UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
(Amendment No. )1)
Filed by the Registrant   x                             Filed by a Party other than the Registrant   ¨
Check the appropriate box:
¨Preliminary Proxy Statement
¨Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
xDefinitive Proxy Statement
¨Definitive Additional Materials
¨Soliciting Material Pursuant to §240.14a-12
Forbes Energy Services Ltd.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Forbes Energy Services Ltd.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
  
xNo fee required.
  
¨Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
   
 1)
Title of each class of securities to which transaction applies:

 2)
Aggregate number of securities to which transaction applies:

 3)
Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):

 4)
Proposed maximum aggregate value of transaction:

 5)Total fee paid:
  
¨Fee paid previously with preliminary materials.
  
¨Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
   
 1)
Amount Previously Paid:

 2)
Form, Schedule or Registration Statement No.:

 3)
Filing Party:

 4)
Date Filed:







feslogoproxy1.jpg
April 29, 201625, 2019
Dear Fellow Shareholder:Stockholder:
The accompanying proxy is solicited by the board of directors (the “Board”) of Forbes Energy Services Ltd., a TexasDelaware corporation (the “Company”), for use at the 20162019 Annual Meeting of ShareholdersStockholders (the “Annual Meeting”) of the Company to be held on Friday, June 10, 20167, 2019 at 9:00 a.m., Central Daylight Savings Time, at the Hyatt Regency Houston, 1200 Louisiana Street, Houston, Texas 77002. For those of you who cannot be present at the Annual Meeting, we urge that you participate by indicating your choices on the proxy form provided to you and completing and returning it at your earliest convenience. If you sign and return your proxy form without specifying your choices, it will be understood that you wish to have your shares voted in accordance with our Board’Board’s recommendations.
This booklet includes the Notice of Annual Meeting of ShareholdersStockholders and the Proxy Statement, which contains details of the business to be conducted at the Annual Meeting. At the Annual Meeting, you will have an opportunity to discuss each item of business described in the Notice of Annual Meeting of ShareholdersStockholders and Proxy Statement and to ask questions about our operations and the Company.
Our 2015 Annual Report to Shareholders, which is not part ofForm 10-K, filed with the Proxy Statement,Securities and Exchange Commission on April 1, 2019 provides additional information regarding our financial results for the fiscal year ended December 31, 2015.2018. A copy of our 2015 Annual Report to Shareholdersthe Form 10-K is available at www.forbesenergyservices.com or may be requested from our Assistant Secretary as described elsewhere in the Proxy Statement.
The shares represented by each valid proxy received by the Company on the form solicited by the Board will be voted in accordance with instructions specified on the proxy. A shareholderstockholder giving a duly executed proxy may revoke it before it is exercised by filing with or transmitting to the Assistant Secretary of the Company an instrument or transmission revoking it, or a duly executed proxy bearing a later date.
In addition to the solicitation of proxies by use of this Proxy Statement, directors, officers and employees of the Company may solicit the return of proxies by mail, personal interview, or the Internet. Officers and employees of the Company will not receive additional compensation for their solicitation efforts, but they will be reimbursed for any out-of-pocket expenses incurred. Brokerage houses and other custodians, nominees and fiduciaries will be requested, in connection with the stock registered in their names, to forward solicitation materials to the beneficial owners of such stock.
All costs of preparing, printing, assembling and mailing the Notice of Annual Meeting of Shareholders,Stockholders, this Proxy Statement, the enclosed form of proxy and any additional materials, as well as the cost of forwarding solicitation materials to the beneficial owners of stock and all other costs of solicitation, will be borne by the Company.
It is important that your shares are represented at the Annual Meeting, whether or not you are able to attend personally. Accordingly, please complete, sign, date and return the proxy form as promptly as possible in the envelope provided, or submit your proxy by Internet, as described in the proxy form. If you do attend the Annual Meeting, you may withdraw your proxy and vote your shares in person.
On behalf of our Board, thank you for your cooperation and continued support.
 
Sincerely,
 
/s/ John E. Crisp
John E. Crisp
Chairman, President and
Chief Executive Officer




feslogoproxy2.jpg
Notice of Annual Meeting of ShareholdersStockholders
April 29, 2016June 7, 2019
Notice is hereby given that the 20162019 Annual Meeting of ShareholdersStockholders (the “Annual Meeting”) of Forbes Energy Services Ltd., a TexasDelaware corporation (the “Company”), will be held on Friday, June 10, 20167, 2018 at 9:00 a.m., Central Daylight Savings Time, in the Hyatt Regency Houston, 1200 Louisiana Street, Houston, Texas 77002, for the following purposes, as more fully described in the accompanying Proxy Statement:
1.to elect a board of six directors, each to serve until our next annual meeting of shareholders or until their respective successors have been duly elected and qualified;
2.to approve amendments to the Company’s Certificate of Formation to effect a reverse stock split of our issued and outstanding shares of common stock, par value $0.04 per share, at a ratio between 1-to-5 and 1-to-10 and effective upon a date and in such ratio as is to be determined by the Board and to effect a change in the par value of the Company’s common stock to $0.01 per share;    
3.to ratify the reappointment of BDO USA, LLP as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2016; and
4.to transact such other business as may properly come before the Annual Meeting and any postponement(s) or adjournment(s) thereof.
to elect one director to hold office as a Class II director until the 2022 Annual Meeting of Stockholders or until his successor is duly elected and qualified;
to ratify the reappointment of BDO USA, LLP as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2019; and,
to transact such other business as may properly come before the Annual Meeting and any postponements or adjournments thereof.
All shareholdersstockholders are cordially invited to attend the Annual Meeting in person. However, to ensure that each shareholder’sstockholder’s vote is counted at the Annual Meeting, shareholdersstockholders are requested to complete, sign, date and return the proxy form provided to you as promptly as possible in the envelope provided, or to submit their proxy by Internet, as described in the proxy form previouslybeing mailed to you. ShareholdersStockholders attending the Annual Meeting may vote in person even if they have previously submitted their proxy authorization.
Only shareholdersstockholders of record as of the close of business on April 11, 20169, 2019 are entitled to receive notice of and to vote at the Annual Meeting and any postponement(s) or adjournment(s) thereof. A list of such shareholdersstockholders shall be open to the examination of any shareholderstockholder of record at the Company’s offices during normal business hours for a period of ten days prior to the Annual Meeting, and shall also be open for examination at the Annual Meeting and any postponement(s) or adjournment(s) thereof.

By Order of the Board,
 
/s/ L. Melvin Cooper
L. Melvin Cooper
Assistant Secretary
Alice, Texas
April 25, 2019
Alice, Texas
April 29, 2016
IT IS IMPORTANT THAT YOUR SHARES OF COMMON STOCK BE REPRESENTED AT THE ANNUAL MEETING REGARDLESS OF THE NUMBER OF SHARES YOU HOLD. PLEASE COMPLETE, SIGN AND MAIL THE PROXY FORM IN THE ENVELOPE PROVIDED OR SUBMIT YOUR PROXY AUTHORIZATION THROUGH THE INTERNET EVEN IF YOU INTEND TO BE PRESENT AT THE ANNUAL MEETING. SUBMITTING YOUR PROXY AUTHORIZATION WILL NOT LIMIT YOUR RIGHT TO VOTE IN PERSON OR TO ATTEND THE ANNUAL MEETING, BUT WILL ENSURE YOUR REPRESENTATION IF YOU CANNOT ATTEND. IF YOU HAVE SHARES OF COMMON STOCK IN MORE THAN ONE NAME, OR IF YOUR SHARES ARE REGISTERED IN MORE THAN ONE WAY, YOU MAY RECEIVE MORE THAN ONE COPY OF THE PROXY MATERIALS. IF SO, SIGN AND RETURN EACH OF THE PROXY FORMS YOU RECEIVE OR SUBMIT YOUR PROXY AUTHORIZATION THROUGH THE INTERNET SO THAT ALL OF YOUR SHARES MAY BE VOTED. YOU MAY REVOKE YOUR PROXY AUTHORIZATION AT ANY TIME BEFORE ITS USE.





TABLE OF CONTENTS
Page
PROXY STATEMENT1
General Information1
Record Date and Voting Securities1
Quorum1
How Your Proxy Will be Voted on Actions to be Taken1
Proxy Solicitation2
Stockholder Proposals2
Delivery of One Proxy Statement and Annual Report to a Single Household to Reduce Duplicate Mailings2
Proposal No. 1-Election of Directors3
Nominated Directors-Class I3
Continuing Directors-Class II4
Continuing Directors-Class III4
Board Structure, Risk Oversight, Committee Composition and Meetings4
Committees of the Board5
Audit Committee5
Compensation Committee6
Nominating and Corporate Governance Committee6
Availability of Committee Charters and Other Information6
Nomination Process7
Nominations for Directors7
Communications with Directors8
Proposal No. 2-Selection and Ratification of the Independent Registered Public Accounting Firm8
Independent Auditors and Fees8
Policy on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Auditors9
Executive Officers9
EXECUTIVE COMPENSATION9
Compensation Program Philosophy and Objectives10
Base Salary10
Benefits and Perquisites.10
Annual Bonuses and Cash Incentive Compensation and Related Stock Grants11
Equity Incentive Awards11
Clawback Policy12
Stock Ownership Policy12
Tax and Accounting Treatment Issues12
How and why we benchmark compensation against our peers12
How and why we plan to use adjusted EBITDA to determine whether incentive cash compensation has been earned13
SUMMARY COMPENSATION TABLE15
Narrative Disclosure to Summary Compensation Table15
Executive Officers15
Cancellation of Prior Equity Interests15
2017 Management Incentive Plan15
Pension and Retirement Plans16
Employment Agreements16
GRANTS OF PLAN-BASED AWARDS18

i



OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END18
Potential Payments Upon Termination or Change In Control19
Payments Made Upon Termination for “Good Reason”19
Payments Made Upon Termination Without Good Cause19
Payments Made Upon a Change in Control19
Payments Made Upon Voluntary Termination or Termination with Good Cause20
Payments Made Upon Permanent Disability or Death20
Material Conditions and Obligations Under the Employment Agreements20
Narrative Discussion21
Officers Who Also Act As Directors21
Principal Stockholders21
Certain Relationships and Related Transactions23
Registration Rights Agreement23
Review, Approval or Ratification of Transactions with Related Persons24
Section 16(a) Beneficial Ownership Reporting Compliance24
Audit Committee Report25
Other Matters25


ii



Forbes Energy Services LTD
3000 South Business Highway 281
Alice, Texas 78332


PROXY STATEMENT
April 29, 2016


25, 2019
General Information
This Proxy Statement is furnished in connection with the solicitation of proxies by the board of directors (the “Board”) of Forbes Energy Services Ltd. (“FESwe”, “our”, “us”, “FES Ltd.” or the “Company”) for the 20162019 Annual Meeting of ShareholdersStockholders to be held on June 10, 2016,7, 2019, and any postponement(s) or adjournment(s) thereof (the “Annual Meeting”). This Proxy Statement and the accompanying Notice of Annual Meeting and proxy form are first being sent or made available to shareholdersstockholders on or about April 29, 2016.26, 2019.
Record Date and Voting Securities
ShareholdersStockholders of record as of the close of business on April 11, 20169, 2019 (the “Record Date”) are entitled to receive notice of and to vote at the Annual Meeting. As of April 11, 2016,the Record Date, there were 22,214,8555,439,247 shares of our common stock, par value $0.04$0.01 per share, issued and outstanding. Each outstanding share of common stock on the Record Date is entitled to one vote upon each matter properly submitted to a vote at the Annual Meeting.
ShareholdersStockholders that are entitled to vote at the Annual Meeting may do so in person at the Annual Meeting, or by proxy submitted by mail or Internet as described on the notice and access form.
Abstentions and broker non-votes are counted for purposes of determining the presence or absence of a quorum for the transaction of business. Broker non-votes occur when a broker or other nominee does not have discretionary authority to vote the shares with respect to a particular matter and has not received voting instructions from the beneficial owner with respect to that matter.
TheOne director will be elected by the affirmative vote of the holders of a pluralitymajority of the shares of common stock present in person or represented by proxy and entitled to vote and representedbe voted at a meeting at which a quorum is present is requiredthe Annual Meeting. The proposal seeking ratification of the appointment of BDO USA, LLP as the Company’s independent registered public accounting firm for 2019 requires the election of directors. Thus, broker non-votes and abstentions will have no effect on the election of directors.
The affirmative vote of a majority of the shares of common stock entitled to vote and representedof the Company present in person or by proxy at a meeting at which a quorum is present is required to approve the proposals relating to (i) the reverse stock split of our issued and outstanding shares of common stock and the changing of the par value of our common stock to $0.01 per share and (ii) the ratification of the reappointment of the Company’s independent registered public accounting firm. Shares represented at the Annual Meeting that abstain with respect to such proposals will be considered in determining whether the requisite number of affirmative votes are cast on such matters. Accordingly, such abstentions will have the same effect as a vote against (i) the reverse stock split of our issued and outstanding shares of common stock and the changing of the par value of our common stock to $0.01 per share and (ii) the ratification of the reappointment of independent registered public accounting firm. Except for the purposes of determining whether a quorum is present, as discussed below, broker non-votes will not be treated as shares represented at the Annual Meeting and are not entitled to vote for purposes of such proposals and, therefore, will have no effect.on the matter.
Quorum
Except as may be otherwise required by law or the Company’s Certificate of FormationIncorporation (the “Certificate of Formation”Incorporation”), or the Company’s Second Amended and Restated Bylaws (the “Bylaws”), the holders of a majority of the Company’s shares of common stock entitled to vote and present in person or represented by proxy shall constitute a quorum at a meeting of the shareholders.stockholders. The persons whom we appoint to act as inspectors of election will determine whether a quorum exists. Shares of the Company’s common stock represented by properly executed and returned proxies will be treated as present. Shares of the Company’s common stock present or represented at the Annual Meeting that abstain from voting or that are the subject of broker non-votes will be counted as present for purposes of determining a quorum.

1




How Your Proxy Will be Voted on Actions to be Taken
The Board is soliciting a proxy in the enclosed form to provide you with an opportunity to vote on all matters scheduled to come before the Annual Meeting, whether or not you attend in person.
Granting Your Proxy. If you properly execute and return a proxy in the enclosed form, your shares of common stock will be voted as you specify. If you make no specifications, your proxy representing our common stock will be voted:
FOReach of the proposed director nominees;nominee;
FOR” amendments to the Certificate of Formation to effect a reverse stock split of our issued and outstanding shares of common stock and to effect a change in the par value per share of the Company’s common stock to $0.01 per share; and
FOR” the ratification of the reappointment of independent registered public accounting firm.firm;


We expect no matters to be presented for action at the Annual Meeting other than the items described in this Proxy Statement. By signing and returning the proxy, however, you will give to the persons named as proxies therein discretionary voting authority with respect to any other matter that may properly come before the Annual Meeting, and they intend to vote on any such other matter in accordance with their best judgment.
Revoking Your Proxy. If you submit a proxy, you may subsequently revoke it or submit a revised proxy at any time before it is voted. You may also attend the Annual Meeting in person and vote by ballot, which would cancel any proxy that you previously submitted. If you wish to vote in person at the Annual Meeting but hold your stock in street name (that is, in the name of a broker, bank or other institution), then you must have a proxy from the broker, bank or institution in order to vote at the Annual Meeting.
Proxy Solicitation
We will pay all expenses of soliciting proxies for the Annual Meeting. In addition to solicitations by mail, arrangements have been made for brokers and nominees to send proxy materials to their principals, and we will reimburse them for their reasonable expenses. We may have our employees or other representatives (who will receive no additional compensation for their services) solicit proxies by telephone, telecopy, personal interview or other means. We may choose to engage a paid proxy solicitor to solicit proxies for the Annual Meeting, but have not yet done so.
ShareholderStockholder Proposals
If you want us to consider includingStockholders interested in submitting a proposal for inclusion in next year’sour proxy statement, youmaterials and for presentation at the 2020 Annual Meeting of Stockholders may do so by following the procedures set forth in Rule 14a-8 under the Exchange Act. No stockholder proposal was received for inclusion in this Proxy Statement.
In addition to the requirements of Rule 14a-8, and as more specifically provided for in the Bylaws, any stockholder wishing to propose for election as a director must give timely and proper notice of the intention to propose the person for election. A stockholder making a nomination for election to our Board for the 2020 Annual Meeting of Stockholders must deliver it in writingproper notice to our corporate secretary at least 90 days but not more than 150 days prior to the Assistant Secretary, Forbes Energy Services Ltd., 3000 South Business Highway 281, Alice, Texas 78332,first anniversary date of the 2019 Annual Meeting of Stockholders; provided, however, that if the date of the annual meeting of stockholders is more than 30 days before or after such anniversary date, notice by the stockholder, to be timely, must be so delivered, or mailed and received, not less than 90 nor more than 150 days before such annual meeting or on or before the tenth day following the day on which public announcement of the date of such meeting was first made. In other words, for a stockholder nomination for election to our Board to be considered at the 2020 Annual Meeting of Stockholders, it should be properly submitted to the corporate secretary no earlier than January 9, 2020 and no later than DecemberMarch 9, 2020 (provided, however, that in the event that the date of the 2020 Annual Meeting is more than 30 2016.
If you want to present a proposal atdays before or more than 30 days after the 2017first anniversary of the 2019 Annual Meeting of Shareholders in person but doStockholders, the notice must be given not wishlater than 10 days following the earlier of the date on which notice of the annual meeting is posted to have it included in our proxy statement, you must submit it in writing to our Assistant Secretary, atstockholders or the above address, by March 11, 2017 to be considered timely, in accordance withdate on which public disclosure of the specific procedural requirements set forth in our Bylaws. If you would like a copydate of these procedures, please contact our Assistant Secretary for a copy of our Bylaws.the 2020 Annual Meeting is made).
Pursuant to the rules of the Securities Exchange Act of 1934, as amended or the Exchange Act,(the “Exchange Act”), the designated proxies may use discretionary authority to vote with respect to shareholderstockholder proposals presented in person at the 20162019 Annual Meeting if the shareholderstockholder making the proposal has not given the Company timely notice of such proposal.
Delivery of One Proxy Statement and Annual Report to a Single Household to Reduce Duplicate Mailings
Each year in connection with the annual meeting of shareholders,stockholders, we are required to arrange for a proxy statement and annual report to be provided to each beneficial shareholderstockholder whose shares are held by or in the name of a broker, bank, trust or other nominee. Because some shareholdersstockholders hold shares of the Company’s common stock in multiple accounts, this process results in duplicate mailings to shareholdersstockholders who share the same address. ShareholdersStockholders may avoid receiving duplicate mailings and save us the cost of producing and mailing duplicate documents as follows:
ShareholdersStockholders of Record. If your shares are registered in your own name and you are interested in consenting to the delivery of a single proxy statement or annual report, you may contact the Company by mail at 3000 South Business Highway 281, Alice, Texas 78332, by telephone at (361) 664-0549 or by e-mail at mledesma@ForbesEnergyServices.com.

2




Beneficial ShareholdersStockholders. If your shares are not registered in your own name, your broker, bank, trust or other nominee that holds your shares may have asked you to consent to the delivery of a single proxy statement or annual report if there are other Company shareholdersstockholders who share an address with you. If you currently receive more than one proxy statement or annual report at your household, and would like to receive only one copy of each in the future, you should contact your nominee.


Right to Request Separate Copies. If you consent to the delivery of a single proxy statement and annual report but later decide that you would prefer to receive a separate copy of the proxy statement or annual report, as applicable, for each shareholderstockholder sharing your address, then please notify us or your nominee, as applicable, and we or they will promptly deliver such additional proxy statements or annual reports. If you wish to receive a separate copy of the proxy statement or annual report for each shareholderstockholder sharing your address in the future, you may contact the Company by mail at 3000 South Business Highway 281, Alice, Texas 78332, by telephone at (361) 664-0549 or by e-mail at mledesma@ForbesEnergyServices.com.
Proposal No. 1 – Election1-Election of DirectorsDirector
We currently have six members of the Board.Board, who serve in separate classes, or Class I, Class II or Class III directors. Our Certificate of Incorporation provides that Class I’s term expires at the first annual meeting after such Class I directors’ election or appointment (2018); Class II’s term expires at the second annual meeting after such Class II directors’ election or appointment (2019); and Class III’s term expires at the third annual meeting after such Class III directors’ election or appointment (2020). The Board has nominated as directors the six personsperson named below, all of whom arewho is presently serving as a Class II director and havehas been nominated to serve as directorsa director until the next2022 annual meeting of shareholdersstockholders or until their successors arehis successor is duly elected and qualified. If anysuch nominee should be unavailable for election as a result of an unexpected occurrence, the Board’s proxies shall vote such shares for the election of such substitute nominee as the Board may propose. It is not anticipated that anysuch nominee will be unable or unwilling to serve as a director if elected. The only other Class II director, David B. Rosenwasser, is not standing for re-election and his term will end on the Annual Meeting date. At the Company’s Board and Committee meetings of April 1, 2019, the continuing directors expressed their appreciation to Mr. Rosenwasser for his service.
The name, age as of AprilMay 1, 2016,2019, principal occupation, and other information highlighting the particular experience, qualifications, attributes and skills that support the conclusion of the nominating and corporate governance committee that such nominee for director should serve as a director of the Company areas well as the same information for continuing directors is set forth below.
Dale W. Bossert, 71, was elected as a director upon the Company’s formation effective April 11, 2008, and has served as a director of Forbes Energy Services LLC (“Forbes LLC”), a Delaware subsidiary of the Company since March 20, 2008. Mr. Bossert served as a director of GasFrac Energy Services from its inception in May 2006 until May 2014. In August 2010, GasFrac Energy Services conducted a Canadian initial public offering and was listed on the Toronto Stock Exchange (the “TSX”). Mr. Bossert served as the Chairman of the Board and a director of Turnkey E&P Inc. (“Turnkey”), a company listed on the TSX, from July 2007 to February 2010, and served as a director of Keeper Resources Inc., a company that was listed on the TSX, from September 2004 until its sale in May 2008. Prior to his service as Chairman of the Board and director of Turnkey, he was Turnkey's President and Chief Executive Officer from December 2004 to July 2007. On November 17, 2008, the principal operating subsidiary of Turnkey filed for protection under Chapter 11 of the U.S. Bankruptcy Code. Turnkey was subject to a cease trade order by the Alberta Securities Commission on December 14, 2009 and received cease trade orders from other Canadian securities commissions subsequently. Mr. Bossert resigned as a director of Turnkey on February 14, 2010. Mr. Bossert has served as the President of DWB Oil and Gas Consulting Ltd. from July 2002 to present. Mr. Bossert has approximately 50 years of experience in the upstream oil and natural gas industry and has held various positions with Amoco Corporation in Calgary, Alberta, and Chicago, Illinois, and with Union Pacific Resources Company in Calgary, Alberta, Denver, Colorado, and Fort Worth, Texas. Mr. Bossert has worked for or acted as a consultant to a number of U.S. based energy companies, including Celsius Energy Company, Chesapeake Energy Corp. and Bass Enterprises.
Mr. Bossert’s significant experience, as both a director and an executive officer, with companies in the oil and gas industry, gives him critical insights to the issues presently facing the Company.
Travis H. Burris, 54, was elected as a director upon the Company’s formation effective April 11, 2008, and since the reorganization of the Company’s predecessor limited liability companies under a Delaware holding company, Forbes LLC, effective January 1, 2008 (the “Delaware Reorganization”), has served as a director of Forbes LLC. Since February 2012, Mr. Burris has served as a director of ZaZa Energy, LLC, a NASDAQ listed company, and chairman of its compensation committee. Mr. Burris also serves as the Chairman of the board of directors for several private companies, including: Agrow Credit Corporation, Inc., where he has been a director since 1995; Cash Box Pawn, Inc., where he has been a director since 2000; and Producers Ag Finance, where he has been a director since 2001. Mr. Burris’ past service on boards of directors includes service as the Chairman of the Board of Falfurrias State Bank from 2001 to 2010, as a director of Mesquite Helicopter Service, Inc. from 1994 to 2008, as a director of Mesquite Aviation from 1998 to 2008, as a director of Resonant Technology from 2006 to 2012, and, from 1990 to 2007, as the founder and Chairman of the Board of Alice Loan Company, a real estate development company. Mr. Burris has been President, Chief Executive Officer and a director of Texas Champion Bank since 1987, Founder, and President of G. and G. Loan Company since 1991, and has significant ownership stakes in various ranching and real estate investment businesses.
Mr. Burris’ experience in finance and banking gives him a broad understanding of the financial structure of the Company and a familiarity with the financial markets available to the Company. Further, Mr. Burris’ work as a director of numerous businesses has given him valuable experience in corporate oversight that he applies to his work on the Board.Nominated Director-Class II
John E. Crisp, 54,57, is the President and Chief Executive Officer of the Company and was appointed to such offices and elected as a director and Chairman of the Board upon the Company’s formation effective April 11, 2008, and since the completion of the Delaware

3




Reorganization on2008. Since January 1, 2008, Mr. Crisp has been the Chairman of the Board, President and Chief Executive Officer of Forbes LLC. Since their reorganization as Delaware limited liability companies inEnergy Services LLC and since June 2007, Mr. Crisp has served as an executive officer of each of TX Energy Services, LLC and C.C. Forbes, LLC, the entities that now serve as the principal operating subsidiaries of the Company (the “Operating Subsidiaries”). Prior to that time, Mr. Crisp helped found the predecessor entities of the Operating Subsidiaries in 2003 and was Director of Operations of one such predecessor entity, TX Energy Services, L.P., from its founding until the reorganization of the Operating Subsidiaries as Delaware limited liability companies in June 2007. Prior to assisting in the founding of the predecessor entities to the Operating Subsidiaries in 2003, Mr. Crisp was a Division Manager at Key Energy from 1998 to 2003. Key Energy acquired Dawson Production Services (“Dawson”) shortly after Dawson acquired Hellums Services, Inc. in 1998. Mr. Crisp became a partner of Hellums in 1995, after serving as their Equipment and Safety Manager from 1990, and served in the same capacity until it was sold to Dawson in 1998, at which time Mr. Crisp was serving as a district manager. Mr. Crisp started in the energy industry in 1978, working as an equipment operator. Mr. Crisp has over 3133 years of oilfield services industry experience and has on three separate occasions built and later sold oilfield service businesses. Mr. Crisp currently serves as a director of both Texas Champion Bank and Brush Country Bank. He also serves in various management capacities with regard to certain business ventures described under “Certain Relationships and Related Transactions” beginning on page 3523 of this proxy statement.Proxy Statement.
Mr. Crisp is one of the founders of the Company and its Chief Executive Officer. As such, Mr. Crisp has a thorough understanding of the Company, its operations and the industry in which it operates. Under his leadership, the Company has grown from a small South Texas company to a major North American provider of production and well services. Mr. Crisp’s knowledge of the Company, combined with his long experience working in the oilfield services industry make him an indispensablea valuable member of the Board.
Continuing Directors-Class I
Charles C. ForbesLawrence “Larry” First, Jr., 62, is57, currently serves as the Company’s Executive Vice President and Chief OperatingInvestment Officer and Managing Director of Ascribe Capital LLC (“Ascribe”). Mr. First joined Ascribe in 2008. Prior to joining Ascribe, Mr. First was appointeda Managing Director and Co-Portfolio Manager in Merrill Lynch’s Principal Credit Group, a proprietary investing platform for the firm’s capital, where he was responsible for evaluating and managing assets in the team’s North American portfolio, including non-investment grade bank loans, stressed/distressed fixed income investments and public and private equity. Prior to such officesjoining Merrill Lynch in 2003, Mr. First was a senior partner in the Bankruptcy and electedRestructuring department of the law firm of Fried, Frank, Harris, Shriver & Jacobson LLP, where he began his legal career in 1987. At Fried Frank, he represented both debtors and creditors in both in-court and out-of court restructurings as well as lenders to, investors in, and potential buyers and sellers of, financially troubled companies. Prior to his


joining Fried Frank’s Bankruptcy and Restructuring department, he was a director upon the Company’s formation effective April 11, 2008, and since the Delaware Reorganization,member of its Corporate Department, where he became a partner in 1994. On behalf of Ascribe Capital LLC, Mr. First has been a member of the boards of directors of Nuverra Environmental Solutions Inc. since May 2018, Engineering Solutions & Products, LLC since November 2013, and Big Run, Inc. since March 2018. He was a director on the board of Geokinetics Inc. from 2013 to 2018, Alion Science and Technology Corp. from August 2014 to August 2015, and EnviroSolutions Inc. from July 2010 to March 2018. Mr. First received a Bachelor of Arts in History and Sociology from Haverford College, and a Juris Doctor from New York University School of Law. He also attended the Executive Vice PresidentLondon School of Economics. Mr. First’s background in the financial and Chief Operating Officer of Forbes LLC. Since their reorganization as Delaware limited liability companies in June 2007, Mr. Forbeslegal industries provides valuable expertise to the Board.
Brett G. Wyard, 49, is a Founder and has served as an executive officerManaging Partner of each of our Operating Subsidiaries. Prior to that time,Solace Capital Partners since April 2014. Beginning in April 2013, Mr. Forbes helped foundWyard spent the predecessor entities of the Operating Subsidiaries in 2003year planning and was Director of Operations of one such predecessor entity, C.C. Forbes, L.P. from its founding until the reorganization of the Operating Subsidiaries as Delaware limited liability companies in June 2007. Prior to assisting inpreparing for the founding of the predecessor entities to the Operating Subsidiaries in 2003, Mr. Forbes founded Forbes Oil & Gas Company, an independent exploration and production company, in the mid-1980s which he continues to operate. From 1998 to 2003, Mr. Forbes served as a consultant to various independent oilfield services companies in South Texas. Mr. Forbes started in the oilfield services industry with Otis Engineering doing workover and wireline work. Mr. Forbes was a part of a group that purchased Hellums Services, Inc. in 1995, which was acquired by Dawson Production Services in 1998. Mr. Forbes started O.K. Well Service in 1978 with three rigs and sold it to Pride Petroleum Services in 1990, when the company had 22 workover rigs, 12 swabbing rigs and 6 winch trucks with approximately 145 employees. Mr. Forbes managed the operations of oil and natural gas leases from 1980 through 2006 and various salt water disposal wells from 1980 through 2006. Mr. Forbes has over 36 years of oilfield services industry experience and has founded, built and later sold oilfield services businesses for the past 20 plus years. Mr. Forbes also serves in various management capacities with regard to certain business ventures described under “Certain Relationships and Related Transactions” beginning on page 35 of this proxy statement
Mr. Forbes is one of the founders of the Company and its Chief Operating Officer. He has detailed knowledge of the operations of the Company. This combined with Mr. Forbes’ over 36 years of experience in the oilfield industry allow him to make significant contributions to the work done by the Board.
Ted A. Izatt, 60, joined the Board in August 2012. He has more than 30 years of financial experience. From September 2010 until November 2014, he served as Chief Investment Officer for Quantum Reservoir Impact, LLC, or QRI, focusing on acquisitions and capital plays in the oil sector. Since January 2014, he has served as director of Investment Relations and Regulatory Compliance for QRI. Currently, he is an Associate in QRI's Scholars and Associates Program. In addition to these positions, Mr. Izatt served as QRI’s Chief Financial Officer and Principal Financial Analyst from October 2008 through August 2010. Prior to joining QRI, Mr. Izatt served as Senior Managing Director of Bear Stearns’ fixed income research department from March 2004 to August 2008. From July 1997 to February 2004, Mr. Izatt worked as Senior Vice President with Lehman Brothers covering the global oil and gas sector as an analyst.Solace Capital Partners. Prior to that, Mr. Izatt workedWyard was with The Carlyle Group from 2005 to 2012, where he was involved with the raising and investing of $2 billion as a Global Partner, Managing Director and Co-head of Carlyle Strategic Partners. Prior to Carlyle, from 1999 to 2005, Mr. Wyard was Managing Director at Oaktree Capital Management as one of the senior members in the firm’s flagship Opportunities Funds. Between 1992 and 1999, Mr. Wyard had roles at Miller & Schroeder, Voyageur Asset Management, the Financial Restructuring Group at Houlihan Lokey Howard & Zukin, and the Global Special Situations Group at Merrill Lynch. Mr. Wyard received a Bachelor of Arts degree in Economics from Boston College. In addition to the Forbes board, Mr. Wyard is currently a member of the Board of Directors of Select Interior Concepts Inc., the Board of Regents of Boston College, and the Board of Trustees of the St. John’s Health Center Foundation and the Young Presidents’ Organization. Mr. Wyard’s experience in the financial industry, particularly as it relates to corporate restructurings, provides valuable expertise to the Board.
Continuing Directors-Class III
Rome G. Arnold III, 63, since January 2017, has served as a Senior Advisor at Rose and Co., a financial-technology startup company with a focus on digital media. From August 2016 to January 2017, Mr. Arnold was an independent private investor managing director of Moody’s Investors Service, where he ran its Global Oil and Gashis personal investments. From January 2012 through August 2016, Mr. Arnold was a Managing Director at UBS Securities in their Energy Group from February 1992 to June 1997. During that period, he covered the global high grade and crossover energy and basic materials industries and, for many years, was ranked by Institutional Investorserving as the top high-grade fixed income energy analyst.Head of Oil Field Services. Mr. IzattArnold received his Bachelor of Arts in Psychology and History of Art from Yale College. He received his Master of Business Administration with High Distinction (Baker Scholar) from Harvard Business School. Mr. Arnold also currently serves as a member ofon the board of directors of Quantum Reservoir Impact,New Mountain Finance Corporation, a publicly-traded business development company. Mr. Arnold brings to the Board valuable expertise in the areas of business and finance related to the oil and gas industry.
Paul S. Butero, 62, since October 2015, has served as the Executive Chairman of Laney Directional Drilling Co. and as an Operating Partner of Altos Energy Partners LLC. From May 2015 to October 2015, Mr. Butero worked as an independent consultant focused on mergers and acquisitions. From October 2012 to May 2015, Mr. Butero served as the President and Chief Executive Officer of Nine Energy Service LLC, a privately-held company.
SCF Partners OFS portfolio company focused on the completion phase of resource development. Prior to joining Nine Energy Service LLC, Mr. Izatt’s significantButero enjoyed over 32 years with Baker Hughes Incorporated, most recently serving as President of US Land Operations. He also served as President of Hughes Christensen Company (drill bits), President of Baker Atlas (wireline), and President of Baker Hughes Inteq (drilling systems). He also held a Vice President role in operations, sales and marketing as well as a number of operational management positions both domestically and internationally. Mr. Butero received his Bachelor of Arts in Geography from the University of Colorado in Boulder. Mr. Butero’s experience as a director, chief investment officer and chief financial officer with a companyan executive in the oil and gas industry and his years of experience in the financial industry give him a deep understanding of the issues presently facing the Company and brings added financialvaluable expertise to the Board.
William W. Sherrill, 89, was elected asThe election of a director uponin this proposal requires the Company’s formation effective April 11, 2008, and since the Delaware Reorganization, has served as a director of Forbes LLC. Mr. Sherrill has extensive experience in both operations and finance. In addition to his active business interests, Mr. Sherrill has taught Entrepreneurship as an Executive Professor at the University of Houston’s Bauer

4




College of Business Administration since September 1990. He has served as Chairmanaffirmative vote of the Center for Entrepreneurship and Innovation and is now the Chairman Emeritus of what is now known as the Wolff Center for Entrepreneurship at such university since September 1993. This program has been ranked in the top three in the nation for the last eight years among similar programs at other universities. Mr. Sherrill has been an Adjunct Professor at the Cullen College of Engineering. From March 1972 to April 1974, Mr. Sherrill was President of Associates Corporation of North America. Mr. Sherrill has served as a director of Gulf and Western and Dasa Corporation. In addition, Mr. Sherrill was a director of the The Federal Deposit Insurance Corporation, a Commissioner to the United Nations Commission for UNESCO (the United Nations Educational, Scientific and Cultural Organization), a Governor of the Federal Reserve System in Washington D.C., Treasurer of the City of Houston, Presidentholders of a commercial bank, Executive Vice President of a savings and loan association, and President of a federal credit union. Mr. Sherrill holds an MBA from Harvard Graduate School of Business Administration, with Distinction in Finance and Manufacturing.
Mr. Sherrill brings to the Board expertise in areas of business and finance. His long experience, both in industry and academia, allows him to provide critical advice to the Board with regard to key issues facing the Company. His leadership skills allow him to serve effectively as our Lead Independent Director and Chairman of the Audit Committee.
The vote of a pluralitymajority of the shares of common stock present and entitled to vote and representedbe voted at a meeting at which a quorum is present is required for the electionAnnual Meeting. Neither abstentions nor broker non-votes will have any effect on the outcome of directors.voting on director elections.
The Board unanimously recommends that the shareholdersstockholders vote “FOR” the election of each of the nominees.nominee as a Class II director.
Board Structure, Risk Oversight, Committee Composition and Meetings

The size of the Board is determined by the Board within a size range of no less than five nor more than seven directors, as required by the Company’s Bylaws. TheCertificate of Incorporation. Although the size of the Board is currently set at six members, it is anticipated that following the Annual Meeting the size of the Board will be reduced to five members. During 2015,2018, our Board held four8 meetings and took action by unanimous written consent seven5 times. All of the directors attended at least 75%of the aggregate number of meetings of the Board and of each committee of the Board on whichfor the period that they served in 2015. 2018.The Board intends to meet at least quarterly every year. The Company has established Second Amended and Restated Corporate Governance Guidelines, which may be found on the Investor Relations page of the Company’s website, www.forbesenergyservices.com. The


role and responsibilities of the Chairman of the Board are set forth in the Company’s Bylaws and the Second Amended and Restated Corporate Governance Guidelines.
The Company’s leadership structure contributes to the manner in which the Board oversees risk by providing a high level of experience and independence to the process of risk oversight. The Board’s oversight of risk is centered principally on risks associated with the Company’s strategic plans, growth initiatives and financial results as well as risks attendant to the legal and regulatory environment in which the Company operates. The Board performs this oversight role by receiving and discussing reports from executive management, including major risks confronting the Company. The audit committee enhances the Board’s oversight of risk management by regularly assessing the quality of financial reporting and ethical behavior of the Company.
Since the founding of the Company in April 2008, Mr. Crisp has served as both the Chief Executive Officer and the Chairman of the Board andBoard. Mr. Forbes has served as both the Chief Operating Officer and a director. Mr. Crisp and Mr. Forbes both played a key role in the founding of the Company and are criticallyis involved in the day-to-day operations of the Company. We believe that the optimal leadership structure for the Company is to have these founders and executive officersMr. Crisp assume roles on the role of Board including Chairman, in the case of Mr. Crisp.Chairman. We believe that this structure will avoid duplication of efforts and provide clear leadership for the Company.
As a result ofAlthough the Company’s common stock beingis currently listed on The NASDAQ Capitalthe OTCQX Best Market, the Board applies NASDAQ rules when determining director independence. The Board has determined that Dale W. Bossert, Travis H. Burris, Ted A. IzattLawrence “Larry” First, Brett G. Wyard, Rome G. Arnold III, Paul S. Butero and William W. SherrillDavid B. Rosenwasser, during his service, are independent directors as defined by NASDAQ. John E. Crisp and Charles C. Forbes, Jr. areis not an independent directors as each of such directors aredirector because he is an executive officersofficer of the Company and havehas interests in certain related party transactions that are described in the section titled “Certain Relationship and Related Transactions” below. Although John E. Crisp, the Chairman of the Board, is not an independent director, William W. Sherrill,Lawrence “Larry” First, the Lead Independent Director, is independent. The primary responsibility of the Lead Independent Director is to provide independent leadership. At present, as noted above, a majority of our directors are independent as defined by NASDAQ and as required by NASDAQ rules.
Committees of the Board
The Board has established three Board committees: the audit committee, the compensation committee, and the nominating and corporate governance committee. The role and responsibilities of each such committee are set forth in their respective charters that have been approved by the Board. The information below summarizes the functions of each of the committees in accordance with its charter.
Audit Committee
The audit committee has been structured to comply with the requirements of Section 3(a)(58)(A) of the Exchange Act. The Board has determined that the audit committee members have the appropriate level of financial understanding and industry specific knowledge to be able to perform their duties on the committee, are financially literate and have the requisite financial sophistication as required by the applicable listing standards of NASDAQ, and qualify as audit committee financial experts as defined in Item 407(d)(s)(5)(ii) of Regulation S-K under the Exchange Act. The charter of the audit committee of the Company, which was amendedSecond Amended and restated by the Board on March 17, 2014,Restated Audit Committee Charter may be found on the Investor Relations page of the Company’s website, www.forbesenergyservices.com.

www.forbesenergyservices.com.
In addition to certain duties prescribed by applicable law, the audit committee is charged, under its written charter, to select and engage the independent public accountants to audit our annual financial statements, subject to stockholder ratification. The audit committee

5




also establishes the scope of, and oversees the annual audit and approves any other services provided by public accounting firms. Furthermore, the audit committee provides assistance to the Board in fulfilling its oversight responsibility to the shareholders,stockholders, potential shareholders,stockholders, the investment community and others relating to the integrity of our financial statements, our compliance with legal and regulatory requirements, the independent auditor’s qualifications and independence, the performance of our internal audit function and our independent auditor, and overseeing our system of disclosure controls and procedures and system of internal controls regarding finance, accounting, legal compliance and ethics that management and the Board have established. The Board is informed of the audit committee’s activities by reports delivered to the Board.

In addition, theThe audit committee is responsible to ensure satisfactory procedures for receipt, retention, and treatment of complaints and for the confidential, anonymous submission by employees regarding any accounting, internal accounting controls or auditing matters. Pursuant to these responsibilities, the audit committee monitors the Company’s employee hotline for the submission of such issues.
The Board has determined that the audit committee is best suited to review and approve related party transactions. Pursuant to the Related Persons Transaction Policy, theThe audit committee reviews related party transactions and determines whether to approve or ratify related party transactions. A summary of the Related Persons Transaction Policy is provided under "Review,“Review, Approval or Ratification of Transactions with Related Persons"Persons” beginning on page 3724 of this Proxy Statement.


In performing its duties, it is the responsibility of the audit committee to maintain free and open communication among the audit committee, our independent registered public accounting firm, the internal audit function and management of the Company.
The audit committee meets at least once per fiscal quarter to fulfill its responsibilities under its charter and in connection with the review of the Company’s quarterly and annual financial statements. In 2015,2018, the audit committee met four6 times. TheCurrently, the audit committee is comprised of Dale W. Bossert, Travis H. Burris, Ted A. IzattMessrs. Arnold, Butero and William W. Sherrill, each of whom is independent under the rules of NASDAQ, satisfies the financial literacy requirements of NASDAQ and qualifies as an audit committee financial expert under the Exchange Act.Rosenwasser. Mr. SherrillArnold is the chair of the audit committee.
Compensation Committee
The compensation committee’s role is to assist the Board in fulfilling its responsibilities relating to matters of compensation, including equity compensation, and to establish a plan of continuity and development for the Company’s senior management. The compensation committee operates under a written charter adopted by the Board, which was amended and restated by the Board on March 17, 2014.May 9, 2017. The compensation committee periodically assesses compensation of the Company’s executive officers in relation to companies of comparable size, industry and complexity, taking the performance of the Company and such other companies into consideration. The compensation committee makes recommendations to the Board regarding the compensation of the Company’s executive officers other than the Chief Executive Officer. The compensation committee, or together with the other independent directordirectors (as directed by the Board), determines and approves the Chief Executive Officer'sOfficer’s compensation based on its evaluation of the Chief Executive Officer'sOfficer’s performance in relation to the corporate goals and objectives approved by the compensation committee. In addition, the compensation committee will, as appropriate, review and approve public or regulatory disclosure respecting compensation including the Compensation Disclosure and Analysis, and the basis on which performance is measured. The compensation committee has the sole authority to retain and compensate any outside adviser as it determines necessary to permit it to carry out its duties. The compensation committee may not form or delegate authority to subcommittees without the prior approval of the Board.
The compensation committee may use the findings and recommendations of compensation consultants to help ensure that management'smanagement’s compensation recommendations properly provide incentives for actions that improve Company performance, and are reasonable when compared to the market for executive talent. In 2013, BDO USA, LLP was engaged to provide a study of compensation programs for directors and executive officers of a broad peer group. In December 2014, the compensation committee selected and directly retained the services of Towers Watson & Co. ("Towers Watson") as a compensation consultant. As part of its services, Towers Watson reviews market data and advises the compensation committee on selecting an appropriate peer group, determining the compensation levels of our chief executive officer, our other named executive officers and our directors, and our incentive plan design. Towers Watson did not provide any other services to the Company and worked with the Company's management, as directed by the compensation committee, only on matters for which the compensation committee is responsible.
The compensation committee is comprised of Dale W. Bossert, Travis H. Burris,Rome G. Arnold III and William W. Sherrill, allPaul S. Butero, each of whom areis independent under the rules of NASDAQ. In 2015,2018, the compensation committee met three2 times. The compensation committee meets as necessary. Mr. BurrisButero is the chair of the compensation committee.
Nominating and Corporate Governance Committee
Under the nominatingSecond Amended and corporate governance committee’s charter, which was amendedRestated Nominating and restated by the Board on March 17, 2014,Corporate Governance Committee Charter, the nominating and corporate governance committee is charged to, among other things, develop, review and recommend to the Board a set of corporate governance policies and procedures for the Company, and to identify, review and recommend to the Board possible candidates for Board membership. The identification of potential Board members is undertaken with a view to ensuring overall

6




diversity of experience, backgrounds, skills, and geographic representation of Board members. The nominating and corporate governance committee receives advice from the Board and will consider written recommendations from the shareholdersstockholders of the Company respecting individuals best suited to serve as directors, and, when necessary, developsdevelop its own list of appropriate candidates for directorships.
The nominating and corporate governance committee is comprised of Dale W. Bossert, Travis H. Burris, Ted A. IzattPaul S. Butero, Rome G. Arnold III, Lawrence First and William W. Sherrill,Brett G. Wyard, all of whom are independent under the rules of NASDAQ. The nominating and corporate governanceIn 2018, the compensation committee met one time in 2015.1 time. The nominating and corporate governance committee meets at least annually, and otherwise as necessary. Mr. BossertPaul S. Butero is the chair of the nominating and corporate governance committee.
Availability of Committee Charters and Other Information
The charters for our audit, compensation, and nominating and corporate governance committees, as well as our Second Amended and Restated Corporate Governance Guidelines, SecondThird Amended and Restated Employee Code of Business Conduct and Ethics (which applies to all employees including executive officers and includes a portion of the policy applicable specifically to executive officers), and Second Amended and Restated Code of Business Conduct and Ethics for Members of the Board, can all be found, free of charge, on the Investor Relations page of the Company’s website, www.forbesenergyservices.com. We intend to disclose any changes to or waivers from the SecondThird Amended and Restated Employee Code of Business Conduct and Ethics applicable to the executive officers and the Second Amended and Restated Code of Business Conduct and Ethics for Members of the Board that would otherwise be required to be disclosed under Item 5.05 of Form 8-K on our website. We will also provide printed copies of these materials to any shareholderstockholder or other interested person upon request to Forbes Energy Services Ltd., Attn: L. Melvin Cooper, 3000 South Business Highway 281, Alice, Texas 78332. The information on our website is not, and shall not


be deemed to be, a part of this report or incorporated into any other filings we make with the Securities and Exchange Commission or the Commission.(the “Commission”).
We also make available on our website, free of charge, access to our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, Proxy Statements and any amendments to those reports and statements, as well as other documents that we file with or furnish to the Commission pursuant to Sections 13(a) or 15(d) of the Exchange Act, as soon as reasonably practicable after such documents are filed with, or furnished to, the Commission.
Nomination Process
It is our Board’s responsibility to nominate members for election to the Board and for filling vacancies on the Board that may occur between annual meetings of shareholders.stockholders. The nominating and corporate governance committee assists the Board by identifying and reviewing potential candidates for Board membership consistent with criteria approved by the Board. The nominating and corporate governance committee also annually recommends qualified candidates (which may include existing directors) for approval by the Board of a slate of nominees to be proposed for election to the Board at the annual meeting of shareholders.stockholders. Having considered the qualifications of these individuals, in March 2016, the nominating and corporate governance committee recommended to the Board the reelection of the sixtwo candidates nominated above.
As provided in the Bylaws, the Board is authorized to nominate and elect a new director when a vacancy occurs between annual meetings of shareholders.stockholders. In the event of a vacancy on the Board between annual meetings of the Company’s shareholders,stockholders, the Board may request that the nominating and corporate governance committee identify, review and recommend qualified candidates for Board membership for Board consideration to fill such vacancies, if the Board determines that such vacancies will be filled. The Bylaws allow for up to seven directors. The
Pursuant to the Certificate of Incorporation, the Board is permitted by the Bylawscomprised of no less than five nor more than seven directors, and such directors are divided into three (3) classes with each class to create a new directorship upon the affirmative votebe as nearly equal in number as possible. The terms of 66 2/3%office of directors of the first class of directors then in office andwas set to fill existingexpire at the first annual meeting of stockholders after their election or newly created directorship slots by a majority voteappointment (2018), that of the directors then in office.second class was set to expire at the second annual meeting after their election or appointment (2019), and that of the third class was set to expire at the third annual meeting after their election or appointment (2020). Thereafter, each director shall serve for a term ending on the date of the third annual meeting of stockholders following the annual meeting at which such director was elected.
When formulating its recommendations for potential Board nominees, the nominating and corporate governance committee seeks and considers advice and recommendations from management, other members of the Board and may seek or consider advice and recommendations from consultants, outside counsel, accountants, or other advisors as the nominating and corporate governance committee or the Board may deem appropriate.
Board membership criteria, which are disclosed in the Company’s Second Amended and Restated Corporate Governance Guidelines on the Investor Relations page of the Company’s website, www.forbesenergyservices.com, are determined by the Board, with input from the nominating and corporate governance committee. The Board is responsible for periodically determining the appropriate skills, perspectives, experiences, and characteristics required of Board candidates, taking into account the Company’s needs and current make-up of the Board. This assessment should include appropriate knowledge, experience, and skills in areas deemed critical to understanding the Company and its business; personal characteristics, such as integrity and judgment; and the candidate’s commitments to the boards of other companies. While the Board does not have a formal policy with respect to diversity of potential Board nominees, the nominating and corporate governance committee considers the impact a potential Board nominee would have in terms of increasing the diversity of the Board with respect to professional experience, background, viewpoints, skills and areas of expertise. The resulting diversity of the Board allows each member of the Board an opportunity to provide specific input to Board decisions in his or her respective area of expertise. Each Board member is expected to ensure that other existing and planned future commitments do not materially interfere with the member’s service as a director and that he or she devotes the time necessary to discharge his or her duties as a director. The Board

7




believes the qualification guidelines included as Exhibit A to the Company’s Second Amended and Restated Corporate Governance Guidelines are currently appropriate, but it may change these guidelines as the Company’s and Board’s needs warrant.
Nominations for Directors
The nominating and corporate governance committee will consider candidates for director nominees that are recommended by shareholdersstockholders of the Company in the same manner as Board recommended nominees, in accordance with the procedures set forth in the Bylaws. Any such nominations should be submitted to the Board care of the Assistant Secretary, Forbes Energy Services Ltd., 3000 South Business Highway 281, Alice, Texas 78332 and accompany it with the following information:


appropriate biographical information, a statement as to the qualifications of the nominee and any other information relating to such nominee that is required to be disclosed pursuant to Regulation 14A under the Exchange Act (including such person’s written consent to being named in the proxy statement as a nominee and to serving as a director if elected); and
the name(s) and address(es) of the shareholder(s)stockholder(s) making the nomination and the number of shares of the Company’s common stock that are owned beneficially and of record by such shareholder(s)stockholder(s).
The written recommendation should be submitted within the time frame described under the caption “Shareholder“Stockholder Proposals” above.
Communications with the BoardDirectors
The Board has approved a process for shareholdersstockholders and other interested personpersons to communicate with the Board or certain committees thereof. A description of this process entitled “Procedures for Communication with the Board”Directors” is located on the Company’s website, www.forbesenergyservices.com.www.forbesenergyservices.com.
In addition, employees wishing to report concerns regarding possible unethical or unlawful behavior may call the Company’s toll-free governance hotline at 1-866-887-5494. Our audit committee monitors these calls. All calls are documented, and those reports that are deemed to be substantive will be investigated.
Proposal No. 2 – Approval of Amendments to the Certificate of Formation to Effect a Reverse Stock Split of Our Outstanding Common Stock at the Discretion of the Board and to Effect a Change in the Par Value of Our Common Stock to $0.01 Per Share

The Board has unanimously recommended a proposal to our shareholders authorizing the Board to effect a reverse split of our common stock if necessary, in the sole discretion of the Board, to maintain eligibility to be listed on The NASDAQ Capital Market (“NASDAQ”). This authorization is to be effective for one year from the Annual Meeting. The effective date and the precise number of shares to be converted is to be determined by the Board at a later time, but under no circumstances would the reverse stock split be greater than 1 for 10. The Board believes this proposal to be prudent for the reasons explained below. In addition, the Board has unanimously determined that, in connection with such reverse stock split, it is in the best interests of the Company and our shareholders to effect a change in the par value of our shares of common stock to $0.01 per share. The form of the Certificate of Amendment to effect the reverse stock split and the change in the par value of our common stock is attached hereto as Appendix A. The following discussion is qualified in its entirety by the full text of the Certificate of Amendment, which is hereby incorporated by reference.
The Board is requesting shareholder authorization to reverse split our outstanding common stock on the basis of one share of common stock for up to 10 shares outstanding, only if necessary, in order to keep the common stock eligible to be quoted on NASDAQ. With an objective to meet NASDAQ’s $1.00 minimum bid price requirement, the Board will take into consideration the immediate impact of a reverse stock split on the stock price as well as price fluctuations caused by current market conditions when determining the final reverse stock split ratio. Approval of this proposal would authorize the Board to reverse split our common stock at any time from the time of approval until June 10, 2017. The Board desires not to effect a reverse stock split but believes that retaining our listing on NASDAQ is crucial to shareholder value and liquidity and our long-term business prospects. This proposed reverse stock split is not the first part of a Rule 13e-3 Going Private Transaction as defined in paragraph (a)(3)(i) of that regulation, as the reverse stock split proposal is solely for the purpose of maintaining our listing on NASDAQ.
In September 2015, we received notice from The NASDAQ Stock Market advising that we had not maintained a minimum bid price of $1.00 per share as required under NASDAQ Listing Rule 5450(a)(1) for continued listing on The NASDAQ Global Market. On March 31, 2016, our shares were transferred from The NASDAQ Global Market to the NASDAQ Capital Market. We have been provided until September 26, 2016 to regain compliance with the $1.00 minimum bid price requirement under NASDAQ Listing Rule 5450(a)(1). If compliance is not demonstrated by us by such date, our securities will be subject to delisting from NASDAQ.
It is recommended that the shareholders give authorization to the Board to approve and cause our management effect up to a 1 for 10 reverse stock split of our common stock at any time until June 10, 2017. Assuming that a reverse stock split would cause the trading price of our common stock to increase in the same proportion as the amount of the split, a reverse stock split would result in a proportionate increase in the quoted bid price of the common stock, thereby exceeding NASDAQ’s $1.00 minimum bid price requirement. On March

8




31, 2016, our common stock closed at a price of $0.47 with a trading volume of 31,578 shares. The average daily trading volume for our common stock for the three months ending March 31, 2016 was 103,309 shares. Assuming a direct correlation between the number of shares before and after the reverse stock split, we expect that the new average daily trading volume for our common stock will be approximately 10,331 shares if the Board elects to effect a 1 for 10 reverse stock split.
For example, if the Board elects to effect a 1 for 10 reverse stock split, each 10 issued shares of our common stock held on the effective date will automatically be converted into one share of common stock. The reverse stock split conversion ratio would also have a proportionate effect on any outstanding options, the shares reserved under our 2012 Equity Incentive Plan (the “Plan”) and the shares of common stock into which our Series B Senior Convertible Preferred Stock could be converted. The reverse stock split would not alterthe rights associated with our common stock nor would it change the number of authorized shares of common stock. As explained below, no fractional shares will be issued.
Although the reverse stock split will not, by itself, impact our assets or prospects, if the fair market value per share of the common stock does not increase proportionately to the decrease in the number of shares of common stock outstanding, the Company’s aggregate market value will decrease. The Board believes that this risk is outweighed by the benefits of the continued listing of the common stock on NASDAQ.
Effect of Reverse Split on Holders of Odd Lots of Shares
If the maximum 1 for 10 reverse split is authorized and declared, the reverse split would result in holders of fewer than 1,000 shares holding an “odd lot” or less than 100 shares. A securities transaction of 100 or more shares is a “round lot” transaction of shares for securities trading purposes and a transaction of less than 100 shares is an “odd lot” transaction. Round lot transactions are the standard size requirements for securities transactions and odd lot transactions may result in higher transaction costs to the odd lot seller.
Effect of Reverse Split Resulting in Fractions of A Share
No fractional shares of common stock will be issued in connection with the reverse stock split. If as a result of the reverse stock split, a shareholder of record would otherwise hold a fractional share, the shareholder will receive a cash payment in lieu of the issuance of any such fractional share in an amount per share equal to the closing price per share on NASDAQ on the trading day immediately preceding the effective date of the reverse stock split (as adjusted to give effect to the reverse stock split), without interest. The ownership of a fractional interest will not give the holder thereof any voting, dividend or other right except to receive the cash payment therefore. These payments will be made through our exchange agent after consummation of the reverse stock split.

Shareholders should be aware that, under the escheat laws of the various jurisdictions where shareholders reside, where we are domiciled and where the funds will be deposited, sums due for fractional interests that are not timely claimed after the effective time may be required to be paid to the designated agent for each such jurisdiction. Thereafter, shareholders otherwise entitled to receive such funds may have to seek to obtain them directly from the state to which they were paid.

Effect on Certificated Shares

As soon as practicable after the effective time of the reverse stock split, shareholders will be notified that the reverse stock split has been effected. We expect our transfer agent, American Stock Transfer & Trust Company, LLC, to serve as our exchange agent to facilitate the exchange of stock certificates. Shareholders holding shares in certificated form will be sent a transmittalletter by our transfer agent. The letter of transmittal will contain instructions on how a shareholder should surrender his or her certificate(s) representing sharesof the common stock (“Old Certificates”) to the transfer agent in exchange for certificates representing the appropriate number of whole shares ofpost-reverse stock split common stock (“New Certificates”). No New Certificates will be issued to a shareholder until that shareholder hassurrendered all Old Certificates, together with a properly completed and executed letter of transmittal, to the transfer agent. No shareholder will berequired to pay a transfer or other fee to exchange the shareholder’s Old Certificates.Shareholders will then receive the New Certificate(s) representing the number of whole shares of common stock to which they are entitledas a result of the reverse stock split. Until surrendered, we will deem outstanding Old Certificates held by shareholders to be canceled and only torepresent the number of whole shares of post-reverse stock split common stock to which these shareholders are entitled.Any Old Certificates submitted for exchange, whether because of a sale, transfer or other disposition of stock, will automatically beexchanged for New Certificates.

If any Old Certificates have a restrictive legend on the back of the Old Certificates, the New Certificate(s) will be issued with the same restrictive legends that are on the back of the Old Certificates. If a shareholder is entitled to a payment in lieu of any fractional shares, such payment will be made as described above under “Effect of Reverse Split Resulting in Fractions of a Share.”


9




Effect on Registered “Book-Entry” Holders of Common Stock (i.e., Shareholders that are Registered on the Transfer Agent’s Books and Records but Do Not Hold Certificates)

Some of our registered holders of common stock may hold some or all of their shares electronically in book-entry form with our transfer agent. These shareholders do not have stock certificates evidencing their ownership of the common stock. They are, however, provided with a statement reflecting the number of shares registered in their accounts. If a shareholder holds registered shares in book-entry form with the transfer agent, no action needs to be taken to receive post-reverse stock split shares or cash payment in lieu of any fractional share interest, if applicable. If a shareholder is entitled to post-reverse stock split shares, a transaction statement will automatically be sent to the shareholder’s address of record indicating the number of shares of common stock held following the reverse stock split. If a shareholder is entitled to a cash payment in lieu of any fractional share interest, a check will be mailed to the shareholder’s registered address as soon as practicable after the effective date of the reverse stock split. By signing and cashing the check, shareholders will warrant that they owned the shares of common stock for which they received a cash payment. The cash payment is subject to applicable federal and state income tax and state abandoned property laws.

Effect on Beneficial Holders of Common Stock (i.e., Shareholders Who Hold in “Street Name”)

Upon the effectiveness of a reverse stock split, we intend to treat shares of common stock held by shareholders in “street name,” through a bank, broker or other nominee, in the same manner as registered shareholders whose shares of common stock are registered in their names. Banks, brokers or other nominees will be instructed to effect the reverse stock split for their beneficial holders holding the common stock in “street name.” However, these banks, brokers or other nominees may have different procedures than registered shareholders for processing the reverse stock split and making payment for fractional shares. If a shareholder holds shares of common stock with a bank, broker or other nominee and has any questions in this regard, shareholders are encouraged to contact their bank, broker or other nominee.

Effect of Reverse Split on Number of Shares Outstanding
The following table sets forth the number of shares of our common stock outstanding after each potential reverse stock split ranging from a 1 for 5 split to a 1 for 10 split, based on 22,214,855 shares of common stock outstanding as of April 11, 2016. The numbers shown below assume that no fractional shares are created from a potential reverse stock split.
Potential Reverse
Stock Split
Post-Split Common
Stock Shares Outstanding
1 for 54,442,971
1 for 63,702,475
1 for 73,173,550
1 for 82,776,856
1 for 92,468,317
1 for 102,221,485
Effect of Reverse Split on Number of Authorized Shares Available for Issuance
As of April 11, 2016, we had a total of 28,896,071 of our 112,500,000 authorized shares of common stock either issued or reserved for (i) exercise of options granted or future grants available under the approved Plan or (ii) conversion of our Series B Senior Convertible Preferred Stock. The table below illustrates the effect on the number of authorized shares of the common stock available for issuance as a result of each potential reverse split. While the number of authorized shares remains constant, the effect of a reverse split would result in an increased number of available authorized unissued shares.

10




Potential
Reverse
Stock Split
 
Post-Split
Common Stock
Issued or
Reserved
  
Authorized
Common Stock
  
Unissued Post-
Split Common
Stock Available
 
1 for 5  5,779,214
   112,500,000
   106,720,786
 
1 for 6  4,816,011
   112,500,000
   107,683,989
 
1 for 7  4,128,010
   112,500,000
   108,371,990
 
1 for 8  3,612,008
   112,500,000
   108,887,992
 
1 for 9  3,210,674
   112,500,000
   109,289,326
 
1 for 10  2,889,607
   112,500,000
   109,610,393
 
As stated previously, our intent for requesting shareholder approval to reverse split the common stock is to keep the common stock eligible to be quoted on NASDAQ. We do not have any plans, proposals, or arrangements at this time to issue any of the additional authorized shares of common stock realized as a result of a reverse stock split for any future acquisitions or financings or any other purpose.
The actual reverse stock split ratio shall be determined by the Board based upon our estimation of the post-split trading bid price and the probability of the bid price meeting the $1.00 minimum bid price requirement under various market conditions.
We do not believe that a reverse stock split at any of the proposed ratios would reduce, to any significant extent, the number of shareholders of record (which does not include shareholders holding shares in "street name").
Anti-takeover Implications of Reverse Stock Split
As a result of a reverse stock split, the number of authorized, but unissued shares of our common stock will increase as shown in the table above. Currently, we have 83,600,803 shares of authorized, unissued and non-reserved shares of our common stock available for issuance. If the maximum reverse split ratio of 1 share for each 10 existing outstanding shares is adopted by the Board following adoption of Proposal No. 2 by the shareholders, then the number of authorized, unissued and non-reserved shares of our common stock available for issuance would increase to 109,610,393 shares. Release No. 34-15230 of the staff of the Securities and Exchange Commission requires disclosure and discussion of the effects of any shareholder proposal that may be used as an anti-takeover device. However, as indicated above, the purpose of the reverse split is to maintain our listing on NASDAQ, and not to construct or enable any anti-takeover defense or mechanism on our behalf. While it is possible that management could use the additional shares to resist or frustrate a third-party transaction providing an above-market premium that is favored by a majority of the independent shareholders, we have no intent or plan to employ the additional unissued authorized shares as an anti-takeover device.

Par Value Change

The Board believes that the decrease in par value of our common stock from $0.04 to $0.01 is in the Company’s best interests and the best interests of our shareholders because it will bring the par value in line with the par value of other similar companies and will provide the Board and our management with more flexibility in setting the consideration that may be received for shares of common stock in purchases and sales and other corporate transactions, although no such transactions are currently contemplated. Par value is used to designate the lowest value for which a company can legally sell its shares. Historically, the concept of par value was to protect creditors and senior security holders by ensuring that when issuing its own shares a company received at least par value as consideration for its shares. As markets have become more liquid, with stock prices responding more rapidly to market developments, par value has become a generally outdated concept. Instead, for public companies like us, the market sets the price at which stock may be issued or otherwise sold. The reduction in par value will have no impact on the value of our stock or the rights of our shareholders.

Accounting Matters

The par value of the shares of our common stock will be changing as a result of the implementation of the reverse stock split as contemplated in this proxy statement. Our stated capital, which consists of the par value per share of our common stock multiplied by the aggregate number of shares of our common stock issued and outstanding, will be reduced proportionately on the effective date of the reverse stock split. Correspondingly, our additional paid-in capital, which consists of the difference between our stated capital and the

11




aggregate amount paid to us upon the issuance of all currently outstanding shares of our common stock, will be increased by a number equal to the decrease in stated capital. Further, net loss per share, book value per share and other per share amounts will be increased as a result of the reverse stock split because there will be fewer shares of common stock outstanding.

Certain United States Federal Income Tax Consequences
The reverse stock split of our common stock should constitute a “recapitalization” for U.S. federal income tax purposes. Accordingly, shareholders should not recognize gain or loss upon the reverse stock split, except with respect to cash received in lieu of a fractional share of common stock. A shareholder’s aggregate tax basis in the shares of the common stock received pursuant to the reverse stock split should equal the aggregate tax basis of the shares of common stock surrendered (excluding any portion of such basis that is allocated to any fractional share of common stock), and such shareholder’s holding period for the shares of the common stock received should include the holding period for the shares of the common stock surrendered. Shareholders should consult their tax advisors as to application of the foregoing rules where shares of common stock were acquired at different times or at different prices. A shareholder who receives cash in lieu of a fractional share of common stock pursuant to the reverse stock split should generally recognize capital gain or loss in an amount equal to the difference, if any, between the amount of cash received and the portion of the shareholder’s tax basis in the shares of the common stock surrendered that is allocated to such fractional share of common stock. Such capital gain or loss should be long-term capital gain or loss if the shareholder’s holding period for the common stock surrendered in the reverse stock split exceeds one year at the time of the reverse stock split.

The Board recommends a vote “FOR” the approval of an amendment to the Certificate of Formation to effect a reverse stock split of our outstanding common stock at the discretion of the Board and to effect a change in the par value of our common stock to $0.01 per share.
Proposal No. 3 – Selection2-Selection and Ratification of the Independent Registered Public Accounting Firm
Our audit committee and Board seek shareholderstockholder ratification of the reappointment of BDO USA, LLP to act as the independent registered public accounting firm of the Company for the 20162019 fiscal year. If the shareholdersstockholders do not ratify the appointment of BDO USA, LLP, the audit committee will reconsider this appointment. A representative of BDO USA, LLP will attend our annual meeting. The representative will have the opportunity to make a statement if he or she desires to do so and to respond to appropriate questions.
The affirmative vote of a majority of the shares of common stock entitled to vote and represented in person or by proxy at a meeting at which a quorum is present is required to ratify the selection of the independent auditors.
The Board unanimously recommends that the shareholdersstockholders vote “FOR” the ratification of the reappointment of BDO USA, LLP as the Company’s independent registered public accounting firm for the 2019 fiscal year 2016.year.
Independent Auditors and Fees
BDO USA, LLP, began serving as the Company’s independent registered public accounting firm on June 23, 2009. The audit committee approved the reappointment of BDO USA, LLP as the Company’s independent registered public accounting firm for the 20162019 fiscal year, subject to ratification by the shareholders.stockholders.
The following table presents fees for professional audit services rendered by BDO USA, LLP for the audit of the Company’s annual financial statements for the years ended December 31, 20152018 and December 31, 2014,2017, and fees billed for other services rendered by BDO USA, LLP during those periods.

   
Year Ended December 31,

Year Ended December 31,  
2015 2014
2018  
 
2017  
Audit fees(1)
$930,455 $867,180$866,545
 $922,717
Tax fees(2)
 140,520  118,650
 115,120
   
Total$1,070,975 $985,830$866,545
 $1,037,837
   
(1)
Audit fees: Consistsfees consist of fees billed for professional services rendered for the audit of the Company’s consolidated financial statements, for the review of the interim condensed consolidated financial statements included in quarterly reports, services that are normally provided by BDO USA, LLP in connection with statutory and regulatory filings or engagements and attest services, except those not required by statute or regulation.

12




(2)
Tax fees: Consistsfees consist of tax compliance and preparation and other tax services. Tax compliance and preparation consistsconsist of fees billed for professional services related to federal, state and international tax compliance, assistance with tax audits and appeals, and tax return preparation. Other tax services consist of fees billed for other miscellaneous tax consulting and planning.


Policy on Audit Committee Pre-Approval of Audit and Permissible Non-Audit Services of Independent Auditors
The audit committee is responsible for the appointment, retention, termination, compensation and oversight of the independent auditors. The audit committee’s policy is to pre-approve all audit and permissible non-audit services provided by the independent auditors. Requests for approval are generally submitted at a meeting of the audit committee. The audit committee may delegate pre-approval authority to a committee member, provided that any decisions made by such member shall be presented to the full committee at its next scheduled meeting.

13





EXECUTIVE OFFICERSExecutive Officers
The names, ages as of April 11, 2016,May 1, 2019, position and other information concerning our executive officers are set forth below.
NameAgePosition
John E. Crisp5458Chairman of the Board, President and Chief Executive Officer
Charles C. Forbes, Jr.62Executive Vice President and Chief Operating Officer
L. Melvin Cooper6265Senior Vice President, Chief Financial Officer and Assistant Secretary
Steve Macek62Executive Vice President and Co-Chief Operating Officer
Joe Michetti49President and Co-Chief Operating Officer of Forbes Energy Services LLC
John E. Crisp is our President and Chief Executive Officer and was appointed to such offices and elected as a director and Chairman of the Board upon the Company’s formation effective April 11, 2008. Please refer to the section entitled “Proposal No. 1 – Election1-Election of Directors”Director” for additional information with respect to Mr. Crisp’s background and experience.
Charles C. Forbes, Jr. is our Executive Vice President and Chief Operating Officer and was appointed to such offices and elected a director upon the Company’s formation effective April 11, 2008. Please refer to the section entitled “Proposal No. 1 – Election of Directors” below for additional information with respect to Mr. Forbes’ background and experience.
L. Melvin Cooper is our Senior Vice President, Chief Financial Officer and Secretary and was appointed to such offices upon the Company’s formation effective April 11, 2008. Mr. Cooper also serves as the Senior Vice President and Chief Financial Officer of each of our Operating Subsidiaries. Prior to joining Forbes in 2007, Mr. Cooper served as the Chief Financial Officer or President of companies involved in site preparation for oil and gas exploration companies, supplying products and services to new home builders, and supply chain management. Mr. Cooper has been a Directormember of the Boards of Directors of Flotek Industries, Inc. (NYSE: FTK) since 2010, where he serves on the Audit Committee, Corporate Governance and Nominating Committee, and Compensation Committee. He is also a member of the Board of Directors for Par Pacific Holdings, Inc. (NYSE: PARR), where he has served since August 2012. Mr. Cooper is a member of the Audit Committee2012 and Compensation and Corporate Governance Committees. In 2011, Mr. Cooper received the Board Leadership Fellow designation from the National Association of Corporate Directors ("NACD") where he is also a member of the Board of Directors of the NACD Houston area Tri-City Chapter.SA Exploration (NASDAQ: SAEX) since July 2016. Mr. Cooper earned a degree in accounting from Texas A&M University - KingsvilleUniversity-Kingsville (formerly Texas A&I) in 1975. Mr. Cooper has been a Certified Public Accountant since May 1977.
Steve Macek is our Executive Vice President and Co-Chief Operating Officer and was appointed to such offices on April 14, 2017. Prior to such appointments, Mr. Macek served as the Executive Vice President of Well Servicing of C.C. Forbes LLC since 2014. From 2007 to 2014, Mr. Macek served as the Vice President of Well Servicing of C.C. Forbes, LLC. Prior to joining Forbes in 2007, Mr. Macek spent 21 years with Pool Company, which was acquired by Nabors, where he held various positions in Sales and Management in South Texas. Mr. Macek has a total of 36 years in the Well Servicing industry. Mr. Macek received his Bachelor of Business Administration in Marketing from Texas A&M University in Kingsville in 1979.
Joe Michetti is the President and Co-Chief Operating Officer of Forbes Energy Services LLC, the principal operating subsidiary of the Company, and was appointed to such office on November 16, 2018. Mr. Michetti was the co-founder of Cretic Energy Services LLC “Cretic” and served as its President and Chief Executive Officer from 2013 until its acquisition by the Company on November 16, 2018. Prior to founding Cretic, Mr. Michetti co-founded Infinistar Energy Services in 2004, which he sold to Weatherford International in 2009, maintaining a managerial position within Weatherford’s Global Coiled Tubing product line until co-founding Cretic in 2013. He also previously held various managerial and engineering positions for El Paso Production, Burlington Resources and Pan Canadian Petroleum. Mr. Michetti received his Bachelor of Science in Engineering from the University of Montana and an Associate degree in Reservoir Engineering from the Southern Alberta Institute of Technology.
EXECUTIVE COMPENSATION
On January 22, 2017, the Company and our then domestic subsidiaries, or collectively, the Debtors, filed voluntary petitions for reorganization under chapter 11 of the United States Bankruptcy Code in the United States Bankruptcy Court for the Southern District of Texas-Corpus Christi Division, or the Bankruptcy Court, pursuant to the terms of a restructuring support agreement that contemplated the reorganization of the Debtors pursuant to a prepackaged plan of reorganization, as amended and supplemented, the Plan. On March 29, 2017, the Bankruptcy Court entered an order confirming the Plan. On April 13, 2017, or the Effective Date, the Plan became effective pursuant to its terms and the Debtors emerged from their chapter 11 cases.
We are currently considered a smaller reporting company for purposes of the Commission’s executive compensation disclosure rules. In accordance with such rules, we are required to provide a Summary Compensation Table and an Outstanding


Equity Awards at Fiscal Year-End Table, as well as limited narrative disclosures. Further, our reporting obligations extend only to the individuals serving as our Chief Executive Officer and our two next most highly compensated executive officers.
This summary focuses primarily on the information in the tables below and related footnotes, as well as the supplemental narratives, relating to the fiscal year ended December 31, 2018. As a smaller reporting company, we are not required to provide, and do not purport to provide, all of the disclosures required for “Compensation Discussion and AnalysisAnalysis” as set forth in Rule 402(b) under Regulation S-K.
Compensation Program Philosophy and Objectives
Our philosophy on the compensation of our executive officers is to provide competitive salary levels and compensation incentives that attract and retain individuals of high quality, recognize performance and align executive goals with the short-term and long-term objectives of the Company and shareholders.our stockholders. Our compensation program is designed to reward performance, leadership and loyalty. The elements of our executive compensation program for our executive officers consist of base salary and benefits, cash bonuses and cash incentive awards and equity incentive awards. We provide base salary and benefits in order to compensate executive officers for their day-to-day services rendered to the Company, cash bonuses and cash incentive awards in order to encourage achievement of operating results over the short-term and equity incentive awards in order to better align the interests of our executive officers with the long-term interests of our shareholders.stockholders. We believe that each of these three principal elements play a role in achieving our overall compensation objective of attracting and maintainmaintaining high quality individuals, recognizing performance and aligning executive goals with the objectives of the Company.
We do not have a formal policy for allocating between cash and non-cash compensation, generally, or with respect to our named executive officers. Each year, the compensation committee evaluates each element of compensation separately and as a whole. In making this evaluation, the compensation committee generally considers information regarding such executive officer'sofficer’s performance; the performance of the Company, past compensation practices and general industry information. In 2015, the Company engaged a compensation committee considered compensation information fromconsultant to prepare a selected groupstudy of peer companies. These peer companies were reviewed and approved by thegroup compensation committee for assessingpractices to assess the competitiveness of 2015 compensation levels.our compensation. A discussion of how this comparison was conducted and a list of the peer companies considered in 2015 is provided in the section entitled “How and why we benchmark compensation against our peers,” below. In 2017, prior to the Effective Date, the Company did not change its approach to compensation. However, on the Effective Date, the Company’s executive officers entered into new employment agreements, and the Company made other changes to its approach to compensation that are described below.
Base Salary
As stated above, we provide base salary to our executive officers in order to compensate such officers for the services they provide to the Company, on a day-to-day basis. The base salaries for the executive officers were initially set in May 2008,April 2017, when we entered into new employment agreements with such officers.officers at the time we exited from our chapter 11 reorganization. Salaries for Messrs. Crisp and Cooper were the same salaries that were in effect since 2012. The salary level for Mr. Macek was effective as of the date of the reorganization when he assumed the title and responsibilities of Chief Operating Officer. The compensation committee will from time to time evaluatesevaluate those salaries based on the

14




contributions made, responsibilities assumed and skills possessed by each such executive, as well as the condition of the Company and the overall energy services industry.
The compensation committee determined that the base salary of Messrs. Crisp, ForbesCooper, Macek and CooperMichetti of $650,000, $650,000$652,224, $432,508, $408,774 and $425,000,$400,000, respectively, should remain unchanged for 2015 and 2016.2019. These salaries are based on the factors described above and aan earlier review of compensation practices of our peer group, which is described in greater detail in the section entitled “How and why we benchmark compensation against our peers” beginning on page 18.12. With respect to setting the salary of Mr. Cooper, specifically, the compensation committee felt, and continues to feel, that Mr. Cooper’s talents and achievements including the completion of debt offerings, bank financings and our NASDAQ listing, make him well qualified to take a position in a company whose size exceeds our peer group. Further, the compensation committee was particularly mindful of the broad scope of responsibilities assumed by Mr. Cooper, including those that would often be associated with a treasurer, controller, corporate secretary, ormergers and acquisitions director, and investor relations, specialist, which may not be performed by chief financial officers in other similarly situated companies.
Benefits and Perquisites.Perquisites.
The Company provides the executive officers and other employees with perquisites and other personal benefits as part of providing a competitive executive compensation program. The Company provides its executive officers with health, medical, dental and life insurance coverage, as it does for all of its employees, provided that with regard to these benefit plans, the Company payscompensates the executives for the cost of certain premiums for such executive officersplans that are not covered for all employees. Further,The cost of such premiums are included in the Company also pays the premiums for a supplemental life insurance policy with a face amount equal to $260,000 for Mr. Forbes and certain family members and the premiums for a supplemental life insurance policy with a face amount equal to $200,000 for Mr. Crisp.executive officer salaries referenced above.


Messrs. Crisp and ForbesMacek have also been provided a company vehicle.trucks, which are used to access work sites and for other business-related purposes. Further, Messrs. Crisp, ForbesCooper and CooperMichetti receive a monthly vehicle and fuel allowance of $1,000 per month.allowance. This vehicle allowance is also available to certain managers and full-time employees.
Annual Bonuses and Cash Incentive Compensation and Related Stock Grants
The Company uses cash compensation in excess of base salary to encourage achievement of operating results and to create a competitive compensation package for our executive officers. ForIn fiscal 2015,year 2017, the compensation committee adopted a formal plan, which we often refer to as our annual bonus plan.plan or our STIP. The compensation committee believes that the adoption of this performance incentive compensation approach, which operates under our Plan, brings greater certainty and executive accountability to the Company’s compensation package.

For 2015,fiscal year 2018, the target awards under the annual bonus plan were based on a percentage of each named executive officer'sofficer’s base salary. In the case of Mr. Crisp, his target award was 100% of base salary. In the case of Messrs. CrispCooper and Forbes,Macek, their target award was 100%70% of base salary with the threshold potential award of 50% of base salary and the maximum potential award of 200% of base salary. In the case of Mr. Cooper, his target award was 60% of his base salary with the threshold potential award of 30% of base salary and the maximum potential award of 120% oftheir base salary.

In previous years, the Company used adjusted EBITDA as the primary financial metric for assessing short-term corporate performance and as a measurement to reward its executive officers. In March 2015, the compensation committee, in consultation with Towers Watson, made adjustments to the performance metrics underlying the Company's 2015 annual bonus plan. The Company continuedcontinues to use adjusted EBITDA as the primary financial metric for assessing short-term corporate performance, and 50%with 75% of the potential short-term award will bebeing based on an adjusted EBITDA, target. Additionally, in line with37.5% for the practicesshort-term award being based on achieving adjusted EBITDA of at least $14.6 million (the “First EBITDA Component”) and another 37.5% for the short-term award being based on achieving adjusted EBITDA of at least $18.3 million (the “Second EBITDA Component”), or if adjusted EBITDA were between $14.6 million and $18.3 million, then the percentage applicable to the Second EBITDA Component would be interpolated on a straight-line basis between $14.6 million and $18.3 million, provided that, the total Performance Component Award Earned for the First EBITDA Component and the Second EBITDA Component, combined, shall not exceed 75% of the majorityMaximum Award of the Company's peer group, the Company moved the safety metric from long-term equity incentive compensation to the annual bonus plan.any named executive officer. For fiscal 2015,year 2018, 25% of the award under the annual bonus plan wasbeing based on the Company'sCompany’s safety record as compared to the Industry Total Recordable Incident Rate for the North American Industry Classification System code for oil and gas operations (NAICS 213112) as published by the Bureau of Labor Statistics. The final 25% of the award under the annual bonus plan was based on the leadership demonstrated by each named executive officer.Statistics in October 2016. These percentages are referred to as the "Component“Component Percentage." Each performance component contributed to the value of the total annual bonus for each executive as discussed below.

The compensation committee established in advance an adjustedthe First EBITDA targetComponent of $26.6at least $14.6 million and the Second EBITDA Component of at least $18.3 million for 2015. Achievement of 60% offiscal year 2018, provided that, the adjustedpercentage applicable to the Second EBITDA target will earn target incentive compensation of 50% of the target incentive compensation multiplied by the Component Percentage, achievement of 100% of the adjusted EBITDA target earns incentive compensation of 100% of the target incentive compensation multiplied by the Component Percentage, achievement of 140% of the adjusted EBITDA target earns incentive compensation of 150% of the target incentive compensation multiplied by the Component Percentage, and achievement of 160% of the adjusted EBITDA target will earn incentive compensation of 200% of the target incentive compensation multiplied by the Component Percentage. The value of this target incentive compensation based on the adjusted EBITDA target iswould be interpolated on a straight-line basis for target resultsadjusted EBITDA between 60%$14.6 million and 100%, 100% and 140%, or 140% and 160%,$18.3 million, as applicable.discussed above. The Company reported EBITDA for 2015 of $20.3 million, or approximately 70.1%2018 performance of the target, which was aboveCompany and the threshold vesting metricofficers entitled each of $16 million, but less than the target vesting metric of $26.6 million for this component. This performance entitled Messrs. Crisp, Cooper and ForbesMacek to receive short-term incentive compensation attributable to the EBITDA componentof 37.5% of the annual bonus plan of $227,770 eachtarget awards for the First EBITDA Component and

15




entitled Mr. Cooper to receive short-term incentive compensation attributable to the EBITDA component 66.23% of the annual bonus plan of $89,356.target awards for the interpolated Second EBITDA Component.

The safety component of the 20152018 target cash incentive compensation was based on the Company achieving a target total recordable incident rate ("TRIR"(“TRIR”) that is equal or betterless (i.e., better) than 50% of the industry average TRIR for the North American Industry Classification System code for oil and gas operations (NAICS 213112) for the 2017 calendar year as published by the Bureau of Labor Statistics.Statistics in 2018. Achievement of TRIR that is 75% (i.e., better than the industry average) of the industry average TRIR will earn target cash incentive compensation of 50% of the target cash incentive compensation multiplied by the Component Percentage, achievement of TRIR that is 50% (i.e., better than the industry average) of the industry average TRIR earns incentive compensation of 100% of the target cash incentive compensation multiplied by the Component Percentage, and achievement of TRIR that is 25% (i.e., better thanPercentage. For the industry average) of the industry average TRIR earns incentive compensation of 200% of the target cash incentive compensation multiplied by the Component Percentage. The value of this target cash incentive compensation based on the Company's TRIR is interpolated on a straight-line basis for target results between 75% and 50% or 50% and 25%, as applicable. For 2015,2017 calendar year, the TRIR for the North American Industry Classification System code for oil and gas operations (NAICS 213112) as published by the Bureau of Labor Statistics in 2018 was 1.6,1.2, while the Company reported a TRIR of 0.7,0.77, meaning the Company achieved a safety record for 20152018 that was 44.4%approximately 64% of the industry average TRIR for the North American Industry Classification System code for oil and gas operations. This performance exceeded the target vesting metric of 50% of the industry average TRIR, but did not meet the maximum vesting metric of 25% of the industry average TRIR for the safety component of the annual bonus plan, and entitled Messrs. Crisp and Forbes to receive short-term incentive compensation attributable to the safety component of the annual bonus plan of $199,062 each and entitled Mr. Cooper to receive short-term incentive compensation attributable to the safety component of the annual bonus plan of $78,093.

The leadership component of the 2015 target cash incentive compensation was to be paid only to the extent that the threshold adjusted EBITDA target for 2015 (i.e., reporting over $16 million in adjusted EBIDTA) was satisfied to reward the executives' leadership. Achievement of the leadership component would earn target cash incentive compensation of 200% of the target cash incentive compensation multiplied by the Component Percentage; however, the compensation committee may, in its sole discretion, reduce the leadership portion of the 2015 target cash incentive compensation based on the level of attainment of individual performance goals set for the named executive officer. For 2015, the Company achievement of the threshold vesting metric for the leadership component of the 2015 annual bonus plan (i.e., reporting over $16 million in adjusted EBIDTA) resulted in target cash incentive compensation of $325,000, $325,000 and $127,500 for Messrs. Crisp, Forbes and Cooper, respectively; however, in recognition of the significant industry downturn and its effect on the Company, the compensation committee applied its discretion to such component's value, and awarded Messrs. Crisp and Forbes short-term incentive compensation attributable to the leadership component of the annual bonus plan of $113,885 each and awarded Mr. Cooper short-term incentive compensation attributable to the leadership component of the annual bonus plan of $44,678. In accordance with the above formula, the compensation committee awarded aggregate short-term incentive compensation for all components of the annual bonus plan in 2015 of $540,717, $540,717 and $212,127 to Messrs. Crisp, Forbes and Cooper, respectively.

The compensation committee determined that, because the threshold,Company’s safety record was better than the industry average for 2018, each officer was entitled to receive the 25% Component Percentage times the target and maximum levels of incentive compensation under the annual bonus plan will remainaward.
Although management envisions using the same compensation structure for 2016 as for 2015. In addition,2019, the threshold, target and maximum levels of performance for each component performance metric under the annual bonus plan will also remain the samehave not yet been approved for 2016 as for 2015.2019.
Equity Incentive Awards
The Company uses equity incentive awards in order to better align the interests of our executive officers with the long-term interests of our shareholdersstockholders and to create a competitive compensation package for such officers. Pursuant


On August 28, 2017, based on the approval of the compensation committee, the Company granted (i) 181,440, 86,395 and 86,400 time-based restricted stock units (the “Time-Based RSUs”) respectively to Mr. John E. Crisp (President and Chief Executive Officer), Mr. L. Melvin Cooper (Senior Vice President, Chief Financial Officer) and Mr. Steve Macek (Executive Vice President and then Chief Operating Officer), and (ii) 9,220, 4,390 and 4,390 exit financing restricted stock units (the “Exit Financing RSUs”) respectively to Messrs. Crisp, Cooper and Macek. No further awards were made to the named executive officers in 2018. In connection with the Company’s merger with Cretic, on November 16, 2018, Mr. Michetti was granted 86,400 Time-Based RSUs.
The Time-Based RSUs and the Exit Financing RSUs were granted under the 2017 Management Incentive Plan (the “MIP”) and are governed by the Form of Time-Based Restricted Stock Unit Award Agreement and the Form of Exit Financing Time-Based Restricted Stock Unit Award Agreement disclosed on Exhibits 10.8 and 10.0, respectively, to the Company’s Plan,quarterly report on Form 10-Q for the compensation committee is permitted toquarter ended March 31, 2017.
The Time-Based RSUs vested 20% on the date of grant incentive stock options, nonstatutory stock options, stock appreciation rights, restricted stock, restricted stock units and other stock-based incentive compensation, collectively referred to assubsequently vested or will vest 20% each on the "Awards," to employees, directorsfirst, second, third and consultantsfourth anniversaries of the Companydate of grant. The Exit Financing RSUs vested or an affiliate.
For fiscal 2015, the compensation committee established long-term incentive target award levels for our named executive officers of $500,000, $500,000, and $250,000, for each of Messrs. Crisp, Forbes, and Cooper, respectively. Of the target 2015 award, $250,000, $250,000, and $125,000, for each of Messrs. Crisp, Forbes, and Cooper, respectively, was awarded on March 26, 2015 as a grant of restricted stock units determined by dividing such amounts by the closing price of the Company's common stockwill vest (i) 40% on the last businessfirst day beforefollowing the day such awards were approved bydate that was eighteen (18) months after the compensation committee. Such awards vest in three equal tranchesdate of grant with the remainder vesting, (ii) 20% each on the first, second and third anniversaries of the date of grant, and (iii) 20% one day prior to the grant.
The remainder of the 2015 long term equity incentive compensation award, $250,000, $250,000, and $125,000 for Messrs. Crisp, Forbes, and Cooper, respectively (the "target performance long-term incentive compensation"), is based on the Company's three-year adjusted EBITDA growth rate. The target performance long-term incentive compensation will be awarded as a grant of restricted stock units that will be settled in cash, and vest, subject to achievement of the performance criteria, on the thirdfourth anniversary of the date of grant as set forth ingrant.
Each of Messrs. Crisp, Cooper, Macek and Michetti were provided with an opportunity to defer the award agreement. The actual payoutsettlement of the target performance long-term incentive compensation will be between 0%

16




and 200% of the value of the target number of shares based on the Company's three-year adjusted EBITDA growth rate relative to the EBITDA growth rate of twenty-six publicly traded companies in the same industry as the Company selected by the compensation committee (the "EBITDA Peer Group"). Achievement of EBITDA growth equal to the 25th percentile of the EBITDA Peer Group will earn incentive compensation of 50% of the target performance long-term incentive compensation, achievement of EBITDA growth equal to the 50th percentile of the EBITDA Peer Group will earn incentive compensation of 100% of the target performance long-term incentive compensation, achievement of EBITDA growth equal to the 75th percentile of the EBITDA Peer Group will earn incentive compensation of 150% of the target performance long-term incentive compensation, and achievement of EBITDA growth equal to the 90th percentile of the EBITDA Peer Group will earn incentive compensation of 200% of the target performance long-term incentive compensation. The value of this target performance long-term incentive compensation will be interpolated on a straight-line basis for target results between 25% and 50%, 50% and 75%, or 75% and 90%, as applicable.

The compensation committee determined that the long-term incentive target award levels will remain the same for 2016 as for 2015. In addition, the threshold, target and maximum levels of performance for the portion of the long-term incentive target award relating to the Company's three-year adjusted EBITDA growth rate will also remain the same for 2016 as for 2015.
2015 Realized Compensation Table
For the purposes of the "Summary Compensation Table" on page 20, the calculation of "total compensation" includes several items that are driven by accounting assumptions and required to be disclosed by Commission rules. As a result, there can be a significant difference between what is reported as total compensation for a given year in such tableTime-Based RSUs and the value actually realized as total compensation for each of our executive officers and what each of them actually receives as take-home compensation (i.e., each executive officers "realized compensation"). In order to accurately reflect each of our executive officer's realized compensation, we have included the following table, which compares the total compensation per the "Summary Compensation Table" on page 20 to the realized compensation of each executive officer for 2015. This table should not be viewed as a substitute for the "Summary Compensation Table."Exit Financing RSUs.
2015 Total Compensation vs. Realized Compensation
 Year
Proxy Reported Compensation (1)
Total Realized Compensation (2)
Realized as a % of Reported
John E. Crisp2015$2,174,876 $1,803,058
 83%
     
Charles C. Forbes, Jr.20152,180,911 1,812,227  83%
     
L. Melvin Cooper20151,072,846 864,265  81%
     

(1)As reported in the Total column of the 2015 Summary Compensation Table on page 20.

(2)Amounts reported in the total realized compensation column include: (a) base salary, (b) actual performance-based cash award payments made during 2015 to each of our executive officers under the Company's annual bonus plan, (c) the value realized upon vesting of restricted stock units during 2015, and (d) amounts reported in the All Other Compensation column of the Summary Compensation Table for 2015 on page 20. As background, realized compensation excludes the following that are specifically included in the 2015 Summary Compensation Table: (1) the grant date fair value of unvested stock awards (as reflected in the Stock Awards column) because it is likely that different amounts will be realized or paid at a future date depending on actual performance of the Company and (2) bonus amounts that were earned in a particular year and actually paid in a subsequent year (as reflected in the Non-Equity Incentive Plan Compensation column).
Clawback Policy
In March 2012, the compensation committee adopted a policy to recover incentive-based compensation paid to any executive officer as required by the provisions of the Dodd-Frank Act, any regulations or rules promulgated thereunder, or any other “clawback” provision required by applicable law or the listing standards of the NASDAQ Global Market. On May 13, 2014, the Company entered into agreements with each of its named executive officersMessrs. Crisp and Cooper and on March 20, 2018 with Mr. Macek to implement this policy.
Stock Ownership Policy
In March 2015, the compensation committee adopted a stock ownership policy, which applies to the Company'sCompany’s named executive officers and directors. The policy provides a number of shares that the Company'sCompany’s named executive officers must accumulate and hold within five years of the date such individual became subject to the policy. The specific ownership requirements is 1,000,000 sharesrequirement for the Company'sCompany’s chief executive officer and 100,000 shares for each of the other named executive officers. Eachofficers remains under review for the purpose of amending it to conform to the named executive

17




officers has satisfiednew equity structure in place since the stock ownership guidelines.Effective Date. The stock ownership guidelines for directors are detailed in the section entitled "2015“2018 Director Compensation."
Elimination of Gross-Ups in Future Employment Agreements
In March 2015, the compensation committee resolved to no longer include "gross-ups" in any new executive employment agreement for any excise taxes.
Tax and Accounting Treatment Issues
Under Section 162(m) of the Code, the Company may not deduct, for federal income tax purposes, compensation paid in excess of $1,000,000 to a named executive officer employed by the Company at year-end unless it qualifies as “performance-based compensation.” While we believe that our Plan makes it possible to take advantage of the deduction of performance-based compensation, inyear-end. In order to ensure competitive levels of total compensation for our executive officers, there may be circumstances in which the Company’s interests are best served by approving compensation for its executive officers that will not meet the requirements of Section 162(m) of the Code and, therefore, will not be deductible by the Company for federal income tax purposes. Accordingly, the compensation committee may approve compensation for one or more of its executive officers that is not deductible for federal income tax purposes.
How and why we benchmark compensation against our peers
We operate in a competitive industry and compete with other companies in that industry for executive officers. In order to ensure that our compensation is effective at attracting and retaining executive talent, we feel it is appropriate to compare our compensation with other companies in our industry.
In 2015, Towers Watson was engaged to provide a study of compensation programs of executive officers and directors offered by a broad peer group in order to assist the compensation committee in establishing and maintaining an appropriate compensation program to better enable the Company to attract and retain highly qualified officers and directors. Based on analysis and survey data provided by Towers Watson, in March, 2015, the compensation committee approved the followinga group of peer groupcompanies for 2015 (and again for 2016) compensation decisions:decisions. The peer companies listed below reflect the list approved by the compensation committee, except that the companies that are no longer in existence have been omitted:

Atwood Oceanics, Inc.
Basic Energy Services, Inc.
C & J Energy Services, Inc.
CARBO Ceramics Inc.
Dawson Geophysical Company
Dril-Quip, Inc.
Energy XXI Ltd.
Gulf Island Fabrication Inc.
Gulfmark Offshore, Inc.
Helix Energy Solutions Group, Inc.
Hercules Offshore, Inc.
Hombeck Offshore Services, Inc.
ION Geophysical Corporation
Key Energy Services Inc.
Matrix Service Company
Nabors Industries Ltd.
Newpark Resources Inc.
Nuverra Environmental Solutions, Inc.
Parker Drilling Co.
PHI Inc.
Pioneer Energy Services Corp.
RigNet, Inc.
SEACOR Holdings Inc.
Superior Energy Services, Inc.
Tesco Corporation
TETRA Technologies, Inc.
Vantage Drilling Company

18




Tidewater Inc.
How and why we plan to use adjusted EBITDA to determine whether incentive cash compensation has been earned
“AdjustedThe term “adjusted EBITDA” is defined as income (loss) from continuing operations before interest, taxes, depreciation, amortization, gain or loss(loss) on early extinguishment of debt and non-cash stock based compensation, excluding non-recurring items. Management does not include gain (loss) on extinguishment of debt, non-cash stock based compensation or other nonrecurring items in its calculations of Adjusted EBITDA because it believes that such amounts are not representative of our core operations. Further, management believes that most investors exclude gain (loss) on extinguishment of debt, stock based compensation recorded under FASB ASC Topic 718 and other nonrecurring items from customary EBITDA calculations as those items are often viewed as either non-recurring and not reflective of ongoing financial performance or have no cash impact on operations. As it pertains to the determination of incentive compensation, adjusted EBITDA may include other items as the Compensation Committee of the Board, in its sole discretion, may deem reasonable or appropriate.
AdjustedOur use of adjusted EBITDA is a non-GAAP financial measure that is used as a supplemental financial measure by our management and directors and by our investors to assess the financial performance of our assets without regard to financing methods, capital structure or historical cost basis; the ability of our assets to generate cash sufficient to pay interest on our indebtedness; and our operating performance and return on invested capital as compared to those of other companies in the well services industry, without regard to financing methods and capital structure. We use adjusted EBITDA in our quarterly earnings releases investor conference calls and other filings with the Commission.
Due to the significance of adjusted EBITDA as a measure of the performance of the Company, the compensation committee felt that it was appropriate to tie elements of executive compensation with the achievement of a target level of adjusted EBITDA. The adjusted EBITDA target is set by the compensation committee, after receiving the recommendation of management. Our use of adjusted EBITDA for 20162019 will be the same as in 2015.2018.

Adjusted
Our use of adjusted EBITDA has limitations as an analytical tool and should not be considered an alternative to net income, operating income, cash flow from operating activities or any other measure of financial performance or liquidity presented in accordance with GAAP. AdjustedOur use of adjusted EBITDA excludes some, but not all, items that affect net income and operating income and these measures may vary among other companies. Limitations to using Adjustedadjusted EBITDA as an analytical tool include:

AdjustedOur use of adjusted EBITDA does not reflect our current or future requirements for capital expenditures or capital commitments;
AdjustedOur use of adjusted EBITDA does not reflect changes in, or cash requirements necessary to service interest or principal payments on our debt;
AdjustedOur use of adjusted EBITDA does not reflect income taxes;
Although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and Adjustedadjusted EBITDA does not reflect any cash requirements for such replacements; and
Other companies in our industry may calculate Adjustedadjusted EBITDA differently than we do, limiting its usefulness as a comparative measure.


Forbes Energy Services Ltd.
Reconciliation of Adjusted EBITDA to Net Loss from Continuing Operations
(Unaudited) (in thousands)

 
Year Ended December 31,

  
   2015 2014  
Adjusted EBITDA $20,539
 $ 75,061  
Non-cash share-based compensation  (442)
   (3,264)  
Income tax benefit16,614  3,060  
Interest expense, net(27,751)  (28,219)  
Depreciation and amortization  (55,034)
   (54,959)  
Net loss from continuing operations $(46,074)
 $ (8,321)  


19




2015 SUMMARY COMPENSATION TABLE
The following table sets forth all compensation paid, payable, awarded, granted, given, or otherwise provided, directly or indirectly, by the Company or a subsidiary thereof, in U.S. dollars, to the individuals who were, at December 31, 2015,2018, the Chief Executive Officer, the Chief Financial Officer and the only other executive officerofficers whose total annual compensation was more than $100,000.
Name and
principal
position
YearSalary
($)
Bonus
($)
Stock
Awards
($)
Non-Equity
Incentive
Compensation
($)
(1)
Nonqualified
Deferred
Compensation
Earnings
($)
All Other
Compensation
($)
Total
($)
(2)
John E. Crisp
President & Chief
Executive Officer
2015
2014
2013
$


650,000
650,000
650,000
$891,880(3)
 610,164(4)
 595,000(5)
$540,717
Name and principal position 
 
Year  
 
Salary
($)(1)  
 
Bonus
($)  
 
Stock
Awards
($)  
 
Option
Awards
($)  
 
Non-Equity
Incentive Plan
Compensation
($)(2)  
 
Nonqualified
Deferred
Compensation
Earnings
($)  
 
All Other
Compensation
($)  
 
Total
($)  
John E. Crisp,
President & Chief Executive Officer

 2018 
652,224(3)
 -   - -   567,676 - 
13,653(5)
 1,233,553
 2017 
664,767(3)
 - 
1,995,840(4)
 -   533,548 - 
41,679(5)
 3,235,834
                   
L. Melvin Cooper,
Senior Vice President & Chief Financial Officer

 2018 
432,508(3)
 - - -   259,821 - 
13,315(6)
 705,644
 2017 
440,825(3)
 - 
950,345(4)
 -   244,201 - 
12,955(6)
 1,648,326
                   
Steve Macek,
Executive Vice President and Co-Chief Operating Officer(7)
 2018 
408,744(3)
 - - - 244,538 - - 653,282
 2017 
390,663(3)
 - 
950,400(4)
 - 229,836 - - 1,570,899
                   
Joe Michetti,
President and Co-Chief Operating Officer of Forbes Energy Services LLC (8)
 2018 
43,269(3)
 - 
406,080(4) 
 - 
-
           
 - 
1,000(6)
 450,349
                   
 893,941
  503,469
$ 92,279(9)
   63,600(10)
   65,504(11)


$2,174,876
  2,217,705
  1,813,973
Charles C. Forbes, Jr
Executive Vice
President & Chief
Operating Officer
2015
2014
2013



650,000
650,000
650,000


891,880(3)
 610,164(4)
 595,000(5)

  540,717
  893,941
  503,469


  98,314(12)
    71,422(13)
    68,519(14)



  2,180,911
  2,225,527
  1,816,988

L. Melvin Cooper
Senior Vice President &
Chief Financial Officer
2015
2014
2013


425,000
425,000
425,000
 417,332(6)
 265,000(7)
 291,500(8)
  212,127
  350,700
  197,515
    18,387(15)
    23,577(16)
    22,414(17)


   1,072,846
  1,064,277
     936,429


(1)
These amounts include gross-up payments for insurance premiums.
(2)
The amounts noted reflect the cash incentive payments to the executive officers under the Company’s annual bonus plan for the years ended December 31, 2015, 2014 and 2013.plan.
(2)
(3)
For disclosureThe amounts noted includes an amount by which the executive officer’s compensation was increased to cover the cost of total realized compensation and a comparison to the 2015 Summary Compensation Table, please see the section entitled "2015 Realized Compensation Table" on page 17.health insurance.
(3)
(4)
The amounts noted reflect the grant date fair value of (i) the award of 196,078 restricted stock units granted to each of Messrs. Crisp and Forbes on March 26, 2015 for the long-term incentive portion of the Company's annual executive bonus plan for services performed for the year ended December 31, 2014, (ii) the award of 176,056 restricted stock units granted to each of Messrs. Crisp and Forbes on March 26, 2015 for the long-term incentive portion of the Company's annual executive bonus plan for services performed for the year ended December 31, 2015 and (iii) the award of 42,336 restricted stock units granted on March 26, 2015 and 21,168 restricted stock units granted on June 29, 2015 to each of Messrs. Crisp and Forbes in their capacities as directors for 2014. This amount also includes the target award of $250,000 granted to each of Messrs. Crisp and Forbes on March 26, 2015 that will vest between 0% and 200% based on the achievement of financial performance conditions and be settled in common stock of the Company. This amount also includes the target award of $50,000 granted to each of Messrs. Crisp and Forbes on March 26, 2015 that will vest over three years based on safety achievements. In addition, this amount includes the target award of $68,765 granted to each of Messrs. Crisp and Forbes on March 26, 2015 that will vest over three years.
The grant date fair values of the restricted stock unitsawards are calculated in accordance with FASB ASC Topic 718.

20




(4)The amounts noted reflect For additional information regarding the grant date fair value of (i) the award of 103,359 restricted stock units grantedassumptions used to each of Messrs. Crisp and Forbes on March 28, 2014 for the long-term incentive portion of the Company's annual executive bonus plan for services performed for the year ended December 31, 2013 and (ii) the award of 20,370 restricted stock units granted on January 3, 2014 and the award of 3,938 restricted stock units granted on March 28, 2014 to each of Messrs. Crisp and Forbes in their capacities as directors for 2013. This amount also includes the target award of $100,000 granted to each of Messrs. Crisp and Forbes on March 28, 2014 that will vest between 0% and 150% based on the achievement of performance conditions and be settled in common stock of the Company. The grant date fair values of the restricted stock units are calculated in accordance with FASB ASC Topic 718.
(5)The amounts noted reflect the grant date fair value of (i) the award of 133,333 restricted stock units granted to each of Messrs. Crisp and Forbes on January 6, 2013 for the long-term incentive portion of the Company's annual executive bonus plan for services performed for the year ended December 31, 2013 and (ii) the target award of $195,000 of which a maximum of $390,000 was eligible to be earned pursuant to the Company's 2013 annual bonus plan and of which $215,772 was earned based on actual performance. The grant date fair values of the restricted stock units are calculated in accordance with FASB ASC Topic 718.
(6)The amount noted reflects the grant date fair value of (i) the award of 105,392 restricted stock units to Mr. Cooper on March 26, 2015 for the long-term incentive portion of the Company's annual executive bonus plan for services performed for the year ended December 31, 2014 and (ii) the award of 88,028 restricted stock units granted to Mr. Cooper on March 26, 2015 for the long-term incentive portion of the Company's annual executive bonus plan for services performed for the year ended December 31, 2015. The amount also includes the target award of $125,000 granted to Mr. Cooper on March 26, 2015 that will vest between 0% and 200% based on the achievement of financial performance conditions and be settled in common stock of the Company. This amount also includes the target award of $25,000 granted to Mr. Cooper on March 26, 2015 that will vest over three years based on safety achievements. In addition, this amount includes the target award of $34,382 granted to Mr. Cooper on March 26, 2015 that will vest over three years. The grant date fair values of the restricted stock units are calculated in accordance with FASB ASC Topic 718.
(7)The amount noted reflectscalculate the grant date fair value of the award of 55,555 restricted stock units to Mr. Cooperawards, see Note 6-Share-Based Compensation in our Annual Report on March 28, 2014 for the long-term incentive portion of the Company's annual executive bonus plan for services performedForm 10-K for the year ended December 31, 2013. The amount also includes2018 as filed with the target award of $50,000 granted to Mr. Cooper on March 28, 2014 that will vest between 0%Securities and 150% based on the achievement of performance conditions and be settled in common stock of the Company. The grant date fair values of the restricted stock units are calculated in accordance with FASB ASC Topic 718.Exchange Commission.
(8)
(5)
The amounts noted reflect the grant date fair valueThis amount is comprised of (i) the award of 71,667 restricted stock units granted to Mr. Cooper on January 6, 2013$28,596 for the long-term incentive portion of the Company's annual executive bonus plan for services performed for the year ended December 31, 2013 and (ii) the target award of $76,500 of whichfees earned as a maximum of $153,000 was eligible to be earned pursuantdirector during 2017, prior to the Company's 2013 annual bonus planEffective Date, and of which $84,649 was earned based on actual performance. The grant date fair values of the restricted stock units are calculated$13,653 and $13,083 for an automobile and related auto expenses in accordance with FASB ASC Topic 718.2018 and 2017, respectively.
(9)
(6)
ThisThe amount is comprised of $77,562reflects an allowance for fees earned as a director, $2,320 for premiums paid by the Company for health and life insurance and $12,397 for an automobile and related auto expenses.
(10)
(7)
This amount is comprisedSteve Macek became the Executive Vice President and Chief Operating Officer of $47,000 for fees earned as a director, $4,203 for premiums paid by the Company for health and life insurance and $12,397 for an automobile and related auto expenses.on the Effective Date.
(11)
(8)
This amount is comprised
Joe Michetti became the President and Co-Chief Operating Officer of $45,000 for fees earned as a director, $2,215 for premiums paid byForbes Energy Services LLCon the Company for health and life insurance and $18,289 for an automobile and related auto expenses.
(12)This amount is comprised of $77,562 for fees earned as a director, $8,355 for premiums paid by the Company for health and life insurance and $12,397 for an automobile and related auto expenses.
(13)This amount is comprised of $47,000 for fees earned as a director, $13,108 for premiums paid by the Company for health and life insurance and $11,314 for an automobile and related auto expenses.
(14)This amount is comprised of $45,000 for fees earned as a director, $5,230 for premiums paid by the Company for health and life insurance and $18,289 for an automobile and related auto expenses.
(15)This amount is comprised of $5,922 for premiums paid by the Company for health and life insurance and $12,465 as an allowance for an automobile and related auto expenses.
(16)This amount is comprised of $11,121 for premiums paid by the Company for health and life insurance and $12,456 as an allowance for an automobile and related auto expenses.November 16, 2018.

Narrative Disclosure to Summary Compensation Table
21Cancellation of Prior Equity Interests


On the Effective Date, pursuant to the Company’s reorganization, all prior equity interests, including the Old Common Stock, the Company’s prior preferred stock, awards under the Company’s prior incentive compensation plans (the “Prior Compensation Plans”), and the preferred stock purchase rights under the rights agreement dated as of May 19, 2008 as subsequently amended on July 8, 2013 (the “Rights Agreement”), between the Company and CIBC Mellon Trust Company, as rights agent) of the Company were extinguished without recovery. Pursuant to the reorganization, on the Effective Date, the Company created a new class of common stock, par value $0.01 per share (the “New Common Stock”). Accordingly, the Company and each of the named executive officers agreed to cancel, effective as of December 31, 2016, all awards under the Prior Compensation Plan that had not vested as of December 31, 2016.

2017 Management Incentive Plan

On the Effective Date, the MIP became effective.
(17)This amount is comprised of $4,137 for premiums paid by the Company for health and life insurance and $18,277 as an allowance for an automobile and related auto expenses.

The compensation committee administers the MIP. The compensation committee has broad authority under the MIP to, among other things: (i) select participants; (ii) determine the terms and conditions, not inconsistent with the MIP, of any award granted under the MIP; (iii) determine the number of shares to be covered by each award granted under the MIP; and (iv) determine the fair market value of awards granted under the MIP, subject to certain exceptions.




22




2012 Equity Incentive PlanPersons eligible to receive awards under the MIP include officers and employees of the Company. The types of awards that may be granted under the MIP include stock options, stock appreciation rights, restricted stock, restricted stock units, performance units, performance shares and other forms of stock based awards.
The Board adopted the Plan on April 30, 2012 and the shareholdersmaximum number of the Company subsequently approved the Plan at the Company’s 2012 annual shareholders' meeting. The Plan replaced that certain incentive plan adopted by the Board and approved by the Company’s sole shareholder in May 2008 (the “2008 Incentive Plan”).
The purpose of the Plan is to promote the success and enhance the value of the Company by linking the interests of employees and the members of our Board to those of our shareholders. We believe that to be successful, our employees need to think like owners. Consistent with this philosophy, our equity program continues to be broad-based to provide us with a competitive advantage in our efforts to hire and retain top talent.
In order to ease the Company’s administration of its equity incentive programs, the Plan combined the shares of common stock authorized for issuanceNew Common Stock that may be issued or transferred pursuant to awards under the 2008 Incentive PlanMIP is 750,000, which number may be increased with 1,022,500 additional shares of common stock authorized for issuance under the Plan. Under the 2008 Incentive Plan, there were a total of 2,977,500 shares of common stock authorized for issuance, of which 2,306,188 shares were issued or were subject to outstanding awards and 671,312 shares remained available for issuance under new awards. Upon the approval of the Plan by the shareholders of the Company, no further awards were made under the 2008 Incentive Plan; however, outstanding awards granted under the 2008 Plan remained subject to the terms and conditions of the 2008 Incentive Plan. Any shares of common stock that were available to be granted under the 2008 Incentive Plan but which were not subject to outstanding awards under the 2008 Incentive Plan, including shares that became available due to the future lapse or forfeiture of outstanding awards, were added to the shares authorized for issuance under the Plan. The total number of shares of common stock that may be issued for awards to any single participant during a calendar year under the Plan (i) for stock options and stock appreciation rights (“SARs”) is 750,000, (ii) for restricted stock units performance shares, performance units and other stock based awards (excluding stock options and SARs) is 750,000, and (iii) for cash awards is $5,000,000.Company’s stockholders. If any outstanding award granted under the PlanMIP expires or the 2008 Incentive Plan expires, is terminated or is canceled without having been exercised or settled in full, or if shares of New Common Stock acquired pursuant to an award subject to forfeiture are forfeited, the shares of common stockNew Common Stock allocable to the terminated portion of such award or such forfeited shares will revert to the MIP and will be available for grant under the MIP as determined by the Compensation Committee in consultation with the Chairman of the Board, subject to certain restrictions.
As is customary in management incentive plans of this nature, in the expired, terminatedevent of any change in the outstanding shares of New Common Stock by reason of a stock split, stock dividend or canceled portionother non-recurring dividends or distributions, recapitalization, merger, consolidation, spin-off, combination, repurchase or exchange of stock, reorganization, liquidation, dissolution or other similar corporate transaction, an equitable adjustment will be made in order to prevent dilution or enlargement of the award shallbenefits or potential benefits intended to be addedmade available under the MIP. Such adjustment may include an adjustment to the maximum number and kind of shares of common stock authorizedor other securities or other equity interests as to which awards may be granted under the Plan.
The Plan was draftedMIP, the number and kind of shares of stock or other securities or other equity interests subject to comply with Section 162(m) of the Internal Revenue Code (the “Code”), as amended, which generally disallows a tax deduction to public companies for certain compensation in excess of $1 million paid to certain of our executive officers unless such compensation is based on objective performance goals that are approved by our shareholders. While the compensation committee considers the deductibility ofoutstanding awards as one factor in determining executive compensation, the compensation committee also looks at other factors in making its decisions, as noted above, and retains the flexibility to award compensation that it determines to be consistent with the goals of our executive program, whether or not such compensation is deductible. The Company believes that by using equity incentive compensation, the interests of the Company’s stockholders and the Company’s management employees remain aligned over the long-term.exercise price thereof, if applicable.


23




Equity Compensation Plan Information
The following provides certain aggregate information with respect to our equity compensation plans in effect as of December 31, 2015.

      
Plan Category

Number of Securities   
to be Issued upon   
Exercise of   
Outstanding Options,   
Warrants and Rights(1) (2)

 
Weighted Average   
Exercise Price of   
Outstanding Options,   
Warrants and Rights

 
Number of Securities   
Remaining  Available   
for Future Issuance   
under Equity   
Compensation Plans   
(Excluding Securities   
Reflected in First   
Column)

Equity Compensation Plans Approved by Security Holders614,125
  $6.80
  750,540
      
Equity Compensation Plans Not Approved by Security Holders
     
 
      
Total614,125
  $6.80
  750,450
      


(1)Includes the number of shares of common stock issuable upon the settlement of outstanding restricted stock units.
(2)On March 26, 2015, the compensation committee and the Board approved the cancellation of the stock options issued on August 11, 2011 and on August 15, 2011 to purchase shares of Company common stock without providing any additional consideration. The Board members and executive officers comprise all persons canceling such options. Pursuant to the Plan, any shares allocable to stock options that are cancelled without being exercised will once again be available for grant under the Plan.
Pension and Retirement Plans
We do not have in place any pension or retirement plan with the exception of a 401(k) retirement plan for substantially all of its employees based on certain eligibility requirements. We may provide profit sharing contributions to the plan at the discretion of management. No such discretionary contributions have been made since the inception of the 401(k) retirement plan.

Employment Agreements


GRANTS OF PLAN-BASED AWARDS
In connection with our emergence from the chapter 11 reorganization, Forbes Energy Services LLC entered into (i) amended and restated employment agreements, replacing the prior agreements, with Messrs. Crisp and Cooper and (ii) an employment agreement with Mr. Macek. The following table provides information aboutsummary details the equity and non-equity awards we made to our executive officers under our Plan during the year ended December 31, 2015.


24




            
Name

Grant
Date

Estimated Future Payouts
Under Non-
Equity  Incentive
Plan Awards
(1)

Estimated Future Payouts
Under Equity Incentive  Plan
Awards
(2)

All Other
Stock
Awards:
Number
of
Shares
of Stock
or Units
(#)

All  Other
Option
Awards:
Number of
Securities
Underlying
Options
(#)

Exercise
or Base
Price of
Option
Awards
($/Sh)

Grant
Date  Fair
Value of
Stock
and
Option
Awards
($)
(3)

Threshold
($)

Target
($)

Maximum
($)

Threshold
($)

Target
($)

Maximum
($)

(a)(b)(c)(d)(e)(f)(g)(h)(i)(j)(k)(l)
John E. Crisp $325,000 $650,000$1,300,000   
    
President & Chief Executive Officer03/26/15     
196,078

 $200,000 
 03/26/15     
176,056

 250,000 
 03/26/15     
42,336

 44,750 
 06/29/15     
21,168

 28,365 
     125,000 250,000 500,000


  
            
            
Charles C.
Forbes, Jr.
 325,000 650,000 1,300,000   
    
Executive Vice President & Chief Operating Officer03/26/15     
196,078

 200,000 
 03/26/15     
176,056

 250,000 
 03/26/15     
42,336

 44,750 
 06/29/15     
21,168

 28,365 
     125,000 250,000 500,000


  
            
            
L. Melvin Cooper. 127,500 255,000 510,000   
    
Senior Vice President & Chief Financial Officer03/26/15     
105,392

 107,950 
 03/26/15     
88,028

 125,000 
     62,500 125,000 250,000


  
            


25




(1)Each of our named executive officers was eligible to receive non-equity incentive compensation based on the achievement of performance goals. The amount actually paid to each named executive officer for the year ended December 31, 2015 pursuant to these criteria is reflected in the “2015 Summary Compensation Table” under the heading “Non-Equity Incentive Compensation."
(2)Each of our named executive officers is eligible to receive equity incentive compensation based on the achievement of performance goals. The target amount of these awards is reflected in the "2015 Summary Compensation Table" under the heading "Stock Awards".
(3)These amounts represent the award of 196,078 restricted stock units granted to each of Messrs. Crisp and Forbes and 105,392 restricted stock units to Mr. Cooper on March 26, 2015 for the long- term incentive portion of the Company's annual executive bonus plan for services performed for the year ended December 31, 2014. These amounts also include the award of 176,056 restricted stock units granted to each of Messrs. Crisp and Forbes and 88,028 restricted stock units to Mr. Cooper on March 26, 2015 for the long- term incentive portion of the Company's annual executive bonus plan for the year ended December 31, 2015. These amounts also include an award of 42,336 restricted stock units granted on March 26, 2015 and an award of 21,168 restricted stock units granted on June 29, 2015 to each of Messrs. Crisp and Forbes for their service as directors.


26




2015 OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END
The following table sets forth for each Named Executive Officer all option-based and share-based awards outstanding at December 31, 2015.

OPTION AWARDSSTOCK AWARDS
Name

Number of
Securities
Underlying
Unexercised
Options (#)
Exercisable

Number of
Securities
Underlying
Unexercised
Options (#)
Unexercisable

Option
Exercise
Price
($)

Option
Expiration
Date

Number
of
Shares
or Units
of

Stock
That
Have
Not
Vested
(#)

Market
Value of
Shares
or Units
of Stock
That
Have
Not
Vested
($)

Equity
Incentive
Plan
Awards:
Number
of
Unearned
Shares,
Units or
Other
Rights
That
Have
Not
Vested
(#)

Incentive
Plan
Awards:
Market
or
Payout
Value of
Unearned
Shares,
Units or
Other
Rights
That
Have
Not
Vested
($)

John E. Crisp,

$


134,519(3)
$39,011
$240,559(6)
President & Chief Executive Officer

196,078(4)
56,863



176,056(5)
51,056

Charles C. Forbes, Jr.,

134,519(3)
39,011
240,559(6)
Executive Vice President & Chief Operating Officer

196,078(4)
56,863



176,056(5)
51,056

L. Melvin Cooper,

60,926(3)
17,669
120,279(6)
Senior Vice President & Chief Financial Officer
118,750(1)


2.60(2)
8/24/2020
105,392(4)
30,564



88,028(5)
25,528




(1)This option-based award was granted on August 24, 2010 and is fully vested.
(2)At the time of this grant, the Company’s common stock was not traded on a United States national securities exchange, therefore, pursuant to the 2008 Plan, the exercise price was determined using the volume weighted average trading price on the Toronto Stock Exchange over the five-day period immediately preceding the grant date. This exercise price was then converted from Canadian dollars to U.S. dollars. The closing price on the grant date of the Company’s common stock on the “Pink Sheets” over-the-counter market was $2.44 per share (as adjusted for the Share Consolidation).
(3)The amounts noted reflect (i) the award of restricted stock units granted to each of Messrs. Crisp, Forbes, and Cooper on January 4, 2013 for services performed through December 31, 2012 and vests over a three year period, (ii) the award of restricted stock units granted to each of Messrs. Crisp, Forbes, and Cooper on March 28, 2014 for services performed through December 31, 2013 and vests over a three year period and (iii) the award of restricted stock units granted on June 29, 2015 to each of Messrs. Crisp and Forbes in their capacities as directors for 2014.

27




(4)This restricted stock unit award was granted on March 26, 2015 for the long term incentive portion of the Company's annual executive bonus plan for services performed for the year ended December 31, 2014 and vests in three equal annual installments over a three year period.
(5)This restricted stock unit award was granted on March 26, 2015 for the long term incentive portion of the Company's annual executive bonus plan for the year ended December 31, 2015 and vests in three equal annual installments over a three year period.
(6)This amount represents four awards based on the Company’s future achievement of certain performance criteria. Two of the awards vest on March 26, 2017 and two awards vest on March 26, 2018. All four awards will be converted into the number of shares of Company common stock determined by dividing the cash value by the ten-day volume weighted average price per share immediately preceding the vesting date, and therefore, the number of shares underlying these awards is not calculable at this time.

OPTIONS EXERCISED AND STOCK VESTED
     
 
Option Awards

Stock Awards

Name

Number of Shares Acquired Upon Exercise   
(#)

Value Realized Upon Exercise
($)

Number of Shares Vested   
(#)(1)

Value Realized Upon Vesting   
($)

John E. Crisp
 
 121,233$132,498
 
Charles C. Forbes, Jr.
 
 121,233 132,498
 
L. Melvin Cooper
 
 42,407 45,561
 


(1)The value realized upon vesting of stock awards is determined by multiplying the number of shares vested by the closing market price of our common stock on the date of vesting.

POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL
Potential payments upon termination, including after change in control, to Messrs. Crisp, Forbes, and Cooper are governed by thematerial terms of their respectivethe employment agreements. We have long-termagreements:
Term. Each of the employment agreements with our three executive officers. Each long-term employment agreement has a current term expiring April 30, 2018.13, 2021, or the Initial Term. The term of each employment agreement automatically extended for an additional year on May 1, 2012 andEmployment Agreement will automatically extend for an additional year every May 1 thereafterApril 14, commencing April 14, 2021, unless written notice of termination is given beforebetween one hundred eighty (180) and two hundred forty (240) days prior to any such renewal date by usthe employee or the employee. Potential payments upon change in control before termination to the executive officers are governed by the terms of the respective equity award agreements.employer.
Payments Made Upon Termination Without Good Cause
Under theBase Salaries. The employment agreements in the event any of Messrs. Crisp, ForbesCooper and Macek provide for annual base salaries of $650,000, $425,000 and $400,000 plus compensation for medical and related premiums, respectively, or Cooper is terminated “without good cause”such other sums as the parties may agree as determined by the Board, during the Initial Term.
Termination.
If the employee terminates his employment for “good reason” (as defined in the employment agreements, heagreements) or under certain circumstances following a change in control, then such employee would be entitled to his base salary, bonus automobile, and medical and other compensation and benefits through the actual expiration date of histhe remaining term of the employment agreement, and any and all options, rights or awards granted in conjunction with the PlanMIP (other than performance awards) would immediately vest.vest and a “pro rata portion” (as defined in the employment agreements) of each performance award would remain outstanding until the end of the applicable performance period (or, if earlier, until the occurrence of a change in control) and would vest or not based on the actual performance for the performance period or, if applicable, upon the change in control.
If the employer terminates employee’s employment for any reason other than for good cause, then such employee would be entitled to his base salary, bonus and other compensation and benefits through the actual expiration date of the remaining term of the employment agreement, and any and all options, rights or awards granted in conjunction with the MIP (other than performance awards) would immediately vest and a “pro rata portion” of each performance award would remain outstanding until the end of the applicable performance period (or, if earlier, until the occurrence of a change in control) and would vest or not based on the actual performance for the performance period or, if applicable, upon the change in control.
If employee is terminated for good cause or if employee voluntarily terminates his employment other than for good reason, employer will pay any compensation earned but not paid to him prior to the effective date of termination.


Employee may voluntarily terminate his employment by giving at least thirty (30) days’ written notice. At that time, employer would have the right to relieve him of his duties; however, his salary would continue during the notice period.
If employee dies or becomes permanently disabled during the term of his employment, employer will pay to his estate the compensation that such employee would have earned through the date of death or determination of permanent disability, including salary, any prior year bonus earned but not yet paid, the pro-rated portion of any current year bonus, any and all options, rights or awards granted in conjunction with the MIP would immediately vest and his dependents would be entitled to benefits, including medical and other benefits and use of an employer automobile for a period of one year.
Change in Control. If a change in control of the Company shall occur after the Effective Date, then any and all options, rights or awards to employee in conjunction with the MIP would be deemed to have vested immediately prior to such change in control; provided that, with respect to the immediate vesting of any and all performance awards, such awards would immediately vest if and to the extent determined by the Board at the time of grant and set forth in the applicable award agreement between employee and employer. See “Potential Payments Upon Termination or Change in Control.”
Restricted Activities. Employee has agreed that, during the term of his agreement and thereafter until the later of (i) the end of the Initial Term or any then applicable extension period and (ii) one year after termination of employment following a notice of non-renewal, regardless of whether the termination occurs with or without cause and regardless of who terminates such employment, he will not, among others, (i) be employed by or associated with or own more than 5% of the outstanding securities of any entity that competes with the Company’s business or (ii) solicit any of our employees to terminate their employment.
Bonuses. The Compensation Committee has discretion to establish the methodology for determining annual bonuses.
Permitted Activities. Employee may engage only in those activities set forth in his Employment Agreement and those that would comply with the terms of the covenant applicable to permitted activities.

In connection with the Company’s merger with Cretic, on November 16, 2018, Forbes Energy Services LLC entered into an employment agreement with Mr. Michetti. Pursuant to Mr. Michetti’s employment agreement, Mr. Michetti will provide services as the President and Co-Chief Operating Officer of Forbes Energy Services LLC for an initial term of three years from the effective date of the merger, with automatic one-year renewals thereafter, unless either party provides 90 days’ written notice of intent not to renew the then-applicable term. The Employment Agreement provides for a base salary of $400,000 and provides that Mr. Michetti is eligible to participate in Forbes Energy Services LLC’s annual bonus plan in the discretion of the Board or the compensation committee of the Board. Mr. Michetti is also eligible to participate in such health and other group insurance and other employee benefit plans and programs of Forbes Energy Services LLC as in effect from time to time on the same basis as other senior executives of Forbes Energy Services LLC, and is entitled to a car allowance of $1,000 per month.
Mr. Michetti’s employment agreement subjects Mr. Michetti to the following restrictive covenants: (i) non-solicitation of employees of Forbes Energy Services LLC and non-interference with any customers or clients during employment and for eighteen months thereafter; (ii) non-competition during employment and for eighteen months thereafter; (iii) perpetual non-disclosure of confidential information; and (iv) perpetual non-disparagement.
In the event that Mr. Michetti is terminated by Forbes Energy Services LLC other than for Cause, Disability (as such terms are defined in his employment agreement) or death, he is entitled to (x) base salary continuation for eighteen months, (y) in the event such termination occurs on or after June 30th of a calendar year, a pro-rata bonus for the year of termination, equal to the annual bonus Mr. Michetti would have been entitled to receive had his employment not been terminated, based on the actual performance of Forbes Energy Services LLC for the full year, multiplied by a fraction, the numerator of which is the number of days Mr. Michetti is employed by Forbes Energy Services LLC during the applicable year prior to and including the date of termination and the denominator of which is 365; and (z) subject to the timely election of continuation coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”) and Mr. Michetti’s copayment of premiums associated with such coverage consistent with amounts paid by him during the year in which the termination occurs, Forbes Energy Services LLC shall reimburse Mr. Michetti, on a monthly basis, for the excess costs of continued health benefits for himself and his covered dependents from the date of termination through the end of the eighteen month period following the date of termination, or such earlier date on which COBRA coverage for Mr. Michetti and his covered dependents terminates in accordance with COBRA.


GRANTS OF PLAN-BASED AWARDS
Plan Category 
Number of Securities to be
Issued upon Exercise of
Outstanding Options
Warrants and Rights(1)
 
Weighted Average
Exercise Price of
Outstanding Options,
Warrants and Rights(2)  
 
Number of Securities Remaining Available
for Future Issuance under Equity
Compensation Plans (Excluding Securities
Reflected in First Column)(3)
Equity Compensation Plans Approved by Security Holders -   -   -  
Equity Compensation Plans Not Approved by Security Holders 387,723 -    230,680
       
Total 387,723 -   230,680
       
(1)
Shares governed by Time-Based RSUs and Exit Financing RSUs granted pursuant to the MIP. For more information regarding the MIP, see “Item 11-Narrative Disclosure to Summary Compensation Table-2017 Management Incentive Plan.”
(2)
The Time-Based RSUs and Exit Financing RSUs have no exercise price.
(3)
This amount is comprised of 230,680shares of New Common Stock available for issuance under the MIP, as of December 31, 2018.
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END
The following table sets forth for each named executive officer all option-based and share-based awards outstanding at December 31, 2018.
 
OPTION AWARDS  
 
STOCK AWARDS  
Name
Number of
Securities
Underlying
Unexercised
Options (#)
Exercisable
Number of
Securities
Underlying
Unexercised
Options (#)
Unexercisable
Equity
incentive
plan
awards:
Number of
securities
underlying
unexercised
unearned
options (#)
Option
Exercise
Price
($)
Option
Expiration
Date
 
Number
of
Shares
or Units
of Stock
That
Have
Not
Vested
(#)
Market
Value
of
Shares
or
Units
of
Stock
That
Have
Not
Vested
($)
Equity
Incentive
Plan
Awards:
Number
of
Unearned
Shares,
Units or
Other
Rights
That
Have Not
Vested
(#)(1)
Equity
Incentive
Plan
Awards:
Market or
Payout
Value of
Unearned
Shares,
Units or
Other
Rights
That Have
Not Vested
($)
John E. Crisp, President & Chief Executive Officer-  -  -  -  -   -  -  118,084354,252
L. Melvin Cooper, Senior Vice President & Chief Financial Officer-  -  -  -  -   -  -  56,227168,681
Steve Macek, Senior Vice President and Co-Chief Operating Officer-  -  -  -  -   -  -  56,230168,690
Joe Michetti, President and Co-Chief Operating Officer of Forbes Energy Services LLC-  -  -  -  -   -  -  69,120207,360

(1)
The Time-Based RSUs vested 20% on the date of grant and 20% on the first anniversary of the date of grant, and will vest 20% each on the second, third and fourth anniversaries of the date of grant. The Exit Financing RSUs vested (i) 40% on the


first day following the date that was eighteen (18) months after the date of grant with the remainder vesting, (ii) 20% each on the second and third anniversaries of the date of grant, and (iii) 20% one day prior to the fourth anniversary of the date of grant.
Potential Payments Upon Termination or Change In Control
The following narrative discussion outlines the material terms of each contract, agreement, plan or arrangement, whether written or unwritten, that provides for payment(s) to a named executive officer at, following, or in connection with the resignation, retirement or other termination of a named executive officer, or a change in control of the Company, with respect to each named executive officer. Potential payments upon termination, including after change in control, to Messrs. Crisp, Macek, Cooper and Michetti are governed by the terms of their respective employment agreements. For more information about their employment agreements, see “Employment Agreements,” above.
Payments Made Upon Termination for “Good Reason”
If any of Messrs. Crisp, Macek or Cooper terminates his employment for “good reason” (as defined in the employment agreements) or under certain circumstances following a change in control, then such employee would be entitled to his base salary, bonus and other compensation and benefits through the actual expiration date of the remaining term of the employment agreement, and any and all options, rights or awards granted in conjunction with the MIP (other than performance awards) would immediately vest and a “pro rata portion” (as defined in the employment agreements) of each performance award would remain outstanding until the end of the applicable performance period (or, if earlier, until the occurrence of a change in control) and would vest or not based on the actual performance for the performance period or, if applicable, upon the change in control.
Payments Made Upon Termination Without Good Cause
If the employer terminates the employment of Messrs. Crisp, Macek or Cooper for any reason other than for good cause, then such employee would be entitled to his base salary, bonus and other compensation and benefits through the actual expiration date of the remaining term of the employment agreement, and any and all options, rights or awards granted to such employees in conjunction with the MIP (other than performance awards) would immediately vest and a “pro rata portion” of each performance award would remain outstanding until the end of the applicable performance period (or, if earlier, until the occurrence of a change in control) and would vest or not based on the actual performance for the performance period or, if applicable, upon the change in control. If the employer terminates the employment of Mr. Michetti for any reason other than for good cause, then Mr. Michetti would be entitled to his base salary, bonus and other compensation and benefits per a period of eighteen (18) months after the effective date of the termination.
Payments Made Upon a Change in Control
If a change in control of the Company occurs after the Effective Date, then any and all options, rights or awards granted to Messrs. Crisp, Macek and Cooper in conjunction with the MIP would be deemed to have vested immediately prior to such change in control; provided that, with respect to the immediate vesting of any and all performance awards, such awards would immediately vest if and to the extent determined by the Board at the time of grant and set forth in the applicable award agreement between employee and employer.
For purposes of the employment agreements of Messrs. Crisp, Forbes, and Cooper and Macek, and the Plan,MIP, a “change in control” means:
(1)the obtaining by any person
(i) Any Person, other than a Significant Shareholder, becomes the “beneficial owner” (as defined in Rule 13d-3 of the Exchange Act), directly or indirectly, of securities of the Company representing more than fifty percent (50%) of the total combined voting power represented by the Company’s then outstanding voting securities; or persons acting as a group of fifty percent (50%) or more of the voting shares of the Company pursuant to a “tender offer” for such shares as provided under Rule 14d-2 promulgated under the Securities Exchange Act of 1934, as amended, or any subsequent comparable federal rule or regulation governing tender offers; or
(2)a majority of the members of the Company’s Board is replaced during any twelve (12) month period by new directors whose appointment or election is not endorsed by a majority of the members of the Company's Board before the date of such new directors’ appointment or election; or

28(ii) The sale or other disposition of all or substantially all of the assets of the Company to any Person, other than a Significant Shareholder;




(3)any person, or persons acting as a group, acquires (or has acquired during the twelve (12) month period ending on the date of the most recent acquisition by such person or persons) assets from the Company that have a total gross fair market value equal to or more than seventy-five percent (75%) of the total gross fair market value of all of the assets of the Company immediately before such acquisition or acquisitions (other than transfers to related persons as defined in Section 1.409A-3(i)(5)(vii)(B) of the Treasury Regulations).
If we should undergoprovided, however, that no transaction will constitute a Change in Control unless it constitutes a change in the ownership or effective control while the employment agreements are in effect and any of Messrs. Crisp, Forbes or Cooper is either constructively or actually terminated under the conditions set forth in his agreement, then he will be entitled to receive three times his salary for the year in which the termination occurs, three years of medical and other insurance benefits from the date of termination and, in general, three times the greater of (x) the amount equal to the bonus paid for the last completed year for which bonuses have been paid or (y) the amount equal to the bonus that would have been payable for the then current year. To the extent that such medical benefits may be taxable to the employee or his or her dependents, the Company, would gross upor in the employee for such taxes based onownership of a substantial portion of its assets, in each case within the employee’s actual tax rate, upmeaning of Section 409A of the Code and the Treasury regulations promulgated thereunder.
A “Significant Shareholder” means (i) any shareholder of the Company as of the Effective Date who, together with its Affiliates, “beneficially owns” (as defined in Rule 13d-3 of the Exchange Act) as of the Effective Date five percent (5%) or more of the Company’s outstanding voting securities and (ii) with respect to 35% (without a gross up onany shareholder described in clause (i) that is an investment fund, any other investment fund managed by the initial gross up). In addition, under the respective equity award agreements for the executive officers, upon a change in control his unvested stock optionssame or other awards would vest upon the termination event.an affiliated investment manager.


In the event that it shall be determined that any payment by the Company to or for the benefit of the executive officers would be subject to the excise tax imposed by Section 4999 of the Code, or any successor provision thereto, by reason of being considered “contingent on a change in ownership or control” of the Company, within the meaning of Section 280G of the Code, or any successor provision thereto, or to any similar tax imposed by state or local law, or any interest or penalties with respect to such tax (such tax or taxes, together with any such interest and penalties, being hereafter collectively referred to as the “Excise Tax”), then the executive officer shall be entitled to receive an additional payment or payments, or gross-up payment, under his employment agreement or change in control agreement. The gross-up payment shall be in an amount such that after payment by such executive officer of all taxes including any Excise Tax (and including any interest or penalties imposed with respect to such taxes and the Excise Tax, other than interest and penalties imposed by reason of such executive officer’s failure to timely file a tax return or pay taxes shown due on such executive officer’s return) imposed upon the gross-up payment, the amount of the gross-up payment retained by such executive officer is equal to the Excise Tax imposed upon the payment. Based on the Company'sCompany’s calculations as of December 31, 2015,2018, the payments by the Company to or for the benefit of the executive officers would not be subject to the excise tax imposed by Section 4999 of the Code, and the Company would not be required to pay to any of the executive officers an additional gross-up payment attributable to such excise tax.
Payments Made Upon Voluntary Termination or Termination with Good Cause
If the employment of any of Messrs. Crisp, Forbes or Cooperemployee is terminated for good cause or if any of Messrs. Crisp, Forbes or Cooperemployee voluntarily terminates his employment with the Company, the Companyother than for good reason, employer will pay any compensation earned but not paid to him prior to the effective date of termination. Messrs. Crisp, Forbes,Macek and Cooper may voluntarily terminate theirhis employment by giving notice of at least thirty days.(30) days’ written notice. Mr. Michetti may voluntarily terminate his employment by giving at least fifteen (15) days’ written notice. At anythat time, after such notice, the Companyemployer would have the right to relieve the employeehim of his duties; however, his salary would continue during the notice period.
Payments Made Upon Permanent Disability or Death
Under the employment agreements, ifIf any of Messrs. Crisp, ForbesMacek, Cooper or Cooper becomeMichetti dies or becomes permanently disabled or die during the term of their employment: (i)his employment, the Company shallwill pay to him or his estate the compensation that such executiveemployee would have earned through the date of death or determination of permanent disability, including salary, any prior year bonus earned but not yet paid, and the pro-rated portion of any current year bonus asbonus. If Messrs. Crisp, Macek or Cooper dies or becomes permanently disabled during the term of his employment, any and when determinedall options, rights or awards granted in conjunction with the ordinary course,MIP would immediately vest and his dependents would be entitled to benefits, including medical and other benefits and use of a Company automobile for a period of one year from the date of death and (ii) his options, rights or awards granted in conjunction with his incentive compensation and stock option plans would vest upon the date of death or determination of permanent disability. Also, the estate of Messrs. Crisp, Forbes, or Cooper would receive life insurance proceeds from the Company-paid term life insurance policies that were in effect on the date of his or her death.year.
Material Conditions and Obligations Under the Employment Agreements
Messrs. Crisp, Forbes and Cooper or Macek have each agreed that during the term of each of their respective agreements and for athereafter until the later of (i) the end of the Initial Term or any then applicable extension period ofand (ii) one year after termination theyof employment following a notice of non-renewal, regardless of whether the termination occurs with or without cause and regardless of who terminates such employment, he will not, (1)among others, (i) be employed by or associated with or own more than 5% of the outstanding securities of any entity that competedcompetes with us in the locations where we operate, (2)Company’s business or (ii) solicit any of our employees to terminate their employment or (3) solicit the purchase, performance or providing of any equipment or services which constitute any part of our business to, for or with any of our customers or (4) use, disclose or publish any company confidential information or trade secrets.employment. Notwithstanding the foregoing, the respective agreements of Messrs. Crisp and Forbes permit their involvement with other business ventures provided that they are not competitive with the Company’s business or have been approved by the independent members of the Board. Certain of these transactions are described under “Certain Relationships and Related Transactions” beginning on page 3523.
Mr. Michetti has agreed during the term of this Proxy Statement.

29




The following table shows the amounthis agreement and thereafter for a period of compensation payable to each of our executive officers under existing contracts, agreements, plans or arrangements, whether written or unwritten, for various scenarios involvingeighteen (18) months after termination of employment, regardless of whether the termination occurs with or a change in control event. The amounts shown assume thatwithout cause and regardless of who terminates such termination was effective as of December 31, 2015, and thus include amounts earned through such time and are estimatesemployment, he will not, among other things, (i) be employed by or associated with or own more than 2% of the amounts which would be paid out to such executive officers upon their termination. The equity value calculations useoutstanding securities of any entity that competes with the closing priceCompany’s business, (ii) solicit any of our common stockemployees to terminate their employment or (iii) engage or participate in a business activity that (x) acquires, develops or transports hydrocarbons and related products, as defined in his agreement, (y) assesses the exploration potential of December 31, 2015, which was $0.29. The actual amounts to be paid out can only be determined athydrocarbon exploration prospects and (z) provides products or services of certain oilfield services in the timestates of such executive’s separation from the Company.

30




2015 POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL (1)

       
Name and principal position

 
Voluntary   
Termination

Termination   
for Cause

Termination by   
Company   
without Cause

Change in
Control with
Termination
for Good
Reason by
Executive or
Without
Cause

Death and
Permanent
Disability

John E. CrispCompensation:     
President & Chief Executive OfficerSeverance


$3,597,383

$4,631,823

 Acceleration of

140,791
140,791
140,791
 Unvested     
 Equity Awards     
       
 Benefits and     
 Perquisites:     
 Insurance

38,105
13,011
16,337
 continuation     
 280G Tax Gross Up




       
 Total

3,776,279
4,785,625
157,128
       
Charles C. Forbes, Jr.Compensation:     
Executive Vice President &Severance

3,597,383
4,631,823

Chief Operating OfficerAcceleration of

140,791
140,791
140,791
 Unvested     
 Equity Awards     
       
 Benefits and     
 Perquisites:     
 Insurance

59,469
40,518
25,506
 continuation     
 280G Tax Gross Up




 Total

3,797,643
4,813,132
166,297
       
L. Melvin CooperCompensation:     
Senior Vice President &Severance

1,807,381
2,327,100

Chief Financial OfficerAcceleration of

73,760
73,760
73,760
 Unvested     
 Equity Awards     
       
 Benefits and     
 Perquisites:     
 Insurance

54,945
34,694
23,564
 continuation     
 280G Tax Gross Up




 Total

1,936,086
2,435,554
 97,324
Texas, New Mexico, Oklahoma and Louisiana.



(1)Calculated as of December 31, 2015.

31




20152018 Director Compensation
The following table details the compensation received by each Director, other than Named Executive Officers,named executive officers, for the year ended December 31, 2015.

2018.
         
Name

Fees   
Earned   
or Paid in   
Cash   
($)

Stock   
Awards   
($)(1)

Option   
Awards   
($)(2)

Non-Equity   
Incentive   
Plan
Compensation
   
($)

Change in
Pension Value
and
Nonqualified
Deferred
Compensation
Earnings
   
($)

All Other
Compensation
($)

Total ($)

 
Dale W. Bossert101,00073,115
 
  
    174,115
Travis H. Burris106,00073,115
 
  
    179,115
Ted A. Izatt83,00073,115
 
  
    156,115
William W. Sherrill111,00073,115
 
  
    184,115
Name 
 
Fees Earned
or Paid in
Cash
($)  
 
Stock
Awards
($)(1)  
 
Option
Awards
($)(1)  
 
Non-Equity
Incentive Plan
Compensation
($)  
 
Nonqualified
Deferred
Compensation
Earnings
($) 
 
All Other
Compensation
($) 
 
Total ($)  
Lawrence First(2)
 125,000
 
 
 
 
 
 125,000
Brett G. Wyard(3)
 125,000
 
 
 
 
 
 125,000
Rome G. Arnold III 150,000
 
 
 
 
 
 150,000
Paul Butero 150,000
 
 
 
 
 
 150,000
David B. Rosenwasser 125,000
 
 
 
 
 
 125,000

(1)
Each directorNo equity was granted (i) an award of 42,336 restricted stock units on March 26, 2015 and (ii) an award of 21,168 restricted stock units on June 29, 2015 for his or her service as a director forawarded to the year ended December 31, 2015.Directors in 2018.
(2)
At December 31, 2015,The amount shown reflects the Company's non-employee directors had the following options outstanding:compensation received by Ascribe Investments II, LLC and Ascribe Investments III, LLC on Mr. First’s behalf.
Dale W. Bossert
(3)
18,750
Travis H. Burris18,750
Ted A. Izatt
William W. Sherrill18,750
The amount shown reflects compensation received by Solace on Mr. Wyard’s behalf.

Narrative Discussion
In fiscal 2015,accordance with the Plan, Lawrence First, Brett G. Wyard, Rome G. Arnold III and Paul S. Butero, together with Mr. Crisp, who remained on the Board, took office on the Effective Date. In addition, David B. Rosenwasser was appointed to the Board on November 21, 2017. The Board members, except Mr. Crisp, were each director receivedpaid an annual cashdirector retainer of $79,750. The chair$125,000 for 2018. Each of Messrs. First and Wyard directed the audit committee,Company to pay any director compensation committeeowed to him to Ascribe’s affiliates and nominating and corporate governance committee each received additional retainers of $25,000, $20,000 and $15,000,Solace, respectively. Each director received $2,000 per meeting plus expenses for attendance at any Board or committee meeting.
Prior toIn March 2015, the compensation committee adopted a stock ownership policy, of awarding directors annual grants of thatwhich applies to the Company’s named executive officers and directors. The policy provides a number of shares of common stock equal to $89,500 divided by the average of the closing price ofthat the Company’s common stock on NASDAQ for the 20 trading days immediately preceding the date of the Company’s prior year's Annual Meeting of Shareholders. These stock grants vest in four equal quarterly increments over the course of a year.
In March 2015, the compensation committee evaluated its director compensation. Towers Watson was engaged to provide a study of compensation programs of directors offered by a broad peer group in order to assist the compensation committee in establishingmust accumulate and maintaining an appropriate compensation program to better enable the Company to attract and retain highly qualified directors. Based on this information, the compensation committee determined to keep the overall level of annual compensation in 2015 consistent with 2014. However, the compensation committee determined that, in consideration of the Company's low share price and low share reserve under the Plan, it was in the best interests of the Company to shift the mix of director compensation to be more heavily weighted towards cash. Therefore, in 2015, each director received a cash retainer of $79,750 and an annual equity grant valued at $44,750 divided by the average of the closing price of the Company’s common stock on NASDAQ for the twenty (20) trading days immediately preceding the date of grant. The compensation committee believes this policy provides certainty and predictability to our director compensation structure.
The Company adopted a stock ownership policy in March 2015. Pursuant to this policy, directors are expected to own 100,000 shares of Company stock. Each individual is expected to satisfy the stock ownership requirementhold within five years of the date such individual became subject to the policy.

32




Compensation Committee Report
The compensation committee has reviewed and discussedspecific ownership requirement for the Compensation Discussion and Analysis required by Item 402(b)Company’s directors continues under review for the purpose of Regulation S-K with management and, based on the review and discussions referenced above, the compensation committee recommendedamending it to conform to the Board thatnew equity structure in place since the Compensation Discussion and Analysis referred to above be included in this Proxy Statement.Effective Date.
This foregoing report is given by the following members of the compensation committee:

Travis H. Burris (Chair)
Dale W. Bossert
William W. Sherrill
Compensation Committee Interlocks and Insider Participation
All members of the compensation committee are independent directors, and none of them are present or past employees of ours. No member of the compensation committee has had any relationship with us requiring disclosure under Item 404 of Regulation S-K of the Exchange Act and none of our executive officers has served on the compensation committee (or other committee serving an equivalent function or the full board, if no such committee exists) of any other entity, one of whose executive officers served on our compensation committee. Nevertheless, in the interest of providing information to our shareholders, we have disclosed, in our discussion of “Certain Relationships and Related Transactions” beginning on page 35 of this Proxy Statement, that Mr. Crisp, our President and Chief Executive Officer, serves on the Board of Texas Champion Bank for which Mr. Burris, the Chairman of our compensation committee, serves as President and Chief Executive Officer. However, no interlocking relationship exists as Texas Champion Bank has a separate compensation committee and Mr. Crisp does not serve on that committee. We have a business relationship with Texas Champion Bank and, as of December 31, 2015, 2014 and 2013, we had $1.1 million, $1.0 million and $0.7 million, respectively, on deposit with this bank.
Officers Who Also Act As Directors
Our Named Executive Officers who serve as directors receive the same compensation as our other directors for their service as directors.

33




PRINCIPAL SHAREHOLDERSPrincipal Stockholders
The following table sets forth certain information regarding the beneficial ownership of our voting securities as of April 11, 2016:9, 2019:
each person who is known to us to be the beneficial owner of more than 5% of our voting securities;
each of our directors; and
each of our named executive officers and all of our executive officers and directors as a group.
Unless otherwise indicated, each person named below has an address in care of our principal executive offices and has sole power to vote and dispose of the shares of voting securities beneficially owned by them, subject to community property laws where applicable.

    
Name
Common Stock
Beneficially
Owned
(**)
 Percentage
of Common
Stock
Beneficially
Owned(%)
    
Executive Officers and Directors:   
John E. Crisp1,362,324 6.1%
Charles C. Forbes, Jr.2,724,199 12.3%
L. Melvin Cooper215,965 1.0%
Dale W. Bossert74,329 * 
Travis H. Burris100,366 * 
Ted A. Izatt65,801 * 
William W. Sherrill53,579 * 
All directors and executive officers as a group (7 persons)
4,596,563 (2)
 20.7%
    
Other 5% Shareholders:   
The West Face Group
5,292,531(3)
 23.8%
Steel Excel Inc.
3,271,518(4)
 14.7%
Janet L. Forbes
2,164,243(5)
 9.7%
The Modern Group Ltd
1,327,750(6)
 6.0%
Frigate Ventures LP
1,182,424(7)
 5.3%
FMR, LLC
2,190,141(8)
 9.9%
Name 
 
Common Stock
Beneficially Owned(**)(1)  
 
Percentage of
Common Stock
Beneficially
Owned(%)  
Executive Officers and Directors:    
John E. Crisp 72,576 1.3
Lawrence A. First. -   *
Brett G. Wyard -   *
Rome G. Arnold III -   *
Paul S. Butero -   *
L. Melvin Cooper 8,000 *
Steve Macek 17,280 *



Name 
 
Common Stock
Beneficially Owned(**)(1)  
 
Percentage of
Common Stock
Beneficially
Owned(%)  
David B. Rosenwasser -   *
Joe Michetti 17,280 *
     
All directors and executive officers as a group (8 persons) 115,136 2.1
5% Stockholders:    
Ascribe Capital LLC 
1,286,306(2)
 23.6
Solace Forbes Holdings, LLC 
947,286(3)
 17.4
FMR LLC 
870,901(4)
 16
Pacific Investment Management Company LLC 
576,018(5)
 10.6
Minerva Advisors, LLC 
334,674(6)
 6.2
Courage Capital Management, LLC 
272,212(7)
 5
*Indicates beneficial ownership of less than 1% of the total outstanding common stock.
**“Beneficial ownership” is a term broadly defined by the SEC in Rule 13d-3 under the Securities Exchange Act of 1934, as amended and includes more than typical forms of stock ownership, that is, stock held in the person’s name. The term also includes what is referred to as “indirect ownership,” meaning ownership of shares as to which a person has or shares investment or voting power. For purposes of this table,There are no shares not outstanding that are subject to options, warrants, rights or conversion privileges exercisable within 60 days of April 11, 2016 are deemed outstanding for the purpose of calculating the number and percentage owned by such person, but not deemed outstanding for the purpose of calculating the percentage owned by each other person listed.February 28, 2019.
(1)
Includes 118,750On the Effective Date, pursuant to the operation of the Plan, the Forbes Energy Services Ltd. 2017 Management Incentive Plan, or the MIP, became effective. The types of awards that may be granted under the MIP include stock options, stock appreciation rights, restricted stock, restricted stock units, performance units, performance shares and other forms of common stock issuable upon exercisebased awards. The maximum number of options.New Common Stock that may be issued or transferred pursuant to awards under the MIP is 750,000, which number may be increased with the approval of the Company’s stockholders.
(2)
Includes 118,750
Based on information provided on Schedule 13G most recently filed with the SEC by Ascribe, reflecting shares of common stock issuable upon exerciseNew Common Stock beneficially owned by Ascribe, which has shared voting power of options.1,286,306 shares of New Common Stock. Its principal business address is 299 Park Avenue, 34th Floor, New York, NY 10171.
(3)
Based on ainformation provided on Schedule 13G/A dated February 16, 201613G most recently filed with the CommissionSEC by Solace, reflecting shares of New Common Stock beneficially owned by the reporting person at December 31, 2015. This amount representsSolace Forbes Holdings, LLC, which has shared voting power of 947,286 shares of common stock currently issuable upon the conversion of the 588,059 shares of Series B Preferred Stock currently held by the West Face Group. Each share of Series B Preferred Stock is convertible at the option of the holder into nine shares of common stock, provided that no holder is entitled to effect such a conversion if it would result in such holder (and affiliates) beneficially owning 20% or more of the number of shares of common stock outstanding immediately after giving effect to the conversion. The West Face Group consists of West Face Long Term Opportunities Limited Partnership, West Face Long Term Opportunities (USA) Limited Partnership and West Face Long Term Opportunities Master Fund L.P. The West Face Group’sNew Common Stock. Its principal business address is 2 Bloor Street East,11111 Santa Monica Boulevard, Suite 810, Toronto, Ontario M4W 1A8.1275, Los Angeles, CA 90025.
(4)
Based on ainformation provided on Schedule 13D/A dated March 8, 201613G most recently filed with the CommissionSEC by FMR LLC, reflecting shares beneficiallyof New Common Stock managed by direct or indirect subsidiaries of FMR LLC (the “Fidelity Entities”). Abigail P. Johnson is the chairman and chief executive officer of FMR LLC. Members of the Johnson family, including Abigail P. Johnson, are the predominant owners, directly or through trusts, of Series B voting common shares of FMR LLC representing 49% of the voting power of FMR LLC. The Johnson family group and all other Series B shareholders have entered into a shareholders’ voting agreement under which all Series B voting common shares will be voted in accordance with the majority vote of Series B voting common shares. Accordingly, through their ownership of voting common shares and the execution of the shareholders’ voting agreement, members of the Johnson family may be deemed, under the Investment Company Act of 1940, to form a controlling group with respect to FMR LLC. Neither FMR LLC nor Abigail P. Johnson has the sole power to vote or direct the voting of the shares owned directly by the reporting person at March 4, 2016.

34




(5)Based onFidelity Entities advised by Fidelity Management & Research Company, a Schedule 13G/A dated January 27, 2016 filedwholly owned subsidiary of FMR LLC, which power resides with the Commission reflectingFidelity Entities’ Boards of Trustees. Fidelity Management & Research Company carries out the voting of the shares beneficially ownedunder written guidelines established by the reporting person at December 31, 2015. Janet Forbe'sFidelity Entities’ Boards of Trustees. FMR LLC’s address is 2522 McKinzie Road, Corpus Christi, Texas 78410.245 Summer Street, Boston, Massachusetts 02210.
(6)
(5)
Based on information provided toon Schedule 13G most recently filed with the issuerSEC by The Modern Group Ltd. on April 13, 2016. The Modern Group Ltd.’sPacific Investment Management Company LLC, reflecting shares of New Common Stock beneficially owned by Pacific Investment Management Company LLC, which has sole voting power of 576,018 shares of New Common Stock. Its address is P.O. Box 790, Beaumont, TX 77704.650 Newport Center Drive, Newport Beach, CA 92660.
(7)
(6)
Based on ainformation provided on Schedule 13G/A dated February 5, 201613G most recently filed with the CommissionSEC by Minerva Advisors LLC (“Minerva”), reflecting shares of New Common Stock beneficially owned by Minerva, which has sole voting power of 295,527 shares of New Common Stock and shared voting power of 39,147 shares of New Common Stock. David P. Cohen is the reporting person at December 31, 2015. Frigate Ventures LP'sPresident of Minerva. Its address is 5950 Berkshire Lane,50 Monument Road, Suite 210, Dallas, TX 75225.201, Bala Cynwyd, Pennsylvania 19004.
(8)
(7)
Based on ainformation provided on Schedule 13G/A dated February 12, 201613G most recently filed with the CommissionSEC by Courage Capital Management, reflecting shares of New Common Stock beneficially owned by the reporting person at December 31, 2015. FMR, LLC'sCourage Capital Management, LLC, which has shared voting power of 272,212 shares of New Common Stock. Its address is 245 Summer Street, Boston, MA 02210.4400 Harding Road, Suite 503, Nashville, Tennessee 37205.


Certain Relationships and Related Transactions
The Company and its subsidiaries enter into transactions with related parties in the normal course of conducting business. References in this section to the Company include the Company’s subsidiaries, unless the context indicates otherwise. We believeThe Company believes all of the terms with the companies are comparable to terms that were and are available to usthe Company in arm’s-length transactions with non-related parties. Below are the cash and cash equivalents, accounts payable and accounts receivable balancesexpenses for the year ended December 31, 2018 related to related party transactions. There were no related party receivables or payables as of December 31, 20152018 and 2014 as well as theno capital expenditures and revenues and expenses for the yearsyear ended December 31, 2015 and 20142018 to related to the related party transactions.

parties.
    As of December 31,
    2015 2014
    (in thousands)
Related parties cash and cash equivalents balances:      
  Balance at Texas Champion Bank (1)
   $1,132
 $1,040
  Balance at Brush Country Bank (2)
   485
 644
       
Related parties receivable:      
  Dorsal Services, Inc. (3)
   
 60
Wolverine Construction, Inc. (4)
   
 282
    $
 $342
       
Related parties payable:      
Alice Environmental Services, LP/Alice Environmental Holding LLC (5)
   $
 $83
Dorsal Services, Inc. (3)
   2
 25
Tasco Tool Services, Inc. (6)
   2
 59
Texas Quality Gate Guard Services, LLC (7)
   4
 11
Texas Water Disposal, LLC (8)
   
 8
    $8
 $186
       
       
 For the year ended December 31, 2018 
Related parties expense activity: 
Alice Environmental Holdings, LLC and
Alice Environmental Services, LP(1)
$873,897
Animas Holding, LLC(2)
197,252
CJW Group, LLC(3)
37,632
 $1,108,781

(1)
Mr. Crisp is a partial owner of Alice Environmental Holdings, LLC, or AEH, and is an indirect shareholder and manager of Alice Environmental Services, LP, or AES and Alice Environmental West Texas, LLC, or AEWT. The Company leases or rents land and buildings from AES.
(2)
Animas Holdings, LLC, or Animas, is partially owned by two sons of Mr. Crisp. Animas owns land and property that it leases to the Company.
(3)
CJW Group, LLC is an entity that leases office space to the Company and is partially owned by Mr. Crisp. In April of 2019, CJW sold its interest in the office space leased by the Company.
In addition to such related party transactions above, Lawrence A. First, a director of FES Ltd., serves as the Chief Investment Officer and Managing Director of Ascribe Capital LLC, or Ascribe, and Brett G. Wyard, also a director of FES Ltd., serves as a Managing Partner of Solace Capital Partners, or Solace, had the right to designate one member of the Board. Additionally, Ascribe and Solace had the right to jointly designate one member of the Board and, together with certain other holders of the Prior Senior Notes, the right to designate the one other member of the Board. Furthermore, Ascribe and/or one of more of its affiliates own approximately 23.6% of the outstanding New Common Stock as of March 31, 2019, and is owed approximately $17.8 million of the aggregate principal amount of the New Loan Agreement and approximately $27.5 million of the aggregate principal amount of the PIK Notes. Solace and/or one of its affiliates own approximately 17.4% of the outstanding New Common Stock as of March 31, 2019, and is owed approximately $16.2 million of the aggregate principal amount of the New Loan Agreement and approximately $20.3 million of the aggregate principal amount of the PIK Notes. Moreover, an affiliate of Solace and affiliates of Ascribe are parties to that certain registration rights agreement dated as of the Effective Date by and among the Company and certain stockholders of the Company, or the Registration Rights Agreement.
Registration Rights Agreement
Pursuant to the Registration Rights Agreement, among other things, any holder that, together with such holder’s affiliates or, collectively, a Demand Holder, (i) beneficially owns at least ten percent (10%) of the outstanding shares of New Common Stock, as of the Effective Date and (ii) continues to beneficially own at least five percent (5%) of the aggregate outstanding shares of New Common Stock will have the right to request the Company to file with the Commission, a registration statement under the Securities Act of 1933, as amended, or the Securities Act, or a Demand Registration, on Form S-1, or a Long-Form Registration, or Form S-3, or a Short-Form Registration, of all or any portion of the Registrable Securities (as defined below) held by such holder. Notwithstanding the foregoing, the Company shall be required to conduct no more than two Long-Form Registrations and an unlimited number of Short-Form Registrations for Demand Holders. Any Demand Holder may request that any offering conducted under a Long-Form Registration or a Short-Form Registration be underwritten.
The term “Registrable Securities” means at any time New Common Stock held or beneficially owned by any party to the Registration Rights Agreement, including (i) any New Common Stock issued pursuant to the Plan or upon the conversion, exercise or exchange, as applicable, of any other securities and/or interests issued pursuant to the Plan and (ii) any shares of New Common Stock acquired in the open market or otherwise purchased or acquired by such person after the Effective Date; provided, however, Registrable Securities shall irrevocably cease to constitute Registrable Securities upon the earliest to occur of: (i) the date on which such securities have been disposed of pursuant to an effective registration statement under the Securities Act; (ii) the date on which such securities have been disposed of pursuant to Rule 144 promulgated under the Securities Act; (iii) the date on which such


35securities have been transferred to any person in a transfer not complying with the provisions of the Registration Rights Agreement governing the transfer of registration rights; and (iv) the date on which such securities cease to be outstanding.




  Years ended December, 31
  2015 2014 2013
  (in thousands)
Related parties capital expenditures:      
Tasco Tool Services, Inc. (6)
 $
 $16
 $64
JITSU Services, LLC (9)
 
 240
 
  $
 $256
 $64
Related parties revenue activity:      
Dorsal Services, Inc. (3)
 $
 $
 $18
  Tasco Tool Services, Inc. (6)
 1
 2
 3
Wolverine Construction, Inc. (4)
 
 249
 152
Testco Well Services, LLC (10)
 
 
 69
Texas Water Disposal, LLC (8)
 
 12
 15
  $1
 $263
 $257
       
Related parties expense activity:      
Alice Environmental Services, LP/Alice Environmental Holding LLC (5)
 $1,889
 $1,861
 $1,810
Dorsal Services, Inc. (3)
 20
 371
 498
Tasco Tool Services, Inc. (6)
 172
 224
 128
FCJ Management, LLC (11)
 15
 27
 36
JITSU Services, LLC (9)
 
 243
 396
Texas Quality Gate Guard Services, LLC (7)
 188
 214
 363
  Animas Holdings, LLC (12)
 225
 265
 670
Testco Well Services, LLC (10)
 
 
 32
Texas Water Disposal, LLC (8)
 
 
 498
CJW Group, LLC (13)
 38
 13
 
  $2,547
 $3,218
 $4,431

(1)Pursuant to the Registration Rights Agreement, the Company filed a Long-Form Registration on Form S-1 on February 2, 2018, which was declared effective by the SEC on June 15, 2018. Pursuant to the Registration Rights Agreement, any Demand Holder may request to effectuate a shelf takedown off of such shelf by means of an underwritten public offering. The Company, hashowever, is obligated to effect an underwritten shelf takedown within 60 days after the pricing of a deposit relationshipprevious underwritten shelf takedown.
In the event the Company proposes to file a Demand Registration or a Company-initiated registration statement with Texas Champion Bank. Travis Burris, onerespect to a public offering of any class of the directors ofCompany’s equity securities other than a registration statement on Form S-8 or Form S-4, such registration a Piggyback Registration, the Company is the President, Chief Executive Officer, and directormust notify all holders of Texas Champion Bank. John E. Crisp, or Mr. Crisp, an executive officer and directorRegistrable Securities of the Company, serves on the board of directors of Texas Champion Bank.its intention to effect such Piggyback Registration.
(2)Mr. Crisp and Charles C. Forbes, Jr., or Mr. Forbes, are directors and shareholders of Brush Country Bank, an institution with which the Company conducts business and has deposits. Mr. Forbes is an executive officer and director of the Company.
(3)Dorsal Services, Inc., or Dorsal Services, is a trucking service company. Mr. Crisp is a partial owner of Dorsal Services. The Company uses Dorsal Services from time to time.
(4)Wolverine Construction, Inc., or Wolverine, is an entity that was owned by two sons and a brother of Mr. Crisp, and a son of Mr. Forbes. Wolverine provided construction and site preparation services to certain customers of the Company. The related party interests in Wolverine were sold in 2014.
(5)Messrs. Crisp and Forbes are also owners and managers of Alice Environmental Holdings, LLC, or AEH, and indirect owners and managers of Alice Environmental Services, LP, or AES and Alice Environmental West Texas, LLC, or AEWT. The Company leases or rents land and buildings, and aircraft from AES. During January 2015, the Company purchased land from AEWT for an additional operating location. The aircraft leases were terminated during the third quarter of 2015.
(6)Tasco Tool Services, Inc., or Tasco, is a down-hole tool company that is partially owned and managed by a company that is owned by Mr. Forbes and Robert Jenkins, or Mr. Jenkins, a former manager of one of the Company's subsidiaries. Tasco rents and sells tools to the Company from time to time.
(7)Texas Quality Gate Guard Services, LLC, or Texas Quality Gate Guard Services, is an entity owned by Messrs. Crisp and Forbes, and a son of Mr. Crisp. Texas Quality Gate Guard Services has provided security services to the Company.
(8) Texas Water Disposal Services, LLC, or TWDS, is partially owned by a brother of Mr. Crisp. TWDS is a company that owns a salt water disposal well that was used by the Company. The Company has not done business with TWDS since March 2014.
(9)JITSU Services, LLC, or JITSU, is a financial leasing company owned by Janet Forbes, or Ms. Forbes, and Mr. Crisp. The Company previously leased ten vacuum trucks from JITSU. This lease was terminated in November 2014. Ms. Forbes served as a Company director until June 11, 2014.
(10)Testco Well Services, LLC, or Testco, is a company that provides valve and gathering system testing services to the Company. Mr. Crisp, Mr. Forbes, and a son of Mr. Crisp were partial owners of Testco. In August 2013, Testco was sold to an unrelated third party. The Company has not done business with Testco subsequent to the sale in August 2013.

36




(11)FCJ Management, LLC, or FCJ, is an entity that leases land and facilities to the Company and is owned by Messrs. Crisp, Forbes, and Jenkins. The lease with FCJ was terminated during the third quarter of 2015.
(12)Animas Holdings, LLC, or Animas, is owned by the two sons of Mr. Crisp and three children of Mr. and Ms. Forbes. Animas owns land and property that it leases to the Company.
(13) CJW Group, LLC is an entity that leases office space to the Company and is partially owned by Messrs. Crisp and Forbes.

Registration Rights Agreement includes customary indemnification provisions.
Review, Approval or Ratification of Transactions with Related Persons
The Board adopted a written Related Persons Transaction Policy on March 17, 2014. Prior to the adoption of the Related Persons Transaction Policy, certain significant related party transactions were reviewed and approved by the Board.

Pursuant to the Related Persons Transaction Policy, any transaction or series of transactions, arrangement or relationship between the company and a “related person” in which such related person has a direct or indirect material interest, and where the amount involved exceeds $120,000, must be submitted to our audit committee for review, approval, or ratification. A “related person” means a director, executive officer or beneficial holder of more than 5% of the Company’s outstanding common stock, or any immediate family member of the foregoing, as well as any entity at which any such person is employed, is a partner or principal (or holds a similar position), or is a beneficial owner of a 10% or greater direct or indirect equity interest.

The Related Persons Transaction Policy requires our audit committee to be provided with full information concerning the proposed transaction, including the benefits to the Company and the related person, any alternative means by which to obtain like benefits, and terms that would prevail in a similar transaction with an unaffiliated third party. In considering whether to approve or ratify any such transaction, the audit committee will consider all relevant factors, including the nature of the interest of the related person in the transaction and whether the transaction may involve a conflict of interest that is not in or consistent with the best interests of the Company and our shareholders.

stockholders.
Specific types of transactions are excluded from the Related Persons Transaction Policy, such as, for example, transactions in which the related person’s interest derives solely from his or her service as a director of another entity that is a party to the transaction.
Further, the Company is required by the indenture governing the notes to obtain the approval of the disinterested Board members when a related party transaction exceeds an aggregate consideration of $500,000 and an opinion regarding the fairness of such transaction from an outside firm when such a transaction exceeds an aggregate consideration of $2.5 million.
Under the agreement governing our existing credit facility, we are only permitted to enter into new transactions with a related party if such transaction is entered into in the ordinary course of business and on an arm-length basis on terms no less favorable than those obtainable form a third-party, subject to certain exceptions, including exceptions for compensation relationships.
Additionally, the Company has a written SecondThird Amended and Restated Employee Code of Business Conduct and Ethics that requires that an employee obtain written approval of the President or the Chief Executive Officer prior to doing business on behalf of the Company with a member of that employee’s family. All of the transactions described above under “Certain Relationships and Related Transactions”" on page 3523 were approved or ratified by the Board, including the disinterested members thereof.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Exchange Act requires our officers and directors, and persons who own more than 10% of a registered class of our equity securities, to file reports of ownership and changes in ownership with the Commission and NASDAQ.Commission. Officers, directors and greater than 10% shareholdersstockholders are also required by Commission regulations to furnish us with copies of all Section 16(a) forms they file.
Based solely on a review of the Forms 3 and 4 and amendments thereto filed during the 20152018 fiscal year, and written certifications provided to the Company, the Company believes that all of these reporting persons timely complied with their filing requirements, except (a) John E. Crisp, Charles C. Forbes, Jr. and L. Melvin Cooper each filed a Form 4 late with respect to the payment of a tax liability associated (i) with the vesting of a time-based restricted stock award on January 6, 2013 and (ii) with the vesting of a time-based restricted stock award on March 28, 2014, (b) Ted A. Izatt filed a late Form 4 with respect to the sales of shares on July 7, 2015 and July 8, 2015 and (c) William W. Sherrill filed a late Form 4 with respect to the sale of shares on June 4, 2015.requirements.


37




Audit Committee Report
In accordance with its written charter adopted by the Board, the audit committee assists the Board in fulfilling its responsibility for oversight of the quality and integrity of the accounting, auditing and financial reporting practices of the Company. Management is responsible for the Company’s financial statements, and the independent auditors are responsible for the examination of those statements.
In keeping with its responsibilities, the audit committee has met and held discussions with management, the independent registered public accounting firm and the separate accounting consultants engaged to ascertain compliance with Section 404 of the Sarbanes-Oxley Act and to perform the internal audit function. Management represented to the audit committee that the Company’s consolidated financial statements were prepared in accordance with generally accepted accounting principles in the United States, and the audit committee has reviewed and discussed the consolidated financial statements with management and the independent registered public accounting firm, both with and without management present. In addition, the audit committee has discussed with the Company’s independent registered public accounting firm all communications required by generally accepted auditing standards, including those required to be discussed by Auditing Standard No. 16,AS 1301, “Communication with Audit Committees,” as currently in effect and as adopted by the Public Company Accounting Oversight Board or PCAOB.(the “PCAOB”). In addition, the Audit Committee has received written disclosures and the letter from our independent registered public accounting firm required by PCAOB Rule 3526, and has discussed with the independent registered public accounting firm matters pertaining to their independence. The audit committee has discussed with the independent auditors all relationships between the registered public accounting firm and the Company that may bear on the auditor’s independence and any relationships that may impact their objectivity and independence and satisfied itself as to the auditor’s independence.
Based on the audit committee’s discussions with management and the independent registered public accounting firm, and the audit committee’s review of the audited financial statements, representations of management and the report of the independent registered public accounting firm, the audit committee recommended to the Board that the audited consolidated financial statements be included in our Annual Report on Form 10-K for the year ended December 31, 20152018 as filed with the Securities and Exchange Commission. The audit committee reappointed BDO USA, LLP as independent registered public accounting firm for the 20162019 fiscal year, subject to shareholderstockholder ratification.

 
AUDIT COMMITTEE OF THE BOARD
 
William W. Sherrill (Chair)
Travis H. Burris
Dale W. Bossert
Ted A. Izatt
Rome G. Arnold III
Paul S. Butero
David B. Rosenwasser
 
April 29, 201625, 2019


38




Other Matters
Neither we nor any of the persons named as proxies know of matters other than those described above to be voted on at the 20162019 Annual Meeting of Shareholders.Stockholders. However, if any other matters are properly presented at the Annual Meeting, it is the intention of the persons named as proxies to vote in accordance with their judgment on these matters, subject to the direction of the Board.
Our 20152019 Annual Report to Shareholders,Stockholders, which contains a copy of our Annual Report on Form 10-K for the fiscal year ended December 31, 2015,2018, accompanies this Proxy Statement, but is not to be deemed a part of the proxy soliciting material.
ShareholdersStockholders may also obtain a copy of our 2015 Annual Report to Shareholders or the Company’s Annual Report on Form 10-K most recently filed with the Commission without charge by writing to the Assistant Secretary of the Company at 3000 South Business Highway 281, Alice, Texas 78332. The Company’s Annual Report on Form 10-K and other filings with the Commission may also be accessed on the Company’s website at www.forbesenergyservices.com.


 
By Order of the Board,
 
/s/ L. Melvin Cooper
L. Melvin Cooper
Assistant
Secretary



39







  
 VOTE BY INTERNET - www.proxyvote.com
 Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 P.M. Eastern Time the day before the meeting date. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create an electronic voting instruction form.
  
FORBES ENERGY SERVICES LTD.
ELECTRONIC DELIVERY OF FUTURE PROXY MATERIALS
3000 SOUTH BUSINESS HIGHWAY 281
ALICE, TX 78332
ATTN: L. MELVIN COOPER
ELECTRONIC DELIVERY OF FUTURE PROXY MATERIALS
If you would like to reduce the costs incurred by our company in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and annual reports electronically via e-mail or the Internet. To sign up for electronic delivery, please follow the instructions above to vote using the Internet and, when prompted, indicate that you agree to receive or access proxy materials electronically in future years.
  
 VOTE BY PHONE - 1-800-690-6903
 Use any touch-tone telephone to transmit your voting instructions up until 11:59 P.M. Eastern Time the day before the meeting date. Have your proxy card in hand when you call and then follow the instructions.
  
 VOTE BY MAIL
 Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717.

TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:KEEP THIS PORTION FOR YOUR RECORDS
DETACH AND RETURN THIS PORTION ONLY
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.


TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS
FOLLOWS:
KEEP THIS PORTION FOR YOUR RECORDS

DETACH AND RETURN THIS PORTION ONLY
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.
 
For
All
Withhold
All
For All
Except
To withhold authority to vote for any individual nominee(s), mark “For All Except” and write the number(s) of the nominee(s) on the line below.                     
The Board
recommends you    
vote FOR the
following:
ooo       
11.Election of DirectorsDirector      
 Nominees:Nominee:        
01 Dale W. Bossert02  Travis H. Burris03   John E. Crisp   
The Board recommends you vote FOR proposals 2 and 3.ForAgainstAbstain
2.Ratification of Selection of Auditors - To ratify the reappointment of BDO USA, LLP as the Company’s independent registered public accounting firm for the fiscal year 2019.
       
            
For address change/comments, mark here. ☐   
04  Charles C. Forbes, Jr.05  Ted A. Izatt06   William W. Sherrill  
(see reverse for instructions)       
           
The Board recommends you vote FOR proposals 2 and 3.ForAgainstAbstain
2.To approve amendments to the Company’s Certificate of Formation to effect a reverse stock split of our issued and outstanding shares of common stock at a ratio and effective upon a date in such ratio as is to be determined by the Company’s board of directors and to effect a change in the par value of the Company’s common stock to $0.01 per shareooo
3.Ratification of Selection of Auditors - To ratify the reappointment of BDO USA, LLP as the Company’s independent registered public accounting firm for the fiscal year 2016.ooo
NOTE: Such other business as may properly come before the meeting or any adjournment thereof.
For address change/comments, mark here.
o

(see reverse for instructions)
    YesNo     
Please indicate if you plan to attend this meeting.oo     
   
 
Please sign exactly as your name(s) appear(s) hereon. When signing as attorney, executor, administrator, or other fiduciary, please give full title as such. Joint owners should each sign personally. All holders must sign. If a corporation or partnership, please sign in full corporate or partnership name, by authorized officer.

                                                         
Signature [PLEASE SIGN
WITHIN BOX]
Date Signature (Joint Owners)  Date




Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting: The Notice & Proxy Statement, Annual Report is/are available at www.proxyvote.com.



FORBES ENERGY SERVICES LTD.
ANNUAL MEETING OF SHAREHOLDERSSTOCKHOLDERS
JUNE 10, 2016June 7, 2019
THIS PROXY IS SOLICITED BY THE BOARD
The shareholderstockholder hereby appoint(s) John E. Crisp and L. Melvin Cooper, or anyeither of them, as proxies, with full powers of substitution, and hereby authorizes them to represent and to vote, as designated on the reverse side of this ballot, all of the shares of common stock of Forbes Energy Services Ltd. that the shareholder(s)stockholder(s) are entitled to vote at the Annual Meeting of ShareholdersStockholders to be held at 9:00 a.m. Central Time on June 10, 2016,7, 2019, at the Hyatt Regency Houston located at 1200 Louisiana Street, Houston, Texas 77002 and any adjournment or postponement thereof.
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED AS DIRECTED BY THE SHAREHOLDER(S)STOCKHOLDER(S). IF NO SUCH DIRECTIONS ARE MADE, THIS PROXY WILL BE VOTED FOR THE ELECTION OF THE NOMINEESNOMINEE LISTED ON THE REVERSE SIDE FOR THE BOARD, AND FOR PROPOSALS 2 AND 3.PROPOSAL 2.
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD PROMPTLY USING THE
ENCLOSED REPLY ENVELOPE.
Address change/comments:

   
   
   
   
  
(If you noted any Address Changes and/or Comments above, please mark corresponding box on the reverse side.)
Continued and to be signed on reverse side







APPENDIX A

CERTIFICATE OF AMENDMENT
TO THE
CERTIFICATE OF FORMATION
OF
FORBES ENERGY SERVICES LTD.
1.The name of the Corporation is Forbes Energy Services LTD.
2.The filing entity is a for-profit corporation. The file number issued to the filing entity by the Secretary of State is 801465230. The date of formation of the entity is August 11, 2011.
3.The first paragraph of Article Seven of the Certificate of Formation is amended and restated in its entirety to read as follows:
“The total number of shares of all classes of stock that the corporation is authorized to issue is one hundred twenty-two million five hundred thousand (122,500,000) shares, consisting of one hundred twelve million five hundred thousand (112,500,000) shares of Common Stock, $0.01 par value per share (the “Common Stock”), and ten million (10,000,000) shares of Preferred Stock, $0.01 par value per share (the “Preferred Stock”). The holders of Common Stock shall, subject to the limitations provided herein (including, without limitation, the rights attaching to the Preferred Stock), (a) be entitled to one vote per share; (b) be entitled to such dividends as the board of directors of the corporation (the “Board”) may from time to time declare; (c) in the event of a winding-up or dissolution of the corporation, whether voluntary or involuntary or for the purpose of a reorganization or otherwise or upon any distribution of capital, be entitled to the surplus assets of the corporation; and (d) generally be entitled to enjoy all of the rights attaching to common stock under the TBOC.”
4.Article Seven of the Certificate of Formation is amended by adding the following paragraph to the end of Article Seven:
“Upon this Certificate of Amendment to the Certificate of Formation becoming effective pursuant to the TBOC (the “Reverse Stock Split Effective Date”), each share of Common Stock, par value $0.04 per share (the “Old Common Stock”), issued and outstanding immediately prior to the Reverse Stock Split Effective Date, shall be, and hereby is, reclassified as and changed into [one-Xth (1/Xth)] of a share of Common Stock, par value $0.01 per share (the “New Common Stock”). Each outstanding stock certificate which immediately prior to the Reverse Stock Split Effective Date represented one or more shares of Old Common Stock shall thereafter, automatically and without the necessity of surrendering the same for exchange, represent the number of whole shares of New Common Stock determined by multiplying the number of shares of Old Common Stock represented by such certificate immediately prior to the Reverse Stock Split Effective Date by [one-Xth (1/Xth)] and rounding such number down to the nearest whole integer, and shares of Old Common Stock held in uncertificated form shall be treated in the same manner. The corporation shall not be required to issue or deliver any fractional shares of New Common Stock. Each holder of such New Common Stock shall be entitled to receive

42




for such fractional interest, and at the Reverse Stock Split Effective Date any such fractional interest in such shares of New Common Stock shall be converted into the right to receive, an amount in cash, without interest, determined by multiplying (i) such fractional share interest to which the holder would otherwise be entitled by (ii) the closing sale price of the Common Stock (on a post-reverse-split basis as adjusted for the amendment effected hereby) on the trading day immediately prior to the Reverse Stock Split Effective Date on The NASDAQ Capital Market, or if the principal exchange on which the Common Stock is then traded is other than The NASDAQ Capital Market, such exchange as may be applicable. Shares of Common Stock that were outstanding prior to the Reverse Stock Split Effective Date and that are not outstanding after the Reverse Stock Split Effective Date shall resume the status of authorized but unissued shares of Common Stock.”
5.The amendments to the Certificate of Formation have been approved in the manner required by the Texas Business Organizations Code and by the governing documents of the entity.

The undersigned signs this document subject to the penalties imposed by law for the submission of a materially false or fraudulent instrument and certifies under penalty of perjury that the undersigned is authorized under the provisions of law governing the entity to execute the filing instrument.
DATE: [__________]
By:
Name:
Title:




43