downturn could result in a significant decline in
demand for oilfield services and adversely affect our results of operations, financial condition and cash flows.
Growth in U.S. drilling and completion activity, and our ability to benefit from such growth, could be
adversely affected by any significant constraints in equipment, labor or takeaway capacity in the regions
in which we operate.
Growth in U.S. drilling and completion activity may be impacted by, among other things, pressure
pumping capacity, pipeline capacity, and material and labor shortages. While there is no perceived shortage in
capacity, should significant growth in activity occur there could be concerns over availability of the equipment,
materials and labor required to drill and complete a well, together with the ability to move the produced oil and
natural gas to market. Should significant constraints develop that materially impact the economics of oil and gas
producers, growth in U.S. drilling and completion activity could be adversely affected. This would have an
adverse impact on the demand for the products we sell and rent, which could have a material adverse effect on
our business, results of operations, financial condition and cash flows.
We may be unable to employ a sufficient number of skilled and qualified workers to sustain or expand
our current operations.
The delivery of our products and services requires personnel with specialized skills and experience.
Our ability to be productive and profitable will depend upon our ability to attract and retain skilled workers. In
addition, our ability to expand our operations depends in part on our ability to increase the size of our skilled
labor force. The demand for skilled workers is high, the supply is limited, and the cost to attract and retain
qualified personnel has increased. During industry downturns, skilled workers may leave the industry, reducing
the availability of qualified workers when conditions improve. In addition, a significant increase in the wages
paid by competing employers could result in increases in the wage rates that we must pay. If we are not able to
employ and retain skilled workers, our ability to respond quickly to customer demands or strong market
conditions may inhibit our growth, which could have a material adverse effect on our business, results of
operations and financial condition.
Our business is dependent on the continuing services of certain of our key managers and employees.
We depend on key personnel. The loss of key personnel could adversely impact our business if we are
unable to implement certain strategies or transactions in their absence. The loss of qualified employees or an
inability to retain and motivate additional highly‑skilled employees required for the operation and expansion of
our business could hinder our ability to successfully maintain and expand our market share.
Equity interests in us are a substantial portion of the net worth of our executive officers and several of
our other senior managers. Following the completion of our IPO, those executive officers and other senior
managers have increased liquidity with respect to their equity interests in us. As a result, those executive
officers and senior managers may have less incentive to remain employed by us. After terminating their
employment with us, some of them may become employed by our competitors.
Political, regulatory, economic and social disruptions in the countries in which we conduct business
could adversely affect our business or results of operations.
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In addition to our facilities in the United States, we operate one production facility in China and have
facilities in Australia that sell and rent equipment as well as provide parts, repair services and field services
associated with installation. Instability and unforeseen changes in any of the markets in which we conduct
business could have an adverse effect on the
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demand for, or supply of, our products and services, our results of operations and our financial condition. These
factors include, but are not limited to, the following:
· nationalization and expropriation;
· potentially burdensome taxation;
· inflationary and recessionary markets, including capital and equity markets;
· civil unrest, labor issues, political instability, natural disasters, terrorist attacks, cyber‑terrorism,
military activity and wars;
· outbreaks of pandemic or contagious diseases;
· supply disruptions in key oil producing countries;
· tariffs, trade restrictions, trade protection measures, including those associated with Section 232
and Section 301, or price controls;
· foreign ownership restrictions;
· import or export licensing requirements;
· restrictions on operations, trade practices, trade partners and investment decisions resulting from
domestic and foreign laws and regulations;
· changes in, and the administration of, laws and regulations;
· inability to repatriate income or capital;
· reductions in the availability of qualified personnel;
· development and implementation of new technologies;
· foreign currency fluctuations or currency restrictions; and
· fluctuations in the interest rate component of forward foreign currency rates.
Our operations and results may be negatively impacted by the coronavirus outbreak.
During January 2020, a novel strain of coronavirus surfaced in the Hubei province in China. We
operate one facility in China in Suzhou, located in the Jiangsu province. While the Jiangsu province does not
share any borders with the Hubei province, it is approximately 500 miles from Hubei. On January 27, 2020, in
an effort to halt the outbreak, China’s State Council announced an extension of the Lunar New Year celebration
and thus extended the mandatory closure of all non-essential enterprises until February 10, 2020 in the Jiangsu
province. As a result of these measures, we temporarily closed our facility in Suzhou for 10 days. Although the
Suzhou facility reopened on February 10, 2020, it is currently operating at a reduced capacity due to, among
other reasons, employee shortages resulting in part from government-imposed travel restrictions and local
statutory quarantines. We cannot be sure the Suzhou facility will not face additional closures or assess how long
it will continue operating at a reduced capacity. Additionally, even once our operations at the Suzhou facility are
fully restored, continued government-imposed transportation restrictions or subsequent bottlenecks in the
shipment of our products may result in additional negative effects to our supply chain or our ability to transport
our products to our customers. There are still too many variables and uncertainties regarding the coronavirus
outbreak to fully assess the potential impact on our business, including the ultimate geographic spread of the
virus, the duration and severity of the outbreak and the extent of travel restrictions and business closures
imposed in China or other affected countries. We believe that our
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existing inventory levels and other operations will be able to meet customer commitments and demand for the
near future, and we do not believe that the coronavirus is likely to have a material adverse impact on our results
of operations for the first quarter of 2020. However, a prolonged shutdown or reduction in capacity of our
Chinese operations or other facilities in China that are engaged in our supply chain will likely have a negative
effect on our results of operations, which could be material. Broader global effects of potentially reduced
consumer confidence, reduced demand for oil and gas and other macro issues could also have a negative effect
on our overall business.
We are dependent on a relatively small number of customers in a single industry. The loss of an
important customer could adversely affect our results of operations and financial condition.
Our customers are engaged in the oil and natural gas E&P business primarily in the United States and
Australia. Historically, we have been dependent on a relatively small number of customers for our revenues. For
the years ended December 31, 2019 and 2018, Pioneer Natural Resources represented 10% and 11%,
respectively, of our total revenue and no other customer represented more than 10% of our total revenue.
Our business, results of operations and financial condition could be materially adversely affected if an
important customer ceases to engage us for our services on favorable terms or at all or fails to pay or delays in
paying us significant amounts of our outstanding receivables.
Additionally, the E&P industry is characterized by frequent consolidation activity. Changes in

ownership of our customers may result in the loss of, or reduction in, business from those customers, which
could materially and adversely affect our business, results of operations and financial condition.
Delays in obtaining, or inability to obtain or renew, permits or authorizations by our customers for their
operations could impair our business.
In both the United States and Australia, our customers are required to obtain permits or authorizations
from one or more governmental agencies or other third parties to perform drilling and completion activities,
including hydraulic fracturing. Such permits or approvals are typically required by state agencies but can also
be required by federal and local governmental agencies or other third parties. The requirements for such permits
or authorizations vary depending on the location where such drilling and completion activities will be
conducted. As with most permitting and authorization processes, there is a degree of uncertainty as to whether a
permit will be granted, the time it will take for a permit or approval to be issued and the conditions which may
be imposed in connection with the granting of the permit. In some jurisdictions, certain regulatory authorities
have delayed or suspended the issuance of permits or authorizations while the potential environmental impacts
associated with issuing such permits can be studied and appropriate mitigation measures evaluated. In Texas,
rural water districts have begun to impose restrictions on water use and may require permits for water used in
drilling and completion activities. Permitting, authorization or renewal delays, the inability to obtain new
permits or the revocation of current permits could cause a loss of revenue and potentially have a materially
adverse effect on our business, results of operations and financial condition.
Competition within the oilfield services industry may adversely affect our ability to market our services.
The oilfield services industry is highly competitive and fragmented and includes numerous small
companies capable of competing effectively in our markets on a local basis, as well as several large companies
that possess substantially greater financial and other resources than we do. The amount of equipment available
may exceed demand, which could result in active price competition. Many contracts are awarded on a bid basis,
which may further increase competition based primarily on price. In addition, adverse market conditions lower
demand for well servicing equipment, which results in excess equipment and lower utilization rates. If market
conditions in our oil‑oriented operating areas were to deteriorate or if adverse market conditions in our natural
gas‑oriented operating areas persist, the prices we are able to charge and utilization rates may decline. The
competitive environment intensified in late 2014 and again in late 2019 as a result of the industry downturn and
oversupply of oilfield equipment and services. Any significant future increase in overall market capacity for the
products, rental equipment or services that we offer could adversely affect our business and results of
operations.
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New technology may cause us to become less competitive.
The oilfield services industry is subject to the introduction of new drilling and completions techniques
and services using new technologies, some of which may be subject to patent or other intellectual property
protections. Although we believe our equipment and processes currently give us a competitive advantage, as
competitors and others use or develop new or comparable technologies in the future, we may lose market share
or be placed at a competitive disadvantage. Further, we may face competitive pressure to develop, implement or
acquire certain new technologies at a substantial cost. Some of our competitors have greater financial, technical
and personnel resources that may allow them to enjoy various competitive advantages in the development and
implementation of new technologies. We cannot be certain that we will be able to continue to develop and
implement new technologies or products. Limits on our ability to develop, bring to market, effectively use and
implement new and emerging technologies may have a material adverse effect on our business, results of
operations and financial condition, including a reduction in the value of assets replaced by new technologies.
Increased costs, or lack of availability, of raw materials and other components may result in increased
operating expenses and adversely affect our results of operations and cash flows.
Our ability to source low cost raw materials and components, such as steel castings and forgings, is
critical to our ability to manufacture and sell our products and provide our services competitively. Our results of
operations may be adversely affected by our inability to manage the rising costs and availability of raw
materials and components used in our wide variety of products and systems. We cannot assure that we will be
able to continue to purchase these raw materials on a timely basis or at commercially viable prices, nor can we
be certain of the impact of changes to Section 232 or Section 301 and future legislation that may impact trade
with China. Further, unexpected changes in the size of regional and/or product markets, particularly for short
lead‑time products, could affect our results of operations and cash flows. Should our current suppliers be unable
to provide the necessary raw materials or components or otherwise fail to deliver such materials and
components timely and in the quantities required, resulting delays in the provision of products or services to our
customers could have a material adverse effect on our business.
In accordance with Section 1502 of the Dodd‑Frank Act, the SEC’s rules regarding mandatory
disclosure and reporting requirements by public companies of their use of “conflict minerals” (tantalum, tin,
tungsten and gold) originating in the Democratic Republic of Congo and adjoining countries became effective
in 2014. While the conflict minerals rule continues in effect as adopted, there remains uncertainty regarding
how the conflict minerals rule, and our compliance obligations, will be affected in the future. Additional
requirements under the rule could affect sourcing at competitive prices and availability in sufficient quantities of
tungsten, which is used in the manufacture of our products or in the provision of our services. This could have a
material adverse effect on our ability to purchase these products in the future. The costs of compliance,
including those related to supply chain research, the limited number of suppliers and possible changes in the
sourcing of these minerals, could have a material adverse effect on our results of operations and cash flows.
Our relationship with one of our vendors is important to us.
We obtain certain important materials and machining services from one of our vendors located in
China. For the years ended December 31, 2019, 2018 and 2017, approximately $36.5 million, $46.7 million and
$33.4 million, respectively, of purchases of machined components were made from this vendor, representing
approximately 16%, 21% and 22%, respectively, of our total third party vendor purchases of raw materials,
finished products, equipment, machining and other services. If we are not able to maintain our relationship or
we experience supply-related issues with such vendor, our results of operations could be adversely impacted
until we are able to find an alternative vendor.
We design, manufacture, sell, rent and install equipment that is used in oil and gas E&P activities,
which may subject us to liability, including claims for personal injury, property damage and
environmental contamination should such equipment fail to perform to specifications.
We provide products and systems to customers involved in oil and gas exploration, development and
production. Some of our equipment is designed to operate in high‑temperature and/or high‑pressure
environments, and some equipment is designed for use in hydraulic fracturing operations. We also provide
parts, repair services and field services associated with installation at all of our facilities and service centers in
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the United States and Australia, as well as at customer sites. Because of applications to which our products and
services are exposed, particularly those involving high pressure environments, a
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failure of such equipment, or a failure of our customers to maintain or operate the equipment properly, could
cause damage to the equipment, damage to the property of customers and others, personal injury and
environmental contamination and could lead to a variety of claims against us that could have an adverse effect
on our business and results of operations.
We indemnify our customers against certain claims and liabilities resulting or arising from our
provision of goods or services to them. In addition, we rely on customer indemnifications, generally, and
third‑party insurance as part of our risk mitigation strategy. However, our insurance may not be adequate to
cover our liabilities. In addition, our customers may be unable to satisfy indemnification claims against them.
Further, insurance companies may refuse to honor their policies, or insurance may not generally be available in
the future, or if available, premiums may not be commercially justifiable. We could incur substantial liabilities
and damages that are either not covered by insurance or that are in excess of policy limits, or incur liability at a
time when we are not able to obtain liability insurance. Such potential liabilities could have a material adverse
effect on our business, results of operations, financial condition and cash flows.
Our operations are subject to hazards inherent in the oil and natural gas industry, which could expose
us to substantial liability and cause us to lose customers and substantial revenue.
Risks inherent in our industry include the risks of equipment defects, installation errors, the presence
of multiple contractors at the wellsite over which we have no control, vehicle accidents, fires, explosions,
blowouts, surface cratering, uncontrollable flows of gas or well fluids, pipe or pipeline failures, abnormally
pressured formations and various environmental hazards such as oil spills and releases of, and exposure to,
hazardous substances. For example, our operations are subject to risks associated with hydraulic fracturing,
including any mishandling, surface spillage or potential underground migration of fracturing fluids, including
chemical additives. The occurrence of any of these events could result in substantial losses to us due to injury or
loss of life, severe damage to or destruction of property, natural resources and equipment, pollution or other
environmental damage, clean‑up responsibilities, regulatory investigations and penalties, suspension of
operations and repairs required to resume operations. The cost of managing such risks may be significant. The
frequency and severity of such incidents will affect operating costs, insurability and relationships with
customers, employees and regulators. In particular, our customers may elect not to purchase our products or
services if they view our environmental or safety record as unacceptable, which could cause us to lose
customers and substantial revenues.
Our insurance may not be adequate to cover all losses or liabilities we may suffer. Also, insurance may
no longer be available to us or its availability may be at premium levels that do not justify its purchase. The
occurrence of a significant uninsured claim, a claim in excess of the insurance coverage limits maintained by us
or a claim at a time when we are not able to obtain liability insurance could have a material adverse effect on
our ability to conduct normal business operations and on our results of operations, financial condition and cash
flows. In addition, we may not be able to secure additional insurance or bonding that might be required by new
governmental regulations. This may cause us to restrict our operations, which might severely impact our
financial condition.
Oilfield anti-indemnity provisions enacted by many states may restrict or prohibit a party’s
indemnification of us.
We typically enter into agreements with our customers governing the provision of our services, which
usually include certain indemnification provisions for losses resulting from operations. Such agreements may
require each party to indemnify the other against certain claims regardless of the negligence or other fault of the
indemnified party; however, many states place limitations on contractual indemnity agreements, particularly
agreements that indemnify a party against the consequences of its own negligence. Furthermore, certain states,
including Louisiana, New Mexico, Texas, and Wyoming, have enacted statutes generally referred to as “oilfield
anti-indemnity acts” expressly prohibiting certain indemnity agreements contained in or related to oilfield
services agreements. Such oilfield anti-indemnity acts may restrict or void a party’s indemnification of us,
which could have a material adverse effect on our business, financial condition, prospects, and results of
operations.
Our operations require us to comply with various domestic and international regulations, violations of
which could have a material adverse effect on our results of operations, financial condition and cash
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flows.
We are exposed to a variety of federal, state, local and international laws and regulations relating to
matters such as environmental, workplace, health and safety, labor and employment, customs and tariffs, export
and re-export controls, economic sanctions, currency exchange, bribery and corruption and taxation. These laws
and regulations are complex,
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frequently change and have tended to become more stringent over time. They may be adopted, enacted,
amended, enforced or interpreted in such a manner that the incremental cost of compliance could adversely
impact our results of operations, financial condition and cash flows.
Our operations outside of the United States require us to comply with numerous anti‑bribery and
anti‑corruption regulations. The U.S. Foreign Corrupt Practices Act, among others, applies to us and our
operations. Our policies, procedures and programs may not always protect us from reckless or criminal acts
committed by our employees or agents, and severe criminal or civil sanctions may be imposed as a result of
violations of these laws. We are also subject to the risks that our employees and agents outside of the United
States may fail to comply with applicable laws.
In addition, we import raw materials, semi‑finished goods, and finished products into the United
States, China and Australia for use in such countries or for manufacturing and/or finishing for re‑export and
import into another country for use or further integration into equipment or systems. Most movement of raw
materials, semi‑finished or finished products involves imports and exports. As a result, compliance with
multiple trade sanctions, embargoes and import/export laws and regulations pose a constant challenge and risk
to us since a portion of our business is conducted outside of the United States through our subsidiaries. Our
failure to comply with these laws and regulations could materially affect our business, results of operations and
financial condition.
Compliance with environmental laws and regulations may adversely affect our business and results of
operations.
Environmental laws and regulations in the United States and foreign countries affect the equipment,
systems and services we design, market and sell, as well as the facilities where we manufacture and produce our
equipment and systems in the United States and China, and opportunities our customers pursue that create
demand for our products. For example, we may be affected by such laws as the Resource Conservation and
Recovery Act, the Comprehensive Environmental Response, Compensation, and Liability Act, the Clean Water
Act, the Clean Air Act and the Occupational Safety and Health Act of 1970. Further, our customers may be
subject to a range of laws and regulations governing hydraulic fracturing, offshore drilling, and greenhouse gas
emissions.
We are required to invest financial and managerial resources to comply with environmental laws and
regulations and believe that we will continue to be required to do so in the future. Failure to comply with these
laws and regulations may result in the assessment of administrative, civil and criminal penalties, the imposition
of remedial obligations, or the issuance of orders enjoining operations. These laws and regulations, as well as
the adoption of other new laws and regulations affecting exploration and production of crude oil and natural gas
by our customers, could adversely affect our business and operating results by increasing our costs, limiting the
demand for our products and services or restricting our operations. Increased regulation or a move away from
the use of fossil fuels caused by additional regulation could also reduce demand for our products and services.
Existing or future laws and regulations related to greenhouse gases and climate change could have a
negative impact on our business and may result in additional compliance obligations with respect to the
release, capture, and use of greenhouse gases that could have a material adverse effect on our business,
results of operations, prospects, and financial condition.
Changes in environmental requirements related to greenhouse gas emissions and climate change may
negatively impact demand for our products and services. For example, oil and natural gas E&P may decline as a
result of environmental requirements, including land use policies responsive to environmental concerns.
Federal, state, and local agencies have been evaluating climate-related legislation and other regulatory
initiatives that would restrict emissions of greenhouse gases in areas in which we conduct business. Because our
business depends on the level of activity in the oil and natural gas industry, existing or future laws and
regulations related to greenhouse gases and climate change, including incentives to conserve energy or use
alternative energy sources, could have a negative impact on our business if such laws or regulations reduce
demand for oil and natural gas. Likewise, such restrictions may result in additional compliance obligations with
respect to the release, capture, sequestration, and use of greenhouse gases that could have a material adverse
effect on our business, results of operations, prospects, and financial condition. Finally, increasing
concentrations of greenhouse gases in the Earth’s atmosphere may produce climate changes that could have
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significant physical effects, such as increased frequency and severity of storms, droughts, floods and other
climatic events; if such effects were to occur, they could have an adverse impact on our operations.
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The outcome of final actions under Section 301 of the Trade Act of 1974 may adversely affect our
business.
On March 22, 2018 the President of the United States announced his decisions on the actions that the
U.S. government will take based on the findings of an investigation under Section 301, which included a
proposed 25% tariff on approximately $50 billion worth of imports from China. The United States has since
taken subsequent actions to impose additional tariffs on imports from China, which currently include a 25%
tariff on approximately $250 billion worth of Chinese imports and a 15% tariff on approximately $120 billion
worth of Chinese imports. In December 2019, the Office of the United States Trade Representative announced
that the United States has reached a Phase One trade deal with China, under which the U.S. suspended
indefinitely the imposition of an additional 15% tariff on certain Chinese products not covered in an earlier
Section 301 action, and cut the 15% tariff on $120 billion worth of Chinese goods to 7.5%. The United States
will be maintaining the 25% tariff on approximately $250 billion of Chinese imports. Substantially all of the
products that we import through our Chinese supply chain are subject to the 25% tariff. In the three months
ended December 31, 2019, we estimate that approximately 50% of our inventory value received was sourced
through our Chinese supply chain. To the extent these actions result in a decrease in demand for our products,
our business may be adversely impacted. Given the uncertainty regarding the scope and duration of these trade
actions by the U.S. or other countries, the impact of these trade actions on our operations or results remains
uncertain.
If we are unable to fully protect our intellectual property rights or trade secrets, we may suffer a loss in
revenue or any competitive advantage or market share we hold, or we may incur costs in litigation
defending intellectual property rights.
While we have some patents and others pending, we do not have patents relating to many of our key
processes and technology. If we are not able to maintain the confidentiality of our trade secrets, or if our
competitors are able to replicate our technology or services, our competitive advantage would be diminished.
We also cannot provide any assurance that any patents we may obtain in the future would provide us with any
significant commercial benefit or would allow us to prevent our competitors from employing comparable
technologies or processes.
We may initiate litigation from time to time to protect and enforce our intellectual property rights. In
any such litigation, a defendant may assert that our intellectual property rights are invalid or unenforceable.
Third parties from time to time may also initiate litigation against us by asserting that our businesses infringe,
impair, misappropriate, dilute or otherwise violate another party’s intellectual property rights. We may not
prevail in any such litigation, and our intellectual property rights may be found invalid or unenforceable or our
products and services may be found to infringe, impair, misappropriate, dilute or otherwise violate the
intellectual property rights of others. The results or costs of any such litigation may have an adverse effect on
our business, results of operations and financial condition. Any litigation concerning intellectual property could
be protracted and costly, is inherently unpredictable and could have an adverse effect on our business,
regardless of its outcome.
A failure of our information technology infrastructure and cyberattacks could adversely impact us.
We depend on our information technology (“IT”) systems for the efficient operation of our business.
Accordingly, we rely upon the capacity, reliability and security of our IT hardware and software infrastructure
and our ability to expand and update this infrastructure in response to our changing needs. Despite our
implementation of security measures, our systems are vulnerable to damage from computer viruses, natural
disasters, incursions by intruders or hackers, failures in hardware or software, power fluctuations, cyber
terrorists and other similar disruptions. Additionally, we rely on third parties to support the operation of our IT
hardware and software infrastructure, and in certain instances, utilize web‑based applications. The failure of our
IT systems or those of our vendors to perform as anticipated for any reason or any significant breach of security
could disrupt our business and result in numerous adverse consequences, including reduced effectiveness and
efficiency of operations, inappropriate disclosure of confidential and proprietary information, reputational harm,
increased overhead costs and loss of important information, which could have a material adverse effect on our
business and results of operations. In addition, we may be required to incur significant costs to protect against
damage caused by these disruptions or security breaches in the future.
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Adverse weather conditions could impact demand for our services or materially impact our costs.
Our business could be harmed by adverse weather conditions. For example, unusually warm winters
could negatively affect the demand for our products and services by decreasing the demand for natural gas or
unusually cold winters could adversely affect our ability to perform our services due to delays in the delivery of
products that we need to provide our services. Our operations in arid regions can be affected by droughts and
limited access to water used in hydraulic fracturing operations. Severe weather can also directly impede our
own operations. Repercussions of adverse weather conditions may include:
· curtailment of services;
· weather‑related damage to infrastructure, transportation, facilities and equipment, resulting in

delays in operations;
· inability to deliver equipment, personnel and products to job sites in accordance with contract
schedules; and
· loss of productivity.
A terrorist attack or armed conflict could harm our business.
The occurrence or threat of terrorist attacks in the United States or other countries, anti‑terrorist efforts,
domestic unrest or civil disturbance and other armed conflicts involving the United States or other countries,
including continued hostilities in the Middle East, may adversely affect the United States and global economies
and could prevent us from meeting our financial and other obligations. If any of these events occur, the resulting
political instability and societal disruption could reduce overall demand for oil and natural gas, potentially
putting downward pressure on demand for our services and causing a reduction in our revenues. Oil and natural
gas related facilities could be direct targets of terrorist attacks, and our operations could be adversely impacted
if infrastructure integral to our customers’ operations is destroyed or damaged. Costs for insurance and other
security may increase as a result of these threats, and some insurance coverage may become more difficult to
obtain, if available at all.
Risks Related to Our Class A Common Stock
We are a holding company whose only material asset is our equity interest in Cactus LLC, and
accordingly, we are dependent upon distributions from Cactus LLC to pay taxes, make payments under
the TRA and cover our corporate and other overhead expenses and pay dividends to holders of our class
A common stock.
We are a holding company and have no material assets other than our equity interest in Cactus LLC.
We have no independent means of generating revenue. To the extent Cactus LLC has available cash and subject
to the terms of any current or future credit agreements or debt instruments, we intend to cause Cactus LLC to
make (i) pro rata distributions to its unitholders, including us, in an amount at least sufficient to allow us to pay
our taxes and to make payments under the TRA and (ii) non‑pro rata payments to us to reimburse us for our
corporate and other overhead expenses. To the extent that we need funds and Cactus LLC or its subsidiaries are
restricted from making such distributions or payments under applicable law or regulation or under the terms of
any future financing arrangements, or are otherwise unable to provide such funds, our financial condition and
liquidity could be materially adversely affected. In addition, our ability to pay dividends to holders of our Class
A common stock depends on receipt of distributions from Cactus LLC.
Moreover, because we have no independent means of generating revenue, our ability to make
payments under the TRA is dependent on the ability of Cactus LLC to make distributions to us in an amount
sufficient to cover our obligations under the TRA. This ability, in turn, may depend on the ability of
Cactus LLC’s subsidiaries to make distributions to it. The ability of Cactus LLC, its subsidiaries and other
entities in which it directly or indirectly holds an equity interest to make such distributions will be subject to,
among other things, (i) the applicable provisions of Delaware law (or other applicable U.S. and foreign
jurisdictions) that may limit the amount of funds available for distribution and (ii) restrictions in relevant debt
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instruments issued by Cactus LLC or its subsidiaries and other entities in which it directly or indirectly holds an
equity interest. To the extent that we are unable to make payments under the TRA for any reason, such
payments will be deferred and will accrue interest until paid.
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We are subject to the requirements of Section 404 of the Sarbanes-Oxley Act. If we fail to comply with
the requirements of Section 404 or if we or our auditors identify and report material weaknesses in
internal control over financial reporting, our investors may lose confidence in our reported information
and our stock price may be negatively affected.
Section 404 requires that we document and test our internal control over financial reporting and issue
our management’s assessment of our internal control over financial reporting. This section also requires that our
independent registered public accounting firm issue an attestation report on such internal control. If we fail to
comply with the requirements of Section 404 of the Sarbanes-Oxley Act or if we or our auditors identify and
report material weaknesses in our internal control over financial reporting, the accuracy and timeliness of the
filing of our annual and quarterly reports may be materially adversely affected and could cause investors to lose
confidence in our reported financial information, which could have a negative effect on the trading price of our
Class A common stock. In addition, a material weakness in the effectiveness of our internal control over
financial reporting could result in an increased chance of fraud and the loss of customers, reduce our ability to
obtain financing and require additional expenditures to comply with these requirements, each of which could
have a material adverse effect on our business, results of operations and financial condition.
Cadent and Cactus WH Enterprises LLC have the ability to direct the voting of a significant percentage
of the voting power of our common stock, and their interests may conflict with those of our other
shareholders.
Holders of Class A common stock and Class B common stock vote together as a single class on all
matters presented to our stockholders for their vote or approval, except as otherwise required by applicable law
or our amended and restated certificate of incorporation. Cadent and Cactus WH Enterprises LLC (“Cactus WH
Enterprises”), a Delaware limited liability company owned by Scott Bender, Joel Bender, Steven Bender and
certain of our other officers and employees, own approximately 11% and 24% of our voting power, respectively,
as of December 31, 2019.
As a result, Cadent and Cactus WH Enterprises effectively control matters requiring stockholder
approval, including the election of directors, changes to our organizational documents and significant corporate
transactions. This concentration of ownership will limit your ability to affect the way we are managed or the
direction of our business. The interests of Cadent and Cactus WH Enterprises with respect to matters potentially
or actually involving or affecting us, such as future acquisitions, financings and other corporate opportunities
and attempts to acquire us, may conflict with the interests of our other stockholders. In addition, the Chairman
of our board of directors is currently a member of Cadent Energy Partners LLC. This director’s duties as a
partner of Cadent Energy Partners LLC may conflict with his duties as our director, and the resolution of these
conflicts may not always be in our or your best interest. Furthermore, in connection with our IPO, we entered
into a stockholders’ agreement with Cadent and Cactus WH Enterprises. Among other things, the stockholders’
agreement provides each of Cadent and Cactus WH Enterprises with the right to designate a certain number of
nominees to our board of directors so long as they and their respective affiliates collectively beneficially own at
least 5% of the outstanding shares of our common stock. The existence of significant stockholders and the
stockholders’ agreement may have the effect of deterring hostile takeovers, delaying or preventing changes in
control or changes in management or limiting the ability of our other stockholders to approve transactions that
they may deem to be in our best interests. Cadent and Cactus WH Enterprises’ concentration of stock ownership
may also adversely affect the trading price of our Class A common stock to the extent investors perceive a
disadvantage in owning stock of a company with significant stockholders. See “Item 13. Certain Relationships
and Related Party Transactions, and Director Independence—Stockholders’ Agreement.”
Certain of our directors have significant duties with, and spend significant time serving, entities that
may compete with us in seeking acquisitions and business opportunities and, accordingly, may have
conflicts of interest in allocating time or pursuing business opportunities.
Certain of our directors, who are responsible for managing the direction of our operations and
acquisition activities, hold positions of responsibility with other entities (including Cadent and its affiliated
entities) whose businesses are similar to our business. The existing positions held by these directors may give
rise to fiduciary or other duties that are in conflict with the duties they owe to us. These directors may become
aware of business opportunities that may be appropriate for presentation to us as well as to the other entities
with which they are or may become affiliated. Due to these existing and potential future affiliations, they may
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present potential business opportunities to other entities prior to presenting them to us, which could cause
additional conflicts of interest. They may also decide that certain opportunities are more appropriate for
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other entities with which they are affiliated, and as a result, they may elect not to present those opportunities to
us. These conflicts may not be resolved in our favor.
Cadent Energy Partners and its affiliates are not limited in their ability to compete with us, and the
corporate opportunity provisions in our amended and restated certificate of incorporation could enable
Cadent Energy Partners to benefit from corporate opportunities that might otherwise be available to us.
Our governing documents provide that Cadent Energy Partners and its affiliates (including portfolio
investments of Cadent Energy Partners and its affiliates) are not restricted from owning assets or engaging in
businesses that compete directly or indirectly with us. In particular, subject to the limitations of applicable law,
our amended and restated certificate of incorporation, among other things:
· permits Cadent Energy Partners and its affiliates, including any of our directors affiliated with
Cadent Energy Partners, to conduct business that competes with us and to make investments in
any kind of business, asset or property in which we may make investments; and
· provides that if Cadent Energy Partners or its affiliates, including any of our directors affiliated
with Cadent Energy Partners, becomes aware of a potential business opportunity, transaction or
other matter, they will have no duty to communicate or offer that opportunity to us (unless such
opportunity is expressly offered to such director in his capacity as one of our directors).
Cadent Energy Partners and its affiliates, or our non‑employee directors, may become aware, from
time to time, of certain business opportunities (such as, among other things, acquisition opportunities) and may
direct such opportunities to other businesses in which they have invested, in which case we may not become
aware of or otherwise have the ability to pursue such opportunity. Further, such businesses may choose to
compete with us for these opportunities, possibly causing these opportunities to not be available to us or causing
them to be more expensive for us to pursue. In addition, Cadent Energy Partners and its affiliates, or our
non‑employee directors, may dispose of assets owned by them in the future, without any obligation to offer us
the opportunity to purchase any of those assets. As a result, our renouncing our interest and expectancy in any
business opportunity that may be from time to time presented to Cadent Energy Partners and its affiliates, or our
non‑employee directors, could adversely impact our business or prospects if attractive business opportunities
are procured by such parties for their own benefit rather than for ours.
Our amended and restated certificate of incorporation and amended and restated bylaws, as well as
Delaware law, contain provisions that could discourage acquisition bids or merger proposals, which may
adversely affect the market price of our Class A common stock.
Our amended and restated certificate of incorporation authorizes our board of directors to issue
preferred stock without shareholder approval. If our board of directors elects to issue preferred stock, it could be
more difficult for a third party to acquire us. In addition, some provisions of our amended and restated
certificate of incorporation and amended and restated bylaws could make it more difficult for a third party to
acquire control of us, even if the change of control would be beneficial to our shareholders, including:
· limitations on the removal of directors;
· limitations on the ability of our shareholders to call special meetings;
· establishing advance notice provisions for shareholder proposals and nominations for elections to
the board of directors to be acted upon at meetings of shareholders;
· providing that the board of directors is expressly authorized to adopt, or to alter or repeal our
bylaws; and
· establishing advance notice and certain information requirements for nominations for election to
our board of directors or for proposing matters that can be acted upon by shareholders at
shareholder meetings.
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In addition, certain change of control events have the effect of accelerating the payment due under the
TRA, which could be substantial and accordingly serve as a disincentive to a potential acquirer of our company.
We may issue preferred stock whose terms could adversely affect the voting power or value of our
Class A common stock.
Our amended and restated certificate of incorporation authorizes us to issue, without the approval of
our shareholders, one or more classes or series of preferred stock having such designations, preferences,
limitations and relative rights, including preferences over our Class A common stock respecting dividends and
distributions, as our board of directors may determine. The terms of one or more classes or series of preferred
stock could adversely impact the voting power or value of our Class A common stock. For example, we might
grant holders of preferred stock the right to elect some number of our directors in all events or on the happening
of specified events or the right to veto specified transactions. Similarly, the repurchase or redemption rights or
liquidation preferences we might assign to holders of preferred stock could affect the residual value of the
Class A common stock.
Future sales of our Class A common stock in the public market, or the perception that such sales may
occur, could reduce our stock price, and any additional capital raised by us through the sale of equity or
convertible securities may dilute your ownership in us.
Subject to certain limitations and exceptions, the CW Unit Holders may cause Cactus LLC to redeem
their CW Units for shares of Class A common stock (on a one‑for‑one basis, subject to conversion rate
adjustments for stock splits, stock dividends and reclassification and other similar transactions) and then sell
those shares of Class A common stock. Additionally, we may issue additional shares of Class A common stock
or convertible securities in subsequent public offerings. We have 47,159,099 outstanding shares of Class A
common stock and 27,957,699 outstanding shares of Class B common stock as of December 31, 2019. The CW
Unit Holders own all 27,957,699 shares of Class B common stock, representing approximately 37.2% of our
total outstanding common stock. As required pursuant to the terms of the registration rights agreement that we
entered into at the time of our IPO, we have filed a registration statement on Form S-3 under the Securities Act
of 1933, as amended, to permit the public resale of shares of Class A common stock owned by Cadent, Cactus
WH Enterprises and Lee Boquet. See “Item 13. Certain Relationships and Related Party Transactions, and
Director Independence—Stockholders’ Agreement” for more information.
We cannot predict the size of future issuances of our Class A common stock or securities convertible
into Class A common stock or the effect, if any, that future issuances and sales of shares of our Class A common
stock will have on the market price of our Class A common stock. Sales of substantial amounts of our Class A
common stock (including shares issued in connection with an acquisition), or the perception that such sales
could occur, may adversely affect prevailing market prices of our Class A common stock.
Holders of our Class A common stock may not receive dividends on their Class A common stock.
We declared our first dividend to Class A stockholders in the fourth quarter of 2019. Holders of our Class
A common stock are entitled to receive only such dividends as our board of directors may declare out of funds
legally available for such payments. We are incorporated in Delaware and are governed by the Delaware
General Corporation Law (“DGCL”). The DGCL allows a corporation to pay dividends only out of a surplus, as
determined under Delaware law or, if there is no surplus, out of net profits for the fiscal year in which the
dividend was declared and for the preceding fiscal year. Under the DGCL, however, we cannot pay dividends
out of net profits if, after we pay the dividend, our capital would be less than the capital represented by the
outstanding stock of all classes having a preference upon the distribution of assets. We are not required to pay a
dividend, and any determination to pay dividends and other distributions in cash, stock or property by us in the
future (including determinations as to the amount of any such dividend or distribution) will be at the discretion
of our board of directors and will be dependent on then-existing conditions, including business conditions, our
financial condition, results of operations, liquidity, capital requirements, contractual restrictions, including
restrictive covenants contained in debt agreements, and other factors.
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Under certain circumstances, redemptions of CW Units by CW Unit Holders will result in dilution to the
holders of our Class A common stock.
Redemptions of CW Units by CW Unit Holders in accordance with the terms of the Cactus
Wellhead LLC Agreement will result in a corresponding increase in our membership interest in Cactus LLC,
increase in the number of shares of Class A common stock outstanding and decrease in the number of shares of
Class B common stock outstanding. In the event that CW Units are exchanged at a time when Cactus LLC has
made cash distributions to CW Unit Holders, including Cactus Inc., and Cactus Inc. has accumulated such
distributions and neither reinvests them in Cactus LLC in exchange for additional CW Units nor distributes
them as dividends to the holders of Cactus Inc.’s Class A common stock, the holders of our Class A common
stock would experience dilution with respect to such accumulated distributions.
Cactus Inc. will be required to make payments under the TRA for certain tax benefits that we may claim,
and the amounts of such payments could be significant.
In connection with our IPO, we entered into the TRA with the TRA Holders. This agreement generally
provides for the payment by Cactus Inc. to each TRA Holder of 85% of the net cash savings, if any, in U.S.
federal, state and local income tax and franchise tax that Cactus Inc. actually realizes or is deemed to realize in
certain circumstances as a result of certain increases in tax basis and certain benefits attributable to imputed
interest. Cactus Inc. will retain the benefit of the remaining 15% of these net cash savings.
The term of the TRA will continue until all tax benefits that are subject to the TRA have been utilized
or expired, unless we exercise our right to terminate the TRA (or the TRA is terminated due to other
circumstances, including our breach of a material obligation thereunder or certain mergers or other changes of
control), and we make the termination payment specified in the TRA. In addition, payments we make under the
TRA will be increased by any interest accrued from the due date (without extensions) of the corresponding tax
return. Payments under the TRA commenced in 2019, and in the event that the TRA is not terminated, the
payments under the TRA are anticipated to continue for approximately 20 years after the date of the last
redemption of CW Units.
The payment obligations under the TRA are our obligations and not obligations of Cactus LLC, and
we expect that the payments we will be required to make under the TRA will be substantial. Estimating the
amount and timing of payments that may become due under the TRA Agreement is by its nature imprecise. For
purposes of the TRA, cash savings in tax generally are calculated by comparing our actual tax liability
(determined by using the actual applicable U.S. federal income tax rate and an assumed combined state and
local income tax rate) to the amount we would have been required to pay had we not been able to utilize any of
the tax benefits subject to the TRA. The amounts payable, as well as the timing of any payments under the
TRA, are dependent upon significant future events and assumptions, including the timing of the redemption of
CW Units, the price of our Class A common stock at the time of each redemption, the extent to which such
redemptions are taxable transactions, the amount of the redeeming unit holder’s tax basis in its CW Units at the
time of the relevant redemption, the depreciation and amortization periods that apply to the increase in tax basis,
the amount and timing of taxable income we generate in the future and the U.S. federal income tax rates then
applicable, and the portion of our payments under the TRA that constitute imputed interest or give rise to
depreciable or amortizable tax basis. The payments under the TRA are not conditioned upon a holder of rights
under the TRA having a continued ownership interest in us. For additional information regarding the TRA, see
“Item 13. Certain Relationships and Related Party Transactions, and Director Independence—Tax Receivable
Agreement.”
In certain cases, payments under the TRA may be accelerated and/or significantly exceed the actual
benefits, if any, we realize in respect of the tax attributes subject to the TRA.
If we elect to terminate the TRA early or it is terminated early due to Cactus Inc.’s failure to honor a
material obligation thereunder or due to certain mergers or other changes of control, our obligations under the
TRA would accelerate and we would be required to make an immediate payment equal to the present value of
the anticipated future payments to be made by us under the TRA (determined by applying a discount rate of
one‑year LIBOR plus 150 basis points) and such payment is expected to be substantial. The calculation of
anticipated future payments will be based upon certain assumptions and deemed events set forth in the TRA,
including (i) the assumption that we have sufficient taxable income to fully utilize the tax benefits covered by
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the TRA and (ii) the assumption that any CW Units (other than those held by Cactus Inc.) outstanding on the
termination date are deemed to be redeemed on the termination date. Any early termination payment may
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be made significantly in advance of the actual realization, if any, of the future tax benefits to which the
termination payment relates.
As a result of either an early termination or a change of control, we could be required to make

payments under the TRA that exceed our actual cash tax savings under the TRA. In these situations, our
obligations under the TRA could have a substantial negative impact on our liquidity and could have the effect of
delaying, deferring or preventing certain mergers, asset sales, or other forms of business combinations or
changes of control. If the TRA were terminated as of December 31, 2019, the estimated termination payments,
based on the assumptions discussed above, would have been approximately $331.3 million (calculated using a
discount rate equal to one-year LIBOR plus 150 basis points, applied against an undiscounted liability of
approximately $434.7 million). The foregoing number is merely an estimate and the actual payment could differ
materially. There can be no assurance that we will be able to finance our obligations under the TRA.
Payments under the TRA are based on the tax reporting positions that we will determine. The TRA
Holders will not reimburse us for any payments previously made under the TRA if any tax benefits that have
given rise to payments under the TRA are subsequently disallowed, except that excess payments made to any
TRA Holder will be netted against payments that would otherwise be made to such TRA Holder, if any, after
our determination of such excess. As a result, in some circumstances, we could make payments that are greater
than our actual cash tax savings, if any, and may not be able to recoup those payments, which could adversely
affect our liquidity.
If Cactus LLC were to become a publicly traded partnership taxable as a corporation for U.S. federal
income tax purposes, we and Cactus LLC might be subject to potentially significant tax inefficiencies,
and we would not be able to recover payments previously made by us under the TRA even if the
corresponding tax benefits were subsequently determined to have been unavailable due to such status.
We intend to operate such that Cactus LLC does not become a publicly traded partnership taxable as a
corporation for U.S. federal income tax purposes. A “publicly traded partnership” is a partnership the interests
of which are traded on an established securities market or are readily tradable on a secondary market or the
substantial equivalent thereof. Under certain circumstances, redemptions of CW Units pursuant to the
Redemption Right (or our Call Right) or other transfers of CW Units could cause Cactus LLC to be treated as a
publicly traded partnership. Applicable U.S. Treasury regulations provide for certain safe harbors from
treatment as a publicly traded partnership, and we intend to operate such that one or more such safe harbors
shall apply. For example, we intend to limit the number of unitholders of Cactus LLC, and the Cactus
Wellhead LLC Agreement, which was entered into in connection with the closing of our IPO, provides for
limitations on the ability of CW Unit Holders to transfer their CW Units and provides us, as managing member
of Cactus LLC, with the right to impose restrictions (in addition to those already in place) on the ability of
unitholders of Cactus LLC to redeem their CW Units pursuant to the Redemption Right to the extent we believe
it is necessary to ensure that Cactus LLC will continue to be treated as a partnership for U.S. federal income tax
purposes.
If Cactus LLC were to become a publicly traded partnership, significant tax inefficiencies might result
for us and for Cactus LLC, including as a result of our inability to file a consolidated U.S. federal income tax
return with Cactus LLC. In addition, we would no longer have the benefit of certain increases in tax basis
covered under the TRA, and we would not be able to recover any payments previously made by us under the
TRA, even if the corresponding tax benefits (including any claimed increase in the tax basis of Cactus LLC’s
assets) were subsequently determined to have been unavailable.
Discontinuation, reform or replacement of LIBOR and other benchmark rates, or uncertainty related to
the potential for any of the foregoing, may adversely affect our business.
The U.K. Financial Conduct Authority announced in 2017 that it intends to phase out LIBOR by the
end of 2021. In addition, other regulators have suggested reforming or replacing other benchmark rates. The
discontinuation, reform or replacement of LIBOR or any other benchmark rates may have an unpredictable
impact on contractual mechanics in the credit markets or cause disruption to the broader financial markets.
Uncertainty as to the nature of such potential discontinuation, reform or replacement may negatively impact
interest expense related to borrowings under our credit facility and interest on deferred payments due under the
TRA. We may in the future pursue amendments to our credit facility and the TRA to provide for a transition
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mechanism or other reference rate in anticipation of LIBOR’s discontinuation, but we may not be able to reach
agreement on any such amendments. Further, our credit facility limits the amount of indebtedness we and
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our subsidiaries may incur. As a result, additional financing to replace our LIBOR-based debt may be
unavailable, more expensive or restricted by the terms of our outstanding indebtedness.
Item 1B. Unresolved Staff Comments
None.
Item 2. Properties
The following table sets forth information with respect to our principal facilities as of December 31,
2019. We do not believe any of the omitted properties, consisting primarily of sales offices and service centers,
are individually or collectively material to our operations or business. We believe that our facilities are adequate
for our current operations.
Own/
Location Type Lease
United States
Bossier City, LA(1) Manufacturing Facility and Service Center Lease
Bossier City, LA(1) Assembly Facility and Warehouse / Land Own
Donora, PA Service Center Lease
DuBois, PA Service Center Lease
Hobbs, NM Service Center / Land Own
Houston, TX Administrative Headquarters Lease
New Waverly, TX Service Center / Land Own
Odessa, TX Service Center Lease
Odessa, TX Land Own
Oklahoma City, OK Service Center Lease
Pleasanton, TX Service Center Lease
Williston, ND Service Center Lease
China and Australia:
Queensland, Australia Service Centers and Offices / Land Lease
Suzhou, China Production Facility and Offices Lease
(1) Consists of various facilities adjacent to each other constituting our manufacturing facility, assembly
facility, warehouse and service center.
Item 3. Legal Proceedings
Due to the nature of our business, we are, from time to time, involved in routine litigation or subject to
disputes or claims related to our business activities, including workers’ compensation claims and employment
related disputes. In the opinion of our management, there is no pending litigation, dispute or claim against us
that, if decided adversely, will have a material adverse effect on our results of operations, financial condition or
cash flows.
Item 4. Mine Safety Disclosures
Not applicable.
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PART II
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of
Equity Securities
Common Stock
The principal market for our Class A common stock is the New York Stock Exchange (“NYSE”),
where it is traded under the symbol “WHD.” As of December 31, 2019, there was one holder of record of our
Class A common stock. This number excludes owners for whom Class A common stock may be held in “street
name.”
Dividends
On October 29, 2019, our board of directors authorized the introduction of a regular quarterly cash
dividend of $0.09 per share of Class A common stock. We currently intend to continue paying the quarterly
dividend while retaining the balance of future earnings, if any, to finance the growth of our business. However,
our future dividend policy is within the discretion of our board of directors and will depend upon then-existing
conditions, including our results of operations, financial condition, capital requirements, investment
opportunities, statutory and contractual restrictions on our ability to pay dividends and other factors our board
of directors may deem relevant.
Performance Graph
The graph below compares the cumulative total shareholder return on our common stock to the S&P
500 Index, the S&P Oil & Gas Equipment & Services Index and the PHLX Oil Service Index from the date our
common stock began trading through December 31, 2019. The total shareholder return assumes $100 invested
on February 7, 2018 in Cactus Inc., the S&P 500 Index, the S&P Oil & Gas Equipment & Services Index and
the PHLX Oil Service Index. It also assumes reinvestment of all dividends. The following graph and related
information shall not be deemed “soliciting material” or to be “filed” with the SEC, nor shall such information
be incorporated by reference into any future filing under the Securities Act of 1933 or the Securities Exchange
Act of 1934, except to the extent that Cactus Inc. specifically incorporates it by reference into such filing.
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Issuer Purchases of Equity Securities
The following sets forth information with respect to our repurchase of Class A common stock during
the three months ended December 31, 2019 (in whole shares).
Total number of
shares purchased Average price
Period (1)
paid per share (2)
October 1-31, 2019 740 $ 28.16
November 1-30, 2019 — —
December 1-31, 2019 — —
Total 740 $ 28.16
(1) Consists of shares of Class A common stock repurchased from employees to satisfy tax withholding
obligations related to restricted stock units that vested during the period.
(2) Average price paid for Class A common stock purchased from employees to satisfy tax withholding
obligations related to restricted stock units that vested during the period.
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Item 6. Selected Financial Data
The following tables show selected historical consolidated financial data, for the periods and as of the
dates indicated, of Cactus Inc. and its consolidated subsidiaries. Our historical results are not necessarily
indicative of future results. The following selected financial and operating data should be read in conjunction
with “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” and
the consolidated financial statements and related notes, each of which is included in this Annual Report.
Year Ended December 31,

2019 2018 2017 2016 2015
(in thousands, except per share data)
Consolidated Statements of Income Data:
Total revenues $628,414 $544,135 $341,191 $ 155,048 $221,395
Total costs and expenses 445,264 366,434 252,328 144,433 179,190
Income from operations 183,150 177,701 88,863 10,615 42,205
Interest income (expense), net 879 (3,595) (20,767) (20,233) (21,837)

Other income (expense), net 4,294 (4,305) — 2,251 1,640
Income (loss) before income taxes 188,323 169,801 68,096 (7,367) 22,008
Income tax expense(1) 32,020 19,520 1,549 809 784
Net income (loss) $156,303 $150,281 $ 66,547 $ (8,176) $ 21,224
Less: pre-IPO net income attributable to Cactus
LLC — 13,648 66,547 (8,176) 21,224
Less: net income attributable to non-controlling
interest 70,691 84,950 — — —
Net income attributable to Cactus Inc. $ 85,612 $ 51,683 $ — $ — $ —
Earnings per Class A share - basic (2) $ 1.90 $ 1.60 $ — $ — $ —

Earnings per Class A share - diluted (2) $ 1.88 $ 1.58 $ — $ — $ —
Weighted average Class A shares outstanding -

basic (2) 44,983 32,329 — — —
Weighted average Class A shares outstanding -
diluted (2) 75,353 32,695 — — —
Consolidated Balance Sheets Data (at period

end):
Cash and cash equivalents $202,603 $ 70,841 $ 7,574 $ 8,688 $ 12,526
Total assets (3) 834,964 584,744 266,456 165,328 177,559
Long-term debt, net (4) — — 241,437 242,254 250,555
Liability related to tax receivable agreement,
net of current portion 201,902 138,015 — — —
Finance lease obligations, net of current
portion 3,910 8,741 7,946 2,065 —
Operating lease liabilities, net of current
portion (3) 20,283 — — — —
Stockholders'/Members’ equity (deficit) (2) 516,395 362,328 (36,217) (103,321) (93,167)
Cash dividends declared per common share (5) $ 0.09 $ — $ — $ — $ —
(1) Cactus Inc. is a corporation and is subject to U.S. federal as well as state income tax for its share of
ownership in Cactus LLC. Our predecessor and operating subsidiary, Cactus LLC, is not subject to U.S.
federal income tax at an entity level. As a result, the consolidated net income (loss) in our historical
financial statements does not reflect the tax expense we would have incurred if we were subject to U.S.
federal income tax at an entity level during such periods. Cactus LLC is subject to entity‑level taxes for
certain states within the United States. Additionally, our operations in both Australia and China are subject
to local country income taxes.
(2) Cactus Inc. completed an initial public offering of Class A common stock on February 12, 2018. See “Item
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1. Business—Organization Structure” above.
(3) Effective January 1, 2019, we adopted Accounting Standards Update (“ASU”) 2016-02, Leases, using the
modified retrospective method of adoption. Prior year amounts reflected in the table above have not been
restated.
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(4) In conjunction with our IPO, we used a portion of the net proceeds to repay all of the borrowings
outstanding under Cactus LLC’s term loan facility.
(5) On October 29, 2019, Cactus Inc.’s board of directors authorized the introduction of a regular quarterly
cash dividend of $0.09 per share of Class A common stock.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Except as otherwise indicated or required by the context, all references in this Annual Report to the
“Company,” “Cactus,” “we,” “us” and “our” refer to (i) Cactus LLC and its consolidated subsidiaries prior
to the completion of our initial public offering on February 12, 2018 and (ii) Cactus Inc. and its consolidated
subsidiaries (including Cactus LLC) following the completion of our initial public offering. The following
discussion and analysis of our financial condition and results of operations should be read in conjunction with
the accompanying consolidated financial statements and related notes. The following discussion contains
“forward-looking statements” that reflect our plans, estimates, beliefs and expected performance. Our actual
results may differ materially from those anticipated as discussed in these forward-looking statements as a result
of a variety of risks and uncertainties, including those described in “Cautionary Statement Regarding Forward-
Looking Statements” and “Item 1A. Risk Factors” included elsewhere in this Annual Report, all of which are
difficult to predict. In light of these risks, uncertainties and assumptions, the forward-looking events discussed
may not occur. We assume no obligation to update any of these forward-looking statements except as otherwise
required by law.
This section includes comparisons of certain 2019 financial information to the same information for
2018. Year-to-year comparisons of the 2018 financial information to the same information for 2017 are
contained in “Item 7. Management’s Discussion and Analysis of Financial Condition and Result of Operations”
of our Annual Report on Form 10-K for the year ended December 31, 2018 filed with the Securities and
Exchange Commission on March 15, 2019, which comparative information and the information therein under
the caption “Factors Affecting the Comparability of our Financial Condition and Results of Operations” are
incorporated by reference herein.
Market Factors and Trends
See “Item 1. Business” for information on our products and business. Demand for our products and
services depends primarily upon the general level of activity in the oil and gas industry, including the number of
drilling rigs in operation, the number of oil and gas wells being drilled, the depth and drilling conditions of
these wells, the number of well completions, the level of well remediation activity, the volume of production
and the corresponding capital spending by oil and natural gas companies. Oil and gas activity is in turn heavily
influenced by, among other factors, oil and gas prices locally and worldwide, which have historically been
volatile.
Oil supply markets tightened in 2017 and through the third quarter of 2018, driving 2018 average West
Texas Intermediate (“WTI”) crude oil prices higher. However, during the fourth quarter of 2018, crude oil prices
declined following concerns over slowing worldwide demand and the granting of waivers to several purchasers
of Iranian oil. In response, many of the larger publicly traded E&P companies announced plans to reduce their
capital budgets year-over-year for 2019. During 2019, the U.S. onshore rig count trended down as a significant
number of E&P operators reduced spending levels during the latter part of 2019.
The 2019 weekly average U.S. onshore rig count as reported by Baker Hughes was 918 rigs compared
to 2018’s average of 1,011 rigs. The 2019 average rig count was a 9% decrease relative to 2018, while up from
the 2017 weekly average of 853 rigs. If the rig count remains at levels below the 2019 average, there may be
reduced demand for our products and services. Given the recent volatility in crude oil prices and pressure on our
customers from the investment community to limit capital spending, it is generally expected that drilling
activity will be down year-over-year in 2020. As of February 21, 2020, the U.S. onshore rig count was 768.
The key market factors impacting our product sales are the number of wells drilled and placed on
production, as each well requires an individual wellhead assembly and, at some time after completion, the
installation of an associated production tree. We measure our product sales activity levels against our
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competitors by the number of rigs that we are supporting on a monthly basis as it is correlated to wells drilled.
Each active drilling rig produces different levels of revenue
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based on the customer’s drilling plan, which includes factors such as the number of wells drilled per pad, the
time taken to drill each well, the number and size of casing strings, the working pressure, material selection and
the complexity of the wellhead system chosen by the customer and the rate at which production trees are
eventually deployed. All of these factors may be influenced by the oil and gas region in which our customer is
operating. While these factors may lead to differing revenues per rig, we are able to broadly forecast our
product needs and anticipated revenue levels based on general trends in a given region and with a specific
customer. Increases in horizontal wells drilled as a percentage of total wells drilled, the shift towards pad
drilling, and an increase in the number of wells drilled per rig are all favorable trends that we believe enhance
the demand for our products relative to the active rig count.
Our rental revenues are primarily dependent on the number of wells completed (i.e., hydraulically
fractured), the number of wells on a well pad and the number of fracture stages per well. Well completion
activity generally follows the level of drilling activity. In 2019, a reduction in the number of drilled but
uncompleted wells (“DUCs”) has led to stronger completion activity relative to drilling activity from U.S. E&P
companies. Changes to the number of DUCs could provide additional opportunities or headwinds for our rental
business relative to general drilling activity.
Service and other revenues are closely correlated to revenues from product sales and rentals, as items
sold or rented almost always have an associated service component. Therefore, the market factors and trends of
product sales and rental revenues similarly impact the associated levels of service and other revenues generated.
Our business experiences some seasonality during the fourth quarter due to holidays and customers
managing their budgets as the year closes out. This can lead to lower activity in our three revenue categories as
well as lower margins, particularly in field services due to lower labor utilization.
Recent Developments
Our factory in Suzhou, China was closed for 10 days in January and February of 2020 as a result of
travel restrictions and other measures taken by the Chinese government in response to the outbreak of the
coronavirus. Our Suzhou facility reopened on February 10, 2020, however it is operating at a reduced capacity.
This is expected to be temporary. Given the dynamic nature of these circumstances, the extent of the business
disruption resulting from the coronavirus outbreak and the financial impact thereof cannot be reasonably
estimated at this time. There are still too many variables and uncertainties regarding the coronavirus outbreak to
fully assess the potential impact on our business, including the ultimate geographic spread of the virus, the
duration and severity of the outbreak and the extent of travel restrictions and business closures imposed in
China or other affected countries. We believe that our existing inventory levels and other operations will be able
to meet customer commitments and demand for the near future, and we do not believe that the coronavirus is
likely to have a material adverse impact on our results of operations for the first quarter of 2020. However, a
prolonged shutdown or reduction in capacity of our Chinese operations or other facilities in China that are
engaged in our supply chain would likely have a negative effect on our results of operations, and that negative
effect may be material. We do not believe that the measures taken by the Chinese government in response to the
outbreak of the coronavirus will have a disproportionately adverse impact on us relative to our competitors.
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Consolidated Results of Operations
Year Ended December 31, 2019 Compared to Year Ended December 31, 2018
The following table presents summary consolidated operating results for the periods indicated:
Year Ended
December 31,
2019 2018 $ Change % Change
(in thousands)
Revenues
Product revenue $357,087 $290,496 $ 66,591 22.9 %
Rental revenue 141,816 133,418 8,398 6.3
Field service and other revenue 129,511 120,221 9,290 7.7
Total revenues 628,414 544,135 84,279 15.5
Costs and expenses
Cost of product revenue 220,615 174,675 45,940 26.3
Cost of rental revenue 69,829 55,015 14,814 26.9
Cost of field service and other revenue 103,163 96,215 6,948 7.2
Selling, general and administrative expenses 51,657 40,529 11,128 27.5
Total costs and expenses 445,264 366,434 78,830 21.5
Income from operations 183,150 177,701 5,449 3.1
Interest income (expense), net 879 (3,595) 4,474 nm

Other income (expense), net 4,294 (4,305) 8,599 nm
Income before income taxes 188,323 169,801 18,522 10.9
Income tax expense 32,020 19,520 12,500 64.0
Net income $156,303 $150,281 $ 6,022 4.0
Less: Pre-IPO net income attributable to Cactus LLC — 13,648 (13,648) (100.0)
Less: net income attributable to non-controlling interest 70,691 84,950 (14,259) (16.8)
Net income attributable to Cactus Inc. $ 85,612 $ 51,683 $ 33,929 65.6 %
nm = not meaningful
Revenues
Product revenue for the year ended December 31, 2019 was $357.1 million, an increase of $66.6
million, or 23%, from $290.5 million for the year ended December 31, 2018. The increase was primarily
attributable to increased sales of wellhead and production related equipment due to our increased market share
and greater efficiencies from customers.
Rental revenue for the year ended December 31, 2019 was $141.8 million, an increase of $8.4 million,
or 6%, from $133.4 million for the year ended December 31, 2018. The increase was primarily attributable to
increased investment in our rental fleet, including new rental offerings, that enabled us to take advantage of
completion activity from customers.
Field service and other revenue for the year ended December 31, 2019 was $129.5 million, an increase
of $9.3 million, or 8%, from $120.2 million for the year ended December 31, 2018. The increase was primarily
attributable to the higher demand for these services following the increase in our product and rental revenue, as
field service is closely correlated with these activities.
Costs and expenses
Cost of product revenue for the year ended December 31, 2019 was $220.6 million, an increase of
$45.9 million, or 26%, from $174.7 million for the year ended December 31, 2018. The increase was largely
attributable to an increase in product sales volume driven by higher demand for our products and tariff costs.
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Cost of rental revenue for the year ended December 31, 2019 was $69.8 million, an increase of $14.8
million, or 27%, from $55.0 million for the year ended December 31, 2018. The increase was largely
attributable to higher depreciation expense on a larger rental fleet and an increase in costs associated with the
deployment of assets into the field including increased repair costs associated with a larger and more active
rental fleet.
Cost of field service and other revenue for the year ended December 31, 2019 was $103.2 million, an
increase of $6.9 million, or 7%, from $96.2 million for the year ended December 31, 2018. The increase was
largely attributable to higher payroll costs due to additional field personnel and higher volume driven operating
costs such as vehicle and equipment costs.
Selling, general and administrative expense for the year ended December 31, 2019 was $51.7 million,
an increase of $11.1 million, or 27%, from $40.5 million for the year ended December 31, 2018. The increase
was largely attributable to higher payroll and incentive compensation costs associated with our overall growth
as well as higher stock-based compensation expense related to equity awards and professional fees and other
costs associated with being a public company including the loss of emerging growth company (“EGC”) status.
Interest income (expense), net. Interest income, net for the year ended December 31, 2019 was $0.9
million, compared to interest expense, net of $3.6 million for the year ended December 31, 2018. The change is
primarily due to the repayment of our previous term loan in mid-February 2018 in conjunction with our IPO in
addition to higher interest income due to a significant increase in the Company’s cash balance in 2019.
Other income (expense), net. Other income, net for the year ended December 31, 2019 of $4.3 million
consists of $1.0 million in offering expenses associated with the secondary offering of our Class A common
stock in March 2019 by certain selling stockholders, offset by a $5.3 million non-cash gain on the revaluation of
the liability related to the TRA. This compares to a $4.3 million loss on early extinguishment of debt for the
year ended December 31, 2018, recorded in conjunction with the repayment of our previous term loan with a
portion of the net proceeds from our IPO.
Income tax expense. Income tax expense for the year ended December 31, 2019 was $32.0 million
(17.0% effective tax rate) compared to $19.5 million (11.5% effective tax rate) for 2018. The change was
primarily attributable to an increase in Cactus Inc.’s ownership of Cactus LLC and a write down of our deferred
tax asset due to a change in our forecasted state tax rate.
Liquidity and Capital Resources
At December 31, 2019 we had $202.6 million of cash and cash equivalents. Our primary sources of
liquidity and capital resources are cash on hand, cash flows generated by operating activities and, if necessary,
borrowings under our ABL Credit Facility. Depending upon market conditions and other factors, we may also
have the ability to issue additional equity and debt if needed. We had no borrowings outstanding under our ABL
Credit Facility and had $75.0 million of available borrowing capacity. We were in compliance with the
covenants of the ABL Credit Facility as of December 31, 2019.
Our ability to satisfy our liquidity requirements, including cash distributions to CW Unit Holders to
fund their respective income tax liabilities relating to their share of the income of Cactus LLC and to fund
liabilities related to the TRA, that we entered into with TRA Holders, depends on our future operating
performance, which is affected by prevailing economic conditions, market conditions in the E&P industry,
availability and cost of raw materials, and financial, business and other factors, many of which are beyond our
control.
We currently estimate our net capital expenditures for the year ending December 31, 2020 will range
from $30 million to $40 million, excluding acquisitions, mostly related to rental fleet investments. We
continuously evaluate our capital expenditures, and the amount we ultimately spend will depend on a number of
factors, including, among other things, demand for rental assets, available capacity in existing locations,
prevailing economic conditions, market conditions in the E&P industry, customers’ forecasts, volatility and
company initiatives.
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We believe that our existing cash on hand, cash generated from operations and available borrowings
under our ABL Credit Facility will be sufficient for at least the next 12 months to meet working capital
requirements, anticipated capital expenditures, expected TRA liability payments, anticipated tax liabilities and
dividends to holders of our Class A common
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stock. In addition, we believe we will be able to fund pro rata cash distributions to holders of CW units (other
than Cactus Inc.) resulting from the requirement to make TRA liability payments, tax liabilities and dividends
from Cactus Inc.
Cash Flows
Year Ended December 31, 2019 Compared to Year Ended December 31, 2018
The following table summarizes our cash flows for the periods indicated:

2019 2018
(in thousands)
Net cash provided by operating activities $ 209,632 $ 167,180
Net cash used in investing activities (55,948) (68,154)
Net cash used in financing activities (21,669) (35,004)
Net cash provided by operating activities was $209.6 million and $167.2 million for the years ended
December 31, 2019 and 2018, respectively. The primary reasons for the change were a $6.0 million increase in
net income, a $12.3 million increase in non-cash items and a $24.2 million decrease in net working capital use,
inclusive of a $9.3 million TRA payment.
Net cash used in investing activities was $55.9 million and $68.2 million for the years ended
December 31, 2019 and 2018, respectively. The decrease was primarily due to lower capital expenditures
associated with the investment in our rental fleet during the year ended December 31, 2019, in addition to
higher proceeds from certain asset sales.
Net cash used in financing activities was $21.7 million and $35.0 million for the years ended
December 31, 2019 and 2018, respectively. Net cash used in financing for the year ended December 31, 2019
includes $8.4 million in pro rata distributions to Cactus LLC members, finance lease payments of $7.5 million,
dividend payments to holders of Class A common stock of $4.2 million and $1.5 million related to the
repurchase of shares to satisfy tax withholding obligations of restricted stock units that vested during the
period. We did not receive any of the proceeds from our March 2019 Secondary Offering. Net cash used in
financing activities for 2018 includes $31.8 million in Cactus LLC member distributions, of which $26.0
million of these distributions were made prior to the IPO, to provide funds to pay members’ federal and state
liabilities associated with taxable income recognized by them as a result of their ownership in Cactus LLC. Also
during 2018, we received $828.2 million of net proceeds from our IPO, the Option and the Follow-on Offering
offset by (i) a $248.5 million repayment of the borrowings outstanding under the term loan portion of our prior
credit agreement and (ii) $575.7 million in redemptions of CW Units from certain direct and indirect owners of
Cactus LLC in connection with our IPO, the Option and the Follow-on Offering. We also made finance lease
payments of $6.3 million during 2018.
Tax Receivable Agreement
The TRA that Cactus Inc. entered into with the TRA Holders in connection with our IPO generally
provides for the payment by Cactus Inc. to the TRA Holders of 85% of the net cash savings, if any, in U.S.
federal, state and local income tax or franchise tax that Cactus Inc. actually realizes or is deemed to realize in
certain circumstances. Cactus Inc. will retain the benefit of the remaining 15% of these net cash savings. To the
extent Cactus LLC has available cash, we intend to cause Cactus LLC to make pro rata distributions to its
unitholders, including us, in an amount at least sufficient to allow us to pay our taxes and to make payments
under the TRA.
Except in cases where we elect to terminate the TRA early, the TRA is terminated early due to certain
mergers, asset sales, or other forms of business combinations or changes of control or we have available cash
but fail to make payments when due under circumstances where we do not have the right to elect to defer the
payment, we may generally elect to defer payments due under the TRA if we do not have available cash to
satisfy our payment obligations under the TRA. Any such deferred payments under the TRA generally will
accrue interest. In certain cases, payments under the TRA may be accelerated and/or significantly exceed the
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actual benefits, if any, we realize in respect of the tax attributes subject to the TRA. In these situations, our
obligations under the TRA could have a substantial negative impact on our liquidity.
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Assuming no material changes in the relevant tax law, we expect that if the TRA were terminated as of
December 31, 2019, the estimated termination payments, based on the assumptions discussed in Note 9 of the
Notes to the Consolidated Financial Statements, would be approximately $331.3 million, calculated using a
discount rate equal to one-year LIBOR plus 150 basis points, applied against an undiscounted liability of $434.7
million. A 10% increase in the price of our Class A common stock at December 31, 2019 would have increased
the discounted liability by $17.2 million to $348.5 million (an undiscounted increase of $23.2 million to $457.9
million), and likewise, a 10% decrease in the price of our Class A common stock at December 31, 2019 would
have decreased the discounted liability by $17.3 million to $314.0 million (an undiscounted decrease of $23.3
million to $411.4 million).
Dividend Policy
dividend of $0.09 per share of Class A common stock. We currently intend to continue paying the quarterly
dividend while retaining the balance of future earnings, if any, to finance the growth of our business. However,
our future dividend policy is within the discretion of our board of directors and will depend upon then-existing
conditions, including our results of operations, financial condition, capital requirements, investment
opportunities, statutory and contractual restrictions on our ability to pay dividends and other factors our board
of directors may deem relevant.
Contractual Obligations
A summary of our contractual obligations as of December 31, 2019 is provided in the following table.
We had no bank debt outstanding as of December 31, 2019.
Payments Due by Period For the Year Ending December 31,

2020 2021 2022 2023 2024 Thereafter Total
(in thousands)
Operating leases $ 7,691 $ 6,291 $ 3,967 $ 3,072 $ 2,453 $ 7,163 $ 30,637
Finance leases 7,434 3,438 768 4 — — 11,644
Liability related to TRA (1) 14,630 11,959 12,183 12,439 12,700 152,621 216,532
Total $29,755 $21,688 $16,918 $15,515 $15,153 $159,784 $258,813
(1) Represents obligations by Cactus Inc. to make payments under the TRA. The amounts and timing of
payments are subject to change.
Critical Accounting Policies and Estimates
In preparing our financial statements in accordance with GAAP, we make numerous estimates and
assumptions that affect the accounting for and recognition and disclosure of assets, liabilities, equity, revenues
and expenses. We must make these estimates and assumptions because certain information that we use is
dependent on future events, cannot be calculated with a high degree of precision from available data or is not
otherwise capable of being readily calculated based on generally accepted methodologies. In some cases, these
estimates are particularly difficult to determine, and we must exercise significant judgment. Actual results could
differ materially from the estimates and assumptions that we use in the preparation of our financial statements.
We identify certain accounting policies as critical based on, among other things, their impact on the portrayal of
our financial condition and results of operations and the degree of difficulty, subjectivity and complexity in their
deployment. Note 2 of the Notes to the Consolidated Financial Statements includes a summary of the significant
accounting policies used in the preparation of the accompanying consolidated financial statements. The
following is a brief discussion of our most critical accounting policies.
Inventories
Inventories are stated at the lower of cost or net realizable value. Cost is determined using standard
cost (which approximates average cost) and weighted average methods. Costs include an application of related
direct labor and overhead cost. Net realizable value is the estimated selling price in the ordinary course of
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business, less reasonably predictable costs of completion, disposal and transportation. We evaluate the
components of inventory on a regular basis for excess and
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obsolescence. Reserves are made based on a range of factors, including age, usage and technological or market
changes that may impact demand for those products. The amount of reserve recorded is subjective and is
susceptible to change from period to period.
Long‑Lived Assets
Key estimates related to long‑lived assets include useful lives and recoverability of carrying values.
Such estimates could be modified, as impairment could arise as a result of changes in supply and demand
fundamentals, technological developments, new competitors with cost advantages and the cyclical nature of the
oil and gas industry. We evaluate long‑lived assets for potential impairment indicators whenever events or
changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Long‑lived
assets assessed for impairment are grouped at the lowest level for which identifiable cash flows are available,
and a provision made where the cash flow is less than the carrying value of the asset. The estimation of future
cash flows and fair value is highly subjective and inherently imprecise. Estimates can change materially from
period to period based on many factors. Accordingly, if conditions change in the future, we may record
impairment losses, which could be material to any particular reporting period.
Income Taxes
Deferred taxes are recorded using the liability method, whereby tax assets and liabilities are
determined based on the differences between the financial statement and tax basis of assets and liabilities using
enacted tax rates in effect for the year in which the differences are expected to reverse.
We assess the likelihood that our deferred tax assets will be recovered through adjustments to future
taxable income. To the extent we believe recovery is not likely, we establish a valuation allowance to reduce the
asset to a value we believe will be recoverable based on our expectation of future taxable income. In evaluating
our ability to recover our deferred tax assets, we consider all available positive and negative evidence, including
scheduled reversals of deferred tax liabilities, projected future taxable income, tax planning strategies and
results of recent operations. The assumptions about future taxable income require significant judgment and are
consistent with the plans and estimates management is using to manage the underlying business. If the projected
future taxable income changes materially, we may be required to reassess the amount of valuation allowance
recorded against our deferred tax assets.
The TRA generally provides for payment by Cactus Inc. to the TRA Holders of 85% of the net cash
savings, if any, in U.S. federal, state and local income tax or franchise tax that Cactus Inc. actually realizes or is
deemed to realize in certain circumstances. Cactus Inc. will retain the benefit of the remaining 15% of these net
cash savings.
Redemptions of CW Units result in adjustments to the tax basis of the tangible and intangible assets of
Cactus LLC. These adjustments will be allocated to Cactus Inc. Such adjustments to the tax basis of the tangible
and intangible assets of Cactus LLC would not have been available to Cactus Inc. absent its acquisition or
deemed acquisition of CW Units. In addition, the repayment of borrowings outstanding under the Cactus LLC
term loan facility resulted in adjustments to the tax basis of the tangible and intangible assets of Cactus LLC, a
portion of which was allocated to Cactus Inc. These basis adjustments are expected to increase (for tax
purposes) Cactus Inc.’s depreciation and amortization deductions and may also decrease Cactus Inc.’s gains (or
increase its losses) on future dispositions of certain assets to the extent tax basis is allocated to those assets.
Such increased deductions and losses and reduced gains may reduce the amount of tax that Cactus Inc. would
otherwise be required to pay in the future.
Estimating the amount and timing of the tax benefit is by its nature imprecise and the assumptions used
in the estimates can change. The tax benefit is dependent upon future events and assumptions, the amount of the
redeeming unit holders' tax basis in its CW Units at the time of the relevant redemption, the depreciation and
amortization periods that apply to the increase in tax basis, the amount and timing of taxable income we
generate in the future and the U.S. federal, state and local income tax rate then applicable, and the portion of
Cactus Inc.’s payments under the TRA that constitute imputed interest or give rise to depreciable or amortizable
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tax basis. The most critical estimate included in calculating the TRA liability to record is the combined U.S.
federal income tax rate and an assumed combined state and local income tax rate, to
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determine the future benefit we will realize. A 100 basis point decrease/increase in the blended tax rate used
would decrease/increase the TRA liability recorded at December 31, 2019 by approximately $12.0 million.
Recent Accounting Pronouncements
See Note 2 in the Notes to the Consolidated Financial Statements for discussion of recent accounting
pronouncements.
Inflation
While inflationary cost increases can affect our income from operations’ margin, we believe that
inflation generally has not had, and in the near future is not expected to have, a material adverse effect on our
results of operations. Although the impact of inflation has been insignificant in recent years, it is still a factor in
the United States economy and we tend to experience inflationary pressure on wages and raw materials.
Off‑Balance Sheet Arrangements
We do not have off‑balance sheet arrangements.
Item 7A. Quantitative and Qualitative Disclosures about Market Risk
In the normal course of business, we are exposed to market risk from changes in foreign currency
exchange rates and changes in interest rates.
Foreign Currency Exchange Rate Risk
We have subsidiaries with operations in China and Australia who conduct business in their local
currencies (functional currencies) and are therefore subject to foreign currency exchange rate risk on cash flows
related to sales, expenses, financing and investing transactions in currencies other than the U.S. dollar.
Additionally, certain intercompany balances between our U.S. and foreign subsidiaries are denominated in U.S.
dollars. Since this is not the functional currency of our subsidiaries in China and Australia, the changes in these
balances are translated in our Consolidated Statements of Income. As a result, we are exposed to foreign
exchange risk as it relates to these balances.
Interest Rate Risk
Our ABL Credit Facility is variable rate debt. At December 31, 2019, although there were no
borrowings outstanding, the applicable margin on Eurodollar borrowings was 1.5% plus an adjusted base rate of
one or three month LIBOR.
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Item 8. Financial Statements and Supplementary Data
The following Consolidated Financial Statements are filed as part of this Annual Report:
Cactus, Inc. and Subsidiaries
Management’s Report on Internal Control Over Financial Reporting 36
Report of Independent Registered Public Accounting Firm 37
Consolidated Balance Sheets as of December 31, 2019 and 2018 39
Consolidated Statements of Income for the Years Ended December 31, 2019, 2018 and 2017 40
Consolidated Statements of Comprehensive Income for the Years Ended December 31, 2019, 2018 and
2017 41
Consolidated Statements of Stockholders’ Equity for the Years Ended December 31, 2019, 2018 and
2017 42
Consolidated Statements of Cash Flows for the Years Ended December 31, 2019, 2018 and 2017 43
Notes to the Consolidated Financial Statements 44
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Management’s Report on Internal Control Over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over
financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act
of 1934, as amended. Our internal control over financial reporting was designed to provide reasonable
assurance regarding the reliability of financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles. Because of its inherent limitations,
internal control over financial reporting may not prevent or detect misstatements. Also, projections of any
evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because
of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
In making its assessment, management has utilized the criteria set forth by the Committee of
Sponsoring Organizations of the Treadway Commission (or “COSO”) in Internal Control-Integrated
Framework (2013 framework). Based on this assessment, management has concluded that, as of December 31,
2019, our internal control over financial reporting was effective.
Our independent registered public accounting firm, PricewaterhouseCoopers, LLP, has issued an audit
report on the effectiveness of our internal control over financial reporting as of December 31, 2019, which
appears herein.
/s/ Scott Bender /s/ Stephen Tadlock

President, Chief Executive Officer and Director Vice President, Chief Financial Officer and
Treasurer
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Report of Independent Registered Public Accounting Firm
To the Board of Directors and Stockholders of Cactus, Inc.
Opinions on the Financial Statements and Internal Control over Financial Reporting
We have audited the accompanying consolidated balance sheets of Cactus, Inc. and its subsidiaries (the
“Company”) as of December 31, 2019 and 2018, and the related consolidated statements of income,
comprehensive income, stockholders’ equity and cash flows for each of the three years in the period ended
December 31, 2019, including the related notes (collectively referred to as the “consolidated financial
statements”). We also have audited the Company's internal control over financial reporting as of December 31,
2019, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee
of Sponsoring Organizations of the Treadway Commission (COSO).
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the
financial position of the Company as of December 31, 2019 and 2018, and the results of its operations and its
cash flows for each of the three years in the period ended December 31, 2019 in conformity with accounting
principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in
all material respects, effective internal control over financial reporting as of December 31, 2019, based on
criteria established in Internal Control - Integrated Framework (2013) issued by the COSO.
Basis for Opinions
The Company's management is responsible for these consolidated financial statements, for maintaining
effective internal control over financial reporting, and for its assessment of the effectiveness of internal control
over financial reporting, included in the accompanying Management's Report on Internal Control over Financial
Reporting. Our responsibility is to express opinions on the Company’s consolidated financial statements and on
the Company's internal control over financial reporting based on our audits. We are a public accounting firm
registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to
be independent with respect to the Company in accordance with the U.S. federal securities laws and the
applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that
we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial
statements are free of material misstatement, whether due to error or fraud, and whether effective internal
control over financial reporting was maintained in all material respects.
Our audits of the consolidated financial statements included performing procedures to assess the risks of
material misstatement of the consolidated financial statements, whether due to error or fraud, and performing
procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding
the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the
accounting principles used and significant estimates made by management, as well as evaluating the overall
presentation of the consolidated financial statements. Our audit of internal control over financial reporting
included obtaining an understanding of internal control over financial reporting, assessing the risk that a
material weakness exists, and testing and evaluating the design and operating effectiveness of internal control
based on the assessed risk. Our audits also included performing such other procedures as we considered
necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.
Definition and Limitations of Internal Control over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of financial statements for external purposes
in accordance with generally accepted accounting principles. A company’s internal control over financial
reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable
detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide
reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in
accordance with generally accepted accounting principles, and that receipts and expenditures of the company
are being made only in accordance with authorizations of management and directors of the
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company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use, or disposition of the company’s assets that could have a material effect on the financial
statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect
misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that
controls may become inadequate because of changes in conditions, or that the degree of compliance with the
policies or procedures may deteriorate.
Critical Audit Matters
The critical audit matter communicated below is a matter arising from the current period audit of the consolidated
financial statements that was communicated or required to be communicated to the audit committee and that (i)
relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our
especially challenging, subjective, or complex judgments. The communication of critical audit matters does not
alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by
communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the
accounts or disclosures to which it relates.
Liability related to the Tax Receivable Agreement
As described in Notes 2 and 9 to the consolidated financial statements, the Company has a liability under the
Tax Receivable Agreement (“TRA”) of $216.5 million as of December 31, 2019. In connection with its initial
public offering, the Company entered into the TRA with certain direct and indirect owners of Cactus Wellhead,
LLC (the “TRA Holders”). The TRA generally provides for payment by the Company to the TRA Holders 85%
of the net cash tax savings, if any, in United States federal, state and local income tax and franchise tax that the
Company actually realizes or is deemed to realize in certain circumstances as a result of (i) certain increases in
tax basis that occur as a result of the Company’s acquisition (or deemed acquisition for U.S. federal income tax
purposes) of all or a portion of such TRA Holder’s ownership interest in Cactus Wellhead, LLC, (ii) certain
increases in tax basis resulting from the repayment of borrowings outstanding under Cactus Wellhead, LLC’s
term loan facility, and (iii) imputed interest deemed to be paid by the Company as a result of, and additional tax
basis arising from, any payments the Company makes under the TRA. Management calculates the TRA liability
by determining the tax basis subject to the TRA (“tax basis”) and applying a blended tax rate to the basis
differences and calculating the iterative impact. The blended tax rate consists of the U.S. federal income tax rate
and an assumed combined state and local income tax rate driven by the apportionment factors applicable to each
state.
The principal considerations for our determination that performing procedures relating to the liability related to
the TRA is a critical audit matter are there was significant complexity in i) management’s calculation of the tax
basis, and (ii) developing the applicable state apportionment factors utilized in determining the appropriate
blended tax rate. This in turn led to a high degree of auditor subjectivity and effort in performing procedures
and evaluating the appropriateness of the calculation of the tax basis and the blended tax rate. In addition, the
audit effort involved the use of professionals with specialized skill and knowledge to assist in performing these
procedures and evaluating the audit evidence obtained from these procedures. As disclosed by management, a
material weakness existed during the year related to this matter.
Addressing the matter involved performing procedures and evaluating audit evidence in connection with
forming our overall opinion on the consolidated financial statements. These procedures included testing the
effectiveness of controls relating to the calculation and recognition of the TRA liability, including controls over
the completeness and accuracy of the underlying data used in the tax basis and blended tax rate calculations.
These procedures also included, among others, testing the information used in the calculation of the TRA
liability, and the involvement of professionals with specialized skills and knowledge to assist in (i) developing
an independent calculation of the tax basis, (ii) comparing the independent calculation to management’s
calculations to evaluate the reasonableness of the tax basis, (iii) evaluating the apportionment factors and the
resulting blended tax rate, and (iv) assessing management’s application of the tax laws. Evaluating
management’s determination of the apportionment factors involved considering the current and expected
activity levels of the Company and whether the apportionment factors were consistent with evidence obtained in
other areas of the audit.
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/s/ PricewaterhouseCoopers LLP
Houston, Texas
February 28, 2020
We have served as the Company’s auditor since 2015.
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CACTUS, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS
December 31, December 31,

2019 2018
(in thousands, except per
share data)
Assets
Current assets
Cash and cash equivalents $ 202,603 $ 70,841
Accounts receivable, net of allowance of $837 and $576, respectively 87,865 92,269
Inventories 113,371 99,837
Prepaid expenses and other current assets 11,044 11,558
Total current assets 414,883 274,505
Property and equipment, net 161,748 142,054

Operating lease right-of-use assets, net 26,561 —
Goodwill 7,824 7,824
Deferred tax asset, net 222,545 159,053
Other noncurrent assets 1,403 1,308
Total assets $ 834,964 $ 584,744
Liabilities and Equity
Current liabilities
Accounts payable $ 40,957 $ 42,047
Accrued expenses and other current liabilities 22,067 15,650
Current portion of liability related to tax receivable agreement 14,630 9,574
Finance lease obligations, current portion 6,735 7,353
Operating lease liabilities, current portion 6,737 —
Total current liabilities 91,126 74,624
Deferred tax liability, net 1,348 1,036

Liability related to tax receivable agreement, net of current portion 201,902 138,015
Finance lease obligations, net of current portion 3,910 8,741
Operating lease liabilities, net of current portion 20,283 —
Total liabilities 318,569 222,416
Commitments and contingencies
Stockholders' equity
Preferred stock, $0.01 par value, 10,000 shares authorized, none issued and
outstanding — —
Class A common stock, $0.01 par value, 300,000 shares authorized, 47,159 and
37,654 shares issued and outstanding 472 377
Class B common stock, $0.01 par value, 215,000 shares authorized, 27,958 and
37,236 shares issued and outstanding — —
Additional paid-in capital 194,456 126,418
Retained earnings 132,990 51,683
Accumulated other comprehensive loss (452) (820)
Total stockholders' equity attributable to Cactus Inc. 327,466 177,658
Non-controlling interest 188,929 184,670
Total stockholders' equity 516,395 362,328
Total liabilities and equity $ 834,964 $ 584,744
The accompanying notes are an integral part of these consolidated financial statements.
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CONSOLIDATED STATEMENTS OF INCOME

2019 2018 2017
(in thousands, except per share data)
Revenues
Product revenue $ 357,087 $290,496 $189,091
Rental revenue 141,816 133,418 77,469
Field service and other revenue 129,511 120,221 74,631
Total revenues 628,414 544,135 341,191
Costs and expenses
Cost of product revenue 220,615 174,675 124,030
Cost of rental revenue 69,829 55,015 40,519
Cost of field service and other revenue 103,163 96,215 60,602
Selling, general and administrative expenses 51,657 40,529 27,177
Total costs and expenses 445,264 366,434 252,328
Income from operations 183,150 177,701 88,863
Interest income (expense), net 879 (3,595) (20,767)

Other income (expense), net 4,294 (4,305) —
Income before income taxes 188,323 169,801 68,096
Income tax expense 32,020 19,520 1,549
Net income $ 156,303 $150,281 $ 66,547
Less: pre-IPO net income attributable to Cactus LLC — 13,648 66,547
Less: net income attributable to non-controlling interest 70,691 84,950 —
Net income attributable to Cactus Inc. $ 85,612 $ 51,683 $ —
Earnings per Class A share - basic $ 1.90 $ 1.60 $ —

Earnings per Class A share - diluted $ 1.88 $ 1.58 $ —
Weighted average Class A shares outstanding - basic 44,983 32,329 —

Weighted average Class A shares outstanding - diluted 75,353 32,695 —
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CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

2019 2018 2017
(in thousands)
Net income $ 156,303 $ 150,281 $ 66,547
Foreign currency translation adjustments 368 (902) 557
Comprehensive income 156,671 149,379 67,104
Less: pre-IPO comprehensive income attributable to Cactus LLC — 13,928 67,104
Less: comprehensive income attributable to non-controlling interest 70,581 84,212 —
Comprehensive income attributable to Cactus Inc. $ 86,090 $ 51,239 $ —
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CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
Accumulated
Members' Class A Class B Additional Other Non- Total
Equity Common Stock Common Stock Paid-In Retained Comprehensive controlling Equity
(in thousands) (Deficit) Shares Amount Shares Amount Capital Earnings Income (Loss) Interest (Deficit)
Balance at
December 31, 2016 $ (102,846) — $ — — $ — $ — $ — $ (475) $ — $ (103,321)
Other comprehensive
income — — — — — — — 557 — 557
Net income 66,547 — — — — — — — — 66,547
Balance at
December 31, 2017 $ (36,299) — $ — — $ — $ — $ — $ 82 $ — $ (36,217)
Member distributions
prior to IPO (26,000) — — — — — — — — (26,000)
Net income prior to
IPO 13,648 — — — — — — — — 13,648
Effect of IPO 48,651 26,450 265 48,440 — 71,196 — — 130,861 250,973
Member distributions
after IPO — — — — — — — — (5,848) (5,848)
Effect of Follow-on
Offering and CW Unit
redemptions — 11,204 112 (11,204) — 24,472 — — (25,293) (709)
Additional paid-in
capital related to tax
receivable agreement — — — — — 26,046 — — — 26,046
Other comprehensive
(loss) — — — — — — — (902) — (902)
Stock-based
compensation — — — — — 4,704 — — — 4,704
Net income after IPO — — — — — — 51,683 — 84,950 136,633
Balance at
December 31, 2018 $ — 37,654 $ 377 37,236 $ — $ 126,418 $ 51,683 $ (820) $ 184,670 $ 362,328
Adjustment to prior
periods — — — — — 10,424 — 409 (11,339) (506)
Member distributions — — — — — — — — (8,392) (8,392)
Effect of CW Unit
redemptions — 9,278 93 (9,278) — 48,635 — (59) (48,669) —
Adjustment to
deferred tax asset from
CW Unit redemptions — — — — — (9,751) — — — (9,751)
Additional paid-in
capital related to tax
receivable agreement — — — — — 15,250 — — — 15,250
Equity award vestings — 227 2 — — (791) — — (760) (1,549)
Other comprehensive
income — — — — — — — 18 4 22
Stock-based
compensation — — — — — 4,271 — — 2,724 6,995
Cash dividends
declared ($0.09 per
share) — — — — (4,305) — — (4,305)
Net income — — — — — — 85,612 — 70,691 156,303
Balance at
December 31, 2019 $ — 47,159 $ 472 27,958 $ — $ 194,456 $ 132,990 $ (452) $ 188,929 $ 516,395
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CONSOLIDATED STATEMENTS OF CASH FLOWS

2019 2018 2017
(in thousands)
Cash flows from operating activities
Net income $ 156,303 $ 150,281 $ 66,547
Reconciliation of net income to net cash provided by operating
activities:
Depreciation and amortization 38,854 30,153 23,271
Debt discount and deferred financing cost amortization 168 275 1,752
Stock-based compensation 6,995 4,704 —
Provision for bad debts 355 — (100)
Inventory obsolescence 2,552 1,451 1,259
Loss on disposal of assets 236 886 534
Deferred income taxes 25,403 15,201 220
Loss on debt extinguishment — 4,305 —
Gain from revaluation of liability related to tax receivable
agreement (5,336) — —
Changes in operating assets and liabilities:
Accounts receivable 4,204 (8,105) (50,094)
Inventories (17,592) (38,227) (28,279)
Prepaid expenses and other assets 438 (6,509) (4,012)
Accounts payable (607) 7,651 19,505
Accrued expenses and other liabilities 6,994 5,114 4,104
Payments pursuant to tax receivable agreement (9,335) — —
Net cash provided by operating activities 209,632 167,180 34,707
Cash flows from investing activities

Capital expenditures and other (59,703) (70,053) (32,082)
Proceeds from sale of assets 3,755 1,899 1,404
Net cash used in investing activities (55,948) (68,154) (30,678)
Cash flows from financing activities

Principal payments on long-term debt — (248,529) (2,569)
Payment of deferred financing costs — (840) —
Payments on finance leases (7,484) (6,274) (2,744)
Net proceeds from equity offerings — 828,168 —
Dividends paid to Class A common stock shareholders (4,244) — —
Distributions to members (8,392) (31,848) —
Redemptions of CW Units — (575,681) —
Repurchases of shares (1,549) — —
Net cash used in financing activities (21,669) (35,004) (5,313)
Effect of exchange rate changes on cash and cash equivalents (253) (755) 170
Net increase (decrease) in cash and cash equivalents 131,762 63,267 (1,114)
Cash and cash equivalents

Beginning of period 70,841 7,574 8,688
End of period $ 202,603 $ 70,841 $ 7,574
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in thousands, except share and per share data, or as otherwise indicated)
1. Organization and Nature of Operations
Cactus, Inc. (“Cactus Inc.”) and its consolidated subsidiaries (“the Company”), including Cactus
Wellhead, LLC (“Cactus LLC”), are primarily engaged in the design, manufacture and sale of wellhead and
pressure control equipment. In addition, we maintain a fleet of frac valves and ancillary equipment for short-
term rental, as well as offer repair and refurbishment services and the provision of service crews to assist in the
installation and operations of pressure control systems. We operate through U.S. service centers located in
Texas, Pennsylvania, Oklahoma, North Dakota, New Mexico, Louisiana, Colorado and Wyoming, and in
Eastern Australia, with our corporate headquarters located in Houston, Texas. We also have manufacturing and
production facilities in Bossier City, Louisiana and Suzhou, China.
Cactus Inc. was incorporated on February 17, 2017 as a Delaware corporation for the purpose of
completing an initial public offering of equity and related transactions, which was completed on February 12,
2018 (our “IPO”). Cactus Inc. is a holding company whose only material asset is an equity interest consisting of
units representing limited liability company interests in Cactus LLC (“CW Units”). Cactus Inc. became the sole
managing member of Cactus LLC upon completion of our IPO. Cactus LLC is a Delaware limited liability
company and was formed on July 11, 2011. Except as otherwise indicated or required by the context, all
references to “Cactus,” “we,” “us” and “our” refer to Cactus Inc. and its consolidated subsidiaries (including
Cactus LLC) following the completion of our IPO and Cactus LLC and its consolidated subsidiaries prior to the
completion of our IPO.
As the sole managing member of Cactus LLC, Cactus Inc. operates and controls all of the business and
affairs of Cactus LLC and conducts its business through Cactus LLC and its subsidiaries. As a result, Cactus
Inc. consolidates the financial results of Cactus LLC and its subsidiaries and reports non-controlling interest
related to the portion of CW Units not owned by Cactus Inc., which reduces net income attributable to holders
of Cactus Inc.’s Class A common stock, par value $0.01 per share (“Class A common stock”). For information
regarding our IPO, see our Annual Report on Form 10-K for the year ended December 31, 2018.
As of December 31, 2019, Cactus Inc. owned 62.8% of Cactus LLC as compared to 50.3% as of
December 31, 2018. As of December 31, 2019, Cactus Inc. had outstanding 47.2 million shares of Class A
common stock (representing 62.8% of the total voting power) and 28.0 million shares of Class B common stock
(representing 37.2% of the total voting power).
2. Summary of Significant Accounting Policies and Other Items
Basis of Presentation
The consolidated financial statements have been prepared in accordance with accounting principles
generally accepted in the United States of America (“GAAP”). These consolidated financial statements include
the accounts of Cactus Inc. and its wholly owned subsidiaries. All intercompany transactions and balances have
been eliminated upon consolidation.
Cactus Inc. is the sole managing member of Cactus LLC and consolidates the financial results of
Cactus LLC and its subsidiaries and reports a non-controlling interest related to the portion of CW Units not
owned by Cactus Inc., which reduces net income attributable to holders of Cactus Inc.’s Class A common stock.
Use of Estimates
In preparing our consolidated financial statements in conformity with GAAP, we make numerous
estimates and assumptions that affect the accounting for and recognition and disclosure of assets, liabilities,
equity, revenues and expenses. We must make these estimates and assumptions because certain information that
we use is dependent on future events, cannot be calculated with a high degree of precision from available data
or is not otherwise capable of being readily calculated based on accepted methodologies. In some cases, these
estimates are particularly difficult to determine, and we
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must exercise significant judgment. Actual results could differ materially from the estimates and assumptions
that we use in the preparation of our consolidated financial statements.
Segment Information
We operate in a single operating segment, which reflects how we manage our business and the fact that
all of our products and services are dependent upon the oil and natural gas industry. Substantially all of our
products and services are sold in the U.S., which consists largely of oil and natural gas exploration and
production companies. We operate in the United States, Australia and China. Our operations in Australia and
China represented less than 10% of our consolidated operations for all periods presented in these consolidated
financial statements.
Concentrations of Credit Risk
Our assets that are potentially subject to concentrations of credit risk are cash and cash equivalents and
accounts receivable. We manage the credit risk associated with these financial instruments by transacting only
with what management believes are financially secure counterparties, requiring credit approvals and credit
limits and monitoring counterparties’ financial condition. Our receivables are spread over a number of
customers, a majority of which are operators and suppliers to the oil and natural gas industry. Our maximum
exposure to credit loss in the event of non‑performance by the customer is limited to the receivable balance. We
perform ongoing credit evaluations and monitoring as to the financial condition of our customers with respect to
trade receivables. Generally, no collateral is required as a condition of sale. We also control our exposure
associated with trade receivables by discontinuing sales and service to non-paying customers. We had one
customer representing 10% of total revenues for the year ended December 31, 2019 and one customer
representing 11% of total revenues in each of the years ended December 31, 2018 and 2017.
Significant Vendors
We purchase a significant portion of supplies, equipment and machined components from a single
vendor. During 2019, 2018 and 2017, purchases from this vendor totaled $36.5 million, $46.7 million and $33.4
million, respectively. These figures represent approximately 16%, 21% and 22% for the respective periods, of
total third party vendor purchases of raw materials, finished products, equipment, machining and other services.
Amounts due to the vendor included in accounts payable, in the consolidated balance sheets, as of
December 31, 2019 and 2018 totaled $4.3 million and $5.0 million, respectively.
Tax Receivable Agreement (TRA)
In connection with our IPO, we entered into the TRA with certain direct and indirect owners of Cactus
LLC (the “TRA Holders”). The TRA generally provides for payment by Cactus Inc. to the TRA Holders of
85% of the net cash savings, if any, in U.S. federal, state and local income tax or franchise tax that Cactus Inc.
actually realizes or is deemed to realize in certain circumstances. Cactus Inc. will retain the benefit of the
remaining 15% of these net cash savings.
We account for amounts payable under the TRA in accordance with Accounting Standards
Codification (“ASC”) Topic 450, Contingencies. As such, subsequent changes to the measurement of the TRA
liability are recognized in the statements of income as a component of other income (expense), net. For the year
ended December 31, 2019, we recognized a $5.3 million gain on the change in the TRA liability. See Note 9 for
further details on the TRA liability.
Revenue Recognition
The majority of our revenues are derived from short-term contracts for fixed consideration. Product
sales generally do not include right of return or other significant post-delivery obligations. A contract’s
transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the
performance obligation is satisfied. Revenues are recognized when we satisfy a performance obligation by
transferring control of the promised goods or providing services to our customers at a point in time, in an
amount specified in the contract with our customer and that reflects the consideration we expect to be entitled to
in exchange for those goods or services. The majority of our contracts with customers contain a single
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performance obligation to provide agreed upon products or services. For contracts with multiple performance
obligations, we allocate revenue to each performance obligation based on its relative standalone selling price.
We do not
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assess whether promised goods or services are performance obligations if they are immaterial in the context of
the contract with the customer. We do not incur any material costs of obtaining contracts.
We do not adjust the amount of consideration per the contract for the effects of a significant financing
component when we expect, at contract inception, that the period between the transfer of a promised good or
service to a customer and when the customer pays for that good or service will be one year or less, which is in
substantially all cases. Payment terms and conditions vary, although terms generally include a requirement of
payment within 30 to 45 days. Revenues are recognized net of any taxes collected from customers, which are
subsequently remitted to governmental authorities. We treat shipping and handling associated with outbound
freight as a fulfillment cost instead of as a separate performance obligation. We recognize the cost for the
associated shipping and handling when incurred as an expense in cost of sales.
Our revenues are derived from three sources: products, rentals, and field service and other:
Product revenue. Product revenues are primarily derived from the sale of wellhead systems and
production trees. Revenue is recognized when the products have shipped and the customer obtains
control of the products.
Rental revenue. Rental revenues are primarily derived from the rental of equipment, tools and products
used for well control during the drilling and completion phases to customers. Our rental agreements are
directly with our customers and provide for a rate based on the period of time the equipment is used or
made available to the customer. In addition, customers are charged for repair costs either through an
agreed upon rate or as incurred. Revenue is recognized ratably over the rental period, which tends to be
short-term in nature with most equipment on site for less than 90 days.
Field service and other revenue. We provide field services to our customers based on contractually
agreed rates. Other revenues are derived from providing repair and reconditioning services to
customers who have installed wellheads and production trees on their wellsite. Revenues are
recognized as the services are performed or rendered.
Foreign Currency Translation
The financial position and results of operations of our foreign subsidiaries are measured using the local
currency as the functional currency. Revenues and expenses of the subsidiaries have been translated into U.S.
dollars at average exchange rates prevailing during the period. Assets and liabilities have been translated at the
rates of exchange on the balance sheet dates. The resulting translation gain and loss adjustments have been
recorded directly as a separate component of other comprehensive income in the consolidated statements of
comprehensive income and stockholders’ equity.
Transaction gains and losses that arise from exchange rate fluctuations on transactions denominated in
a currency other than the functional currency are included in our consolidated statements of income as incurred.
Stock‑based Compensation
We measure the cost of equity‑based awards based on the grant date fair value and we allocate the
compensation expense over the corresponding service period, which is usually the vesting period, using the
straight‑line method. The grant date fair value is determined by the average price of the trading high and trading
low of our Class A common stock on the effective date of the grant.
Income Taxes
Deferred taxes are recorded using the asset and liability method, whereby tax assets and liabilities are
determined based on the differences between the financial statement and tax basis of assets and liabilities using
enacted tax rates in effect for the year in which the differences are expected to reverse. We regularly evaluate
the valuation allowances established for deferred tax assets for which future realization is uncertain. In
assessing the realizability of deferred tax assets, we consider both positive and negative evidence, including
scheduled reversals of deferred tax assets and liabilities, projected future taxable income, tax planning strategies
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and results of recent operations. If, based on the weight of available evidence, it is more likely than not that the
deferred tax assets will not be realized, a valuation allowance is recorded.
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Cactus Inc. is a corporation and is subject to U.S. federal as well as state income tax related to its
ownership percentage in Cactus LLC. Cactus LLC is a limited liability company treated as a partnership for
U.S. federal income tax purposes and files a U.S. Return of Partnership Income, which includes both our U.S.
and foreign operations. Consequently, the members of Cactus LLC are taxed individually on their share of
earnings for U.S. federal and state income tax purposes. However, Cactus LLC is subject to the Texas Margins
Tax. Additionally, our operations in both Australia and China are subject to local country income taxes. See
Note 5 “Income Taxes” for additional information regarding income taxes.
Cash and Cash Equivalents
Cash in excess of current operating requirements is invested in short-term interest-bearing investments

with maturities of three months or less at the date of purchase and is stated at cost, which approximates fair
value. Throughout the year we maintained cash balances that were not covered by federal deposit insurance. We
have not experienced any losses in such accounts.
Accounts Receivable
We extend credit to customers in the normal course of business. We do not accrue interest on
delinquent accounts receivable. Accounts receivable includes amounts billed and currently due from customers
and unbilled amounts for products delivered and services performed for which billings had not yet been
submitted to the customers. Total unbilled revenue included in accounts receivable as of December 31, 2019
and 2018 was $23.8 million and $26.8 million, respectively. We maintain an allowance for doubtful accounts to
provide for the estimated amount of receivables that will not be collected. In our determination of the allowance
for doubtful accounts, we assess those amounts where there are concerns over collection and record an
allowance for that amount. Estimating this amount requires us to analyze the financial condition of our
customers, our historical experience and any specific concerns. Earnings are charged with a provision for
doubtful accounts based on this review of the collectability of accounts. Accounts deemed uncollectible are
applied against the allowance for doubtful accounts. Accounts receivable is net of allowance for doubtful
accounts of $0.8 million and $0.6 million as of December 31, 2019 and 2018, respectively. The following is a
rollforward of our allowance for doubtful accounts:
Balance at Balance at
Beginning of Expense End of
Period (recovery) Write off Other Period
Year Ended December 31, 2019 $ 576 $ 355 $ (94) $ — $ 837
Year Ended December 31, 2018 740 — (164) — 576
Year Ended December 31, 2017 851 (100) (3) (8) 740
Inventories
Inventories are stated at the lower of cost or net realizable value. Cost is determined using standard
cost (which approximates average cost) and weighted average methods. Costs include an application of related
direct labor and overhead cost. Net realizable value is the estimated selling price in the ordinary course of
business, less reasonably predictable costs of completion, disposal and transportation. Reserves are made for
excess and obsolete items based on a range of factors, including age, usage and technological or market changes
that may impact demand for those products. The inventory obsolescence reserve was $9.8 million and $7.3
million as of December 31, 2019 and 2018, respectively. The following is a rollforward of our inventory
obsolescence reserve:
Balance at Balance at
Beginning of End of
Period Expense Write off Other Period
Year Ended December 31, 2019 $ 7,310 $ 2,552 $ (90) $ — $ 9,772
Year Ended December 31, 2018 5,885 1,451 — (26) 7,310
Year Ended December 31, 2017 4,770 1,259 (103) (41) 5,885
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Property and Equipment
Property and equipment are stated at cost. We manufacture or construct most of our own rental assets
and during the manufacture of these assets, they are reflected as construction in progress until complete. We
depreciate the cost of property and equipment using the straight‑line method over the estimated useful lives and
depreciate our rental assets to their salvage value. Leasehold improvements are amortized over the shorter of the
remaining lease term or economic life of the related assets. When assets are retired or otherwise disposed of, the
cost and related accumulated depreciation are removed from the accounts and any resulting gain or loss are
reflected in income for the period. The cost of maintenance and repairs is charged to income as incurred;
significant renewals and improvements are capitalized. Estimated useful lives are as follows:
Land N/A
Buildings 10 - 30 years
Machinery and equipment 2 - 12 years
Vehicles under finance lease 3 years
Rental equipment 2 - 8 years
Furniture and fixtures 5 years
Computers and software 4 years
Property and equipment as of December 31, 2019 and 2018 consists of the following:
December 31,
2019 2018
Land $ 3,203 $ 3,614
Buildings and improvements 21,655 20,803
Machinery and equipment 55,494 47,606
Vehicles under finance lease 24,275 25,165
Rental equipment 161,156 124,002
Furniture and fixtures 1,684 1,623
Computers and software 3,317 3,094
Gross property and equipment 270,784 225,907
Less: Accumulated depreciation (123,397) (96,412)
Net property and equipment 147,387 129,495
Construction in progress 14,361 12,559
Total property and equipment, net $ 161,748 $ 142,054
Depreciation and amortization was $38.9 million, $30.2 million and $23.3 million for 2019, 2018 and
2017, respectively. Depreciation and amortization expense is included in the consolidated statements of income
as follows:

2019 2018 2017
Cost of product revenue $ 3,304 $ 3,262 $ 3,169
Cost of rental revenue 24,881 17,997 14,912
Cost of field service and other revenue 9,986 8,456 4,786
Selling, general and administrative expenses 683 438 404
Total depreciation and amortization $ 38,854 $ 30,153 $ 23,271
Impairment of Long‑Lived Assets
We review the recoverability of long‑lived assets, such as property and equipment, when events or
changes in circumstances occur that indicate the carrying value of the asset or asset group may not be
recoverable. The assessment of possible impairment is based on our ability to recover the carrying value of the
asset or asset group from the expected future pre‑tax cash flows (undiscounted) of the related operations. If
these cash flows are less than the carrying value of such asset, an impairment loss is recognized for the
difference between estimated fair value and carrying value. We concluded there were no indicators evident or
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other circumstances present that these assets were not recoverable and accordingly, no impairment charges of
long‑lived assets were recognized for 2019, 2018 and 2017.
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Goodwill
Goodwill represents the excess of acquisition consideration paid over the fair value of net assets
acquired. All of the goodwill recorded on our consolidated balance sheets resulted from the acquisition of a
manufacturing facility in Bossier City, Louisiana in 2011. The facility supports our full range of products,
rentals and services. Goodwill is not amortized, but is reviewed for impairment on an annual basis (or more
frequently if impairment indicators exist). We have established December 31 as the date of our annual test for
impairment of goodwill. We perform a qualitative assessment of the fair value of our reporting unit before
calculating the fair value of the reporting unit in step one of the two‑step goodwill impairment model. If,
through the qualitative assessment, we determine that it is more likely than not that the reporting unit’s fair
value is greater than its carrying value, the remaining impairment steps would be unnecessary.
If there are indicators that goodwill has been impaired and thus the two‑step goodwill impairment
model is necessary, step one is to determine the fair value of the reporting unit and compare it to the reporting
unit’s carrying value. Fair value is determined based on the present value of estimated cash flows using
available information regarding expected cash flows of each reporting unit, discount rates and the expected
long‑term cash flow growth rates. If the fair value of the reporting unit exceeds the carrying value, goodwill is
not impaired and no further testing is performed. The second step is performed if the carrying value exceeds the
fair value. The implied fair value of the reporting unit’s goodwill must be determined and compared to the
carrying value of the goodwill. If the carrying value of a reporting unit’s goodwill exceeds its implied fair value,
an impairment loss equal to the difference will be recorded. We concluded that there was no impairment of
goodwill in 2019, 2018 or 2017 based on our annual impairment analysis.
Accrued Expenses and Other Current Liabilities
Accrued expenses and other current liabilities as of December 31, 2019 and 2018 are as follows:
December 31,
2019 2018
Payroll, incentive compensation, payroll taxes and benefits $ 10,708 $ 7,842
Accrued international freight and tariffs 3,794 1,418
Income based tax payable 2,481 2,061
Accrued professional fees and other 1,790 1,512
Deferred revenue 1,371 1,110
Taxes other than income 767 1,414
Accrued workers' compensation insurance 600 —
Product warranties 556 293
Total $ 22,067 $ 15,650
Self-Insurance Accrued Expenses
We maintain a partially self-insured health benefit plan which provides medical and prescription drug
benefits to certain of our employees electing coverage under the plan. Our exposure is limited by individual and
aggregate stop loss limits via third-party insurance carriers. Our self-insurance expense is accrued based upon
the aggregate of the expected liability for reported claims and the estimated liability for claims incurred but not
reported, based on historical claims experience provided by our third-party insurance advisors, adjusted as
necessary based upon management’s reasoned judgment. Actual employee medical claims expense may differ
from estimated loss provisions based on historical experience. The liabilities for these claims are included as a
component of payroll, incentive compensation, payroll taxes and benefits in the table above and were $1.6
million and $0.5 million as of December 31, 2019 and 2018, respectively.
Product Warranties
We generally warrant our manufactured products 12 months from the date placed in service. The
estimated liability for product warranties is based on historical and current claims experience.
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Fair Value Measurements
The carrying value of cash and cash equivalents, receivables, accounts payable and accrued expenses
approximates fair value based on the short-term nature of these accounts. We had no long-term debt outstanding
as of December 31, 2019 or 2018.
Employee Benefit Plan
Our employees within the United States are eligible to participate in a 401(k) plan sponsored by us.
These employees are eligible to participate on the first day of the month following 30 days of employment and
if they are at least eighteen years of age. All eligible employees may contribute a percentage of their
compensation subject to a maximum imposed by the Internal Revenue Code. During 2019, 2018 and 2017, we
matched 100% of the first 3% of gross pay contributed by each employee and 50% of the next 4% of gross pay
contributed by each employee. We may also make additional non‑elective employer contributions at our
discretion under the plan. Similar benefit plans exist for employees of our foreign subsidiaries. During 2019,
2018 and 2017, employer matching contributions totaled $3.1 million, $3.7 million and $2.2 million,
respectively. For the year ended December 31, 2019, we made a non-elective contribution of $0.1 million under
the Plan. No such contributions were made in 2018 or 2017.
Recent Accounting Pronouncements
Standards Adopted
Effective January 1, 2019, we adopted Financial Accounting Standards Board (“FASB”) ASU No.
2016-02, Leases (Topic 842) by utilizing the modified retrospective approach. There was no cumulative effect
adjustment required to the opening balance of retained earnings as we utilized the package of practical
expedients permitted under the transition guidance within the standard. The expedient package allowed us to
not reassess whether existing contracts contained a lease, to not reassess the lease classification of existing
leases, and to not consider the initial direct cost for existing leases. In addition to the package of practical
expedients, we also utilized expedients and elections allowing for the exclusion of leases with terms of less than
twelve months across all asset classes, use of the portfolio approach and the election to not separate non-lease
components from lease components. Adoption of this standard resulted in the recognition of operating lease
right-of-use (“ROU”) assets of $25.3 million, reversal of previously recorded deferred rent of $0.5 million and
corresponding operating short-term and long-term lease liabilities of $6.2 million and $19.6 million,
respectively, on the consolidated balance sheet. Our accounting for finance leases remained substantially
unchanged under the new guidance. Additionally, as a lessor, recognition of lease revenue associated with short-
term equipment rentals remained consistent with previous guidance. Adoption of the standard did not have a
material impact on our consolidated statements of income and consolidated statements of comprehensive
income or consolidated statements of cash flows. See Note 8 for further details regarding leases.
Standards Not Yet Adopted
In January 2017, the FASB issued ASU 2017-04, Intangibles – Goodwill and Other (Topic 350), which
simplifies the accounting for goodwill impairment by eliminating Step 2 of the current goodwill impairment
test. In computing the implied fair value of goodwill under Step 2, an entity had to perform procedures to
determine the fair value at the impairment testing date of its assets and liabilities (including unrecognized assets
and liabilities) following the procedure that would be required in determining the fair value of assets acquired
and liabilities assumed in a business combination. Instead, under the new standard, an entity should perform its
goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount. An entity
should recognize an impairment charge for the amount by which the carrying amount exceeds the reporting
unit’s fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that
reporting unit. An entity still has the option to perform the qualitative assessment for a reporting unit to
determine if the quantitative impairment test is necessary. The new guidance should be adopted for annual or
any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. We do not expect the
adoption of this pronouncement will have a material impact on our consolidated financial statements.
In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326),
Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). ASU 2016-13 changes the
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measurement of credit losses on financial assets measured at amortized cost, including but not limited to trade
receivables. The new guidance replaces the
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current methodology for recognizing credit losses when it is probable that a loss has been incurred with an
expected loss model that requires consideration of a broader range of information to estimate expected credit
losses over the lifetime of an asset. Application of this new guidance may result in an earlier recognition of
credit losses as the allowance for credit losses is measured and recorded upon the initial recognition of the
financial asset. The allowance for credit losses under the new guidance represents the portion of the asset’s
amortized cost basis that we do not expect to collect over the asset’s contractual life, considering past events,
current conditions and reasonable and supportable forecasts of future economic conditions. We finalized our
methodology for estimating expected credit losses, including the assumptions used in order to pool receivables
with similar risk characteristics and adopted the new standard effective January 1, 2020. Adoption of the
standard did not impact our consolidated financial statements.
3. Inventories
Inventories consist of the following:
December 31,
2019 2018
Raw materials $ 1,538 $ 1,925
Work-in-progress 4,619 3,582
Finished goods 107,214 94,330
$ 113,371 $ 99,837
4. Debt
We had no debt outstanding as of December 31, 2019 and 2018.
On August 21, 2018, Cactus LLC entered into a five-year senior secured asset-based revolving credit
facility with a syndicate of lenders and JPMorgan Chase Bank, N.A., as administrative agent for such lenders
and as an issuing bank and swingline lender (the “ABL Credit Facility”). The ABL Credit Facility provides for
$75.0 million in revolving commitments, up to $15.0 million of which is available for the issuance of letters of
credit. The ABL Credit Facility matures on August 21, 2023. The maximum amount that Cactus LLC may
borrow under the ABL Credit Facility is subject to a borrowing base, which is based on a percentage of eligible
accounts receivable and eligible inventory, subject to reserves and other adjustments.
Borrowings under the ABL Credit Facility bear interest at Cactus LLC’s option at either (i) the
Alternate Base Rate (as defined therein) (“ABR”), or (ii) the Adjusted LIBO Rate (as defined therein)
(“Eurodollar”), plus, in each case, an applicable margin. Letters of credit issued under the ABL Credit Facility
accrue fees at a rate equal to the applicable margin for Eurodollar borrowings. The applicable margin ranges
from 0.50% to 1.00% per annum for ABR borrowings and 1.50% to 2.00% per annum for Eurodollar
borrowings and, in each case, is based on the average quarterly availability under the ABL Credit Facility for
the immediately preceding fiscal quarter. The unused portion of the ABL Credit Facility is subject to a
commitment fee that varies from 0.250% to 0.375% per annum, according to the average quarterly availability
under the ABL Credit Facility for the immediately preceding fiscal quarter.
The ABL Credit Facility contains various covenants and restrictive provisions that limit Cactus LLC’s
and each of its subsidiaries’ ability to, among other things, incur additional indebtedness and create liens, make
investments or loans, enter into asset sales, make certain restricted payments and distributions, and engage in
transactions with affiliates.
The ABL Credit Facility also requires Cactus LLC to maintain a fixed charge coverage ratio of 1.0 to
1.0 based on the ratio of EBITDA (as defined therein) minus Unfinanced Capital Expenditures (as defined
therein) to Fixed Charges (as defined therein) during certain periods, including when availability under the ABL
Credit Facility is under certain levels. If Cactus LLC fails to perform its obligations under the ABL Credit
Facility, (i) the commitments under the ABL Credit Facility could be terminated, (ii) any outstanding
borrowings under the ABL Credit Facility may be declared immediately due and payable and (iii) the lenders
may commence foreclosure or other actions against the collateral.
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At December 31, 2019 and 2018, although there were no borrowings outstanding, the applicable
margin on our Eurodollar borrowings was 1.5% plus an adjusted base rate of one or three month LIBOR. We
were in compliance with all covenants under the ABL Credit Facility as of December 31, 2019.
The ABL Credit Facility replaced Cactus LLC’s prior credit agreement, dated as of July 31, 2014, with
Credit Suisse AG, as administrative agent, collateral agent and issuing bank, and the other lenders party thereto
(the “Prior Credit Agreement”). The Prior Credit Agreement provided for a term loan tranche in an aggregate
principal amount of $275.0 million, the outstanding balance of which was repaid in full in February 2018 from
the net proceeds of our IPO, and a revolving credit facility (the “Prior Revolving Credit Facility”) of up to $50.0
million with a $10.0 million sublimit for letters of credit. The Prior Credit Agreement was terminated
concurrently with the effectiveness of, and as a condition of entering into, the ABL Credit Facility. No loans or
letters of credit under the Prior Credit Agreement were outstanding at the time of, or were repaid in connection
with, such termination.
Loss on Debt Extinguishment
We recorded a $4.3 million loss on early extinguishment of debt in conjunction with the repayment of
the term loan portion of the Prior Credit Agreement with a portion of the net proceeds from our IPO. The loss
consisted of the write-off of the unamortized balance of debt discount and deferred loan costs of $2.1 million
and $2.2 million, respectively. The loss on debt extinguishment is included under other income (expense), net,
in the consolidated statement of income for the year ended December 31, 2018.
Interest (Income) Expense, net
Interest (income) expense, net, including debt discount and deferred financing costs amortization, was
comprised of the following:

2019 2018 2017
Interest under bank facilities $ 315 $ 2,669 $ 18,627
Debt discount and deferred financing costs amortization 168 275 1,752
Finance lease interest 877 734 311
Other 164 45 82
Interest income (2,403) (128) (5)
Interest (income) expense, net $ (879) $ 3,595 $ 20,767
5. Income Taxes
Domestic and foreign components of income before income taxes were as follows:

2019 2018 2017
Pre-IPO Domestic $ — $ 13,370 $ 65,023
Post-IPO Domestic 173,039 146,620 —
Pre-IPO Foreign — 512 3,073
Post-IPO Foreign 15,284 9,299 —
Income before income taxes $ 188,323 $169,801 $ 68,096
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The provision for income taxes consisted of:

2019 2018 2017
Current:
Federal $ 1,088 $ — $ —
State 1,408 1,172 594
Foreign 4,121 3,147 735
Total current income taxes 6,617 4,319 1,329
Deferred:
Federal 14,853 12,589 —
State 10,681 1,992 —
Foreign (131) 620 220
Total deferred income taxes 25,403 15,201 220
Total provision for income taxes $ 32,020 $ 19,520 $ 1,549
The effective income tax rate was different from the statutory U.S. federal income tax rate due to the
following:

2019 2018 2017
Income taxes at 21% (35% for 2017) statutory tax rate $ 39,548 $ 35,658 $ 23,834
Net difference resulting from:
Profit of Cactus LLC pre-IPO not subject to U.S. federal tax — (2,808) (22,758)
Profit of non-controlling interest not subject to U.S. federal tax (15,477) (18,570) —
Foreign income taxes (net of foreign tax credit) 364 828 (302)
State income taxes (excluding rate change) 4,887 2,746 594
Impact of change in forecasted state income tax rate 5,774 — —
Foreign withholding taxes 988 1,056 220
Change in valuation allowance (3,888) 733 (39)
Other (176) (123) —
Total provision for income taxes $ 32,020 $ 19,520 $ 1,549
Our effective tax rate was 17.0%, 11.5% and 2.3% for the years ended December 31, 2019, 2018 and
2017, respectively. For the year ended December 31, 2019, the primary reason for the change to our effective
tax rate relates to an increase in Cactus Inc.’s ownership of Cactus LLC and a write down of our deferred tax
asset due to a change in our forecasted state tax rate. Prior to our IPO, our accounting predecessor was a limited
liability company treated as a partnership for U.S. federal income tax purposes, and therefore not subject to U.S.
federal income taxes. Our operations are subject to state taxes within the United States and our operations in
China and Australia are subject to local country income taxes.
The components of deferred tax assets and liabilities are as follows:
December 31,
2019 2018
Investment in Cactus LLC $ 234,629 $ 181,390
Net operating loss carryforwards — 619
Imputed interest 10,323 7,445
Tax credits 1,479 1,988
Other 155 144
Deferred tax assets 246,586 191,586
Valuation allowance (24,041) (32,533)
Deferred tax asset, net $ 222,545 $ 159,053
Foreign withholding taxes $ 1,054 $ 1,036

Other 294 —
Deferred tax liability, net $ 1,348 $ 1,036
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We recorded a deferred tax asset for the differences between our tax and book basis in the investment
in Cactus LLC and imputed interest on the TRA. We also recorded deferred tax assets for foreign tax credits
associated with our portion of Cactus LLC’s accrued foreign taxes.
We did not have any foreign net operating losses for 2019. Foreign net operating losses were $1.4
million and $1.6 million for 2018 and 2017, respectively.
Based upon our cumulative earnings history and forecasted future sources of taxable income, we
believe that we will be able to realize the majority of our U.S. deferred tax assets in the future. We do not expect
to realize the portion of our deferred tax asset for our investment in Cactus LLC that may only be realizable
through the sale or liquidation of the investment and our ability to generate sufficient capital gains. As of
December 31, 2019, we have a valuation allowance of $22.7 million against this deferred tax asset. For the year
ended December 31, 2019, as a result of the March 2019 Secondary Offering and redemptions of CW Units, we
released $5.4 million of our valuation allowance and recorded a tax benefit of $5.4 million related to the
realizable portion of the deferred tax asset.
As of December 31, 2019, our liability related to the TRA was $216.5 million, representing 85% of the
calculated net cash savings in the United States federal, state and local or franchise tax that we anticipate
realizing in future years from certain increases in tax basis and certain tax benefits attributed to imputed interest
as a result of our acquisition of CW Units. We have determined it is more-likely-than-not that we will be able to
utilize all of our tax basis subject to the TRA; therefore, we have recorded a liability related to the TRA for the
tax savings we may realize from certain increases in tax basis and certain tax benefits attributable to imputed
interest as a result of our acquisition (or deemed acquisition for United States federal income tax purposes) of
CW Units. If we determine the utilization of this tax basis is not more-likely-than-not in the future, our estimate
of amounts to be paid under the TRA would be reduced. In this scenario, the reduction of the liability under the
TRA would result in a benefit to our pre-tax consolidated results of operations.
As of December 31, 2019 and 2018, we had no uncertain tax positions.
None of our federal or state income tax returns are currently under examination by state taxing
authorities.
6. Stock-Based Compensation
We have a long-term incentive plan (“LTIP”) to incentivize individuals providing services to us or our
affiliates. The LTIP provides for the grant, from time to time, at the discretion of our compensation committee
of our board of directors, of stock options, stock appreciation rights, restricted stock, restricted stock units, stock
awards, dividend equivalents, other stock-based awards, cash awards, substitute awards and performance
awards. Any individual who is an officer or employee or an officer or employee of any of our affiliates, and any
other person who provides services to us or our affiliates, including members of our board of directors, will be
eligible to receive awards under the LTIP at the discretion of our board of directors. As of December 31, 2019,
2.0 million stock awards were available for grant.
Restricted Stock Units
Restricted stock units (“RSUs”) granted pursuant to the LTIP are expected to be settled in shares of our
Class A common stock if they vest. RSU’s generally vest over a three-year period; however, RSUs granted to
our non-employee directors generally vest on the first anniversary of the grant.
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A summary of restricted stock unit awards for the year ended December 31, 2019 is as follows (units
in thousands):
Weighted
Average Grant
No. of RSUs Date Fair Value
Nonvested as of December 31, 2018 782 $ 19.84
Granted 221 $ 37.04
Vested (274) $ 19.50
Forfeited (39) $ 22.48
Nonvested as of December 31, 2019 690 $ 25.34
During the year ended December 31, 2019 and 2018, we recorded $7.0 million and $4.7 million,
respectively, of stock-based compensation expense. We did not recognize any stock-based compensation
expense during 2017. Stock-based compensation expense is primarily recorded in selling, general and
administrative expenses. There was approximately $11.1 million of unrecognized compensation expense
relating to the unvested RSUs as of December 31, 2019. The unrecognized compensation expense will be
recognized over the weighted average remaining vesting period of 2.0 years.
7. Revenue
We disaggregate revenue from contracts with customers into three revenue categories: (i) product
revenues, (ii) rental revenues and (iii) field service and other revenues. We have predominately domestic
operations, with a small amount of sales being generated in Australia. For the year ended December 31, 2019,
we derived 57% of our total revenues from the sale of our products, 22% of our total revenues from rental and
21% of our total revenues from field service and other. This compares to 53% of our total revenues from the
sale of our products, 25% of our total revenues from rental and 22% of our total revenues from field service and
other for the year ended December 31, 2018. In 2017, we derived 55% of our total revenues from the sale of
our products, 23% from rental and 22% from field service and other. The following table presents our revenues
disaggregated by category:

2019 2018 2017
Product revenue $ 357,087 $ 290,496 $ 189,091
Rental revenue 141,816 133,418 77,469
Field service and other revenue 129,511 120,221 74,631
Total revenue $ 628,414 $ 544,135 $ 341,191
At December 31, 2019, we had a deferred revenue balance of $1.4 million compared to the December
31, 2018 balance of $1.1 million included in accrued expenses and other current liabilities in the consolidated
balance sheets. Deferred revenue represents our obligation to transfer products or perform services to a
customer for which we have received cash or billed in advance. The revenue that has been deferred will be
recognized upon product delivery or as services are performed. As of December 31, 2019, we did not have any
contracts with an original length of greater than a year from which revenue is expected to be recognized in the
future related to performance obligations that are unsatisfied.
8. Leases
As a lessee, we lease real estate, apartments, forklifts, vehicles and trucks, and other equipment under
non-cancellable agreements. We determine if these contracts are or contain a lease at inception and review the
facts and circumstances of the arrangement to classify the leased asset as operating or finance. To assess
whether a contract is or contains a lease, we consider whether (i) explicitly or implicitly identified assets have
been deployed in the contract and (ii) whether we obtain substantially all the economic benefits from the use of
that underlying asset and direct how and for what purpose the asset is used during the term of the contract.
The portion of active leases within our portfolio classified as operating leases are included in operating
lease right-of-use assets and current and long-term operating lease liabilities on our consolidated balance sheet.
The finance lease right-of-use assets portion of the active lease agreements are included in property and
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equipment and current and long-term finance lease obligations on our consolidated balance sheets. The ROU
assets represent our right to use the underlying asset for the
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lease term and lease liabilities represent our obligation to make minimum lease payments arising from the lease
for the duration of the lease term.
Certain of our leases include one or more options to renew, with renewal terms that can extend the
lease term from one to 10 years or greater. The exercise of lease renewal options is typically at our discretion.
The measurement of the lease term includes options to extend or renew the lease when it is reasonably certain
that we will exercise that option. We do not have leases that include options to purchase leased property or that
provide for the automatic transfer of ownership of leased property to us, residual value guarantees, or the
incurrence by us of other restrictions or covenants.
To determine the present value of future minimum lease payments, we use the implicit rate when
readily determinable; however, many of our leases do not provide an implicit rate, therefore to determine the
present value of minimum lease payments we use our incremental borrowing rate based on the information
available at commencement date of the lease. Our finance lease agreements typically include an interest rate
that is used to determine the present value of future lease payments.
Minimum lease payments are expensed on a straight-line basis over the term of the lease, including
reasonably certain renewal options. In addition, some leases may require additional contingent or variable lease
payments based on factors specific to the individual agreement. Variable lease payments for which we are
typically responsible include payment of real estate taxes and maintenance expenses. These payments are
expensed as incurred and recorded as variable lease costs.
The following are the components of operating and finance lease costs:
Year Ended
December 31,
2019
Finance lease cost:
Amortization of right-of-use assets $ 7,601
Interest expense 877
Operating lease cost 8,329
Short-term lease cost 847
Variable lease cost 528
Sublease income (455)
Total lease cost $ 17,727
The following is supplemental cash flow information for our operating and finance leases:
Year Ended
December 31,
2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from finance leases $ 877
Operating cash flows from operating leases 6,828
Financing cash flows from finance leases 7,484
Total $ 15,189
Right-of-use assets obtained in exchange for new lease obligations:

Operating leases $ 8,054
Finance leases 3,008
Total $ 11,062
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The following is the aggregate future lease payments for operating and finance leases as of December
31, 2019:
Operating Finance
2020 $ 7,691 $ 7,434
2021 6,291 3,438
2022 3,967 768
2023 3,072 4
2024 2,453 —
Thereafter 7,163 —
Total undiscounted lease payments 30,637 11,644
Less: effects of discounting (3,617) (999)
Present value of lease payments $ 27,020 $ 10,645
The following represents the average lease terms and discount rates for our operating and finance lease
portfolio as of December 31, 2019:
December 31, 2019

Weighted average remaining lease term:
Finance leases 1.51 years
Operating leases 5.82 years
Weighted average discount rate

Finance leases 12.18 %
Operating leases 3.76 %
As a lessor, we rent a fleet of frac valves and ancillary equipment for short-term rental periods,
typically one to two months. Our lessor portfolio consists mainly of operating leases for equipment utilized
during the drilling, completion and production phases of our customers’ wells. At this time, most lessor
agreements contain less than three-month terms with no renewal options that are reasonably certain to exercise,
or early termination options based on established terms specific to the individual agreement. See Note 7 for
disaggregation of revenue.
Disclosures related to periods prior to adoption of new lease standard
Operating and Capital Leases:
We lease certain facilities, vehicles, equipment, office and manufacturing space under noncancelable
operating leases which expire at various dates. We are also party to a significant number of month‑to‑month
leases that can be canceled at any time. Total rent expense under operating leases was $7.7 million in 2018 and
$7.1 million in 2017. Accumulated depreciation for capital leases totaled $8.6 million at December 31, 2018.
Minimum lease payments, including executory costs and interest, under capital and operating leases
with non-cancelable terms as of December 31, 2018 were as follows:
Operating Capital
2019 $ 6,638 $ 8,740
2020 4,618 6,790
2021 3,487 2,533
2022 2,195 41
2023 1,426 —
Thereafter 3,339 —
$ 21,703 $ 18,104
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9. Tax Receivable Agreement
The TRA generally provides for the payment by Cactus Inc. to the TRA Holders of 85% of the net
cash savings, if any, in U.S. federal, state and local income tax and franchise tax that Cactus Inc. actually
realizes or is deemed to realize in certain circumstances as a result of (i) certain increases in tax basis that occur
as a result of Cactus Inc.’s acquisition (or deemed acquisition for U.S. federal income tax purposes) of all or a
portion of such TRA Holder’s CW Units in connection with our IPO or any subsequent offering, or pursuant to
any other exercise of the Redemption Right or the Call Right, (ii) certain increases in tax basis resulting from
the repayment of borrowings outstanding under Cactus LLC’s term loan facility in connection with our IPO and
(iii) imputed interest deemed to be paid by Cactus Inc. as a result of, and additional tax basis arising from, any
payments Cactus Inc. makes under the TRA. We will retain the remaining 15% of the cash savings.
The TRA liability is calculated by determining the tax basis subject to TRA (“tax basis”) and applying
a blended tax rate to the basis differences and calculating the iterative impact. The blended tax rate consists of
the U.S. federal income tax rate and an assumed combined state and local income tax rate driven by the
apportionment factors applicable to each state. As of December 31, 2019, the total liability from the TRA was
$216.5 million with $14.6 million reflected in current liabilities based on the expected timing of our next
payment. The payments under the TRA will not be conditional on a holder of rights under the TRA having a
continued ownership interest in either Cactus LLC or Cactus Inc.
The term of the TRA commenced upon completion of our IPO and will continue until all tax benefits
that are subject to the TRA have been utilized or expired, unless we exercise our right to terminate the TRA. If
we elect to terminate the TRA early (or it is terminated early due to certain mergers, asset sales, other forms of
business combinations or other changes of control), our obligations under the TRA would accelerate and we
would be required to make an immediate payment equal to the present value of the anticipated future payments
to be made by us under the TRA and such payment is expected to be substantial. The calculation of anticipated
future payments will be based upon certain assumptions and deemed events set forth in the TRA, including the
assumptions that (i) we have sufficient taxable income to fully utilize the tax benefits covered by the TRA and
(ii) any CW Units (other than those held by Cactus Inc.) outstanding on the termination date are deemed to be
redeemed on the termination date. Any early termination payment may be made significantly in advance of the
actual realization, if any, of the future tax benefits to which the termination payment relates.
We may elect to defer payments due under the TRA if we do not have available cash to satisfy our
payment obligations under the TRA. Any such deferred payments under the TRA generally will accrue interest
from the due date for such payment until the payment date.
10. Equity
Redemptions of CW Units
Pursuant to the First Amended and Restated Limited Liability Company Operating Agreement of
Cactus LLC (the “Cactus LLC Agreement”), each holder of CW Units (“CW Unit Holder”) has, subject to
certain limitations, the right (the “Redemption Right”) to cause Cactus LLC to acquire all or at least a minimum
portion of its CW Units for, at Cactus LLC’s election, (x) shares of our Class A common stock at a redemption
ratio of one share of Class A common stock for each CW Unit redeemed, subject to conversion rate adjustments
for stock splits, stock dividends and reclassification and other similar transactions, or (y) an equivalent amount
of cash. Alternatively, upon the exercise of the Redemption Right, Cactus Inc. (instead of Cactus LLC) will
have the right (the “Call Right”) to acquire each tendered CW Unit directly from the exchanging CW Unit
Holder for, at its election, (x) one share of Class A common stock, subject to conversion rate adjustments for
stock splits, stock dividends and reclassifications and other similar transactions, or (y) an equivalent amount of
cash. In connection with any redemption of CW Units pursuant to the Redemption Right or our Call Right, the
corresponding number of shares
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of Class B common stock, par value $0.01 per share (“Class B common stock”), will be canceled. The
following is a rollforward of ownership of legacy CW Units by legacy CW Unit Holders.
CW Units
(in thousands)
CW Units held by legacy CW Unit Holders as of February 7, 2018 60,558
IPO (12,118)
July 2018 Follow-on Offering (11,197)
March 2019 Secondary Offering (8,474)
On March 19, 2019, Cactus Inc. entered into an underwriting agreement by and among Cactus Inc.,
Cactus LLC, certain selling stockholders of Cactus (the “Selling Stockholders”) and the underwriters named
therein, providing for the offer and sale of Class A common stock by the Selling Stockholders (the “March 2019
Secondary Offering”). As described in the prospectus supplement dated March 19, 2019 and filed with the
Securities and Exchange Commission on March 20, 2019, in connection with the March 2019 Secondary
Offering, certain Selling Stockholders owning CW Units exercised their Redemption Right with respect to 8.5
million CW Units, together with a corresponding number of shares of Class B common stock, as provided in the
Cactus LLC Agreement. The March 2019 Secondary Offering closed on March 21, 2019, at which time, in
exercise of its Call Right, Cactus Inc. acquired the redeemed CW Units and a corresponding number of shares
of Class B common stock (which shares of Class B common stock were then canceled) and issued 8.5 million
shares of Class A common stock to the underwriters at the direction of the redeeming Selling Stockholders, as
provided in the Cactus LLC Agreement. In addition, certain other Selling Stockholders sold 26 thousand shares
of Class A common stock in the March 2019 Secondary Offering, which shares were owned by them directly
prior to the closing of this offering. Cactus did not receive any of the proceeds from the sale of common stock in
the March 2019 Secondary Offering. Cactus incurred $1.0 million in offering expenses which were recorded in
other income (expense), net, in the consolidated statement of income during the first quarter of 2019.
In addition to the redemptions associated with the March 2019 Secondary Offering, certain legacy CW
Unit Holders redeemed 0.8 million CW Units (together with a corresponding number of shares of Class B
common stock) pursuant to the Redemption Right, for the year ended December 31, 2019. Cactus acquired the
redeemed CW Units and a corresponding number of shares of Class B common stock (which shares of Class B
common stock were then canceled) and issued 0.8 million shares of Class A common stock to the redeeming
CW Unit Holders. Any exercise by Cactus LLC or Cactus Inc. of the right to acquire redeemed CW Units for
cash must be approved by the board of directors of Cactus Inc. To date, neither Cactus Inc. nor Cactus LLC
have elected to acquire CW Units for cash in connection with exchanges by CW Unit Holders. It is the policy of
Cactus Inc. that any exercise by Cactus Inc. or Cactus LLC of the right to acquire redeemed CW Units for cash
must be approved by a majority of those members of the board of directors of Cactus Inc. who have no interest
in such transaction.
Pursuant to the tax receivable agreement (the “TRA”) described in Note 9, the CW Units redeemed in
the March 2019 Secondary Offering and other CW Unit redemptions for the year ended December 31, 2019,
created additional TRA liability. Also, as a result, Cactus Inc. increased its ownership in Cactus LLC and
accordingly, increased its equity by $48.7 million from the non-controlling interest.
During 2019, we corrected for misstatements of equity between Cactus Inc. and non-controlling
interest related to our July 2018 Follow-on Offering by reducing non-controlling interest and increasing
additional paid-in capital and accumulated other comprehensive income. This related to immaterial errors
associated with the ownership percentage change used in the underlying calculation giving effect to the
offering. Additionally, we finalized the majority of the Company’s tax returns and identified immaterial
adjustments.
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Dividends
dividend of $0.09 per share of Class A common stock of which $4.2 million was paid on December 19, 2019.
We currently intend to continue paying the quarterly dividend while retaining the balance of future earnings, if
any, to finance the growth of our business. However, our future dividend policy is within the discretion of our
board of directors and will depend upon then-existing conditions, including our results of operations, financial
condition, capital requirements, investment opportunities, statutory and contractual restrictions on our ability to
pay dividends and other factors our board of directors may deem relevant.
Limitation of Members’ Liability
Under the terms of the Cactus Wellhead LLC Agreement, the members of Cactus LLC are not
obligated for debt, liabilities, contracts or other obligations of Cactus LLC. Profits and losses are allocated to
members as defined in the Cactus Wellhead LLC Agreement.
11. Related Party Transactions
When needed, we rent a plane under dry-lease from a company owned by a member of Cactus LLC.
These transactions are under short-term rental arrangements and the agreement governing these transactions
does not qualify as a lease under ASC 842. We pay a base hourly rent of $1,750 per flight hour of use of the
aircraft, payable monthly, for the hours of aircraft operation during the prior calendar month. We are also
responsible for employing pilots and certain fuel true up fees. During 2019, 2018 and 2017, expense recognized
in connection with these rentals totaled $0.3 million, $0.4 million and $0.3 million, respectively. As of
December 31, 2019 and 2018, we owed less than $0.1 million to the related party which are included in
accounts payable in the consolidated balance sheets.
The TRA agreement is with certain direct and indirect holders of CW Units, including certain of our
officers, directors and employees. These TRA Holders have the right in the future to receive 85% of the net
cash savings, if any, in U.S. federal, state and local income tax and franchise tax that Cactus Inc. actually
realizes or is deemed to realize in certain circumstances. The total liability from the TRA as of December 31,
2019 was $216.5 million. We pay professional fees to assist with maintenance of the TRA which are
reimbursable from the TRA Holders. As of December 31, 2019, we had a $0.3 million balance due from the
TRA Holders for fees paid in 2019. The balance is included in accounts receivable, net in the consolidated
balance sheet. No such balance existed as of December 31, 2018.
Distributions made by Cactus LLC are generally required to be made pro rata among all its members.
For the year ended December 31, 2019, Cactus LLC distributed $14.2 million to Cactus Inc. to fund the 2019
TRA liability payments and estimated tax payments and made pro rata distributions to its other members
totaling $8.4 million over the same period. For the year ended December 31, 2018, Cactus LLC made $3.8
million in distributions to Cactus Inc. to cover its estimated tax payments and also made an aggregate $5.8
million in pro-rata distributions to its other members over the same period.
Prior to our IPO, we were party to a management services agreement with two Cactus LLC members,
whereby Cactus paid an annual management fee totaling approximately $0.3 million, payable in four
installments, each to be paid quarterly in advance, prorated for any partial year. In conjunction with our IPO, the
management services agreement terminated pursuant to its terms. Management fee expense totaled $0.1 million
and $0.3 million for 2018 and 2017, respectively. There were no outstanding balances due as of December 31,
2019 and 2018 under the management services agreement.
Prior to our IPO, on January 25, 2018, Cactus LLC paid a cash distribution of $26.0 million to holders
of CW Units at that time. This distribution was funded by borrowing under a revolving credit facility. The
purpose of the distribution was to provide funds to these owners to pay their federal and state tax liabilities
associated with taxable income recognized by them for periods prior to the completion of our IPO as a result of
their ownership interests in Cactus LLC. The borrowings under this revolving credit facility were repaid during
the first quarter of 2018.
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12. Commitments and Contingencies
We are involved in various disputes arising in the ordinary course of business. Management does not
believe the outcome of these disputes will have a material adverse effect on our consolidated financial position
or consolidated results of operations.
13. Earnings Per Share
Basic earnings per share of Class A common stock is calculated by dividing the net income attributable
to Cactus Inc. during the period by the weighted average number of shares of Class A common stock
outstanding during the same period. Diluted earnings per share of Class A common stock is calculated by
dividing the net income attributable to Cactus Inc. during that period by the weighted average number of
common shares outstanding assuming all potentially dilutive shares were issued.
We use the “if-converted” method to determine the potential dilutive effect of outstanding CW Units
(and corresponding shares of outstanding Class B common stock), and the treasury stock method to determine
the potential dilutive effect of unvested restricted stock units assuming that the proceeds will be used to
purchase shares of Class A common stock.
The following table summarizes the basic and diluted earnings per share calculations:
2019 2018
Numerator:
Net income attributable to Cactus Inc.—basic $ 85,612 $ 51,683
Net income attributable to non-controlling interest (1) 56,012 —
Net income attributable to Cactus Inc.—diluted (1) $ 141,624 $ 51,683
Denominator:
Weighted average Class A shares outstanding—basic 44,983 32,329
Effect of dilutive shares (2) 30,370 366
Weighted average Class A shares outstanding—diluted (2) 75,353 32,695
Earnings per Class A share—basic $ 1.90 $ 1.60

Earnings per Class A share—diluted (1) (2) $ 1.88 $ 1.58
(1) Under the if-converted method for the twelve months ended December 31, 2019, the numerator is
adjusted in the calculation of diluted earnings per share to include $73.7 million of additional pre-
tax income attributable to non-controlling interest adjusted for a corporate effective tax rate of
24%.
(2) Diluted earnings per share for the year ended December 31, 2018 excludes 37.2 million shares of
Class B common stock as the effect would be anti-dilutive.
14. Supplemental Cash Flow Information
Non-cash investing and financing activities were as follows:

2019 2018 2017
Property and equipment acquired under finance leases $ 3,008 $ 9,966 $ 12,941
Property and equipment in payables 1,052 1,312 1,553
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Cash paid for interest and income taxes was as follows:

2019 2018 2017
Cash paid for interest $ 1,187 $ 3,583 $ 18,826
Cash paid for income taxes, net 5,301 7,613 1,535
In conjunction with our IPO, we issued and contributed shares of Class B common stock to owners of
CW Units equal to the number of outstanding CW Units held by the owners thereof. The Class B common stock
has no economic interest and does not share in cash dividends or liquidation rights.
During the year ended December 31, 2019, we issued 9.3 million shares of Class A common stock
pursuant to redemptions of CW Units by holders thereof.
15. Quarterly Financial Information (Unaudited)
Summarized quarterly financial data for the years ended December 31, 2019 and 2018 are presented in
the following tables. In the following tables, the sum of basic and diluted earnings per share for the four
quarters may differ from the annual amounts due to the required method of computing weighted average
number of shares in the respective periods. Additionally, due to the effect of rounding, the sum of the individual
quarterly earnings per share amounts may not equal the calculated year-to-date earnings per share amount.
2019 Quarters
First Second Third Fourth Total
Total revenues $ 158,875 $ 168,493 $ 160,808 $ 140,238 $ 628,414

Net income 48,446 40,750 35,833 31,274 156,303
Less: net income attributable to non-
controlling interest 21,639 19,342 16,494 13,216 70,691
Net income attributable to Cactus Inc. 26,807 21,408 19,339 18,058 85,612
Earnings per Class A share—basic $ 0.69 $ 0.46 $ 0.41 $ 0.38 $ 1.90
Earnings per Class A share—diluted $ 0.59 $ 0.45 $ 0.41 $ 0.38 $ 1.88
Dividends declared per common share $ — $ — $ — $ 0.09 $ 0.09
2018 Quarters
First Second Third Fourth Total
Total revenues $ 115,110 $ 138,543 $ 150,658 $ 139,824 $ 544,135

Net income 26,408 41,542 43,648 38,683 150,281
Less: pre-IPO net income attributable to Cactus
LLC 13,648 — — — 13,648
Less: net income attributable to non-controlling
interest 9,007 29,208 24,976 21,759 84,950
Net income attributable to Cactus Inc. 3,753 12,334 18,672 16,924 51,683
Earnings per Class A share—basic $ 0.14 $ 0.47 $ 0.52 $ 0.45 $ 1.60
Earnings per Class A share—diluted $ 0.14 $ 0.46 $ 0.52 $ 0.44 $ 1.58
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Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
None.
Item 9A. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
We have evaluated, under the supervision and with the participation of our principal executive officer
and principal financial officer, the effectiveness of the design and operation of our disclosure controls and
procedures (as defined in Rules 13a‑15(e) and 15d‑15(e) under the Exchange Act as amended) as of
December 31, 2019. Based upon that evaluation, our principal executive officer and principal financial officer
concluded that our disclosure controls and procedures were effective at the reasonable assurance level as of
such date. Our disclosure controls and procedures are designed to provide reasonable assurance that the
information required to be disclosed by us in reports that we file or submit under the Exchange Act is
accumulated and communicated to our management, including our principal executive officer and principal
financial officer, as appropriate to allow timely decisions regarding required disclosure and is recorded,
processed, summarized and reported within the time periods specified in the rules and forms of the SEC.
Remediation of Previously Reported Material Weakness
As discussed in “Part II – Item 9A, Controls and Procedures” of our Annual Report on Form 10-K for
the year ended December 31, 2018, we identified a material weakness in our internal control over financial
reporting related to accounting of the liability and deferred tax asset associated with the tax receivable
agreement (“TRA”). In response to the identified material weakness, we implemented certain processes and
procedures to address and remediate this material weakness. We added the following processes and procedures:
· Replaced our outside service provider for tax compliance, support of tax accounting and reporting
functions, and TRA accounting processes beginning in the first quarter of 2019 and hired a Tax
Director in May 2019 who has extensive knowledge and experience in accounting for TRA
liabilities;
· Redesigned, enhanced and implemented control activities related to the quarterly processes around
accounting for the TRA beginning in the second quarter of 2019; and
· Redesigned, enhanced and implemented control activities related to reviews of the completeness
and accuracy of inputs (including estimates) and assumptions used in calculations beginning in the
third quarter of 2019
The control activities discussed above have operated for a sufficient period of time, and management
has concluded, through testing, that these controls are effective. Therefore, management has concluded that the
previously identified material weakness has been remediated as of December 31, 2019.
Changes in Internal Control over Financial Reporting
There have been no other changes in our internal control over financial reporting during the quarter
ended December 31, 2019 that have materially affected, or are reasonably likely to materially affect, our
internal control over financial reporting.
Item 9B. Other Information
Not applicable.
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PART III
Item 10. Directors, Executive Officers and Corporate Governance
Directors and Executive Officers
The directors and executive officers of the Company are:
Name Age Title

Bruce Rothstein 67 Chairman of the Board of Directors
Scott Bender 66 President, Chief Executive Officer and Director
Joel Bender 60 Senior Vice President, Chief Operating Officer and Director
Michael McGovern 68 Director, Compensation Committee Chairman and Audit Committee
member
John (Andy) O'Donnell 71 Director, Audit Committee member, Compensation Committee member and
Nominating and Governance Committee member
Gary Rosenthal 70 Director, Nominating and Governance Committee Chairman and
Compensation Committee member
Alan Semple 60 Director, Audit Committee Chairman and Nominating and Governance
Committee member
Melissa Law 46 Director, Audit Committee member and Compensation Committee member
Steven Bender 37 Vice President of Operations
Stephen Tadlock 41 Vice President, Chief Financial Officer and Treasurer
David Isaac 59 General Counsel, Vice President of Administration and Secretary
Set forth below is biographical information about each of our directors and executive officers.
Directors
Bruce Rothstein—Chairman of the Board of Directors. Bruce Rothstein has been our Chairman of
the Board since 2011. Mr. Rothstein has been a Member of Cadent Energy Partners LLC (“Cadent Energy
Partners”), a natural resources private equity firm that invests in companies in the North American energy
industry, since co‑founding Cadent Energy Partners in 2003. From November 2005 until November 2017,
Mr. Rothstein served on the board of directors of Array Holdings, Inc., formerly a portfolio company of Cadent
Energy Partners. From May 2006 to August 2016, he served on the board of directors of Vedco Holdings, Inc.,
formerly a Cadent Energy Partners portfolio company. From December 2007 to April 2016, Mr. Rothstein
served on the board of directors of Torqued‑Up Energy Services, Inc., formerly a Cadent Energy Partners
portfolio company. From December 2008 until February 2012, Mr. Rothstein served as a director of Ardent
Holdings, LLC, a portfolio company of Cadent Energy Partners. Mr. Rothstein graduated from Cornell
University in 1974 with a Bachelor of Arts in Mathematics and New York University’s Stern School of
Business in 1985 with a Master of Business Administration. We believe that Mr. Rothstein’s extensive financial
and energy investment experience brings valuable skills to our board of directors and qualifies him to serve on
our board of directors.
Scott Bender—President, Chief Executive Officer and Director. Scott Bender has been our President
and Chief Executive Officer and one of our directors since 2011, when he and Mr. Joel Bender founded
Cactus LLC. Prior to founding Cactus LLC, Mr. Bender was President of Wood Group Pressure Control from
2000 to 2011. He began his career in 1977 as President of Cactus Wellhead Equipment, a subsidiary of Cactus
Pipe that was eventually sold to Cooper Cameron Corporation in 1996. Mr. Bender graduated from Princeton
University in 1975 with a Bachelor of Science in Engineering and the University of Texas at Austin in 1977
with a Master of Business Administration. We believe that Mr. Bender’s significant experience in the oil field
services industry and his founding and leading of Cactus LLC bring important skills to our board of directors
and qualifies him to serve on our board. Mr. Bender is the father of Steven Bender, our Vice President of
Operations, and the brother of Joel Bender, our Senior Vice President and Chief Operating Officer and one of
our directors.
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Joel Bender—Senior Vice President, Chief Operating Officer and Director. Joel Bender has been
our Senior Vice President and Chief Operating Officer and one of our directors since 2011, when he and
Mr. Scott Bender founded Cactus LLC. Prior to founding Cactus LLC, Mr. Bender was Senior Vice President of
Wood Group Pressure Control from 2000 to 2011. He began his career in 1984 as Vice President of Cactus
Wellhead Equipment, a subsidiary of Cactus Pipe that
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was eventually sold to Cooper Cameron Corporation in 1996. Mr. Bender graduated from Washington
University in 1981 with a Bachelor of Science in Engineering and the University of Houston in 1985 with a
Master of Business Administration. We believe that Mr. Bender’s significant experience in the oil field services
industry and his founding and leading of Cactus LLC bring important skills to our board of directors and
qualifies him to serve on our board. Mr. Bender is the brother of Scott Bender, our President and Chief
Executive Officer and one of our directors.
Michael McGovern—Director. Mr. McGovern has served as one of our directors since 2011. He
currently serves as our Compensation Committee chairman. He served as Executive Advisor to Cadent Energy
Partners from January 2008 to December 2014 and has served as Chairman and Chief Executive Officer of
Sherwood Energy, LLC, a Cadent Energy Partners portfolio company, since March 2009. Mr. McGovern has
also served as a director of GeoMet, Inc., an independent energy company, from September 2010 until
December 2018. He also currently serves on the board of directors of Nuverra Environmental Solutions, Inc.
since August 2017 and Ion Geophysical (NYSE: IO) since June 2019. Mr. McGovern served on the board of
directors of Quicksilver Resources Inc. from March 2013 until August 2016 and of Probe Holdings, Inc. from
February 2014 until July 2017. He has also served on the board of directors of Fibrant (f/k/a DSM Caprolactam)
from May 2016 to June 2019. Mr. McGovern also served on the board of directors of Sonneborn, Inc. from
2012 to December 2016. Mr. McGovern graduated from the Centenary College of Louisiana in 1973 with a
Bachelor of Science in Business. We believe Mr. McGovern’s qualifications to serve on our board of directors
include his 40 years of experience in the energy industry and his extensive executive leadership and
management experience, including as Chief Executive Officer of several public companies.
John (Andy) O’Donnell—Director. Mr. O’Donnell has served as one of our directors since January
2015. Mr. O’Donnell served as an officer of Baker Hughes Incorporated from 1998 until his retirement in
January 2014. In his most recent role he served as Vice President, Office of the CEO of Baker Hughes
Incorporated. Prior to that he held multiple leadership positions within Baker Hughes Incorporated, including
President of Western Hemisphere, President of BJ Services, President of Baker Petrolite and President of Baker
Hughes Drilling Fluids. He was responsible for the process segment, which was divested in early 2004.
Mr. O’Donnell also managed Project Renaissance, an enterprise‑wide cost savings effort, completed in 2001.
Prior to that he served as Vice President Manufacturing for Baker Oil Tools and Plant Manager for Hughes Tool
Company. He joined Hughes Tool Company in 1975 starting his career as a systems analyst. Mr. O’Donnell
served as an officer and aviator in the U.S. Marine Corps and holds a B.S. degree from the University of
California, Davis. He is a member of the board of directors of CIRCOR International, Inc., where he serves on
the Compensation Committee and the Nominating and Governance Committee. We believe Mr. O’Donnell’s
qualifications to serve on our board of directors include his years of experience in the energy industry and his
extensive executive leadership and management experience, including as an officer of Baker Hughes
Incorporated from 1998 until 2014.
Gary Rosenthal—Director. Mr. Rosenthal has served as one of our directors since January 2018. He
currently serves as our Nominating and Governance Committee chairman. Mr. Rosenthal has been a partner in
The Sterling Group, L.P., a private equity firm based in Houston, Texas, since January 2005. Since September
2019, Mr. Rosenthal has served as Chairman of the Board of Highline Aftermarket LLC with whom he has
served as a director since April 2016. Additionally, he has served as Chairman of the Board of Polychem
Investments LLC since March 2019 and from October 2013 until February 2018, he was Chairman of the Board
of Safe Fleet Investments LLC. All three of these companies are Sterling Group portfolio companies. Mr.
Rosenthal served, from 2001 until 2018, as a director and chairman of the Compensation Committee of Oil
States International, Inc. Mr. Rosenthal served as Chairman of the Board of Hydrochem Holdings, Inc. from
May 2003 until December 2004. From August 1998 to April 2001, he served as Chief Executive Officer of
AXIA Incorporated, a diversified manufacturing company. From 1991 to 1994, Mr. Rosenthal served as
Executive Chairman and then after its initial public offering, as Chairman and Chief Executive Officer of
Wheatley—TXT Corp., a manufacturer of pumps and valves for the oil field. Mr. Rosenthal holds J.D. and A.B.
degrees from Harvard University. We believe that Mr. Rosenthal’s qualifications to serve on our board of
directors include his extensive executive leadership experience and his experience in the energy sector.
Alan Semple—Director. Mr. Semple has served as one of our directors since April 2017. He
currently serves as our Audit Committee chairman. Since December 2015, Mr. Semple has served as a member
of the board of directors and the Audit Committee of Teekay Corporation, a leading provider of international
crude oil and gas marine transportation services, and as the Audit Committee Chairman since March 2018.
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Since May 2019, Mr. Semple has served as a member of the Board of Directors and Chairman of the Audit
Committee of Teekay GP, LLC, the general partner of Teekay LNG Partners, LP. He was formerly Director and
Chief Financial Officer at John Wood Group PLC (Wood Group), a provider of engineering,
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production support and maintenance management services to the oil and gas and power generation industries, a
role he held from 2000 until his retirement in May 2015. Prior to this, he held a number of senior finance roles
in Wood Group since 1996. Mr. Semple graduated from the University of Strathclyde (Glasgow, Scotland) in
1979 with a Bachelor of Arts degree in Business Administration and is a member of the Institute of Chartered
Accountants of Scotland. We believe that Mr. Semple’s 30 years of finance experience, primarily in the energy
industry, makes him qualified to serve on our board of directors.
Melissa Law—Director. Ms. Law was appointed by the Board to fill the newly created Board seat in
January 2020. Ms. Law is an accomplished executive leader with significant experience in the oilfield services
industry and more recent experience in the food & beverage ingredient industry. Ms. Law currently serves as
the President of Global Operations for Tate & Lyle since September 2017. As a member of the Executive
Leadership team, Ms. Law is responsible for leading the EHS, Quality, and Sustainability Programs, the end to
end supply chain and logistics function as well as the global manufacturing and engineering organizations. Prior
to joining Tate and Lyle, Ms. Law held various roles of increasing responsibility at Baker Hughes Incorporated
from 1997 to 2017. At Baker Hughes, Ms. Law had full profit and loss responsibility for Baker Hughes' Global
Specialty Chemical Business from 2014-2017 as well as Baker Hughes’ Australasia geo-market from 2013-
2104. Prior to those roles, Ms. Law held various other senior leadership roles in technology, manufacturing and
operations at Baker Hughes. Ms. Law is a graduate of the University of Houston from where she holds a Master
of Science in Environmental Chemistry. We believe Ms. Law’s qualifications to serve on the board include her
20 years of experience in the energy industry and her multi-industry executive leadership and management
experiences.
Our Executive Officers
Steven Bender—Vice President of Operations. Steven Bender has been our Vice President of
Operations since 2011. From 2005 to 2011, Mr. Bender served as Rental Business Manager of Wood Group
Pressure Control. Mr. Bender graduated from Rice University in 2005 with a Bachelor of Arts in English and
Hispanic Studies and the University of Texas at Austin in 2010 with a Master of Business Administration.
Mr. Bender is the son of Scott Bender, our President and Chief Executive Officer and one of our directors.
Stephen Tadlock—Vice President, Chief Financial Officer and Treasurer. Mr. Tadlock has been our
Vice President, Chief Financial Officer and Treasurer since March 2019. He was our Vice President and Chief
Administrative Officer from March 2018 until March 2019 and joined our company in June 2017 as our Vice
President of Corporate Services. Mr. Tadlock previously worked at Cadent Energy Partners LLC from 2007 to
2017, where he most recently served as a Partner from 2014 to 2017. While at Cadent Energy Partners LLC,
Mr. Tadlock managed investments across all energy sectors and worked with Cactus LLC since its founding in
2011 as a board observer. Prior to joining Cadent Energy Partners LLC, Mr. Tadlock was a consultant to Cairn
Capital, a London based asset management firm. Previously he was associate to the CEO of SoundView, a
publicly traded investment bank in Old Greenwich, Connecticut. Mr. Tadlock began his career as an analyst at
UBS Investment Bank in New York, New York. Mr. Tadlock served as a director and chairman of Polyflow
Holdings, LLC until his resignation in 2018. Mr. Tadlock also served as a director of Composite Energy
Services, LLC and Energy Services Holdings, LLC until his respective resignations in 2017. Mr. Tadlock
graduated from Princeton University in 2001 with a Bachelor of Science in Engineering in Operations Research
and from the Wharton School at the University of Pennsylvania in 2007 with a Master of Business in
Administration.
David Isaac—General Counsel, Vice President of Administration and Secretary. David Isaac has
been our General Counsel, Vice President of Administration and Secretary since 2018. Mr. Isaac previously
worked at Rockwater Energy Solutions, Inc. from 2011 to 2017 where he most recently served as Senior Vice
President of Human Resources and General Counsel. While at Rockwater, Mr. Isaac led the Human Resources,
HSE, and Legal functions of the organization. Prior to joining Rockwater, Mr. Isaac was the Vice President of
Human Resources and General Counsel of Inmar, Inc. a private business-process outsourcing and reverse
logistics firm in Winston-Salem, North Carolina. Previously he served as Senior Vice President of Human
Resources at Wachovia Bank, also in Winston-Salem, North Carolina. Before Wachovia, Mr. Isaac performed
legal and human resources functions for Baker Hughes, Inc. and its subsidiaries in Houston, Texas. Mr. Isaac
graduated from The College of William & Mary in 1983 with a Bachelor of Arts in Economics and from The
Ohio State University in 1986 with a Juris Doctor.
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Composition of Our Board of Directors
Our business and affairs are managed under the direction of our board of directors. Our board of
directors consists of eight members, including our Chief Executive Officer. In connection with our IPO, we
entered into a Stockholders’ Agreement with Cadent and Cactus WH Enterprises, a Delaware limited liability
company owned by Messrs. Scott Bender, Joel Bender and Steven Bender and certain of our other officers and
employees. The Stockholders’ Agreement provides each of Cadent and Cactus WH Enterprises with the right to
designate a certain number of nominees to our board of directors so long as they and their respective affiliates
collectively beneficially own at least 5%, respectively, of the outstanding shares of our common stock. See
“Item 13. Certain Relationships and Related Transactions, and Director Independence—Stockholders’
Agreement.”
In evaluating director candidates, our board of directors will assess whether a candidate possesses the
integrity, judgment, knowledge, experience, skills and expertise that are likely to enhance the board’s ability to
manage and direct our affairs and business, including, when applicable, to enhance the ability of committees of
our board of directors to fulfill their duties.
Our directors are divided into three classes serving staggered three‑year terms. Class I, Class II and
Class III directors will serve until our annual meetings of stockholders in 2021, 2022 and 2020, respectively.
Messrs. McGovern and O’Donnell have been assigned to Class I, Messrs. Semple and Joel Bender and Ms. Law
have been assigned to Class II, and Mr. Rothstein, Scott Bender and Mr. Rosenthal have been assigned to
Class III. At each of the Company’s annual meeting of stockholders, directors will be elected to succeed the
class of directors whose terms have expired.
Our board of directors has reviewed the independence of our directors using the independence
standards of the New York Stock Exchange (“NYSE”) and, based on this review, determined that
Messrs. Semple, McGovern, O’Donnell and Rosenthal are independent within the meaning of the NYSE listing
standards currently in effect and within the meaning of Section 10A‑3 of the Securities Exchange Act of 1934,
as amended (the “Exchange Act”).
Committees of the Board of Directors
We have a standing Audit Committee, Compensation Committee and a Nominating and Governance
Committee.
Audit Committee
Rules implemented by the NYSE and the SEC require us to have an Audit Committee comprised of at
least three directors who meet the independence and experience standards established by the NYSE and the
Exchange Act. Our Audit Committee is currently comprised of Messrs. Semple, McGovern and O’Donnell and
Ms. Law, each of whom are independent under the rules of the SEC. SEC rules also require that a public
company disclose whether or not its audit committee has an “audit committee financial expert” as a member.
An “audit committee financial expert” is defined as a person who, based on his or her experience, possesses the
attributes outlined in such rules. The board has determined that Mr. Semple satisfies the definition of an “audit
committee financial expert.” Mr. Semple serves as the chairman of the Audit Committee.
The Audit Committee oversees, reviews, acts on and reports on various auditing and accounting
matters to the board, including: the selection of our independent accountants, the scope of our annual audits,
fees to be paid to the independent accountants, the performance of our internal audit function and our
independent accountants and our accounting practices. In addition, the Audit Committee assists our board of
directors in fulfilling its oversight responsibilities regarding our compliance programs relating to legal and
regulatory requirements. In connection with our IPO, we adopted an Audit Committee charter defining the
committee’s primary duties in a manner consistent with the rules of the SEC and applicable stock exchange or
market standards. Our Audit Committee charter is available on our website at www.CactusWHD.com.
Compensation Committee
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Our Compensation Committee is currently comprised of Messrs. McGovern, Rosenthal and O’Donnell
and Ms. Law, all of whom meet the independence standards established by the NYSE. Mr. McGovern serves as
the chairman of the Compensation Committee. The Compensation Committee establishes salaries, incentives
and other forms of compensation
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for officers and other employees. The Compensation Committee also administers our incentive compensation
and benefit plans. We have adopted a Compensation Committee charter defining the committee’s primary duties
in a manner consistent with the rules of the SEC and applicable stock exchange or market standards. Our
Compensation Committee charter is available on our website at www.CactusWHD.com.
Nominating and Governance Committee
Our Nominating and Governance Committee is currently comprised of Messrs. Rosenthal, Semple and
O’Donnell, all of whom meet the independence standards established by the NYSE. Mr. Rosenthal serves as the
chairman of the Nominating and Governance Committee. The Nominating and Governance Committee
identifies, evaluates and recommends qualified nominees to serve on our board of directors, develops and
oversees our internal corporate governance processes and maintains a management succession plan. We have
adopted a Nominating and Governance Committee charter defining the committee’s primary duties in a manner
consistent with the rules of the SEC and applicable stock exchange or market standards. Our Nominating and
Governance Committee charter is available on our website at www.CactusWHD.com.
Corporate Governance
Corporate Governance Guidelines
Our board of directors believes that sound governance practices and policies provide an important
framework to assist it in fulfilling its duty to stockholders. The Company’s “Corporate Governance Guidelines”
cover the following principal subjects:
• the size of the board;
• qualifications and independence standards for the board;
• director responsibilities;
• board of director leadership;
• meetings of the board and of non‑employee directors;
• committee functions and independence of committee members;
• compensation of the board;
• self‑evaluation and succession planning;
• ethics and conflicts of interest (a copy of the current “Code of Business Conduct and Ethics” is
posted on the Company’s website at www.CactusWHD.com);
• stockholder communications with directors; and
• access to senior management and to independent advisors.
The Corporate Governance Guidelines are posted on the Company’s website at www.CactusWHD.com.
The Corporate Governance Guidelines will be reviewed periodically and as necessary by the board for its
approval.
The NYSE has adopted rules that require listed companies to adopt governance guidelines covering
certain matters. The Company believes that the Corporate Governance Guidelines comply with the NYSE rules.
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Anti-Hedging and Pledging Policies
Our directors and executive officers are prohibited from hedging their ownership of Company
stock. Furthermore, our directors and executive officers are prohibited from pledging their Company stock.
Board Leadership
Our board of directors directs and oversees the management of the business and affairs of the
Company in a manner consistent with the best interests of the Company. Our board’s responsibility is one of
oversight, and in performing its oversight role, our board serves as the ultimate decision‑making body of the
Company, except for those matters reserved to or shared with our stockholders.
In accordance with the Company’s Corporate Governance Guidelines, our board of directors selects the
Company’s Chairman and the Company’s CEO in any way it considers in the best interests of the Company
and, accordingly, does not have a policy on whether the roles of Chairman and CEO should be separate or
combined and, if separate, whether the Chairman should be selected from the independent directors. At the
present time, the roles of Chairman and CEO are separate. Mr. Rothstein currently serves as the Chairman of the
Board, and is not considered independent under NYSE rules.
Executive Sessions of Non‑Employee Directors
Our board of directors holds regular executive sessions in which the non‑employee directors meet
without any members of management present. The purpose of these executive sessions is to promote open and
candid discussion among the non‑employee directors. The Chairman of the Board will serve as the lead director
at executive sessions of the non‑employee directors, unless the Chairman of the Board is a member of
management, in which case the lead director at such meetings will be the chairman of the Audit Committee.
If the non‑employee directors includes members who are not independent within the listing
requirements of the NYSE, the independent members of the board will meet in executive session at least once
per year. Our Corporate Governance Guidelines provide that the Chairman of the Board will serve as the lead
director at executive sessions of the independent directors, unless the Chairman of the Board is not independent,
in which case the lead director at such meetings will be an independent director selected by our board of
directors. At present, the Chairman of the Board is not independent, and the board has selected Mr. O’Donnell
to serve as the lead director at executive sessions of the independent directors.
Communications with the Board of Directors
Stockholders and any other interested parties may send communications to the board, any committee
of the board, the Chairman of the Board or any other director in particular to: Cactus, Inc., 920 Memorial City
Way, Suite 300 Houston, Texas 77024. Stockholders and any other interested parties should mark the envelope
containing each communication as “Stockholder Communication with Directors” and clearly identify the
intended recipient(s) of the communication. Our General Counsel will review each communication received
from stockholders and other interested parties and will forward the communication, as expeditiously as
reasonably practicable, to the addressees if: (1) the communication complies with the requirements of any
applicable policy adopted by the board relating to the subject matter of the communication; and (2) the
communication falls within the scope of matters generally considered by the board. To the extent the subject
matter of a communication relates to matters that have been delegated by the board to a committee or to an
executive officer of the Company, then our General Counsel may forward the communication to the executive
officer or chairman of the committee to which the matter has been delegated. The acceptance and forwarding of
communications to the members of the board or an executive officer does not imply or create any fiduciary duty
of the board members or executive officer to the person submitting the communications.
Oversight of Risk Management
Risk assessment, management and oversight are an integral part of our governance and management
processes. Our board of directors encourages management to promote a culture that incorporates risk
management into our corporate strategy and day‑to‑day business operations. Management discusses strategic
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and operational risks at regular management meetings and conducts specific strategic planning and review
sessions during the year that include a focused discussion and
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analysis of the risks facing us. Throughout the year, senior management reviews these risks with the board at
regular board meetings as part of management presentations that focus on particular business functions,
operations or strategies, and presents the steps taken by management to mitigate such risks.
Our board of directors does not have a standing risk management committee, but rather administers
this oversight function directly through the board as a whole. Our board of directors is responsible for
monitoring and assessing strategic risk exposure, and the Audit Committee assists the board in fulfilling its
oversight responsibilities by overseeing our major financial risk exposures and the steps our management has
taken to monitor and control these exposures.
Attendance at Annual Meetings
While we have no formal policy regarding director attendance at its annual meetings of stockholders,
directors are encouraged to attend our annual meetings, if practicable. All of the directors attended our annual
meeting held in 2019.
Board and Committee Meeting Attendance
During 2019, the entire Board held twelve meetings, the Audit Committee held six meetings, the
Compensation Committee held four meetings and the Nominating and Governance Committee also held four
meetings. Each of the directors attended 100% of the meetings of the board. Committee members also attended
100% of the meetings for the committees on which they serve except Mr. O’Donnell who attended 67% of the
meetings of the Audit Committee having missed two special meetings that were convened within the same
week of his absence.
Compensation Committee Interlocks and Insider Participation
During 2019, the Company’s Compensation Committee consisted of Messrs. McGovern, Rosenthal
and O’Donnell. There were no compensation committee interlock relationships for the year ended December
31, 2019. No member of our Compensation Committee during 2019 has engaged in any related party
transaction in which our company was a participant.
Delinquent Section 16(a) Reports
Based solely on the review of Forms 3 and 4 received by the Company during the 2019 fiscal year, as
required under Section 16(a)(2) of the Exchange Act, all of our directors and officers reported all their
transactions as required on a Form 4, on a timely basis.
Code of Business Conduct and Ethics
Our board of directors has adopted a Code of Business Conduct and Ethics applicable to all of our
officers, directors and employees, including our principal executive officer, principal financial officer, principal
accounting officer and controller, or persons performing similar functions and is available on our website at
www.CactusWHD.com under “Corporate Governance” within the “Investors” section. We will provide a copy
of this document to any person, without charge, upon request, by writing to us at Cactus, Inc., Investor
Relations, 920 Memorial City Way, Suite 300, Houston, Texas 77024. We intend to satisfy the disclosure
requirement under Item 406(b) of Regulation S-K regarding amendments to, or waivers from, provisions of our
Code of Business Conduct and Ethics by posting such information on our website at the address and the
location specified above.
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Item 11. Executive Compensation
Introduction
This Compensation Discussion and Analysis (“CD&A”) provides information about the compensation
objectives and policies for our principal executive officer, our principal financial officer and our three other
most highly compensated executive officers (collectively our named executive officers or “NEOs”) during the
last completed fiscal year and is intended to place in perspective the information contained in the executive
compensation tables that follow this discussion. Throughout this discussion, the following individuals are
referred to as our NEOs and are included in the Summary Compensation Table which follows:
Name Position
Scott Bender President, Chief Executive Officer and Director
Joel Bender Senior Vice President, Chief Operating Officer and Director
Stephen Tadlock Vice President, Chief Financial Officer and Treasurer(1)
Brian Small Senior Finance Director and Former Chief Financial Officer(2)
Steven Bender Vice President of Operations
David Isaac General Counsel, Vice President of Administration and Secretary
(1) On March 15, 2019, Mr. Tadlock became our Vice President, Chief Financial Officer and Treasurer,
completing the management transition announced in November 2018. Prior to that time, Mr. Tadlock
served as our Vice President and Chief Administrative Officer.
(2) Mr. Small stepped down from the position of Chief Financial Officer on March 15, 2019 and transitioned to
the role of Senior Finance Director.
Executive Compensation Philosophy and Objectives
The core principle of our executive compensation philosophy is to pay for performance that is aligned
with our business strategy and drives growth in shareholder value over the short and long term. Accordingly, a
significant portion of the compensation that we pay to our NEOs is in the form of variable, “at-risk” cash and
equity incentives. The following compensation objectives are considered in setting the compensation
components for our executive officers:
· Attraction and retention: providing compensation opportunities that reflect competitive market practices
so that we can attract and retain key executives responsible not only for our continued growth and
profitability, but also for ensuring proper corporate governance while carrying out the goals and plans of
the Company;
· Paying for performance: linking a significant portion of compensation to variable, “at-risk” incentive
compensation with realized values dependent upon financial, operational, and stock price performance to
ensure that compensation earned by our NEOs reflects our performance; and
· Shareholder alignment: providing a balance of short-term and long-term incentive opportunities with a
majority of NEO compensation in the form of equity in order to ensure alignment of interests between our
NEOs and our shareholder, and to promote an ownership culture among our executive officers.
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Our compensation philosophy is supported by the following principal pay elements:
Grounding Principles
Attraction & Pay for Shareholder
Element Key Characteristic Retention Performance Alignment
Base Salary • Annual fixed cash compensation
• Critical factor in attracting and retaining qualified
talent
Short-term • Annual variable cash award
Incentives • Awards are tied to achievement of key financial and
(STI) safety objectives
Long-term • Provided in the form of time-vested equity
Incentives • Promotes alignment with shareholders by tying a
(LTI) majority of NEO compensation to creation of long-term
value and by encouraging NEOs to build meaningful
equity ownership
Target Pay Mix
As evidence of our emphasis on at-risk, incentive-based pay, the charts below show the mix of total
direct compensation of our Chief Executive Officer and our other NEOs for 2019. These charts illustrate that a
majority of NEO total direct compensation is at-risk (86% for our Chief Executive Officer and an average of
80% for our other NEOs).
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Compensation Program Governance
We have worked extensively and deliberately to develop a thoughtful, fair, and effective compensation
program for our NEOs that helps us to deliver long-term sustainable growth to our stockholders. The following
chart highlights several features of our compensation practices that are intended to meet our objectives:
What We Do What We Don't Do

Significant majority of pay at risk X No excessive prerequisites
Balance of short- and long-term incentives X No guaranteed bonuses
Clawback policy for all executive officers that
applies to cash and equity incentives X No excise tax gross-ups
Prohibition on hedging, pledging, and short sales
Share ownership guidelines for NEOs and directors X by insiders
Regularly evaluate risks of our compensation policy X Prohibition on option repricing
Independent compensation consultant
One-year minimum vesting requirement for LTIP
grants
2019 Say on Pay and Say on Frequency
At our 2019 Annual Meeting, a plurality of our stockholders expressed their preference for an advisory
vote on executive compensation occurring every three years, and we have implemented their recommendation.
At our 2019 Annual Meeting, we also held our first advisory vote on compensation for our NEOs
(“Say on Pay”). In that vote our stockholders expressed their support, with 94% of the shares of our Class A
common stock and Class B common stock present or represented by proxy at the 2019 Annual Meeting voting
in support our executive compensation policies and practices for our NEOs during 2018.
Our Compensation Committee values the opinions of our shareholders regarding NEO compensation.
In reviewing our program, our Compensation Committee considered the results of last year’s advisory vote on
executive compensation and the support expressed by stockholders in their overall assessment of our programs.
Our Compensation Committee elected to apply similar principles in determining the types and amounts of
compensation to be paid to our NEOs for 2019.
How We Make Compensation Decisions
Role of the Compensation Committee
The Compensation Committee has the responsibility for reviewing and approving the compensation
policies, programs, and plans for our senior officers (including our NEOs) and our non-employee directors. The
Compensation Committee’s responsibilities include administering our Management Incentive Plan (“MIP”),
which provides for annual cash incentive opportunities, and our long-term incentive plan (the “LTIP”), which
provides for the grant of equity-based awards. The Compensation Committee reviews the CD&A section of our
annual proxy statement and produces the Compensation Committee Report with respect to our executive
compensation disclosures for inclusion in the annual proxy statement. In addition, the Compensation Committee
regularly reviews current best compensation and governance practices to ensure that our executive
compensation program is consistent with recent developments and market practice. In overseeing the
compensation of our directors and officers, our Compensation Committee considers various analyses and
perspectives provided by its independent compensation consultant and by Company management. Subject in
certain circumstances to Board approval, the Compensation Committee has the sole authority to make final
decisions with respect to our executive compensation program, and the Compensation Committee is under no
obligation to use the input of other parties. For more detailed information regarding the Compensation
Committee, please refer to the Compensation Committee Charter, which may be accessed via our website at
www.CactusWHD.com by selecting “Investors,” “Corporate Governance” and then “Governance Documents.”
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Role of Independent Compensation Consultant
Pearl Meyer & Partners, LLC (“Pearl Meyer”) serves as independent compensation consultant for, and
reports directly to, the Compensation Committee. Representatives of Pearl Meyer attend Compensation
Committee meetings as requested and communicate with the Compensation Committee informally between
meetings as necessary. Pearl Meyer assists and advises the Compensation Committee on all aspects of our
executive compensation program. Services provided by the independent compensation consultant include:
· reviewing the compensation and stock performance peer groups and recommending changes,
as necessary;
· reviewing executive compensation based on an analysis of market-based compensation data;
· analyzing the effectiveness of our executive compensation program and recommending

changes, as necessary; and
· evaluating how well our executive compensation adheres to program objectives.
To facilitate the delivery of these services to the Compensation Committee, Pearl Meyer interfaces
with our management, primarily with our General Counsel and VP of Administration. In 2019, Pearl Meyer did
not provide any services to the Company other than those requested by the Compensation Committee in Pearl
Meyer’s role as the Committee’s independent advisor.
Other than those services requested by the Compensation Committee, Pearl Meyer did not have any
business or personal relationships with members of the Compensation Committee or executives of the
Company, did not own any of the Company’s common stock and maintained policies and procedures designed
to avoid such conflicts of interest. As such, the Compensation Committee determined the engagement of Pearl
Meyer in 2019 did not create any conflicts of interest.
Role of Executive Officers in Compensation Decisions
With respect to the compensation of the NEOs other than our Chief Executive Officer, the
Compensation Committee considers the recommendations of our Chief Executive Officer and each NEO’s
individual performance. In light of our NEOs’ integral role in establishing and executing the Company’s overall
operational and financial objectives, the Compensation Committee requests that our NEOs provide the initial
recommendations on the appropriate goals for the qualitative and quantitative performance metrics used in our
short-term cash incentive program. However, the Committee is under no obligation to follow those
recommendations, and only Compensation Committee members are allowed to vote on decisions regarding
NEO compensation.
The Compensation Committee may invite any NEO to attend Compensation Committee meetings to
report on the Company’s progress with respect to the annual quantitative and qualitative performance metrics,
but any such officer is excluded from any decisions or discussions regarding his individual compensation. In
addition, the Board has granted limited authority to Scott Bender, our Chief Executive Officer, to make awards
under the LTIP to certain individuals who are not executive officers.
Role of Competitive Benchmarking
In the exercise of its duties, the Compensation Committee periodically evaluates the Company’s
executive compensation against that of comparable companies. The Compensation Committee does not set
specific percentile goals against competitive data for purposes of determining executive compensation levels. In
establishing individual compensation opportunities, the Committee considers this competitive data as well as a
variety of other factors including individual performance, competencies, scope of responsibility, and internal
equity.
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The Compensation Committee considers the competitive market to consist of the oilfield services
industry broadly as well as other similarly sized companies in related industries who could potentially compete
with us for executive talent. The Committee periodically reviews data for a selected peer group approved by the
Compensation Committee (the “peer group”) as well as for broader general industry companies of comparable
size and business complexity (compensation survey
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data), as provided to the Committee by their independent advisor. For the 2019 compensation analysis, the
Company used the following peer group companies:
2019 Compensation Peer Group

Archrock, Inc. NCS Multistage Holdings, Inc.
Core Laboratories, NV Newpark Resources, Inc.
Dril-Quip, Inc. Oil States International, Inc.
Forum Energy Technologies Pioneer Energy Services Corp.
Frank’s International, NV RPC, Inc.
Helix Energy Solutions Group, Inc. USA Compression Partners, LP
In selecting comparison companies, the Compensation Committee considered various factors including
each company’s participation in the energy services sector as well as market capitalization, annual revenues,
business complexity, profitability, returns on equity and assets, the number of divisions/segments, countries in
which they operate and total number of employees. The selected peer companies are reviewed from time to time
to ensure their continued appropriateness for comparative purposes.
Elements of Compensation
Base Salary
Base salary is the guaranteed element of an executive’s direct compensation and is intended to provide
a foundation for a competitive overall compensation opportunity for the executive. The Compensation
Committee reviews each executive’s base salary annually. Executive officer base salaries are determined after
an evaluation that considers the executive’s prior experience and breadth of knowledge and which also
considers compensation data from peer group companies and other similarly sized companies in businesses
comparable to the Company’s, the Company’s and the executive’s performance, and any significant changes in
the executive’s responsibilities. The Compensation Committee considers all these factors together plus overall
industry conditions.
Salaries for our Chief Executive Officer and our Chief Operating Officer have remained unchanged
since 2017. Effective February 17, 2019, after discussions regarding competitive market data with Pearl Meyer,
the Board approved a salary of $335,000 for Stephen Tadlock, who completed his transition to Chief Financial
Officer on March 15, 2019.
2018 2019 Percent Increase

NEO Base Salary Base Salary During 2019
Scott Bender $ 300,000 $ 300,000 0%
Joel Bender 300,000 300,000 0%
Stephen Tadlock 250,000 335,000 34%
Brian Small (1)
250,000 —
Steven Bender (1)
300,000 —
David Isaac (1)
300,000 —
(1) Cactus was an EGC from our IPO until the end of 2019, and as such, in our 2019 proxy statement, we only
reported information regarding the compensation of our Chief Executive Officer and our two next most
highly compensated executive officers. Accordingly, Brian Small, Steven Bender and David Isaac were not
NEOs for any years prior to 2019.
Short Term Incentives
Our NEOs are eligible for an annual incentive bonus which is designed to focus executives on
execution of our annual plan, which is linked to our long-term strategy. Execution against our annual corporate
plan is important to drive long-term shareholder value by improving financial strength, managing costs and
investing in projects that will deliver future value. We employ financial and safety performance metrics to
further specific objectives of our strategy, such as EBITDA and total recordable incident rate.
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On February 15, 2019, after discussions with Pearl Meyer, the Board approved a performance‑based
bonus plan for 2019, the 2019 Management Incentive Plan (the “2019 MIP”), pursuant to which all eligible
Company employees, including NEOs, would be eligible to receive a cash bonus upon the achievement of
certain financial performance and safety metrics.
Under the 2019 MIP, executive officers, including NEOs, were eligible to receive base cash bonus
payments equal to a certain specified percentage of their annual base salaries (“Target Bonus”) in the event that
the Company met the specified performance targets. The approved 2019 Target Bonus for each of the
Company’s NEOs is set forth in the table below as a percentage of such executive’s 2019 base salary:
2019 Target Bonus Opportunity

NEO (percent of Salary)
Scott Bender 100%
Joel Bender 100%
Stephen Tadlock 50%
Brian Small 40%
Steven Bender 75%
David Isaac 50%
Target Bonus Opportunity
For NEOs, the MIP has two performance parameters on which the bonus is calculated. The first
parameter is Earnings Before Interest, Taxes, Depreciation and Amortization, excluding exceptional items, as
defined by the Board (EBITDA), which is weighted as 90% of the bonus opportunity. Participants begin to earn
a bonus payout when EBITDA performance reaches Threshold EBITDA which is set at 80% of Target
EBITDA. Participants are eligible for a Stretch bonus opportunity if actual EBITDA exceeds Target
EBITDA. The maximum Stretch bonus payment is achieved when EBITDA performance reaches 120% of
Target EBITDA. The maximum Stretch payment is 40% of the full, non-stretch bonus payment. The
calculation of the EBITDA portion of the bonus payout is linear between Threshold and Target and between
Target and Stretch. The second parameter is Total Recordable Incident Rate (“TRIR”) which is defined as the
number of employees per 100 full-time employees that have been involved in a recordable injury or illness in
the pertinent period. TRIR is weighted as 10% of the bonus opportunity. Participants begin to earn a bonus
payout when TRIR performance reaches Threshold TRIR of 1.85. A full bonus payout on the TRIR parameter
is achieved when safety performance reaches Target TRIR of 1.50 or lower. The calculation of the TRIR
portion of the bonus payout is linear between Threshold and Target. Depending upon Company performance,
actual payouts under the 2019 MIP may be between 0% and 140% of the Target Bonus opportunity for each
NEO.
EBITDA Payout
($ in millions)
Threshold $ 169.60 0%
Target 212.00 100%
Stretch 254.40 140%
TRIR Payout
Threshold 1.85 0%
Target 1.50 100%
2019 Award Determination
Performance under the MIP is assessed relative to pre-established goals approved by the Committee
near the beginning of the fiscal year. For 2019, the Compensation Committee approved performance objectives
under the 2019 MIP after considering a combination of factors including alignment with the Company’s
business strategy, 2019 budget, investor expectations, recommendations from management, and the
Committee’s assessment of management’s ability to impact outcomes.
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In 2019, the actual EBITDA performance was $229.0 million. which exceeded Target EBITDA. Based
on this result, in addition to earning a full target bonus on the EBITDA component, executives also earned
40.1% of their 40% stretch opportunity an additional 16.2% of the full, non-stretch bonus calculation. The 2019
TRIR performance was 1.64 which is between Threshold and Target performance. Based on this performance
NEOs were eligible for 59.2% payout on the TRIR parameter. In total, NEOs will receive a payout for the 2019
MIP of approximately 111.3% of Target. The table below summarizes the metrics and performance standards
approved for the 2019 MIP, and management’s level of achievement under the plan:
% of
Threshold Target Stretch Actual Target
(in millions)
EBITDA(1) $ 169.6 $ 212.0 $ 254.4 $ 229.0 108 %
(1)Earnings before interest, taxes, depreciation and amortization excluding any exceptional items as defined by
the board.
The EBITDA performance represented in the table above demonstrates full target achievement with
respect to EBITDA. Furthermore, because EBITDA achievement was in excess of target, this results in the
achievement of 40.1% of the 40% stretch component. This equates to a stretch payment of 16.2% of the full,
non-stretch bonus calculation.
% of
Threshold Target Actual Target
TRIR(1) 1.85 1.50 1.64 108 %
(1)Total Recordable Incident Rate (TRIR) is the number of employees per 100 full-time employees that have
been involved in a recordable injury or illness in the pertinent period.
The following table shows the calculation of the non-stretch bonus payment:
Parameter Percent of Target Weighting Percent Earned

EBITDA 100 % 90 % 90.0 %
TRIR 59.2 % 10 % 5.9 %
Total 95.9 %
The table below shows the aggregate bonus calculation including both the non-stretch bonus payment
and the stretch bonus:
Non-Stretch Bonus Percent 95.9 %

Stretch Bonus Component (16.2% of Non-Stretch Bonus) 15.4 %
Total Bonus Percentage 111.3 %
Long-Term Incentives
In order to incentivize individuals providing services to us or our affiliates, in 2018 the Board adopted
a long‑term incentive plan (the “LTIP”). The LTIP provides for the grant, from time to time, at the discretion of
the Board or a committee thereof, of stock options, stock appreciation rights, restricted stock, restricted stock
units, stock awards, dividend equivalents, other stock‑based awards, cash awards, substitute awards and
performance awards. The Board has delegated to the Compensation Committee the authority to administer the
LTIP, including the power to determine the eligible individuals to whom awards will be granted, the number and
type of awards to be granted and the terms and conditions of awards. In addition, the Board has granted limited
authority to Scott Bender, our Chief Executive Officer, to make awards under the LTIP to certain individuals
who are not executive officers.
The primary purpose of awards under our LTIP is to enforce direct alignment between the long-term
interests of our NEOs and those of our shareholders through the use of multi-year vesting and realized value of
equity incentives that is contingent upon our stock price performance. Awards of equity under the LTIP also
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promote long-term share ownership by our NEOs, a goal which is further supported by the adoption of share
ownership guidelines in 2019.
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2019 LTIP Awards.
On March 11, 2019, our NEOs received grants of restricted stock units (“RSUs”) under our LTIP in the
following amounts:
Total RSUs Total Grant

NEO Granted Date Value
Scott Bender 40,139 $ 1,499,994
Joel Bender 40,139 1,499,994
Stephen Tadlock 40,218 1,502,947
Steven Bender 16,055 599,975
David Isaac 12,041 449,972
The restricted stock unit awards will vest in three equal annual installments beginning on the first
anniversary of the grant date.
Retirement, Health and Welfare Benefits
The Company offers retirement, health and welfare benefits to substantially all of its U.S. employees
including executive officers. Executive officers are eligible for these benefits on the same basis as other
employees. Health and welfare benefits we offer to our employees include: medical, vision and dental
coverage, life insurance, accidental death and dismemberment, short and long-term disability insurance, flexible
spending accounts and employee assistance.
The Company offers a defined contribution 401(k) retirement plan to substantially all of its U.S.
employees, including the NEOs. Participants may contribute from 1% to 85% of their base pay and cash
incentive compensation (subject to U.S. Internal Revenue Service (“IRS”) limitations), and the Company makes
matching contributions under this plan on the first 7% of the participant’s compensation (100% match of the
first 3% employee contribution and 50% match on the next 4% employee contribution). Company matching
contributions vest 20% per year on the first five anniversaries of the respective employee’s hire date.
Perquisites
We provide Scott Bender, Joel Bender, Stephen Tadlock, Steven Bender and Brian Small with bi-
weekly vehicle allowances. Additionally, Scott Bender receives a gasoline reimbursement.
Other Compensation Practices and Policies
Compensation Risk
Our compensation policies and practices are designed to provide rewards for short-term and long-term
performance, both on an individual basis and at the entity level. In general, optimal financial and operational
performance, particularly in a competitive business, requires some degree of risk-taking. Our compensation
strategies are designed to encourage company growth and appropriate risk taking but not to encourage excessive
risk taking. We also attempt to design the compensation program for our larger general employee population so
that it does not inappropriately incentivize our employees to take unnecessary risks in their day to day activities.
We recognize, however, that there are trade-offs and that it can be difficult in specific situations to maintain the
appropriate balance. As such, we continue to evaluate our programs with a goal of preventing them from
becoming materially imbalanced one way or the other.
Our compensation arrangements contain certain design elements that are intended to minimize the
incentive for taking unwarranted risk to achieve short-term, unsustainable results. Those elements include a
maximum amount that can be earned under our annual incentive cash compensation program.
We also provide compensation to our NEOs in the form of a reasonable base salary. We want our
executives to be motivated to achieve Cactus’s short-term and long-term goals, without sacrificing our financial
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and corporate integrity in trying to achieve those goals. While an executive’s overall compensation should be
strongly influenced by the achievement
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of specific financial and operational targets, we also believe that a portion of an executive’s compensation
should be awarded in components that provide a degree of financial certainty.
In combination with our risk management practices, we do not believe that risks arising from our
compensation policies and practices for our employees, including our NEOs, are reasonably likely to have a
material adverse effect on us.
Clawback Policy
In June 2019, our Board adopted the Executive Compensation Clawback Policy (the “Clawback
Policy”). In the event of a restatement of our financial statements (other than a restatement caused by a change
in applicable accounting rules or interpretations), the result of which is that any performance-based
compensation paid under an incentive compensation plan would have been a lower amount had it been
calculated based on such restated results, the Compensation Committee may seek to recover for the benefit of
the Company the after tax portion of the difference between the compensation actually paid to the executive and
the corrected amount based on the restated financial results.
Stock Ownership Guidelines
As of December 13, 2019, the Committee has established stock ownership guidelines for our NEOs
and non-employee directors. The approved guidelines are as follows:
Position Required Level of Ownership

Chief Executive Officer 6 times base salary
Other NEOs 2 times base salary
Non-Employee Directors 3 times annual cash retainer for Board service
Stock ownership levels must be achieved by each NEO or non-employee director within five years of
becoming subject to the guidelines, or within five years of any material change to the guideline level of
ownership. As of February 28, 2020, all of our NEOs and non-employee directors have met or exceeded the
ownership expectations under the guidelines other than Mr. Isaac and Ms. Law.
Employment, Severance, and Change-in-Control Agreements
Employment Agreements
In February 2018, in connection with our IPO, we amended and restated our employment agreements
with Messrs. Scott and Joel Bender (as amended and restated, each, an “Employment Agreement”). Each
Employment Agreement reflects the executive’s base salary of $300,000 and has an initial three‑year term that
will extend automatically for one‑year periods thereafter unless advance written notice by either party is
provided. Under the Employment Agreements, each of Messrs. Scott and Joel Bender are entitled to receive
severance compensation if his employment is terminated under certain conditions, such as a termination by the
executive officer for “good reason” or by us without “cause,” each as defined in the agreements and further
described below under “—Potential Payments upon Termination or Change of Control.” In addition, the
agreements provide for:
· specified minimum base salaries;

· participation in all of our employee benefit plans to the extent the executive is eligible
thereunder;
· termination benefits, including, in specified circumstances, severance payments; and
· an annual bonus of up to 100% of annual base salary in the good faith discretion of the Board
if the executive satisfies budgetary and performance goals, as determined annually by the
Board.
On February 21, 2019, we amended the Employment Agreements to provide that Scott Bender and
Joel Bender shall be eligible to receive an additional annual bonus of up to 40% of the regular annual bonus
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actually paid, determined in the good faith discretion of the Board if the executive satisfies additional budgetary
and performance goals, as determined annually by the Board.
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We have not entered into separate severance agreements with Messrs. Scott and Joel Bender and
instead rely on the terms of each executive’s Employment Agreement to dictate the terms of any severance
arrangements. The Employment Agreements do not provide for accelerated or enhanced cash payments or
health and welfare benefits upon a change in control but do provide for salary continuation payments and
subsidized health and welfare benefits upon the termination of the executive’s employment for “good reason” or
without “cause.” Mr. Tadlock will be eligible to receive severance payments should a merger or sale transaction
result in Mr. Tadlock being terminated by the new entity. In addition, Mr. Isaac will be eligible to receive
severance payments should he be subject to a Qualifying Termination prior to the third anniversary of his
commencement date. Severance payments that could become payable to Messrs. Scott and Joel Bender, Mr.
Tadlock and Mr. Isaac pursuant to these arrangements have been described in more detail below under “—
Potential Payments upon Termination or Change of Control—Employment Agreements.”
Non‑Compete Agreements
In connection with our IPO, on February 12, 2018, Cactus LLC entered into amended and restated
noncompetition agreements (each, a “Noncompetition Agreement”) with each of Scott Bender and Joel Bender.
Each of the Noncompetition Agreements provide that, for a period of one year following termination of his
employment, Scott Bender and Joel Bender will not (i) compete against us in connection with our business,
(ii) solicit or induce any of our employees to leave his or her employment with us or hire any of our employees
or (iii) solicit or entice customers who were our customers within the one‑year period immediately prior to his
date of termination to cease doing business with us or to begin doing business with our competitors. Pursuant
to his employment arrangement with the Company, Mr. Isaac is subject to the same restrictions.
Summary Compensation Table
The following table sets forth information regarding the compensation awarded to, earned by or paid to
our NEOs during the year ended December 31, 2019.
Non Equity
Incentive Plan Stock All Other
Name and Principal Salary Bonus Compensation Awards Compensation Total
Position Year ($) ($) ($)(1) ($)(2) ($)(3) ($)
Scott Bender, President, 2019 300,000 — 334,835 1,499,994 29,102 2,163,931
Chief Executive Officer
and Director (4)
2018 300,000 — 300,000 1,000,008 31,135 1,631,143
2017 260,096 — 300,000 — 24,726 584,822
Joel Bender, Senior Vice 2019 300,000 — 334,835 1,499,994 30,120 2,164,949
President, Chief
Operating Officer and
Director (4)
2018 300,000 — 300,000 1,000,008 30,070 1,630,078
2017 260,096 — 300,000 — 14,386 574,482
Stephen Tadlock, Vice 2019 321,923 — 180,971 1,502,947 24,773 2,030,614
President, Chief
Financial Officer and
Treasurer (5)
2018 250,000 — 120,298 1,875,015 23,780 2,269,093
Brian Small, Senior 2019 250,000 — 111,611 — 27,620 389,231
Finance Director and
Former Chief Financial
Officer (5)
Steven Bender, Vice 2019 296,154 — 248,489 599,975 25,789 1,170,407
President of Operations
(5)
David Isaac, General 2019 296,154 — 165,659 449,972 14,260 926,045

Counsel, Vice President
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of Administration and
Secretary (5)
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(1) Amounts of “Non-Equity Incentive Plan Compensation” paid to each applicable NEO were made
pursuant to the Company’s short-term incentive program. For a description of this plan please see
“Compensation Discussion and Analysis—Elements of Compensation—Short-Term Incentives.”
(2) The amounts reported in this column represent the aggregate grant date fair value of restricted stock
unit awards granted to each NEO and computed in accordance with FASB ASC Topic 718. For a
discussion of the valuation assumptions with respect to these awards, see Note 6 in the notes to the
consolidated financial statements in our Annual Report on Form 10‑K for the fiscal year ended
December 31, 2019 (our “2019 Annual Report”). For additional information about restricted stock unit
awards granted during 2018, see “Outstanding Equity Awards at 2019 Fiscal Year‑End” below. For
more information about our LTIP, see “Compensation Discussion and Analysis—Elements of
Compensation—Long-Term Incentives.”
(3) Amounts reflected within the “All Other Compensation” column are comprised of the following
amounts:
Employer
Contributions
to
401(k) Vehicle Gas
Plan Allowance Reimbursement Total
Name Year ($) ($) ($) ($)
Scott Bender 2019 14,375 14,400 327 29,102
2018 15,670 14,400 1,065 31,135
2017 13,545 10,800 381 24,726
Joel Bender 2019 15,720 14,400 — 30,120
2018 15,670 14,400 — 30,070
2017 3,586 10,800 — 14,386
Stephen Tadlock 2019 10,373 14,400 — 24,773
2018 9,380 14,400 — 23,780
Brian Small 2019 13,220 14,400 — 27,620
Steven Bender 2019 11,389 14,400 — 25,789
David Isaac 2019 14,260 — — 14,260
(4) Although Messrs. Scott and Joel Bender each serve on the Board, they are not compensated for their
services as directors.
(5) Mr. Tadlock was not a NEO for any years prior to 2018. Brian Small, Steven Bender and David Isaac
were not NEOs for any years prior to 2019.
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Grants of Plan Based Awards
The following table provides information about equity and non-equity awards granted to our NEOs in
2019, including the following: (1) the grant date; (2) the estimated possible payouts under the non-equity
incentive plan, which is discussed in “Compensation Discussion and Analysis—Elements of Compensation—
Short-term Incentives and -Long-term Incentives”, included herein; (3) the number of restricted stock awards
pursuant to the Company’s LTIP; and (4) the fair value of each equity award.
Estimated Future Payouts Under

Non-Equity Incentive Plan Awards(1)
All Other
Stock
Awards:
Number of
Shares of Grant Date
Stock or Fair Value of
Grant Threshold Target Maximum Units Stock Awards
Name Date ($) ($) ($) (#)(2) ($)(3)
Scott Bender 0 300,000 420,000
3/11/2019 — — — 40,139 1,499,994
Joel Bender 0 300,000 420,000
3/11/2019 — — — 40,139 1,499,994
Stephen Tadlock 0 167,500 234,500
3/11/2019 — — — 40,218 1,502,947
Brian Small 0 100,000 140,000
Steven Bender 0 225,000 315,000
3/11/2019 — — — 16,055 599,975
David Isaac 0 150,000 210,000
3/11/2019 — — — 12,041 449,972
(1) Amounts in these columns represent the threshold, target, and maximum estimated payouts for 2019
MIP bonus awards. The actual value of bonuses paid to our NEOs for 2019 under this program can be
found in the “Non-Equity Incentive Plan Compensation” column of the Summary Compensation Table
above.
(2) This column includes the number of restricted stock units granted to our NEOs during 2019. See
“Compensation Discussion and Analysis—Elements of Compensation—Long-Term Incentives—2019
LTIP Awards” for more information regarding these restricted stock units.
(3) The amounts shown in this column represent the grant date fair value of each equity award computed
in accordance with FASB ASC Topic 718. Please see Note 6 to our consolidated financial statements
for the fiscal year ended December 31, 2019 for additional detail regarding assumptions underlying the
value of these equity awards.
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Outstanding Equity Awards at 2019 Fiscal Year‑End
The following table reflects information regarding outstanding restricted stock units held by our NEOs
as of December 31, 2019.
Number of Shares or Units of Stock Market Value of Shares or Units

Name Grant Date That Have Not Vested (#) That Have Not Vested ($)(1)
Scott Bender 2/7/2018 35,088(2) 1,204,220
3/11/2019 40,139(3) 1,377,571
75,227 2,581,791
Joel Bender 2/7/2018 35,088(2) 1,204,220
3/11/2019 40,139(3) 1,377,571
75,227 2,581,791
Stephen Tadlock 2/7/2018 65,790(2) 2,257,913
3/11/2019 40,218(3) 1,380,282
106,008 3,638,195
Brian Small 2/7/2018 2,632(2) 90,330
2,632 90,330
Steven Bender 2/7/2018 21,052(2) 722,505
3/11/2019 16,055(3) 551,007
37,107 1,273,512
David Isaac 10/24/2018 6,077(4) 208,563
3/11/2019 12,041(3) 413,247
18,118 621,810
(1) The market value of these units is based on the closing price of the Company’s Class A common stock
on December 31, 2019 ($34.32), the last trading day of the fiscal year.
(2) Reflects RSUs which vest over two years in equal annual installments on February 7, 2020 and
February 7, 2021.
(3) Reflects RSUs which vest over three years in equal annual installments on March 11, 2020, March 11,
2021 and March 11, 2022.
(4) Reflects RSUs which vest over two years in equal annual installments on October 24, 2020 and
October 24, 2021.
Stock Vested
The following table provides information for our NEOs on the number of shares of Class A common
stock acquired upon the vesting of RSU awards and the value realized, in each case before payment of any
applicable withholding tax or exercise prices.
Stock Awards (1)

Pre-tax Value Realized on
Number of Shares Acquired Vesting
Name on Vesting (#) ($)
Scott Bender 17,544 575,268
Joel Bender 17,544 575,268
Stephen Tadlock 32,895 1,078,627
Brian Small 1,316 43,152
Steven Bender 10,527 345,180
David Isaac 3,039 85,578
(1) Reflects shares received pursuant to RSU awards granted under the LTIP vesting in 2019. The value
realized upon vesting of these awards represents the aggregate dollar amount realized by the NEO
upon vesting computed by multiplying the number of shares of stock by the closing price of the
underlying shares on the applicable vesting
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date. For Scott Bender, Joel Bender, Stephen Tadlock, Brian Small and Steven Bender, the applicable
vesting date was February 7, 2019, and the closing price of the Class A common stock on that date was
$32.79. For David Isaac, the applicable vesting date was October 24, 2019, and the closing price of
the Class A common stock on that date was $28.16.
Pension Benefits and Nonqualified Deferred Compensation
We have not maintained, and do not currently maintain, a defined benefit pension plan or a
nonqualified deferred compensation plan providing for retirement benefits.
Potential Payments Upon Termination or Change of Control
Each of our NEOs may be entitled to certain severance and other benefits upon a termination of
employment under their respective award agreements and employment agreements, as described in further
detail below. The description of the relevant terms of such award agreements and employment agreements set
forth below does not purport to be a complete description of all of the provisions of any such agreements and is
qualified in its entirety by reference to the forms of award agreements and severance agreements previously
filed.
Scott Bender and Joel Bender Employment Agreements
We have entered into employment agreements with Messrs. Scott and Joel Bender. The Employment
Agreements do not provide for accelerated or enhanced cash payments or health and welfare benefits upon a
change in control but do provide for salary continuation payments and subsidized health and welfare benefits
upon the termination of the executive’s employment for “good reason” or without “cause.”
To receive benefits under the Employment Agreements, the executive officer will be required to
execute a release of all claims against the Company.
Termination for Good Reason or Without Cause. If either Scott or Joel Bender terminates his
employment for “good reason” or is terminated by us without “cause,” he will be entitled to receive as
severance, in addition to any amounts earned and unpaid through the date of termination, his then‑current base
salary and benefits (except car and expense reimbursement benefits) for the remaining term of the Employment
Agreement if such term is greater than one year, or if such term is not greater than one year, one year from the
date of termination, paid in lump sum within 60 days after the executive’s separation from service.
Termination Due to Disability. If either Scott or Joel Bender’s employment is terminated by either us
or the executive due to disability, he will be entitled to receive as severance his then‑current base salary and
benefits through the remainder of the calendar month during which such termination is effective and for the
lesser of (a) six consecutive months thereafter or (b) the date on which disability insurance benefits commence
under any disability insurance coverage which may be provided by us, paid in lump sum within 30 days after
the executive’s termination due to disability.
Termination Due to Death. If either Scott or Joel Bender’s employment is terminated due to death, his
estate will be entitled to receive his then‑current base salary and accrued benefits through the end of the
calendar month in which his death occurs, paid in lump sum within 30 days after the executive’s termination
due to disability.
In each case, if the executive is entitled to severance payments, during such severance period we will
pay such executive’s portion of Consolidated Omnibus Budget Reconciliation Act (“COBRA”) premium
payments, and if COBRA is no longer available during such period, we will provide similar health insurance
coverage for such executive during the severance period.
For purposes of Scott and Joel Bender’s Employment Agreements:
• The term “cause” means the executive (i) is convicted of, or enters a nolo contendre or guilty plea
with respect to, a crime involving fraud, theft, embezzlement or other act of material dishonesty or
the Board’s loss of
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confidence in the executive because he is convicted of, or enters a nolo contendre or guilty plea
with respect to, any felony or crime involving moral turpitude; (ii) commits any other material
breach of any of the provisions of his employment agreement other than a breach which (being
capable of being remedied) is remedied by him within 14 days of being called upon to do so in
writing by us; or (iii) fails to perform his duties and responsibilities (other than a failure from
disability) for a period of 30 consecutive days.
• The term “good reason” means any of the following: (i) we commit any material breach of the
provisions of the executive’s Employment Agreement; (ii) we assign the executive to a position,
responsibilities or duties of a materially lesser status or degree of responsibility than his position,
responsibilities or duties as of the effective date of the Employment Agreement; (iii) the
requirement by us that the executive be based anywhere other than Houston, Texas, provided that
such a change in geographic location be deemed material; or (iv) any decrease of more than 10%
in the executive’s base salary as of the effective date of the Employment Agreement. In any case,
the executive must provide written notice of termination for good reason within 90 days of the
initial existence of the condition at issue, and we will have the opportunity to cure such
circumstances within a 30‑day period of receipt of such notice.
Stephen Tadlock Offer Letter
Pursuant to the terms of his offer letter, Mr. Tadlock will be eligible to receive six months of severance
should a merger or sale transaction result in Mr. Tadlock being terminated by the new entity.
David Isaac Severance Agreement
Pursuant to the terms of a severance agreement, Mr. Isaac is entitled to a severance payment in the
event of a Qualifying Termination prior to September 24, 2021. If Mr. Isaac has a Qualifying Termination
before September 24, 2020, he will be eligible for a severance payment equal to 2/3 of his then current annual
base salary. If Mr. Isaac has a Qualifying Termination during the period from September 25, 2020 until
September 24, 2021, he will be eligible to receive a severance payment equal to 1/3 of his then current annual
base salary.
Restricted Stock Unit Awards
The Company’s restricted stock unit award agreements provide that restricted stock awards will
become fully vested on (i) the date a Change of Control occurs, (ii) the termination of an employee’s
employment due to his death or a Disability or (iii) upon the employee’s Normal Retirement. As used in the
restricted stock unit award agreements, “Disability” means that the employee is unable to perform the essential
functions of their duties for three consecutive months, or three months during any six-month period, as
determined after an examination by a medical doctor selected by written agreement of the employee and the
Company. As used in the restricted stock unit award agreements, “Normal Retirement” means an employee’s
separation from service without Cause on or following the age of 65. For purposes of the restricted stock unit
award agreements, “Cause” means the employee (i) is convicted of, or enters a nolo contendere or guilty plea
with respect to a crime involving fraud, theft, embezzlement or other act of material dishonesty, the Board’s loss
of confidence in the employee because he is convicted of or enters a nolo contendere or guilty plea with respect
to any felony or crime involving moral turpitude; (ii) commits any other material breach of any of the
provisions of their employment agreement with the Company (if applicable) or any material employment
contract, policy or agreement the employee has entered into with the Company, other than a breach which
(being capable of being remedied) is remedied by the employee within fourteen days of being called upon to do
so in writing by the Company; or (iii) fails to perform their duties and responsibilities (other than a failure
resulting from Disability).
Management Incentive Plan Awards
The Company’s Management Incentive Plan provides that participants whose employment ends before
the bonus payments are made forfeit all rights to participate in the Management Incentive Plan and to receive
any bonus relating to prior service, except for the following:
· Injury, disability or ill-health (as determined by the Compensation Committee);

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· Change of control; or
· Death.
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Quantification of Payments
Shown in the table below are potential payments upon the assumed (i) involuntary not for Cause
termination of our NEOs other than during the 24-month period following a Change of Control, or (ii)
involuntary not for Cause termination or termination by the NEO for “Good Reason,” in either case, during the
24-month period following a Change of Control of the Company, occurring as of December 31, 2019. In
addition, the tables that follow show the potential payments upon the hypothetical (i) disability, retirement or
death of our NEOs, and (ii) Change of Control of the Company, in each case, occurring as of December 31,
2019. The table includes estimate amounts because actual amounts to be paid can only be determined at the
time of such executive’s separation from the Company or upon a Change of Control.
Potential Payments Upon Termination and Change of Control

Involuntary
Not for Cause
Termination
without a Termination Disability or Change of
Executive Benefits and Termination Change of with a Change Normal Control (No
Payments Upon Separation for Cause Control of Control Retirement Death Termination)
Scott
Compensation:
Bender
Cash
— 300,000 300,000 150,000 25,000 —
Severance $ $ $ $ $ $
Stock Awards
(1) — 2,581,791 2,581,791 2,581,791 2,581,791 2,581,791
Performance
Cash Awards — — 300,000 300,000 300,000 300,000
(2)
Benefits &
Perquisites:
Health and
Welfare — 11,229 11,229 5,615 11,229 —
Benefits (3)
Total $ — $ 2,893,020 $ 3,193,020 $ 3,037,406 $ 2,918,020 $ 2,881,791
Joel
Compensation:
Bender
Cash
— 300,000 300,000 150,000 25,000 —
Stock Awards
(1) — — 2,581,791 2,581,791 2,581,791 2,581,791
Performance
Cash Awards — — 300,000 300,000 300,000 300,000
(2)
Benefits &
Perquisites:
Health and
Welfare — 11,104 11,104 5,552 11,104 —
Benefits (3)
Total $ — $ 311,104 $ 3,192,895 $ 3,037,343 $ 2,917,895 $ 2,881,791
Stephen
Compensation:
Tadlock
Cash
— — 167,500 — — —
Stock Awards
(1) — — 3,638,195 3,638,195 3,638,195 3,638,195
Performance
Cash Awards — — 167,500 167,500 167,500 167,500
(2)
Benefits &
Perquisites:
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Health and — — — — — —
Welfare
Benefits (3)
Total $ — $ — $ 3,973,195 $ 3,805,695 $ 3,805,695 $ 3,805,695
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Potential Payments Upon Termination and Change of Control

Involuntary
Not for Cause
Termination
without a Termination Disability or Change of
Executive Benefits and Payments Termination Change of with a Change Normal Control (No
Upon Separation for Cause Control of Control Retirement Death Termination)
Brian
Compensation:
Small
Cash Severance $ — $ — $ — $ — $ — $ —
Stock Awards (1) — — 90,330 90,330 90,330 90,330
Performance
— — 100,000 100,000 100,000 100,000
Cash Awards (2)
Benefits &
Perquisites:
Health and
Welfare Benefits — — — — — —
(3)
Total $ — $ — $ 190,330 $ 190,330 $ 190,330 $ 190,330

Steven
Compensation:
Bender
Cash Severance $ — $ — $ - $ — $ — $ —
Stock Awards (1) — — 1,273,512 1,273,512 1,273,512 1,273,512
Performance
— — 225,000 225,000 225,000 225,000
Cash Awards (2)
Benefits &
Perquisites:
Health and
(3)
Total $ — $ — $ 1,498,512 $ 1,498,512 $ 1,498,512 $ 1,498,512

David
Compensation:
Isaac
Cash Severance $ — $ 200,000 $ 200,000 $ — $ — $ —
Stock Awards (1) — — 621,810 621,810 621,810 621,810
Performance
— — 150,000 150,000 150,000 150,000
Cash Awards (2)
Benefits &
Perquisites:
Health and
(3)
Total $ — $ 200,000 $ 971,810 $ 771,810 $ 771,810 $ 771,810
(1) Reflects the value of unvested restricted stock unit awards as of December 31, 2019 that would be
accelerated as a result of the separation event based on the Company’s stock price of $34.32, which was the
closing market price of the Company’s Class A common stock as of December 31, 2019.
(2) Reflects the value of unvested performance-based cash awards as of December 31, 2019. Performance-
based cash awards have been reported assuming that the performance period ended on December 31, 2019
and that the performance level achievement was at target for the 2019 awards.
(3) Reflects the estimated lump-sum present value of all future premiums which will be paid on behalf of the
NEO under the Company’s health and welfare benefit plans for the applicable continuation period specified
in the Executive Agreements.
(4) Due to Mr. Bender’s eligibility for “Normal Retirement” treatment in the event of a separation from service
without cause, this reflects the value of unvested restricted stock unit awards held by Mr. Bender as of
December 31, 2019, that would be accelerated upon his “Normal Retirement.”
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2019 Chief Executive Officer Pay Ratio
As required by Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection
Act, and Item 402(u) of Regulation S-K, we are providing the following information about the relationship
of the median annual total compensation of our employees (other than the Chief Executive Officer) and the
annual total compensation of Scott Bender, our Chief Executive Officer.
For 2019, our last completed fiscal year:
· Scott Bender had total annual compensation of $2,163,931 as reflected in the Summary
Compensation Table included in this Proxy Statement.
o Our median employee’s annual total compensation was $90,436.
o As a result, we estimate that Scott Bender’s 2019 annual total compensation was
approximately 23.9 times that of our median employee.
· To identify the median employee, we took the following steps:
o We determined that, as of December 1, 2019, our employee population consisted

of 1,137 individuals. This population consisted of our full-time and part-time
employees (including both active employees and employees on leave as of
December 31, 2019);
o We selected December 1, 2019 as our identification date for determining our

median employee because it enabled us to make such identification in a
reasonably efficient and economic manner.
o We used a consistently applied compensation measure to identify our median

employee by comparing the actual amount of salary or wages as reflected in our
payroll records. Compensation was annualized for employees that were not
employed by us for all of 2019.
o For our employees located outside of the United States, we obtained similar
payroll records and converted such information into U.S. dollars using the year-
end currency exchange rate.
o To determine the annual total compensation of our median employee and our
Chief Executive Officer, we took the following steps:
After we identified our median employee, we combined all of the

elements of such employee’s compensation for the 2019 year in
accordance with the requirements of Item 402(c)(2)(x) of Regulation S-
K, resulting in annual total compensation of $90,436.17.
With respect to the annual total compensation of our Chief Executive

Officer, we used the amount reported in the “Total” column of our 2019
Summary Compensation Table included in this Proxy Statement.
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Director Compensation
Pursuant to our non‑employee director compensation program, each non‑employee director

receives the following compensation for his or her service on the Board:
· a cash retainer of $80,000 per year, payable quarterly in arrears;
· an additional cash retainer of $20,000 per year, payable quarterly in arrears if such
non‑employee director serves as the chairperson of our Audit Committee and an additional
cash retainer of $10,000 per year for each other member of our Audit Committee;
non‑employee director serves as the chairperson of our Compensation Committee and an
additional cash retainer of $5,000 per year for each other member of our Compensation
Committee;
non‑employee director serves as the chairperson of our Nominating and Governance
Committee and an additional $5,000 per year for each other member of our Nominating and
Governance Committee; and
· annual equity‑based compensation with an aggregate grant date value of $100,000, described
below.
In addition, a cash retainer of $20,000 per year will be payable to a non‑employee Chairman of the
Board quarterly in arrears. Each director will be reimbursed for out‑of‑pocket expenses incurred in
connection with attending board and committee meetings.
The non‑employee directors received a restricted stock unit grant value of $100,000 in connection
with our IPO. All director restricted stock unit awards will generally be subject to a one‑year vesting
schedule. In connection with our IPO, Messrs. Rosenthal and Semple also each received restricted stock
unit awards with grant date values of $1,250,000 that will vest over three years.
Messrs. Scott and Joel Bender, as employees of the Company, do not receive compensation for
their services as directors in addition to their employee compensation described above. The table below
reflects the compensation provided during 2019 to each member of the Board who was not employed by the
Company.
Fees Earned or Paid

Name in Cash ($)(1) Stock Awards ($)(2) Total ($)(3)
Bruce Rothstein(3) $ 100,000 $ 99,965 $ 199,965
John (Andy) O'Donnell 100,000 99,965 199,965
Michael McGovern 100,000 99,965 199,965
Alan Semple 105,000 99,965 204,965
Gary L. Rosenthal 95,000 99,965 194,965
Melissa Law(4) — — —
(1) The amounts shown in this column reflect cash fees earned by each director during 2019. We will
also reimburse all directors for reasonable expenses incurred in attending all board or committee
meetings.
(2) Amounts reported in this column represent the grant date fair market value determined in
accordance with FASB ASC Topic 718 of restricted stock units granted during 2019.
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(3) Mr. Rothstein did not directly receive any compensation for his services as a director during 2019.
Mr. Rothstein is a Managing Partner of Cadent Energy Partners LLC. Due to Mr. Rothstein’s
services as a managing partner at Cadent, all compensation and equity awards that he receives will
be payable or transferred to Cadent.
(4) Melissa Law was appointed to the board of directors on January 30, 2020 and therefore was not a
director in 2019.
Consistent with the director compensation program described above, on March 11, 2019, the
Compensation Committee made grants of 2,675 restricted stock units to each of our non-employee
directors. These awards of restricted stock will vest in full on the first anniversary of the date of grant and
are subject to forfeiture pursuant to the terms of the notice of grant and award agreement under which they
were granted as well as the terms of the LTIP on that date.
As of December 31, 2019, the aggregate number of unvested restricted stock unit awards held by
non-employee directors were as follows:
Stock Awards
Name (#)
Bruce Rothstein(3) 2,675
John (Andy) O'Donnell 2,675
Michael McGovern 2,675
Alan Semple 46,535
Gary L. Rosenthal 46,535
Compensation Committee Interlocks and Insider Participation
During 2019, the Company’s Compensation Committee consisted of Messrs. McGovern,

O’Donnell and Rosenthal. There were no compensation committee interlock relationships for the year
ended December 31, 2019. No member of our Compensation Committee during 2019 has engaged in any
related party transaction in which our company was a participant.
Compensation Committee Report

The Compensation Committee reviewed and discussed the Compensation Discussion and Analysis
required by Item 402 of Regulation S-K promulgated by the SEC with management of the Company, and,
based on such review and discussions, the Compensation Committee recommended to the Board of
Directors that such Compensation Discussion and Analysis be included in the Company’s Proxy Statement
for the 2020 annual meeting and the Company’s Annual Report on Form 10-K for the fiscal year ended
December 31, 2019.
Compensation Committee of the Board of

Directors
Michael McGovern, Chairman
John (Andy) O’Donnell, Member
Gary Rosenthal, Member
Melissa Law, Member
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Item 12. Security Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters
Security Ownership of Certain Beneficial Owners and Management
The following table sets forth certain information regarding the beneficial ownership of common
stock as of February 11, 2020, by (i) each person who is known by the Company to own beneficially more
than five percent of the outstanding shares of common stock, (ii) each NEO of the Company, (iii) each
director and director nominee of the Company and (iv) all directors and executive officers as a group. All of
such information is based on publicly available filings, unless otherwise known to us from other sources.
Unless otherwise noted, the mailing address of each person or entity named below is 920 Memorial City
Way, Suite 300 Houston, Texas 77024.
As of February 11, 2020, 47,339,329 shares of our Class A common stock and 27,957,699 shares
of our Class B common stock were outstanding.
Shares Beneficially Owned by

Certain Beneficial Owners and Management (2)
Class A Class B Combined Voting
Common Stock Common Stock Power
% of % of % of
Number class Number class Number class
5% Stockholders
Cadent Energy Partners II, L.P.(3) 5,264 * % 8,347,466 29.9 % 8,352,730 11.1 %
Cactus WH Enterprises, LLC(4) — — % 17,934,356 64.1 % 17,934,356 23.8 %
BlackRock, Inc.(5) 3,311,308 7.0 % — — % 3,311,308 4.4 %
The Vanguard Group(6) 4,303,181 9.1 % — — % 4,303,181 5.7 %
Directors and NEOs:
Bruce Rothstein(3) — —% — —% — —%
Scott Bender(4) 26,816 * % 17,934,356 64.1 % 17,961,172 23.9 %
Joel Bender(4) 26,234 * % 17,934,356 64.1 % 17,960,590 23.9 %
Stephen Tadlock 49,452 *% — —% 49,452 *%
David Isaac 2,299 *% — —% 2,299 *%
Steven Bender 15,614 *% — —% 15,614 *%
Brian Small 1,850 *% — —% 1,850 *%
John (Andy) O’Donnell 5,264 *% 52,508 *% 57,772 *%
Michael McGovern 5,264 *% 56,018 *% 61,282 *%
Alan Semple 39,994 *% — —% 39,994 *%
Gary Rosenthal 32,167 *% — —% 32,167 *%
Melissa Law — —% — —% — —
Directors and executive officers
204,954 * % 18,042,882 64.5 % 18,247,836 24.2 %
as a group (12 persons)
(1) Subject to the terms of the First Amended and Restated Limited Liability Company Operating
Agreement of Cactus LLC (the “Cactus Wellhead LLC Agreement”), each holder of common units
representing limited liability company interests in Cactus LLC (such units, “CW Units” and
holders of CW Units, “CW Unit Holders”), subject to certain limitations, has the right (the
“Redemption Right”) to cause Cactus LLC to acquire all or at least a minimum portion of its
CW Units for, at our election, (x) shares of our Class A Common Stock at a redemption ratio of
one share of Class A Common Stock for each CW Unit redeemed, subject to
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conversion rate adjustments for stock splits, stock dividends and reclassifications and other similar
transactions, or (y) an equivalent amount of cash. Alternatively, upon the exercise of the
Redemption Right, Cactus Inc. (instead of Cactus LLC) will have the right (the “Call Right”) to
acquire each tendered CW Unit directly from the exchanging CW Unit Holder for, at its election,
(x) one share of Class A Common Stock, subject to conversion rate adjustments for stock splits,
stock dividends and reclassification and other similar transactions, or (y) an equivalent amount of
cash. In connection with any redemption of CW Units pursuant to the Redemption Right or our
Call Right, the corresponding number of shares of Class B Common Stock will be canceled. See
“Transactions with Related Persons—Cactus Wellhead LLC Agreement.” The amounts and
percentages of common stock beneficially owned are reported on the basis of regulations of the
SEC governing the determination of beneficial ownership of securities. Under the rules of the SEC,
a person is deemed to be a “beneficial owner” of a security if that person has or shares voting
power, which includes the power to vote or direct the voting of such security, or investment power,
which includes the power to dispose of or to direct the disposition of such security. Securities that
can be so acquired are deemed to be outstanding for purposes of computing such person’s
ownership percentage, but not for purposes of computing any other person’s percentage. Under
these rules, more than one person may be deemed a beneficial owner of the same securities, and a
person may be deemed to be a beneficial owner of securities as to which such person has no
economic interest. Except as otherwise indicated in these footnotes, each of the beneficial owners
has, to our knowledge, sole voting and investment power with respect to the indicated shares of
common stock, except to the extent this power may be shared with a spouse.
(2) Represents percentage of voting power of our Class A Common Stock and Class B Common
Stock voting together as a single class. The CW Unit Holders hold one share of Class B Common
Stock for each CW Unit that they own. Each share of Class B Common Stock has no economic
rights but entitles the holder thereof to one vote for each CW Unit held by such holder.
Accordingly, the CW Unit Holders collectively have a number of votes in Cactus Inc. equal to the
number of CW Units that they hold.
(3) Cadent Energy Partners II, L.P., its general partner, Cadent Energy Partners II—GP, L.P., and
Cadent Management Services, LLC (“Cadent Management”), its manager, are indirectly controlled
by Cadent Energy Partners. Cadent Energy Partners controls all voting and dispositive power over
the reported shares and therefore may be deemed to be the beneficial owner of such shares. Any
decision taken by Cadent Management to vote, or to direct to vote, and to dispose, or to direct the
disposition of, the securities held by Cadent has to be approved by its investment committee.
There are four members of the investment committee, and unanimous approval of the members of
the investment committee is required to approve an action. Under the so-called “rule of three,” if
voting and dispositive decisions regarding an entity’s securities are made by three or more
individuals, and a voting or dispositive decision requires the approval of a majority of those
individuals, then none of the individuals is deemed a beneficial owner of the entity’s securities.
This is the situation with regard to the investment committee of Cadent Management. Bruce
Rothstein, the Chairman of our board of directors, is a Managing Director of Cadent Energy
Partners. Certain of our directors and officers have passive interests in Cadent. In connection with
our IPO, Cactus Inc. entered into a Stockholders’ Agreement with Cadent and Cactus WH
Enterprises, which provides Cadent and Cactus WH Enterprises with the right to designate a
certain number of nominees to our board of directors so long as they and their respective affiliates
collectively beneficially own at least 5% of the outstanding shares of our common stock.
Therefore, Cadent and Cactus WH Enterprises may each be deemed to beneficially own an
aggregate 26,281,822 shares of our Class B common stock, representing an aggregate combined
voting power of 34.9%. Cadent also owns 5,264 shares of Class A common stock that was issued
to Mr. Rothstein in connection with the vesting of previously granted restricted stock units. Due to
Mr. Rothstein’s position as a managing director at Cadent Energy Partners, all compensation and
equity awards that he receives are directly payable or transferred to Cadent Management, a
subsidiary of Cadent Energy Partners.
(4) Scott Bender and Joel Bender control Cactus WH Enterprises and may be deemed to share voting
and dispositive power over the reported shares and, therefore, will also be deemed to be the
beneficial owners of such shares. In connection with our IPO, Cactus Inc. entered into a
Stockholders’ Agreement with Cadent and
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Cactus WH Enterprises, which provides Cadent and Cactus WH Enterprises with the right to
designate a certain number of nominees to our board of directors so long as they and their
respective affiliates collectively beneficially own at least 5% of the outstanding shares of our
common stock. Therefore, Cadent and Cactus WH Enterprises may each be deemed to beneficially
own an aggregate 26,281,822 shares, representing an aggregate combined voting power of 34.9%.
(5) Based on the Schedule 13G/A, filed February 5, 2020 by BlackRock, Inc., (“BlackRock”) a parent
holding company, which states that BlackRock and its affiliates have sole investment discretion
over 3,311,308 shares of our Class A common stock and sole voting power over 3,229,404 shares
of our Class A common stock. All shares covered by such filings are held by BlackRock and/or its
subsidiaries. The address of BlackRock, Inc. is 55 East 52nd Street, New York, NY 10055.
(6) Based on the Schedule 13G/A, filed February 12, 2020 by The Vanguard Group (“Vanguard”),
which states that Vanguard has sole voting power over 98,023 shares of our Class A common
stock, shared voting power over 4,804 shares of our Class A common stock, sole dispositive power
over 4,205,331 shares of our Class A common stock and shared dispositive power over 97,850
shares of our Class A common stock. The address of Vanguard is 100 Vanguard Boulevard,
Malvern, PA 19355.
* Less than 1.0%.
Changes in Control
We know of no arrangements, including any pledge by any person of our securities, the operation
of which may at a subsequent date result in a change in control of the Company.
Securities Authorized for Issuance under Equity Compensation Plans
The following table sets forth certain information relating to our LTIP as of December 31, 2019.
Number of securities Number of securities

to be issued upon Weighted average remaining available for
exercise of exercise price of future issuance under
outstanding options, outstanding equity compensation plans
warrants and rights options, warrants (excluding securities
Plan category (1)
and rights ($)(2) reflected in column (a))(3)
(a) (b) (c)
Equity compensation plans approved by N/A N/A N/A
security holders
Equity compensation plans not approved 688,865 N/A 2,036,788
by security holders
Total 688,865 N/A 2,036,788
(1) This column reflects all shares subject to time-based restricted stock units granted under the LTIP
that were outstanding and unvested as of December 31, 2019. No stock options or warrants have
been granted under the LTIP.
(2) No stock options have been granted under the LTIP, and the restricted stock units reflected in
column (a) are not reflected in this column as they do not have an exercise price.
(3) This column reflects the total number of shares remaining available for issuance under the LTIP as
of December 31, 2019.
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Item 13. Certain Relationships and Related Transactions, and Director Independence
Policies and Procedures for Review of Related Party Transactions
A “Related Party Transaction” is a transaction, arrangement or relationship in which we or any of

our subsidiaries was, is or will be a participant, the amount of which involved exceeds $120,000, and in
which any related person had, has or will have a direct or indirect material interest. A “Related Person”
means:
• any person who is, or at any time during the applicable period was, one of our executive
officers or one of our directors;
• any person who is known by us to be the beneficial owner of more than 5% of any class of our
voting securities;
• any immediate family member of any of the foregoing persons, which means any child,
stepchild, parent, stepparent, spouse, sibling, mother‑in‑law, father‑in‑law, son‑in‑law,
daughter‑in‑law, brother‑in‑law or sister‑in‑law of a director, executive officer or a beneficial
owner of more than 5% of our Common Stock, and any person (other than a tenant or
employee) sharing the household of such director, executive officer or beneficial owner of
more than 5% of our Common Stock; and
• any firm, corporation or other entity in which any of the foregoing persons is a partner or
principal or in a similar position or in which such person has a 10% or greater beneficial
ownership interest.
Our board of directors adopted a written Related Party Transactions policy prior to the completion
of our IPO. Pursuant to this policy, our Audit Committee has and will continue to review all material facts
of all Related Party Transactions and either approve or disapprove entry into the Related Party Transaction,
subject to certain limited exceptions. In determining whether to approve or disapprove entry into a Related
Party Transaction, our Audit Committee takes into account, among other factors, the following: (i) whether
the Related Party Transaction is on terms no less favorable than terms generally available to an unaffiliated
third party under the same or similar circumstances and (ii) the extent of the Related Person’s interest in the
transaction. Further, the policy requires that all Related Party Transactions required to be disclosed in our
filings with the SEC be so disclosed in accordance with applicable laws, rules and regulations.
Cactus Wellhead LLC Agreement
Under the Cactus Wellhead LLC Agreement, each CW Unit Holder, subject to certain limitations,
has the right, pursuant to the Redemption Right, to cause Cactus LLC to acquire all or at least a minimum
portion of its CW Units for, at Cactus LLC’s election, (x) shares of our Class A Common Stock at a
redemption ratio of one share of Class A Common Stock for each CW Unit redeemed, subject to conversion
rate adjustments for stock splits, stock dividends and reclassification and other similar transactions, or
(y) an equivalent amount of cash. Alternatively, upon the exercise of the Redemption Right, Cactus Inc.
(instead of Cactus LLC) will have the right, pursuant to the Call Right, to acquire each tendered CW Unit
directly from the exchanging CW Unit Holder for, at its election, (x) one share of Class A Common Stock,
subject to conversion rate adjustments for stock splits, stock dividends and reclassifications and other
similar transactions, or (y) an equivalent amount of cash. In connection with any redemption of CW Units
pursuant to the Redemption Right or our Call Right, the corresponding number of shares of Class B
Common Stock will be canceled. In addition, any redemptions involving all of the CW Units held by a CW
Unit Holder (subject to the discretion of Cactus Inc. to restrict redemptions of a lower number of units) may
occur at any time. As the CW Unit Holders redeem their CW Units, our membership interest in Cactus LLC
will be correspondingly increased, the number of shares of Class A Common Stock outstanding will be
increased, and the number of shares of Class B Common Stock outstanding will be reduced.
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Under the Cactus Wellhead LLC Agreement, we have the right to determine when distributions
will be made to CW Unit Holders and the amount of any such distributions. If we authorize a distribution,
such distribution will be made to the holders of CW Units on a pro rata basis in accordance with their
respective percentage ownership of CW Units.
The holders of CW Units, including us, will generally incur U.S. federal, state and local income
taxes on their proportionate share of any taxable income of Cactus LLC and will be allocated their
proportionate share of any taxable loss of Cactus LLC. Net profits and net losses of Cactus LLC generally
will be allocated to holders of CW Units on a pro rata basis in accordance with their respective percentage
ownership of CW Units, except that certain non pro rata adjustments will be required to be made to reflect
built-in gains and losses and tax depletion, depreciation and amortization with respect to such built-in gains
and losses. To the extent Cactus LLC has available cash and subject to the terms of any current or future
credit agreements or debt instruments, we intend to cause Cactus LLC to make (i) pro rata distributions to
the holders of CW Units, including us, in an amount at least sufficient to allow us to pay our taxes and make
payments under the Tax Receivable Agreement that we entered into with the TRA Holders in connection
with our IPO and (ii) non pro rata payments to Cactus Inc. to reimburse us for our corporate and other
overhead expenses incurred by us in connection with serving as a managing member of Cactus LLC.
The Cactus Wellhead LLC Agreement provides that, except as otherwise determined by us, at any
time we issue a share of our Class A Common Stock or any other equity security, the net proceeds received
by us with respect to such issuance, if any, shall be concurrently invested in Cactus LLC, and Cactus LLC
shall issue to us one CW Unit or other economically equivalent equity interest. Conversely, if at any time,
any shares of our Class A Common Stock are redeemed, repurchased or otherwise acquired, Cactus LLC
shall redeem, repurchase or otherwise acquire an equal number of CW Units held by us, upon the same
terms and for the same price, as the shares of our Class A Common Stock are redeemed, repurchased or
otherwise acquired.
Under the Cactus Wellhead LLC Agreement, Cadent and its affiliates are not required to offer to us
an opportunity to participate in specified business opportunities that are from time to time presented to
Cadent and its affiliates, including any of our directors affiliated with Cadent. The Cactus Wellhead LLC
Agreement further provides that if Cadent or an affiliate, including any of our directors affiliated with
Cadent, becomes aware of a potential business opportunity, transaction or other matter, they will have no
duty to communicate or offer that opportunity to us (unless such opportunity is expressly offered to such
director in his capacity as one of our directors). In addition, the Cactus Wellhead LLC Agreement provides
that none of Cadent and its affiliates, including any of our directors affiliated with Cadent, will have any
duty to refrain from (i) engaging in a corporate opportunity in the same or similar lines of business in which
we or our affiliates now engage or propose to engage or (ii) otherwise competing with us or our affiliates.
Cactus LLC will be dissolved only upon the first to occur of (i) the sale of substantially all of its
assets or (ii) an election by us to dissolve the company. Upon dissolution, Cactus LLC will be liquidated
and the proceeds from any liquidation will be applied and distributed in the following manner: (a) first, to
creditors (including to the extent permitted by law, creditors who are members) in satisfaction of the
liabilities of Cactus LLC, (b) second, to establish cash reserves for contingent or unforeseen liabilities and
(c) third, to the members in proportion to the number of CW Units owned by each of them.
Pursuant to the Cactus Wellhead LLC Agreement, each TRA Holder will, subject to certain
limitations, have the right (the “Redemption Right”) to cause Cactus LLC to acquire all or at least a
minimum portion of its CW Units for, at Cactus LLC’s election, (x) shares of our Class A common stock at
a redemption ratio of one share of Class A common stock for each CW Unit redeemed, subject to
conversion rate adjustments for stock splits, stock dividends and reclassification and other similar
transactions, or (y) an equivalent amount of cash. Alternatively, upon the exercise of the Redemption Right,
Cactus Inc. (instead of Cactus LLC) will have the right (the “Call Right”) to acquire each tendered CW Unit
directly from the exchanging TRA Holder for, at its election, (x) one share of Class A common stock,
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subject to conversion rate adjustments for stock splits, stock dividends and reclassifications and other
similar transactions, or (y) an equivalent amount of cash. In connection with any redemption of CW Units
pursuant to the Redemption Right or our Call Right, the corresponding number of shares of Class B
common stock will be canceled.
Cactus LLC has made for itself (and for each of its direct or indirect subsidiaries that is treated as a
partnership for U.S. federal income tax purposes and that it controls) an election under Section 754 of the
Internal Revenue Code (the “Code”) that will be effective for 2018 and each taxable year in which a
redemption of CW Units pursuant to the Redemption Right or the Call Right occurs. Pursuant to the Section
754 election, redemptions of CW Units pursuant to the Redemption Right or the Call Right are expected to
result in adjustments to the tax basis of the tangible and intangible assets of Cactus LLC. These adjustments
will be allocated to Cactus Inc. Such adjustments to the tax basis of the tangible and intangible assets of
Cactus LLC would not have been available to Cactus Inc. absent its acquisition or deemed acquisition of
CW Units pursuant to the exercise of the Redemption Right or the Call Right. In addition, the repayment of
borrowings outstanding under the Cactus LLC term loan facility resulted in adjustments to the tax basis of
the tangible and intangible assets of Cactus LLC, a portion of which was allocated to Cactus Inc.
These basis adjustments are expected to increase (for tax purposes) Cactus Inc.’s depreciation and
amortization deductions and may also decrease Cactus Inc.’s gains (or increase its losses) on future
dispositions of certain assets to the extent tax basis is allocated to those assets. Such increased deductions
and losses and reduced gains may reduce the amount of tax that Cactus Inc. would otherwise be required to
pay in the future.
The TRA will generally provide for the payment by Cactus Inc. to each TRA Holder of 85% of the
net cash savings, if any, in U.S. federal, state and local income tax and franchise tax that Cactus Inc.
actually realizes or is deemed to realize in certain circumstances as a result of (i) certain increases in tax
basis that occur as a result of Cactus Inc.’s acquisition (or deemed acquisition for U.S. federal income tax
purposes) of all or a portion of such TRA Holder’s CW Units in connection with CW Unit exchanges or
pursuant to the exercise of the Redemption Right or the Call Right, (ii) certain increases in tax basis
resulting from the repayment of borrowings outstanding under Cactus LLC’s term loan facility and (iii)
imputed interest deemed to be paid by Cactus Inc. as a result of, and additional tax basis arising from, any
payments Cactus Inc. makes under the TRA. We will retain the benefit of the remaining 15% of the cash
savings.
The payment obligations under the TRA are Cactus Inc.’s obligations and not obligations of Cactus
LLC, and we expect that the payments we will be required to make under the TRA will be substantial. We
have determined that it is more likely than not that actual cash tax savings will be realized by Cactus Inc.
from the tax benefits resulting from our IPO (and the related transactions), the follow-on equity offering in
July 2018 and March 2019 and CW Unit exchanges. Future exchanges of CW Units create additional
liability and follow the same accounting procedures. Estimating the amount and timing of payments that
may become due under the TRA is by its nature imprecise and the assumptions used in the estimate can
change. For purposes of the TRA, net cash savings in tax generally will be calculated by comparing Cactus
Inc.’s actual tax liability (determined by using the actual applicable U.S. federal income tax rate and an
assumed combined state and local income tax rate) to the amount it would have been required to pay had it
not been able to utilize any of the tax benefits subject to the TRA. The amounts payable, as well as the
timing of any payments under the TRA, are dependent upon significant future events and assumptions,
including the timing of the redemption of CW Units, the price of our Class A common stock at the time of
each redemption, the extent to which such redemptions are taxable transactions, the amount of the
redeeming unit holder’s tax basis in its CW Units at the time of the relevant redemption, the depreciation
and amortization periods that apply to the increase in tax basis, the amount and timing of taxable income we
generate in the future and the U.S. federal income tax rate then applicable, and the portion of Cactus Inc.’s
payments under the TRA that constitute imputed interest or give rise to depreciable or amortizable tax basis.
A delay in the timing of redemptions of CW Units, holding other assumptions constant, would be
expected to decrease the discounted value of the amounts payable under the TRA as the benefit of the
depreciation and amortization deductions would be delayed and the estimated increase in tax basis could be
reduced as a result of allocations of Cactus
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LLC taxable income to the redeeming unit holder prior to the redemption. Stock price increases or
decreases at the time of each redemption of CW Units would be expected to result in a corresponding
increase or decrease in the undiscounted amounts payable under the TRA in an amount equal to 85% of the
tax-effected change in price. The amounts payable under the TRA are dependent upon Cactus Inc. having
sufficient future taxable income to utilize the tax benefits on which it is required to make payments under
the TRA. If Cactus Inc.’s projected taxable income is significantly reduced, the expected payments would
be reduced to the extent such tax benefits do not result in a reduction of Cactus Inc.’s future income tax
liabilities.
It is possible that future transactions or events could increase or decrease the actual tax benefits
realized and the corresponding liability from the TRA. Moreover, there may be a negative impact on our
liquidity if, as a result of timing discrepancies or otherwise, (i) the payments under the TRA exceed the
actual benefits we realize in respect of the tax attributes subject to the TRA or (ii) distributions to Cactus
Inc. by Cactus LLC are not sufficient to permit Cactus Inc. to make payments under the TRA after it has
paid its taxes and other obligations. The payments under the TRA will not be conditional on a holder of
rights under the TRA having a continued ownership interest in either Cactus LLC or Cactus Inc.
In addition, although we are not aware of any issue that would cause the Internal Revenue Service
(“IRS”) or other relevant tax authorities to challenge potential tax basis increases or other tax benefits
covered under the TRA, the TRA Holders will not reimburse us for any payments previously made under
the TRA if such basis increases or other benefits are subsequently disallowed, except that excess payments
made to any such holder will be netted against payments otherwise to be made, if any, to such holder after
our determination of such excess. As a result, in such circumstances, Cactus Inc. could make payments that
are greater than its actual cash tax savings, if any, and may not be able to recoup those payments.
The term of the TRA commenced upon completion of our IPO and will continue until all tax
benefits that are subject to the TRA have been utilized or expired, unless we exercise our right to terminate
the TRA. In the event that the TRA is not terminated, the payments under the TRA, which commenced in
2019, will continue for approximately 20 years after the date of the last redemption of CW Units.
Accordingly, it is expected that payments will continue to be made under the TRA for more than 20 years.
If we elect to terminate the TRA early (or it is terminated early due to certain mergers, asset sales, other
forms of business combinations or other changes of control), our obligations under the TRA would
accelerate and we would be required to make an immediate payment equal to the present value of the
anticipated future payments to be made by us under the TRA (determined by applying a discount rate of
one-year LIBOR plus 150 basis points) and such payment is expected to be substantial. The calculation of
anticipated future payments will be based upon certain assumptions and deemed events set forth in the
TRA, including the assumptions that (i) we have sufficient taxable income to fully utilize the tax benefits
covered by the TRA and (ii) any CW Units (other than those held by Cactus Inc.) outstanding on the
termination date are deemed to be redeemed on the termination date. Any early termination payment may
be made significantly in advance of the actual realization, if any, of the future tax benefits to which the
termination payment relates. Assuming no material changes in the relevant tax law, we expect that if the
TRA were terminated as of December 31, 2019, the estimated termination payments, based on the
assumptions discussed above, would be approximately $331.3 million (calculated using a discount rate
equal to one-year LIBOR plus 150 basis points, applied against an undiscounted liability of $434.7 million).
A 10% increase in the price of our Class A Common Stock at December 31, 2019 would have increased the
discounted liability by $17.2 million to $348.5 million (an undiscounted increase of $23.2 million to $457.9
million), and likewise, a 10% decrease in the price of our Class A Common Stock at December 31, 2019
would have decreased the discounted liability by $17.3 million to $314.0 million (an undiscounted decrease
of $23.3 million to $411.4 million).
The TRA provides that in the event that we breach any of our material obligations under the TRA,
whether as a result of (i) our failure to make any payment when due (including in cases where we elect to
terminate the TRA early, the TRA is terminated early due to certain mergers, asset sales, or other forms of
business combinations or changes of control or we have available cash but fail to make payments when due
under circumstances where we do not have the
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right to elect to defer the payment, as described below), (ii) our failure to honor any other material
obligation under it or (iii) by operation of law as a result of the rejection of the TRA in a case commenced
under the U.S. Bankruptcy Code or otherwise, then the TRA Holders may elect to treat such breach as an
early termination, which would cause all our payment and other obligations under the TRA to be
accelerated and become due and payable applying the same assumptions described above.
As a result of either an early termination or a change of control, we could be required to make

payments under the TRA that exceed our actual cash tax savings under the TRA. In these situations, our
obligations under the TRA could have a substantial negative impact on our liquidity and could have the
effect of delaying, deferring or preventing certain mergers, asset sales, or other forms of business
combinations or changes of control.
Decisions we make in the course of running our business, such as with respect to mergers, asset
sales, other forms of business combinations or other changes in control, may influence the timing and
amount of payments that are received by the TRA Holders under the TRA. For example, the earlier
disposition of assets following a redemption of CW Units may accelerate payments under the TRA and
increase the present value of such payments, and the disposition of assets before a redemption of CW Units
may increase the TRA Holders’ tax liability without giving rise to any rights of the TRA Holders to receive
payments under the TRA. Such effects may result in differences or conflicts of interest between the interests
of the TRA Holders and other shareholders.
Payments generally are due under the TRA within five business days following the finalization of
the schedule with respect to which the payment obligation is calculated. However, interest on such
payments will begin to accrue from the due date (without extensions) of our U.S. federal income tax return
for the period to which such payments relate until such payment date at a rate equal to one-year LIBOR plus
150 basis points. Except in cases where we elect to terminate the TRA early or it is otherwise terminated as
described above, generally we may elect to defer payments due under the TRA if we do not have available
cash to satisfy our payment obligations under the TRA. Any such deferred payments under the TRA
generally will accrue interest from the due date for such payment until the payment date at a rate of one-
year LIBOR plus 550 basis points. However, interest will accrue from the due date for such payment until
the payment date at a rate of one-year LIBOR plus 150 basis points if we are unable to make such payment
as a result of limitations imposed by our credit facility. We have no present intention to defer payments
under the TRA.
Because we are a holding company with no operations of our own, our ability to make payments
under the TRA is dependent on the ability of Cactus LLC to make distributions to us in an amount sufficient
to cover our obligations under the TRA. This ability, in turn, may depend on the ability of Cactus LLC’s
subsidiaries to make distributions to it. The ability of Cactus LLC, its subsidiaries and other entities in
which it directly or indirectly holds an equity interest to make such distributions will be subject to, among
other things, the applicable provisions of Delaware law (or other applicable jurisdiction) that may limit the
amount of funds available for distribution and restrictions in relevant debt instruments issued by Cactus
LLC or its subsidiaries and other entities in which it directly or indirectly holds an equity interest.
Additionally, distributions made by Cactus LLC generally require pro-rata distribution among all its
members, which could be significant. To the extent that we are unable to make payments under the TRA for
any reason, such payments will be deferred and will accrue interest until paid.
Two of our independent directors, Messrs. McGovern and O’Donnell, have the right to receive
payments under the Tax Receivable Agreement in respect of CW Units owned by them at the time of our
IPO. During 2019, a company controlled by Scott Bender and Joel Bender received approximately $2.1
million in payments under the TRA in respect
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of CW Units owned by them. In addition, Cadent and Steven Bender received payments under the TRA of
approximately $6.3 million and $0.2 million, respectively, during 2019 in respect of CW Units owned by
them.
Liability
related to
TRA
2020 $ 14,630
2021 11,959
2022 12,183
2023 12,439
2024 12,700
Thereafter 152,621
$ 216,532
Registration Rights Agreement
In connection with our IPO, we entered into a registration rights agreement (the “Registration
Rights Agreement”) with Cadent, Cactus WH Enterprises and Lee Boquet (together with Cactus WH
Enterprises and Cadent, the “Registration Rights Holders”). Pursuant to the Registration Rights Agreement,
we agreed to register the sale of shares of Class A Common Stock by the Registration Rights Holders under
certain circumstances as described below.
On March 15, 2019, in accordance with the requirements of the Registration Rights Agreement, we
filed a shelf registration statement on Form S-3 pursuant to the Securities Act of 1933, as amended, to,
amount other things, permit the resale by the Registration Rights Holders of shares of Class A Common
Stock issuable upon the exercise of redemption rights. If at any time we are not eligible to register the sale
of our securities on Form S‑3, each of Cadent and Cactus WH Enterprises will have the right to request
three “demand” registrations, provided that the aggregate amount of registrable securities that are requested
to be included in such demand registration is at least $25,000,000. Further, the Registration Rights Holders
and certain of their assignees will have customary “piggyback” registration rights.
Upon the demand of a Registration Rights Holder, we will facilitate in the manner described in the
Registration Rights Agreement a “takedown” of Class A Common Stock off of an effective shelf
registration statement. A shelf takedown may take the form of an underwritten public offering provided that
the aggregate amount of registrable securities that are requested to be included in such offering is at least
$25,000,000.
These registration rights are subject to certain conditions and limitations, including the right of the
underwriters to limit the number of shares to be included in a registration and our right to delay or withdraw
a registration statement under certain circumstances. Also, any demand for a registered offering or a
takedown and the exercise of any piggyback registration rights will be subject to the constraints of any
applicable lock‑up arrangements. In addition, we may postpone the filing of a demanded registration
statement, suspend the initial effectiveness of any shelf registration statement or delay offerings and sales
under any effective shelf registration statement for a reasonable “blackout period” not in excess of 90 days
if the board determines that such registration or offering could materially interfere with a bona fide
business, acquisition or divestiture or financing transaction or is reasonably likely to require premature
disclosure of information, the premature disclosure of which could materially and adversely affect us;
provided that we shall not delay the filing of any demanded registration statement more than once in any
12‑month period.
We will generally pay all registration expenses in connection with our obligations under the
registration rights agreement, regardless of whether a registration statement is filed or becomes effective.
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Stockholders’ Agreement
In connection with our IPO, we entered into a stockholders’ agreement (the “Stockholders’
Agreement”) with Cadent and Cactus WH Enterprises. Summaries of certain material terms of the
Stockholders’ Agreement are set forth below. Among other things, the Stockholders’ Agreement provides
Cadent with the right to designate a number of nominees (each, a “Cadent Director”) to our board of
directors such that:
• at least 50% of the directors on the board are Cadent Directors for so long as Cadent and its
affiliates collectively beneficially own at least 20% of the outstanding shares of Common
Stock;
• at least 25% of the directors on the board are Cadent Directors for so long as Cadent and its
affiliates collectively beneficially own less than 20% but at least 10% of the outstanding
shares of Common Stock;
• at least one of the directors on the board are Cadent Directors for so long as Cadent and its
affiliates collectively beneficially own less than 10% but at least 5% of the outstanding shares
of Common Stock; and
• once Cadent and its affiliates collectively own less than 5% of the outstanding shares of
Common Stock, Cadent will not have any board designation rights.
Further, the Stockholders’ Agreement provides Cactus WH Enterprises with the right to designate
a number of nominees (each, a “CWHE Director”) to the Board such that:
• at least 50% of the directors on the board are CWHE Directors for so long as Cactus WH
Enterprises and its affiliates collectively beneficially own at least 20% of the outstanding
shares of Common Stock;
• at least 25% of the directors on the board are CWHE Directors for so long as Cactus WH
Enterprises and its affiliates collectively beneficially own less than 20% but at least 10% of
the outstanding shares of Common Stock;
• at least one of the directors on the board are CWHE Directors for so long as Cactus WH
Enterprises and its affiliates collectively beneficially own less than 10% but at least 5% of the
outstanding shares of Common Stock; and
• once Cactus WH Enterprises and its affiliates collectively own less than 5% of the outstanding
shares of Common Stock, Cactus WH Enterprises will not have any Board designation rights.
In the event that the percentage ownership of Cadent or Cactus WH Enterprises declines such that
the number of Cadent Directors or CWHE Directors, as the case may be, exceeds the number of directors
that Cadent or Cactus WH Enterprises is then entitled to designate to our board of directors under the
Stockholders’ Agreement, then if requested by the Company, Cadent or Cactus WH Enterprises shall take
such actions as are reasonably necessary to remove such excess Cadent Directors or CWHE Directors from
the board.
Currently, Bruce Rothstein and Michael McGovern are each deemed to be designees of Cadent,
and Scott Bender, Joel Bender and Alan Semple are each deemed to be designees of Cactus WH
Enterprises.
Pursuant to the Stockholders’ Agreement, we, Cadent and Cactus WH Enterprises are required to
take all necessary action, to the fullest extent permitted by applicable law (including with respect to any
fiduciary duties under Delaware law), to cause the election of the nominees designated by Cadent and
Cactus WH Enterprises.
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The rights granted to Cadent and Cactus WH Enterprises to designate directors are additive to and
not intended to limit in any way the rights that Cadent and Cactus WH Enterprises or any of their affiliates
may have to nominate, elect or remove our directors under our amended and restated certificate of
incorporation, our amended and restated bylaws or the Delaware General Corporation Law.
Non-Exclusive Aircraft Lease Agreements
In July 2019, Cactus LLC entered into a Non-Exclusive Aircraft Lease Agreement (the “SusieAir
Lease”) with SusieAir, LLC (“SusieAir”), an entity wholly owned by Mr. Scott Bender, pursuant to which
Cactus LLC leases an aircraft, excluding crew, from SusieAir. The 2019 agreement replaced the previous
agreement originally entered into in 2014 due to the sale of the aircraft under the previous lease. Under the
SusieAir Lease, the aircraft may be subject to use by other lessees. The SusieAir Lease has an initial term of
one year and automatically renews for successive one year terms unless either party gives at least 15 days’
advance notice of its intention to terminate the agreement. The SusieAir Lease shall terminate automatically
upon a sale or total loss of the aircraft or at any time, upon 30 days’ written notice by either party.
Cactus LLC pays SusieAir a base hourly rent of $1,750 per flight hour of use of the aircraft, payable
monthly, for the hours of aircraft operation during the prior calendar month. Cactus LLC is also responsible
for employing pilots and certain fuel true up fees. Mr. Scott Bender and Mr. Joel Bender pay the Company
$1,800/day for their personal use of the pilots employed by the Company. The SusieAir Lease generally
provides that Cactus LLC will indemnify SusieAir from liabilities arising from the operation of the aircraft.
During 2019, total expense recognized in connection with these rentals totaled $0.3 million. As of
December 31, 2019, we owed less than $0.1 million to SusieAir, which amount is included in accounts
payable in the consolidated balance sheets.
We have entered into employment agreements and non‑compete agreements with Scott Bender, our
Chief Executive Officer, and Joel Bender, our Chief Operating Officer. Mr. Tadlock has an agreement
providing him severance pay under certain circumstances. Mr. Isaac also has an agreement providing him
severance pay under certain circumstances and he also has a non-compete agreement. For more information,
please read Part III. Item 11. Executive Compensation—Employment, Severance and Change in Control
Agreements—Employment Agreements.
Director Independence
See “Item 10. Directors, Executive Officers and Corporate Governance” for a discussion of the
directors who our Board has determined to be independent.
Item 14. Principal Accounting Fees and Services
The table below sets forth the aggregate fees billed or expected to be billed by
PricewaterhouseCoopers LLP, our independent registered public accounting firm, for services rendered for
each of the last two fiscal years:
2019 2018
(in thousands)
Audit Fees(1) $ 1,760 $ 1,645
Audit-Related Fees 3 10
Tax Fees(2) — 328
All Other Fees — —
Total $ 1,763 $ 1,983
(1) Audit fees consist of the aggregate fees billed or expected to be billed for professional services
rendered for (i) the audit of annual financial statements, (ii) reviews of our quarterly financial
statements, (iii) statutory
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audits, (iv) research necessary to comply with generally accepted accounting principles, (v) other
filings with the SEC, including consents and comfort letters, and (vi) services related to our IPO
and our follow-on equity offering.
(2) Tax fees consist of fees for tax compliance, including the preparation, preview and filing of tax
returns, and for tax advice and tax planning.
The charter of the Audit Committee and its pre‑approval policy require that the Audit Committee
review and pre‑approve the plan and scope of our independent registered public accounting firm’s audit,
audit‑related, tax and other services. During 2019 and 2018, all audit and non-audit services were pre-
approved by the Audit Committee.
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PART IV
Item 15. Exhibits, Financial Statement Schedules
(1) Financial Statements
The consolidated financial statements of Cactus, Inc. and Subsidiaries and the Report of
Independent Registered Public Accounting Firm are included in Part II, Item 8 of this Annual Report.
Reference is made to the accompanying Index to Consolidated Financial Statements.
(2) Financial Statement Schedules
All financial statement schedules have been omitted because they are not applicable or the required
information is presented in the financial statements or the notes thereto.
(3) Index to Exhibits
The exhibits required to be filed or furnished pursuant to Item 601 of Regulation S-K are set forth
below.
Exhibit No. Description

3.1 Amended and Restated Certificate of Incorporation of Cactus, Inc., effective February 12, 2018
(incorporated by reference to Exhibit 3.1 to the Registrant’s Form 8‑K filed with the
Commission on February 12, 2018)
3.2 Amended and Restated Bylaws of Cactus, Inc. (incorporated by reference to Exhibit 3.2 to the
Registrant’s Form 8-K filed with the Commission on February 12, 2018)
3.3 First Amendment to the Amended and Restated Bylaws of Cactus, Inc (incorporated by
reference to Exhibit 3.1 to the Registrant’s Form 8-K filed with the Commission on January 31,
2020)
4.1* Description of Securities
10.1 First Amended and Restated Limited Liability Company Operating Agreement of Cactus
Wellhead, LLC, (incorporated by reference to Exhibit 10.2 to the Registrant’s Form 8‑K filed
with the Commission on February 12, 2018)
10.2† Amended and Restated Employment Agreement with Scott Bender, dated as of February 12,
2018 (incorporated by reference to Exhibit 10.3 to the Registrant’s Form 8‑K filed with the
10.3† First Amendment to the Amended and Restated Employment Agreement, dated February 21,
2019, by and between Scott Bender and Cactus Wellhead, LLC (incorporated by reference to
Exhibit 10.1 to the Registrant’s Form 8-K filed with the Commission on February 22, 2019)
10.4† Amended and Restated Employment Agreement with Joel Bender, dated as of February 12,
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10.5† First Amendment to the Amended and Restated Employment Agreement, dated February 21,
2019, by and between Joel Bender and Cactus Wellhead, LLC (incorporated by reference to
Exhibit 10.2 to the Registrant’s Form 8-K filed with the Commission on February 22, 2019)
10.6† Amended and Restated Noncompetition Agreement with Scott Bender, dated as of February 12,
10.7† Amended and Restated Noncompetition Agreement with Joel Bender, dated as of February 12,
10.8† Form of Director and Officer Indemnification Agreement (incorporated by reference to Exhibit
10.5 to the Registrant’s Registration Statement on Form S-1 filed with the Commission on
January 12, 2018)
10.9†* Schedule of Director and Officer Indemnification Agreements Identical in All Material
Respects to the Form of Director and Officer Indemnification Agreement Filed as Exhibit 10.8
to this Annual Report pursuant to Instruction 2 to Item 6-1 of Regulation S-K
10.10 Tax Receivable Agreement (incorporated by reference to Exhibit 10.1 to the Registrant’s
Form 8‑K filed with the Commission on February 12, 2018)
10.11 Registration Rights Agreement (incorporated by reference to Exhibit 4.1 to the Registrant’s
Form 8‑K filed with the Commission on February 12, 2018)
10.12 Stockholders’ Agreement, effective as of February 12, 2018., by and among Cactus, Inc.,
Cadent Energy Partners II, L.P. and Cactus WH Enterprises, LLC (incorporated by reference to
Exhibit 4.2 to the Registrant’s Form 8‑K filed with the Commission on February 12, 2018)
10.13 Credit Agreement, dated July 31, 2014, among Cactus Wellhead, LLC, Credit Suisse AG, as
administrative agent, collateral agent and issuing bank, and the lenders named therein as parties
thereto (incorporated by reference to Exhibit 10.1 to the Registrant’s Registration Statement on
Form S‑1 (File No. 333‑222540) filed with the Commission on January 12, 2018)
10.14† Cactus, Inc. Long Term Incentive Plan (incorporated by reference to Exhibit 10.18 to the
Registrant’s Form 8‑K filed with the Commission on February 12, 2018)
10.15† Amendment No. 1 to Cactus, Inc. Long Term Incentive Plan, dated November 25, 2019
(incorporated by reference to Exhibit 10.1 to the Registrant’s Form 8-K filed with the
Commission on November 26, 2019
10.16† Form of Restricted Stock Agreement under the Cactus Inc. Long Term Incentive Plan
(incorporated by reference to Exhibit 10.10 to the Registrant’s Form S‑1 Registration Statement
(File No. 333‑222540) filed with the Commission on January 12, 2018)
10.17† Form of Restricted Stock Unit Agreement under the Cactus Inc. Long Term Incentive Plan
(incorporated by reference to Exhibit 10.11 to the Registrant’s Form S‑1 Registration Statement
(File No. 333‑222540) filed with the Commission on January 12, 2018)
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10.18 Credit Agreement, dated as of August 21, 2018, among Cactus Wellhead, LLC, as borrower,
the lenders party thereto and JPMorgan Chase Bank, N.A., as administrative agent, an issuing
bank and swingline lender (incorporated by reference to Exhibit 10.1 to the Registrant’s Form
8-K filed with the Commission on August 24, 2018)
10.19† Form of Restricted Stock Unit Agreement (Directors, one-year vesting) (incorporated by
reference to Exhibit 4.7 to the Registrants Form S-8 Registration Statement (File No. 333-
22569) filed with the Commission on May 29, 2018)
10.20† Form of Restricted Stock Unit Agreement (Directors, three-year vesting) (incorporated by
reference to Exhibit 4.7 to the Registrants Form S-8 Registration Statement (File No. 333-
22569) filed with the Commission on May 29, 2018)
10.21† Offer Letter to Stephen Tadlock dated May 30, 2017 (incorporated by reference to Item 10.17
of the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2018, filed
with the Commission on March 15, 2019
10.22†* Offer letter to David Isaac dated September 17, 2018
10.23†* Severance Agreement by and between Cactus Wellhead, LLC and David Isaac, dated as of
September 24, 2018
21.1* List of Subsidiaries of Cactus, Inc.
23.1* Consent of PricewaterhouseCoopers LLP
31.1* Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.
31.2* Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of
2002.
32.1** Certification of Chief Executive Officer pursuant to 18 U.S.C. § 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.
32.2** Certification of Chief Financial Officer pursuant to 18 U.S.C. § 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS* XBRL Instance Document
101.SCH* XBRL Taxonomy Extension Schema Document
101.CAL* XBRL Taxonomy Calculation Linkbase Document
101.LAB* XBRL Taxonomy Label Linkbase Document
101.PRE* XBRL Taxonomy Presentation Linkbase Document
101.DEF* XBRL Taxonomy Definition Document
* Filed herewith
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** Furnished herewith. Pursuant to SEC Release No. 33‑8212, this certification will be treated as
“accompanying” this Annual Report and not “filed” as part of such report for purposes of Section 18 of
the Exchange Act or otherwise subject to the liability of Section 18 of the Exchange Act, and this
certification will not be deemed to be incorporated by reference into any filing under the Securities Act,
except to the extent that the registrant specifically incorporates it by reference.
† Management contract or compensatory plan or arrangement.
Item 16. Form 10‑K Summary
None.
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Table of Contents
Signatures
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly
authorized.
Cactus, Inc.
Date: February 28, 2020 By: /s/ Scott Bender

Scott Bender
President, Chief Executive Officer and Director
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed
below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
Signature Title Date
/s/ Scott Bender President, Chief Executive Officer and Director February 28,
(Principal Executive Officer) 2020
Scott Bender
/s/ Stephen Tadlock Vice President, Chief Financial Officer and Treasurer February 28,
(Principal Financial Officer) 2020
Stephen Tadlock
/s/ Donna Anderson Chief Accounting Officer (Principal Accounting February 28,
Officer) 2020
Donna Anderson
February 28,
/s/ Bruce Rothstein Chairman of the Board and Director
2020
Bruce Rothstein
Senior Vice President, Chief Operating Officer and February 28,

/s/ Joel Bender
Director 2020
Joel Bender
/s/ John (Andy) O’Donnell February 28,

Director
2020
John (Andy) O’Donnell
/s/ Michael McGovern February 28,

Director
2020
Michael McGovern
/s/ Alan Semple February 28,

Director
2020
Alan Semple
/s/ Gary Rosenthal February 28,

Director
2020
Gary Rosenthal
/s/ Melissa Law February 28,

Director
2020
Melissa Law
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Exhibit 4.1
Description of Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934
Capitalized terms used but not defined herein have the meanings set forth in the Annual Report on Form 10-
K to which this Exhibit is attached. References to “we,” “our” and “us” refer to Cactus, Inc., unless the
context otherwise requires. References to “stockholders” refer to holders of our Class A common stock and
Class B common stock, unless the context otherwise requires.
As of December 31, 2019, we had one class of securities registered under Section 12 of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”): Class A common stock, $0.01 par value per share.
Although described below, our Class B common stock, $0.01 par value per share, is not registered under
Section 12 of the Exchange Act.
The following contains a description of our Class A common stock and Class B common stock, as well as
certain related additional information. The following summary does not purport to be complete and is
qualified in its entirety by reference to the provisions of applicable law and to our Amended and Restated
Bylaws and Amended and Restated Certificate of Incorporation, which we refer to as our “amended and
restated bylaws” and our “amended and restated certificate of incorporation,” respectively. Our amended and
restated bylaws and amended and restated certificate of incorporation as they exist on the date of this Annual
Report on Form 10-K are incorporated by reference or filed as an exhibit to the Annual Report on Form 10-K
of which this Exhibit is a part, and amendments or restatements of each will be filed with the Securities and
Exchange Commission (the “SEC”) in future periodic or current reports in accordance with the rules of the
SEC. You are encouraged to read these documents.
General
As of February 24, 2020, our authorized capital stock consisted of: 300,000,000 shares of Class A common
stock, $0.01 par value per share, of which 47,339,551 shares were issued and outstanding; 215,000,000
shares of Class B common stock, $0.01 par value per share, of which 27,957,699 shares were issued and
outstanding; and 10,000,000 shares of preferred stock, $0.01 par value per share, of which no shares were
issued and outstanding.
Class A Common Stock
Voting Rights. Holders of shares of Class A common stock are entitled to one vote per share held of record
on all matters to be voted upon by the stockholders. The holders of Class A common stock do not have
cumulative voting rights in the election of directors.
Dividend Rights. Holders of shares of our Class A common stock are entitled to ratably receive dividends
when and if declared by our board of directors out of funds legally available for that purpose, subject to any
statutory or contractual restrictions on the payment of dividends and to any prior rights and preferences that
may be applicable to any outstanding preferred stock.
Liquidation Rights. Upon our liquidation, dissolution, distribution of assets or other winding up, the holders
of Class A common stock are entitled to ratably receive the assets available for distribution to the
stockholders after payment of liabilities and the liquidation preference of any of our outstanding shares of
preferred stock.
Other Matters. The shares of Class A common stock have no preemptive or conversion rights and are not
subject to further calls or assessment by us. There are no redemption or sinking fund provisions applicable
to the Class A common stock. All outstanding shares of our Class A common stock are fully paid and non-
assessable.
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Class B Common Stock
Generally. In connection with our IPO, each owner of CW Units (a “CW Unit Holder”) received one share of
Class B common stock for each CW Unit that it held. Accordingly, each CW Unit Holder has a number of
votes in Cactus, Inc. equal to the aggregate number of CW Units that it held.
Voting Rights. Holders of shares of our Class B common stock are entitled to one vote per share held of
record on all matters to be voted upon by the stockholders. The holders of our Class B common stock do not
have cumulative voting rights in the election of directors. Holders of shares of our Class A common stock
and Class B common stock vote together as a single class on all matters presented to our stockholders for
their vote or approval, except with respect to the amendment of certain provisions of our amended and
restated certificate of incorporation that would alter or change the powers, preferences or special rights of the
Class B common stock so as to affect them adversely, which amendments must be by a majority of the votes
entitled to be cast by the holders of the shares affected by the amendment, voting as a separate class, or as
otherwise required by applicable law.
Dividend and Liquidation Rights. Holders of our Class B common stock do not have any right to receive
dividends, unless the dividend consists of shares of our Class B common stock or of rights, options, warrants
or other securities convertible or exercisable into or exchangeable for shares of Class B common stock paid
proportionally with respect to each outstanding share of our Class B common stock and a dividend consisting
of shares of Class A common stock or of rights, options, warrants or other securities convertible or
exercisable into or exchangeable for shares of Class A common stock on the same terms is simultaneously
paid to the holders of Class A common stock. Holders of our Class B common stock do not have any right to
receive a distribution upon a liquidation or winding up of Cactus, Inc.
Other Matters. The shares of Class B common stock have no preemptive rights and are not subject to further
calls or assessment by us. There are no redemption or sinking fund provisions applicable to the Class B
common stock. All outstanding shares of our Class B common stock are fully paid and non-assessable.
Anti-Takeover Effects of Provisions of Our Amended and Restated Certificate of Incorporation, our
Amended and Restated Bylaws and Delaware Law
Some provisions of Delaware law, and our amended and restated certificate of incorporation and our
amended and restated bylaws described below, contain provisions that could make the following transactions
more difficult: acquisitions of us by means of a tender offer, a proxy contest or otherwise; or removal of our
incumbent officers and directors. These provisions may also have the effect of preventing changes in our
management. It is possible that these provisions could make it more difficult to accomplish or could deter
transactions that stockholders may otherwise consider to be in their best interest or in our best interest,
including transactions that might result in a premium over the market price for our shares.
These provisions, summarized below, are expected to discourage coercive takeover practices and inadequate
takeover bids. These provisions are also designed to encourage persons seeking to acquire control of us to
first negotiate with us. We believe that the benefits of increased protection and our potential ability to
negotiate with the proponent of an unfriendly or unsolicited proposal to acquire or restructure us outweigh
the disadvantages of discouraging these proposals because, among other things, negotiation of these
proposals could result in an improvement of their terms.
Delaware Law
We are not subject to the provisions of Section 203 of the Delaware General Corporation Law (“DGCL”),
regulating corporate takeovers. In general, those provisions prohibit a Delaware corporation, including
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those whose securities are listed for trading on the New York Stock Exchange, from engaging in any
business combination with any interested stockholder for a period of three years following the date that the
stockholder became an interested stockholder, unless:
· the transaction is approved by the board of directors before the date the interested stockholder
attained that status;
· upon consummation of the transaction that resulted in the stockholder becoming an interested
stockholder, the interested stockholder owned at least 85% of the voting stock of the corporation
outstanding at the time the transaction commenced; or
· on or after such time the business combination is approved by the board of directors and
authorized at a meeting of stockholders by at least two-thirds of the outstanding voting stock that
is not owned by the interested stockholder.
Amended and Restated Certificate of Incorporation and Our Amended and Restated Bylaws
Provisions of our amended and restated certificate of incorporation and our amended and restated bylaws
may delay or discourage transactions involving an actual or potential change in control or change in our
management, including transactions in which stockholders might otherwise receive a premium for their
shares, or transactions that our stockholders might otherwise deem to be in their best interest. Therefore,
these provisions could adversely affect the price of our Class A common stock.
Among other things, our amended and restated certificate of incorporation and amended and restated bylaws:
· establish advance notice procedures with regard to stockholder proposals relating to the
nomination of candidates for election as directors or new business to be brought before meetings
of our stockholders. These procedures provide that notice of stockholder proposals must be
timely given in writing to our corporate secretary prior to the meeting at which the action is to be
taken. Generally, to be timely, notice must be received at our principal executive offices not less
than 90 days nor more than 120 days prior to the first anniversary date of the annual meeting for
the preceding year. Our amended and restated bylaws specify the requirements as to form and
content of all stockholders’ notices. These requirements may preclude stockholders from
bringing matters before the stockholders at an annual or special meeting;
· provide our board of directors the ability to authorize undesignated preferred stock. This ability
makes it possible for our board of directors to issue, without stockholder approval, preferred
stock with voting or other rights or preferences that could impede the success of any attempt to
change control of us. These and other provisions may have the effect of deferring hostile
takeovers or delaying changes in control or management of our company;
· provide that the authorized number of directors may be changed only by resolution of the board
of directors;
· provide that all vacancies, including newly created directorships, may, except as otherwise
required by law, the rights of holders of any series of preferred stock and the then applicable
provisions of the “Stockholders’ Agreement” be filled by the affirmative vote of a majority of
directors then in office, even if less than a quorum;
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· provide that any action required or permitted to be taken by the stockholders must be effected at
a duly called annual or special meeting of stockholders and may not be effected by any consent
in writing in lieu of a meeting of such stockholders, subject to the rights of the holders of any
series of preferred stock with respect to such series;
· provide that our amended and restated certificate of incorporation and amended and restated
bylaws may be amended by the affirmative vote of the holders of at least two-thirds of our then
outstanding Class A common stock;
· provide that special meetings of our stockholders may only be called by the board of directors,
the chief executive officer or the chairman of the board;
· provide for our board of directors to be divided into three classes of directors, with each class as
nearly equal in number as possible, serving staggered three-year terms, other than directors
which may be elected by holders of preferred stock, if any. This system of electing and
removing directors may tend to discourage a third party from making a tender offer or otherwise
attempting to obtain control of us, because it generally makes it more difficult for stockholders
to replace a majority of the directors;
· provide that we renounce any interest in existing and future investments in other entities by, or
the business opportunities of, Cadent or any of its officers, directors, agents, stockholders,
members, partners, affiliates and subsidiaries (other than our directors that are presented
business opportunities in their capacity as our directors) and that they have no obligation to offer
us those investments or opportunities, and that they have no duty to refrain from engaging in
corporate opportunities in the same or similar lines of business in which we or our affiliates now
engage or propose to engage or otherwise competing with us or our affiliates; and
· provide that our amended and restated bylaws can be amended by the board of directors.
Forum Selection
Our amended and restated certificate of incorporation provides that unless we consent in writing to the
selection of an alternative forum, the Court of Chancery of the State of Delaware will, to the fullest extent
permitted by applicable law, be the sole and exclusive forum for:
· any derivative action or proceeding brought on our behalf;
· any action asserting a claim of breach of a fiduciary duty owed by any of our directors, officers,
employees or agents to us or our stockholders;
· any action asserting a claim against us or any director or officer or other employee of ours arising
pursuant to any provision of the DGCL, our certificate of incorporation or our bylaws; or
· any action asserting a claim against us or any director or officer or other employee of ours that is
governed by the internal affairs doctrine, in each such case subject to such Court of Chancery
having personal jurisdiction over the indispensable parties named as defendants therein.
Our amended and restated certificate of incorporation also provides that any person or entity purchasing or
otherwise acquiring any interest in shares of our capital stock will be deemed to have notice of, and to have
consented to, this forum selection provision. Although we believe these provisions benefit us by providing
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increased consistency in the application of Delaware law for the specified types of actions and proceedings,
the provisions may have the effect of discouraging lawsuits against our directors, officers, employees and
agents. The enforceability of similar exclusive forum provisions in other companies’ certificates of
incorporation has been challenged in legal proceedings, and it is possible that, in connection with one or
more actions or proceedings described above, a court could rule that this provision in our amended and
restated certificate of incorporation is inapplicable or unenforceable.
Business Opportunities and Competition
Delaware law permits corporations to adopt provisions renouncing any interest or expectancy in certain
opportunities that are presented to the corporation or its officers, directors or stockholders.
Our amended and restated certificate of incorporation, to the maximum extent permitted from time to time by
Delaware law, renounces any interest or expectancy that we have in, or right to be offered an opportunity to
participate in, specified business opportunities that are from time to time presented to Cadent and its
affiliates, including any of our directors affiliated with Cadent and provides that if Cadent or its affiliates,
including any of our directors affiliated with Cadent, becomes aware of a potential business opportunity,
transaction or other matter, they have no duty to communicate or offer that opportunity to us (unless such
opportunity is expressly offered to such director in his capacity as one of our directors).
In addition, our amended and restated certificate of incorporation, to the maximum extent permitted from
time to time by Delaware law, provides that none of Cadent or its affiliates, including any of our directors
affiliated with Cadent, have any duty to refrain from (i) engaging in a corporate opportunity in the same or
similar lines of business in which we or our affiliates now engage or propose to engage or (ii) otherwise
competing with us or our affiliates.
Limitation of Liability and Indemnification Matters
Our amended and restated certificate of incorporation limits the liability of our directors for monetary
damages for breach of their fiduciary duty as directors, except for liability that cannot be eliminated under
the DGCL. Delaware law provides that directors of a company will not be personally liable for monetary
damages for breach of their fiduciary duty as directors, except for liabilities:
· for any breach of their duty of loyalty to us or our stockholders;
· for acts or omissions not in good faith or which involve intentional misconduct or a knowing
violation of law;
· for unlawful payment of dividend or unlawful stock repurchase or redemption, as provided under
Section 174 of the DGCL; or
· for any transaction from which the director derived an improper personal benefit.
Any amendment, repeal or modification of these provisions will be prospective only and would not affect
any limitation on liability of a director for acts or omissions that occurred prior to any such amendment,
repeal or modification.
Our amended and restated bylaws also provide that we will indemnify our directors and officers to the fullest
extent permitted by Delaware law. Our amended and restated bylaws also permit us to purchase insurance on
behalf of any officer, director, employee or other agent for any liability arising out of that person’s actions as
our officer, director, employee or agent, regardless of whether Delaware law would
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permit indemnification. We have entered into indemnification agreements with each of our current directors
and officers and intend to enter into indemnification agreements with any future directors and
officers. These agreements require us to indemnify these individuals to the fullest extent permitted under
Delaware law against liability that may arise by reason of their service to us, and to advance expenses
incurred as a result of any proceeding against them as to which they could be indemnified. We believe that
the limitation of liability provision that is in our amended and restated certificate of incorporation and the
indemnification agreements will facilitate our ability to continue to attract and retain qualified individuals to
serve as directors and officers.
Transfer Agent and Registrar
The transfer agent and registrar for our Class A common stock is American Stock Transfer & Trust
Company, LLC.
Listing
Our Class A common stock is listed on the NYSE under the symbol “WHD.”
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Exhibit 10.22
[Company Letterhead]
September 17, 2018
Dear David:
We are pleased to extend you an offer of employment with Cactus Wellhead, LLC.
Your position will be Vice President of Administration and General Counsel, based in Houston, TX, reporting
to me. Your tentative start date will be September 24, 2018. You will be paid a bi-weekly base salary of
$10,576.92, or $275,000.00 per year. As this position is considered "exempt" for federal wage-hour
purposes, you will not be eligible for overtime pay for hours worked in excess of 40 in a given workweek.
As a full-time employee with Cactus Wellhead, you are eligible for the following:
· Comprehensive benefits package including medical, dental, vision effective the 1st of the month
following 30 days of employment. Disability, voluntary ancillary benefits, and 401(k) retirement
programs (please see attached) are also offered.
· 20 Paid Time Off (PTO) days per calendar year, prorated, which includes vacation and sick time.
· Cell phone allowance, as per company policy.
· Participation in our Incentive Program (IP). This plan provides for annual bonus payments based on
achieving the financial and operational goals of the Company and weighs your personal
contributions to the Company as well. In your position, you are eligible for the Company incentive
plan. Payment of this plan is based on the objectives that are set by the Company.
· Your initial target participation level in the Incentive Program would be at a 34% level, with inclusion
in the Tier 1 participant pool, which currently incorporates the highest stretch bonus component in
the plan.
· With Board approval, you will participate in our long-term incentive program, which is generally
equivalent in value to your annual non-stretch cash bonus target percentage of 34% with three-year
vesting terms starting in 2019 (vesting equally in one third installments per year).
· A one-time restricted stock unit award of $300,000 with three-year vesting terms that will be granted
at the closing stock price 30 days after your start date (vesting equally in one third installments per
year).
Your employment with the company is contingent upon the successful completion of a background
investigation and a drug and alcohol screen. Additionally, this offer is contingent upon satisfactory review of
any covenants related to non-compete agreements that may be currently in force with your current or
previous employers. Once satisfactory results are received, we will contact you to confirm your start date.
Employment with Cactus Wellhead, LLC is considered "at will", meaning that either you or the company may
terminate the relationship at any time for any reason, with or without cause or notice. Notwithstanding the
aforementioned, a one-year severance payment will be provided should the Company terminate you without
Cause. Nothing in this letter is intended or should be construed as a contract, express or implied. This letter
supersedes any prior representation or agreement, whether written or oral. This employment letter may not
be modified or amended except by a written agreement.
We hope you will find working with Cactus Wellhead, LLC to be a rewarding experience.
Sincerely,
Scott Bender
Please confirm your acceptance of t is offer by signing below and returning the signed copy by email
to [email protected]. This offer is void if your response is not received within seven (7)
days. Should you have any questions, please do not hesitate to contact [Omitted] at [Omitted].
Signature/s/ David Isaac Date:9/17/18
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Exhibit 10.23
SEVERANCE AGREEMENT
This Severance Agreement (this “Agreement”) is made effective as of September 24, 2018
(the “Commencement Date”) by Cactus Wellhead, LLC (the “Employer”), and David Isaac, an
individual resident in Houston, Texas (the “Executive”).
RECITALS
(A) The Employer employs the Executive as of September 24, 2018 (the
“Commencement Date”)
(B) The Employer wishes to provide severance pay in the event of certain terminations
of employment.
(C) In this Agreement, the Employer and the Executive will be known as “Party” or
“Parties” as the context requires.
(D) In consideration of the mutual agreements contained herein and other good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties
hereto, intending to be legally bound, agree as follows:
AGREEMENT
1. FORM, CONTENT AND GOVERNING LAW
1.1 This Agreement comprises 5 Clauses and 2 Schedules and the contents of the Schedules are
incorporated herein by reference as if fully set forth herein and are made a part of this
Agreement for all purposes.
1.2 Capitalized terms used in this Agreement shall have the meanings set forth in Schedule 1 or
as otherwise set forth herein.
1.3 This Agreement will be governed by the internal laws of the State of Texas without regard to
conflict of laws principles.
2. TERM OF AGREEMENT
This Agreement will terminate, except to the extent that any obligation of the Company hereunder
remains unpaid as of such time and the Executive’s ongoing obligations pursuant to Section 4 of
this Agreement, upon the earlier of (i) the date three years after the Commencement Date or (ii) the
termination of the Executive’s employment with the Company and its Affiliates for any reason.
3. NON-COMPETITION AND NON-SOLICITATION; CONFIDENTIALITY
As an additional inducement to the Employer to enter into this Agreement, and in order to protect
the confidential information (including, without limitation, trade secrets) and goodwill of the
Employer and its Affiliates, the Executive agrees that he will abide by the restrictions set forth in
the Confidentiality, Non-Solicitation, Non-competition, and Non-Recruitment Agreement entered
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into by the Executive and the Employer effective as of September 24, 2018, which is attached
hereto as Exhibit A (the “Non-Competition Agreement”) and incorporated herein by reference, and
that, in the event that the Employer determines that the Executive has violated any covenant
contained in the Non-Competition Agreement or if any court of competent jurisdiction in a
proceeding between the Executive and the Employer or any Affiliates determines that any of the
covenants set forth in the Non-Competition Agreement may not be enforced, the Executive will
forfeit any remaining rights to any payment under this Agreement and upon the Employer’s
demand, the Executive will forfeit and repay to the Employer, any amounts previously paid to the
Executive pursuant to this Agreement, in addition to any other remedies that may be available to the
Employer in such event.
4. SEVERANCE PAY
4.1 If, during the term of this Agreement, the Executive experiences a Qualifying Termination,
then the Employer will provide the Executive with a Severance Payment (as defined below),
subject to compliance by Executive with the Non-Competition Agreement and the
Executive’s execution without revocation of the Release Agreement set forth in Exhibit B
on or before the fiftieth (50th) day following his separation from service. The amount of the
Severance Payment will be equal to (i) one times the Executive’s then current annual base
salary if the Qualifying Termination occurs prior to the first anniversary of the
Commencement Date, (ii) 2/3 times the Executive’s then current annual base salary if the
Qualifying Termination occurs on or after the first anniversary of the Commencement Date
and prior to the second anniversary of the Commencement Date, or (iii) 1/3 times the
Executive’s then current annual base salary if the Qualifying Termination occurs on or after
the second anniversary of the Commencement Date and prior to the third anniversary of the
Commencement Date. Payment of the Severance Payment pursuant to this paragraph will be
made in a single lump sum cash payment to the Executive (less all applicable withholding)
on the sixtieth (60th) day immediately following the date of Executive’s separation from
service.
4.2 If the Executive’s employment with the Employer and its Affiliates terminates otherwise
than in a Qualifying Termination, no amount shall be payable under this Agreement.
5. MISCELLANEOUS
General provisions pertaining to this Agreement are contained in Schedule 1 attached hereto.
Additionally, Schedule 2 of this Agreement contains grievance procedures and dispute resolution
procedures.
- Remainder of Page Intentionally Left Blank -
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IN WITNESS WHEREOF the Parties have executed and delivered this Agreement to be effective
as of the Commencement Date.
CACTUS WELLHEAD, LLC
By: /s/ Scott Bender

Name:Scott Bender
Title: President
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EXECUTIVE
/s/ David Isaac

David Isaac
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SCHEDULE 1: DEFINITIONS AND GENERAL PROVISIONS
This is Schedule 1 to the Severance Agreement between Cactus Wellhead, LLC and David Isaac
dated effective September 24, 2018.
DEFINITIONS AND GENERAL PROVISIONS
1. Definitions. In this Agreement and the Schedules, the following words and expressions will
have the following meanings unless the context otherwise requires:
“Affiliate” means, with respect to any Person, any other Person directly or indirectly
controlling, controlled by or under common control with such Person. For purposes of this
definition, the term “control” means, with respect to any Entity, the power to direct or cause
the direction of the management and policies of such Entity, directly or indirectly, whether
through the ownership of voting securities, by contract or otherwise, and the terms
“controlling” and “controlled” have meanings correlative to the foregoing.
“Board” means the governing body of the Employer, which shall be the Board of
Managers.
“Cause” means:
(a) the commission by the Executive of a deliberate act against the

interests of the Employer, including but not limited to fraud, theft or embezzlement against
the Employer, its Affiliates, or any customer or client thereof;
(b) conviction of, or plea of no contest or guilty with respect to a crime

involving fraud, theft, embezzlement or other act of material dishonesty on behalf of the
Executive or the Board’s loss of confidence in Executive because Executive is convicted of
or enters a plea of no contest or guilty with respect to any felony or crime involving moral
turpitude;
(c) the Executive’s material breach of any material employment contract,

policy or agreement entered into with the Employer or its Affiliate or any material policy of
the Employer or its Affiliate, other than a breach which (being capable of being remedied) is
remedied by the Executive within fourteen (14) days of being called upon to do so in writing
by the Employer; or
(d) the Executive’s failure to perform his duties and responsibilities

(other than a failure from Disability);
“Disability” will be determined in accordance with Section 2 below.
“Good Reason” means any of the following, without the Executive’s prior written
consent: (a) the Employer commits any material breach of any of the provisions of this
Agreement; (b) the Employer assigns the Executive to a position, responsibilities, or duties
of a materially lesser status or degree of responsibility than his position, responsibilities or
duties as of the Commencement Date; (c) the requirement by the Employer that the
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Executive be based anywhere other than Houston, Texas, provided that such a change in
geographic location be deemed material; or (d) any decrease of more than ten percent (10%)
in Executive’s base salary as it exists on the effective date of this Agreement.
Notwithstanding the foregoing, prior to the Executive being eligible to terminate for Good
Reason, the Executive must provide written notice of termination for Good Reason pursuant
to this Agreement within the ninety (90) day period immediately following the initial
existence of the condition at issue, and the Employer shall have the opportunity to cure such
circumstances within the thirty (30) day period of receipt of such notice. If the Employer
cures the applicable condition, Good Reason shall not be deemed to exist.
“Qualifying Termination” means a termination of the Executive’s employment with

the Employer and its Affiliates (i) by the Employer without Cause or (ii) by the Executive
for Good Reason; provided that a termination of employment due to death or Disability shall
not constitute a Qualifying Termination.
2. Disability. The Executive will be deemed to have a “Disability” if, for physical or mental
reasons, the Executive is unable to perform the essential functions of the Executive’s duties under
this Agreement for 3-consecutive months, or 3-months during any twelve-month period. The
Disability of the Executive will be determined by the examination of the Executive by a medical
doctor selected by written agreement of the Parties upon the request of either Party by notice to the
other Party. If the Parties are unable to agree on the selection of a medical doctor, each of the
Parties will select a medical doctor and the two medical doctors will select a third medical doctor
who will conduct the examination to determine whether the Executive has a Disability. The
determination of the examining medical doctor will be final and binding on the Parties. The
Executive must submit to a reasonable number of examinations by the examining medical doctor
and the Executive hereby authorizes the disclosure and release to the Employer of such
determination and all supporting medical records. If the Executive is not legally competent then the
Executive’s legal guardian or duly authorized attorney-in-fact will act in the Executive’s stead for
the purposes of submitting the Executive to the examination and providing the authorization of
disclosure required. If requested by Employer, Executive will execute such further documents as
are necessary to permit such disclosure in a timely manner.
3. Notices. All notices, consents, waivers, and other communications under this Agreement
must be in writing and will be deemed to have been duly given when (a) delivered by hand (with
written confirmation of receipt), (b) sent by facsimile (with written confirmation of receipt),
provided that a copy is mailed by certified mail, return receipt requested, or (c) when received by
the addressee, if sent by a nationally recognized overnight delivery service (receipt requested), in
each case to the appropriate addresses and facsimile numbers set forth below (or to such other
addresses and facsimile numbers as a Party may designate by notice to the other party):
Executive:
David Isaac
4006 Blossom Street
Houston, TX 77007
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Employer:
Cactus Wellhead, LLC

920 Memorial City Way
Suite 300
Houston, Texas 77024
Attention: Chief Executive Officer
4. Further Assurances. The Parties agree (a) to furnish upon request in a timely manner to
each other such further information, (b) to execute and deliver to each other such other documents,
and (c) to do such other acts and things, all as the other Party may reasonably request for the
purpose of carrying out the intent of this Agreement and the documents referred to in this
Agreement.
5. Waiver.
5.1 The rights and remedies of the Parties to this Agreement are cumulative and not
alternative. Neither the failure nor any delay by any Party in exercising any right, power, or
privilege under this Agreement or the documents referred to in this Agreement will operate as a
waiver of such right, power, or privilege, and no single or partial exercise of any such right, power,
or privilege will preclude any other or further exercise of such right, power, or privilege or the
exercise of any other right, power, or privilege.
5.2 To the maximum extent permitted by applicable law, (a) no claim or right arising out
of this Agreement or the documents referred to in this Agreement may be discharged by one Party,
in whole or in part, by a waiver or renunciation of the claim or right unless in writing signed by the
both Parties; (b) no waiver that may be given by a Party will be applicable except in the specific
instance for which it is given; and (c) no notice to or demand on one Party will be deemed to be a
waiver of any obligation of such Party or of the right of the Party giving such notice or demand to
take further action without notice or demand as provided in this Agreement or the documents
referred to in this Agreement.
6. Internal Revenue Code Section 409A. The Parties intend that this Agreement will be
administered in accordance with Section 409A of the Code and all regulations promulgated
thereunder (“Section 409A”). To the extent that any provision of this Agreement is ambiguous as to
its compliance with Section 409A, the provision shall be read in such a manner so that all payments
hereunder are either exempt or comply with Section 409A. The Parties agree that this Agreement
may be amended, as reasonably requested by either Party, as may be necessary to be exempt from
or fully comply with Section 409A in order to preserve the payments and benefits provided
hereunder without additional cost to either Party. Notwithstanding anything contained herein to the
contrary, to the extent required in order to avoid accelerated taxation and/or tax penalties under
Section 409A, Executive shall not be considered to have terminated employment with the Employer
or any subsidiary or Affiliate thereof for purposes of this Agreement unless Executive would be
considered to have incurred a “separation from service” within the meaning of Section 409A from
the Employer or any of its subsidiaries or Affiliates. Each amount to be paid or benefit to be
provided under this Agreement shall be construed as a separate identified payment for purposes of
Section 409A, and any payments described in this Agreement that are
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due within the “short term deferral period” as defined in Section 409A shall not be treated as
deferred compensation unless applicable law requires otherwise. Without limiting the foregoing
and notwithstanding anything contained herein to the contrary, if Executive is deemed by the
Employer at the time of Executive’s separation from service to be a “specified employee” for
purposes of Section 409A, to the extent delayed commencement of any portion of the benefits to
which Executive is entitled under this Agreement is required in order to avoid the imposition of
additional taxes and interest on Executive under Section 409A, such portion of Executive’s benefits
shall not be provided to Executive prior to the earlier of (a) the expiration of the six-(6) month
period measured from the date of Executive’s separation from service or (b) the date of Executive’s
death.
7. Assignments, Successors, And No Third-Party Rights. This Agreement will inure to the
benefit of, and will be binding upon, the Parties hereto and their respective successors, assigns,
heirs, and legal representatives, including any entity with which the Employer may merge or
consolidate or be converted into or to which all or substantially all of its assets may be transferred.
The duties and covenants of the Employee under this Agreement, being personal, may not be
delegated.
8. Severability. If any provision of this Agreement is held invalid or unenforceable by any

court of competent jurisdiction, the other provisions of this Agreement will remain in full force and
effect. Any provision of this Agreement held invalid or unenforceable only in part or degree will
remain in full force and effect to the extent not held invalid or unenforceable and the invalid or
unenforceable provision(s) shall be deemed replaced by valid and enforceable provisions that are
consistent with the expressed intent of the Parties to the maximum extent permitted by applicable
law.
9. Time Of Essence. With regard to all dates and time periods set forth or referred to in this
Agreement, time is of the essence.
10. Counterparts. This Agreement may be executed in one or more counterparts, each of
which will be deemed to be an original copy of this Agreement and all of which, when taken
together, will be deemed to constitute one and the same agreement.
11. Amendment. Any amendment to or modification of this Agreement shall be in writing and
signed by both Parties.
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SCHEDULE 2: GRIEVANCE PROCEDURES AND DISPUTE RESOLUTION
This is Schedule 2 to the Severance Agreement between Cactus Wellhead, LLC and David Isaac
dated effective September 24, 2018.
GRIEVANCE PROCEDURES AND DISPUTE RESOLUTION
1. If the Executive wishes to obtain redress of any grievance relating to his employment or is
dissatisfied with any reprimand, suspension or other disciplinary step taken by the Employer, he
will apply in writing, setting out the nature and details of any such grievance or dissatisfaction, to
the Board of Managers.
2. In the event that there is a dispute arising out of or in any way relating to this Agreement,
the Parties covenant and agree as follows:
2.1 The Parties will first use their reasonable best efforts to resolve such dispute among
themselves, with or without mediation.
2.2 If the Parties are unable to resolve such dispute among themselves, they will use
their reasonable best efforts to agree upon an individual arbitrator to settle the dispute. Any award
as a result of such arbitration will be final and binding upon the Parties and the Parties agree to
abide by and perform any award rendered by the arbitrator. Such a ruling will be non-appealable.
2.3 If the Parties are unable to agree on a single arbitrator such dispute will be submitted
to binding arbitration in Houston, Texas, pursuant to the Federal Arbitration Act, under the auspices
of, and pursuant to the rules, of the American Arbitration Association’s Commercial Arbitration
Rules as then in effect, or such other procedures as the Parties may agree to at the time, before a
tribunal of three (3) arbitrators, one of which will be selected by the Executive, one of which will be
selected by the Employer, and the third of which will be selected by the two arbitrators so selected.
Any award issued as a result of such arbitration will be final and binding upon the Parties as to all
demands, complaints, claims, liens, obligations, liabilities or causes of action, including, but not
limited to, all claims of unlawful employment discrimination, harassment or retaliation under state,
local or federal law (including, but not limited to, the Texas Code, the Americans with Disabilities
Act, the Age Discrimination in Employment Act, the Older Workers Benefit Protection Act, the
Family Medical Leave Act, the National Labor Relations Act, the Labor Management Relations
Act, and the Employee Retirement Income Security Act of 1974, as amended), and will be
enforceable by any court having jurisdiction over the Party against whom enforcement is sought. A
ruling by the arbitrators will be non-appealable except as provided by the Federal Arbitration Act.
The Parties agree to abide by and perform any award rendered by the arbitrators except as provided
by the Federal Arbitration Act.
2.4 If either the Employer or the Executive materially breaches this Agreement or fails
to comply with any final and non-appealable award and the other party thereafter seeks enforcement
of any award rendered by the arbitrators, then the prevailing Party (designated by the arbitrators) to
such proceeding(s) will be entitled to recover all of its costs and expenses from the non-prevailing
Party, in addition to any other relief to which it may be entitled.
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2.5 If a dispute arises and one Party fails or refuses to designate an arbitrator within
thirty (30) days after receipt of a written notice that an arbitration proceeding is to be held, then the
rules of the Federal Arbitration Act shall apply to designate the arbitrator not so designated by a
Party.
2.6 Either the Employer or the Executive may cause an arbitration proceeding to
commence by giving the other Party notice in writing of such arbitration. The Employer and the
Executive covenant and agree to act as expeditiously as practicable to resolve all disputes by
arbitration.
2.7 The arbitration proceeding will be held in English.
2.8 Notwithstanding anything contained in this Agreement to the contrary, neither the
Employer nor the Executive will be precluded from seeking interim court action at any time after
commencing arbitration and before the arbitrators are selected in the event the relief sought is
equitable relief to preserve the status quo. All such interim remedies shall not bind the arbitrators in
connection with any subsequent rulings. Legal process in any such action or proceeding may be
served on any party anywhere in the world.
2.9 Except as expressly provided herein and except for an action seeking injunctive or
other equitable relief to enforce the provisions of this Agreement, no action may be brought in any
court of law and EACH OF THE PARTIES WAIVES ANY RIGHTS THAT IT MAY HAVE
TO BRING A CAUSE OF ACTION IN ANY COURT OR IN ANY PROCEEDING
INVOLVING A JURY TO THE MAXIMUM EXTENT PERMITTED BY LAW.
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EXHIBIT A: NON-COMPETITION
CONFIDENTIALITY, NON-SOLICITATION, NON-COMPETITION, AND NON-

RECRUITMENT
A-1
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EXHIBIT B: RELEASE
RELEASE AGREEMENT
FOR AND IN CONSIDERATION OF the severance pay to be provided in connection with

the termination of my employment in accordance with Section 4 of the Severance Agreement, dated
as of September 24, 2018 between Cactus Wellhead, LLC (the “Company”) and me (the
“Severance Agreement”), I, on my own behalf and on behalf of my personal and legal
representatives, executors, administrators, successors, heirs, distributees, devisees and legatees and
all others connected with me, hereby release and forever discharge the Company and its affiliates
and all of their respective past and present officers, directors, managers, stockholders, controlling
persons, employees, agents, representatives, successors and assigns and all others connected with
any of them (the “Released Parties”), both individually and in their official capacities, from any and
all rights, liabilities, claims, damages, demands and causes of action, whether statutory or at
common law (including any claim for salary, benefits, payments, expenses, costs, attorney’s fees,
damages, penalties, compensation, remuneration, contractual entitlements) (collectively, “Claims”)
relating to any matter occurring on or prior to the date of my signing of this Release Agreement (the
“Release”), including any Claims resulting from, arising out of, or connected with my employment
or its termination and any other Claims pursuant to: (a) any federal, state, foreign or local law,
regulation or other requirement (including without limitation Title VII of the Civil Rights Act of
1964, the Age Discrimination in Employment Act of 1967, the Americans with Disabilities Act of
1990, and any other local, state, or federal anti-discrimination or anti-retaliation law, each as
amended from time to time); (b) any other local, state or federal law, regulation or ordinance; (c)
any public policy or common law; and (d) any contract I may have with any Released Party,
including the Severance Agreement (collectively, the “Released Claims”); provided, however, that
the foregoing release shall not apply to (i) any right explicitly set forth in the Severance Agreement
to any payments and benefits to be provided in connection with the termination of my employment,
(ii) any right or claim that arises after the date this release is executed, (iii) any right I may have to
vested or accrued benefits or entitlements under any applicable plan, agreement, program, award,
policy or arrangement of the Company and its parents, subsidiaries and affiliates, (iv) my right to
indemnification and advancement of expenses in accordance with applicable laws and/or the
certificate of incorporation and by-laws, limited liability company agreement or other governing
documents of the Company and its parents, subsidiaries and affiliates, or any applicable insurance
policy, or (v) any right I may have to obtain contribution as permitted by law in the event of entry of
judgment against me as a result of any act or failure to act for which I, on the one hand, and any
Released Party, on the other hand, are jointly liable. This Release is not intended to indicate that any
such claims exist or that, if they do exist, they are meritorious. Rather, I am simply agreeing that, in
exchange for the consideration received by me through this Release, any and all Released Claims
that I may have against any Released Party, regardless of whether they actually exist, are expressly
settled, compromised and waived. This Release includes matters attributable to the sole or partial
negligence (whether gross or simple) or other fault, including strict liability, of any Released Party.
Nothing in this Release prohibits me from filing a charge with, or reporting possible
violations of federal law or regulation to any governmental agency or entity, including but not
limited to the U.S. Equal Opportunity Commission, the Department of Justice, the Securities and
B-1
8/31/2020 SEC-Show
Exchange Commission, Congress, and any agency Inspector General, or making other disclosures
that are protected under the whistleblower provisions of federal law or regulation. Nothing in this
Release limits my ability to communicate with any government agencies or participate in any
investigation or proceeding that may be conducted by any government agency, including providing
documents or other information, without notice to the Company.
In signing this Release, I acknowledge that (i) I have carefully read this Release; (ii) I have
had at least twenty-one (21) days from the date of notice of termination of my employment, or in
the event that such termination of employment is “in connection with an exit incentive or other
employment termination program” (as such phrase is defined in the Age Discrimination in
Employment Act of 1967, as amended), the date that is forty-five (45) days following such notice
date, to consider the terms of this Release and that such time has been sufficient; (iii) I am hereby
encouraged by the Company to seek the advice of an attorney prior to signing this Release and have
had adequate opportunity to do so; (iv) I am not entitled to the consideration set forth in the
Severance Agreement but for my entry into, and non-revocation of, this Release within the time
provided to do so; and (v) I am signing this Release voluntarily and with a full understanding and
acceptance of its terms, I understand the final and binding effect of this Release, and the only
promises made to me to sign this Release are those stated in the Severance Agreement and herein.
I understand that I may revoke this Release at any time within seven days of the date of my
signing by providing written notice to the Company of such revocation so that such notice is
received by the Company no later than 11:59 P.M. on the seventh (7th) day after I sign this Release
and that this Release will take effect only upon the expiration of such seven-day (7) revocation
period (the “Effective Date”) and only if I have not timely revoked it.
Intending to be legally bound, I have signed this Release to be effective as of the Effective
Date.
David Isaac
Date
B-2
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Exhibit 10.9
SCHEDULE OF DIRECTOR AND OFFICER INDEMNIFICATION AGREEMENTS

SUBSTANTIALLY IDENTICAL TO FORM OF DIRECTOR AND OFFICER
INDEMNIFICATION AGREEMENT FILED AS EXHIBIT TO ANNUAL REPORT
In accordance with Instruction 2 to Item 601 of Regulation S-K, the Registrant has omitted filing
the following Director and Officer Indemnification Agreements by and between Cactus, Inc. and the parties
named below because they are substantially identical in all material respects to the form of Director and
Officer Indemnification Agreement filed as Exhibit 10.8 to Cactus, Inc.’s Annual Report on Form 10-K for
the fiscal year ended December 31, 2019:
1. Indemnification Agreement with Scott Bender, dated as of February 12, 2018

2. Indemnification Agreement with Joel Bender, dated as of February 12, 2018
3. Indemnification Agreement with Bruce Rothstein, dated as of February 12, 2018
4. Indemnification Agreement with Brian Small, dated as of February 12, 2018
5. Indemnification Agreement with Steven Bender dated as of February 12, 2018
6. Indemnification Agreement with Stephen Tadlock, dated as of February 12, 2018
7. Indemnification Agreement with John (Andy) O’Donnell, dated as of February 12, 2018
8. Indemnification Agreement with Michael McGovern, dated as of February 12, 2018
9. Indemnification Agreement with Alan Semple, dated as of February 12, 2018
10. Indemnification Agreement with Gary Rosenthal, dated as of February 12, 2018
11. Indemnification Agreement with David Isaac, dated as of September 24, 2018
12. Indemnification Agreement with Donna Anderson, dated as of December 9, 2019
13. Indemnification Agreement with Melissa Law, dated as of January 30, 2020
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Exhibit 21.1
Cactus, Inc.
Subsidiaries
December 31, 2019
State or Country
Subsidiary of Incorporation
Cactus Wellhead, LLC Delaware

Cactus Wellhead (Suzhou) Pressure Control
Co., Ltd. China
Cactus Wellhead Australia Pty, Ltd Australia
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Exhibit 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We hereby consent to the incorpora on by reference in the Registra on Statements on Form

S-3 (No. 333-230328) and Form S-8 (No. 333-225269) of Cactus, Inc. of our report dated
February 28, 2020 rela ng to the financial statements and the effec veness of internal
control over financial repor ng, which appears in this Form 10-K.
/s/ PricewaterhouseCoopers LLP

Houston, Texas
February 28, 2020
8/31/2020 SEC-Show
Exhibit 31.1
CERTIFICATION OF THE PRINCIPAL EXECUTIVE OFFICER PURSUANT TO

RULE 13a‑14(a)
I, Scott Bender, certify that:
1) I have reviewed this Annual Report on Form 10‑K of Cactus, Inc. (the “registrant”);
2) Based on my knowledge, this report does not contain any untrue statement of a material fact or
omit to state a material fact necessary to make the statements made, in light of the circumstances
under which such statements were made, not misleading with respect to the period covered by this
report;
3) Based on my knowledge, the financial statements, and other financial information included in this
report, fairly present in all material respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in this report;
4) The registrant’s other certifying officer and I are responsible for establishing and maintaining
disclosure controls and procedures (as defined in Exchange Act Rules 13a‑15(e) and 15d‑15(e))
and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-
15(f)) for the registrant and have:
a) Designed such disclosure controls and procedures, or caused such disclosure controls and
procedures to be designed under our supervision, to ensure that material information
relating to the registrant, including its consolidated subsidiaries, is made known to us by
others within those entities, particularly during the period in which this report is being
prepared;
b) Designed such internal control over financial reporting, or caused such internal control
over financial reporting to be designed under our supervision, to provide reasonable
assurance regarding the reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally accepted accounting
principles;
c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and
presented in this report our conclusions about the effectiveness of the disclosure controls
and procedures as of the end of the period covered by this report based on such
evaluation; and
d) Disclosed in this report any change in the registrant’s internal control over financial
reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s
fourth fiscal quarter in the case of an annual report) that has materially affected, or is
reasonably likely to materially affect, the registrant’s internal control over financial
reporting; and
5) The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation
of internal control over financial reporting, to the registrant’s auditors and the audit committee of
the registrant’s board of directors (or persons performing the equivalent functions):
a) All significant deficiencies and material weaknesses in the design or operation of internal
control over financial reporting which are reasonably likely to adversely affect the
registrant’s ability to record, process, summarize and report financial information; and
b) Any fraud, whether or not material, that involves management or other employees who
have a significant role in the registrant’s internal control over financial reporting.
Date: February 28, 2020 /s/ Scott Bender

Scott Bender
President, Chief Executive Officer and Director
(Principal Executive Officer)
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8/31/2020 SEC-Show
Exhibit 31.2
CERTIFICATION OF THE PRINCIPAL FINANCIAL OFFICER PURSUANT TO RULE 13a‑14(a)
I, Stephen Tadlock, certify that:
1) I have reviewed this Annual Report on Form 10‑K of Cactus, Inc. (the “registrant”);
2) Based on my knowledge, this report does not contain any untrue statement of a material fact or
omit to state a material fact necessary to make the statements made, in light of the circumstances
under which such statements were made, not misleading with respect to the period covered by this
report;
3) Based on my knowledge, the financial statements, and other financial information included in this
report, fairly present in all material respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in this report;
4) The registrant’s other certifying officer and I are responsible for establishing and maintaining
disclosure controls and procedures (as defined in Exchange Act Rules 13a‑15(e) and 15d‑15(e))
and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-
15(f)) for the registrant and have:
a) Designed such disclosure controls and procedures, or caused such disclosure controls and
procedures to be designed under our supervision, to ensure that material information
relating to the registrant, including its consolidated subsidiaries, is made known to us by
others within those entities, particularly during the period in which this report is being
prepared;
b) Designed such internal control over financial reporting, or caused such internal control
over financial reporting to be designed under our supervision, to provide reasonable
assurance regarding the reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally accepted accounting
principles;
c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and
presented in this report our conclusions about the effectiveness of the disclosure controls
and procedures as of the end of the period covered by this report based on such
evaluation; and
d) Disclosed in this report any change in the registrant’s internal control over financial
reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s
fourth fiscal quarter in the case of an annual report) that has materially affected, or is
reasonably likely to materially affect, the registrant’s internal control over financial
reporting; and
5) The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation
of internal control over financial reporting, to the registrant’s auditors and the audit committee of
the registrant’s board of directors (or persons performing the equivalent functions):
a) All significant deficiencies and material weaknesses in the design or operation of internal
control over financial reporting which are reasonably likely to adversely affect the
registrant’s ability to record, process, summarize and report financial information; and
b) Any fraud, whether or not material, that involves management or other employees who
have a significant role in the registrant’s internal control over financial reporting.
Date: February 28, 2020 /s/ Stephen Tadlock

Stephen Tadlock
Vice President, Chief Financial Officer and
Treasurer
(Principal Financial Officer)
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Exhibit 32.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report on Form 10-K of Cactus, Inc. (the “Company”) for the year
ended December 31, 2019 as filed with the Securities and Exchange Commission on the date hereof (the
“Report”), I, Scott Bender, President, Chief Executive Officer and Director of the Company, certify,
pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to the
best of my knowledge:
(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities
Exchange Act of 1934, as amended; and
(2) The information contained in the Report fairly presents, in all material respects, the financial
condition and results of operations of the Company.
Date: February 28, 2020 /s/ Scott Bender

Scott Bender
President, Chief Executive
Officer and Director
(Principal Executive Officer)
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Exhibit 32.2
CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Annual Report on Form 10-K of Cactus, Inc. (the “Company”) for the year
ended December 31, 2019 as filed with the Securities and Exchange Commission on the date hereof (the
“Report”), I, Stephen Tadlock, Vice President, Chief Financial Officer and Treasurer of the Company,
certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that,
to the best of my knowledge:
(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities
Exchange Act of 1934, as amended; and
(2) The information contained in the Report fairly presents, in all material respects, the financial
condition and results of operations of the Company.
Date: February 28, 2020 /s/ Stephen Tadlock

Stephen Tadlock
Vice President, Chief
Financial Officer and
Treasurer
(Principal Financial Officer)

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8/31/2020 SEC-Show

Securities registered pursuant to Section 12(b) of the Act

Securities registered pursuant to Section 12(g) of the Act: None

Cautionary Statement Regarding Forward-Looking Statements ii

Item 10. Directors, Executive Officers and Corporate Governance 64

Item 15. Exhibits, Financial Statement Schedules 103

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

Forward‑looking statements may include statements about:

· capital spending discipline exercised by customers;

· the size and timing of orders;

· availability of raw materials and imported items;

· availability of skilled and qualified workers;

· the possibility of cancellation of orders;

· our business strategy;

· our future revenue, income and operating performance;

· the termination of relationships with major customers or suppliers;

· disruptions in the political, regulatory, economic and social conditions domestically or

· a failure of our information technology infrastructure or any significant breach of security;

· potential uninsured claims and litigation against us;

· competition within the oilfield services industry;

How We Generate Our Revenues

Costs of Conducting Our Business

Impact of Section 301 of the Trade Act of 1974 (“Section 301”)

Suppliers and Raw Materials

Trademarks and Other Intellectual Property

Environmental, Health and Safety Regulation

· the Clean Air Act;

· the Comprehensive Environmental Response, Compensation and Liability Act;

· the Resource Conservation and Recovery Act;

· the Occupational Safety and Health Act; and

Insurance and Risk Management

Item 1A. Risk Factors

Risks Related to the Oilfield Services Industry and Our Business

· political and economic uncertainty and sociopolitical unrest;

· conservation measures and technological advances affecting energy consumption;

· changes in laws and regulations related to hydraulic fracturing activities;

· nationalization and expropriation;

· potentially burdensome taxation;

· inflationary and recessionary markets, including capital and equity markets;

· outbreaks of pandemic or contagious diseases;

· supply disruptions in key oil producing countries;

· foreign ownership restrictions;

· import or export licensing requirements;

· changes in, and the administration of, laws and regulations;

· inability to repatriate income or capital;

· reductions in the availability of qualified personnel;

· development and implementation of new technologies;

· foreign currency fluctuations or currency restrictions; and

· fluctuations in the interest rate component of forward foreign currency rates.

Additionally, the E&P industry is characterized by frequent consolidation activity. Changes in

New technology may cause us to become less competitive.

Our relationship with one of our vendors is important to us.

· weather‑related damage to infrastructure, transportation, facilities and equipment, resulting in

A terrorist attack or armed conflict could harm our business.

Risks Related to Our Class A Common Stock

· limitations on the removal of directors;

· limitations on the ability of our shareholders to call special meetings;

As a result of either an early termination or a change of control, we could be required to make

Item 1B. Unresolved Staff Comments