Wires

UPDATE 1-Oilfield firm ProPetro ousts CEO over lack of loan disclosure

Liz Hampton

(New throughout, adds details on audit, other management changes, background)

March 16 (Reuters) - Oilfield services firm ProPetro Holding Corp disclosed on Monday it ousted Chief Executive Officer Dale Redman, saying he violated its insider trading policies over use of shares pledged for personal loans, and admitted it had issued inaccurate information on his holdings.

The shakeup was the latest in a series of departures since last year, when the company disclosed it had issued inaccurate information about an equipment contract and was reviewing accounting controls and public disclosures.

Redman, a co-founder of the shale fracking provider, pledged shares in 2017 and 2018 for personal loans without disclosing it to the board. Company insider trading policies prohibit "pledging the Companys securities as collateral to secure loans," the company said.

The former CEO "engaged in other inappropriate conduct in connection with these personal loans," it said in a securities filing, without identifying the conduct. The lack of the loan disclosure led ProPetro to submit false statements to the U.S. Securities and Exchange Commission (SEC) over one of the share pledges, the filing said.

The company had no further comment beyond the securities filing. A spokesperson for Redman did not immediately respond to a request for comment.

Former finance chief Jeffrey Smith also stepped down as chief administrative officer, the company said in a statement. It was Smith's second demotion since an internal audit of the company was disclosed last August.

The company statement did not say why Smith was demoted. He will become a "special advisor" to the new CEO, it said.

Reuters last year said ProPetro is being investigated over its past financial and public disclosures by the SEC.

Board Chairman Phillip Gobe will replace Redman. Former CFO Smith will become a special advisor to Gobe, and receive a salary of $425,000 annually but no incentive awards or cash bonus, according to a company filing.

Gobe last year was named the company's principal executive officer after the company expanded its audit to include expense reimbursements and transactions involving Redman and other executives. Redman had reimbursed the company for roughly $346,000.

On Monday, ProPetro also named Sam Sledge as its chief strategy and administrative officer, replacing Smith.

An independent accounting firm is continuing to examine the board's findings and remediation plan, the company said.

Monday's shake-up follows a string of management moves that ProPetro has made since last July. Director Royce Mitchell and General Counsel Mark Howell left their positions in August, and the prior month, Chairman Spencer Armour III resigned. Chief Accounting Officer Ian Denholm resigned in October. (Additional reporting by Shariq Khan in Bengaluru, Editing by Sherry Jacob-Phillips and David Gregorio)