HOUSTON, Dec. 28, 2011 /PRNewswire/ -- Flotek Industries, Inc. ("Flotek" or the "Company") (NYSE: FTK) announced today that it has entered into a Repurchase Agreement (the "Agreement") with the holders of the Company's 5.25% Senior Secured Convertible Notes due in 2028 (the "Notes").Under the terms of the Agreement Flotek will pay the holders of the Notes 104.95% of the principal amount plus accrued interest at closing. All of the holders of the notes have agreed to participate in the redemption process which will retire approximately $36 million of Flotek indebtedness. The payment, which will be in cash, will come from Company cash balances. "Flotek is delighted to announce this transformational transaction as we conclude 2011 that significantly strengthens our balance sheet," said John Chisholm, Chairman of the Board and President of Flotek. "Our cash generation in 2011 combined with our outlook for 2012 created the opportunity to continue the fundamental improvement of our balance sheet. In the past nine months we have reduced our indebtedness by nearly 50%, or nearly $70 million. This redemption is done with no dilution to shareholders, at a premium less than the interest due in the coming 12 months, and leaves Flotek with an abundance of liquidity to execute our 2012 growth plan. Moreover, it removes any doubt and distraction regarding Flotek's ability to deal with its future debt obligations." As of December 23, 2011 Flotek's cash balance was over $45 million. In addition, the Company has a $35 million revolving credit facility through PNC Bank that is currently undrawn. The Company anticipates capital spending of approximately $14 million in 2012 and expects operating cash flow and its credit capacity to be more than sufficient to meet capital needs. "There should be little doubt that Flotek is a stronger, more focused company today than ever before in its history and this seminal financial transaction is just one sign of Flotek's evolution in the past two years," added Chisholm. "This would not have been possible without the dedication of the entire Flotek team that, over the course of the past twelve months, has shown incredible effort and spirit in turning our vision into reality. That said, there is much work ahead of us and, as we look ahead to 2012, we see challenges that offer opportunities to create more value for all Flotek stakeholders."