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| TTI > SEC Filings for TTI > Form 8-K on 8-May-2009 | All Recent SEC Filings |
8-May-2009
Change in Directors or Principal Officers, Financial Statements and Exhibi
As previously announced on March 20, 2009, the Board of Directors of TETRA Technologies, Inc. (the "Company") approved a succession plan under which Geoffrey M. Hertel, President and Chief Executive Officer of the Company, would resign from his positions as President and Chief Executive Officer immediately following the Company's Annual Meeting of Stockholders on May 5, 2009, and Stuart M. Brightman would assume the positions of President and Chief Executive Officer. The Company also announced that it was the intention and expectation of the Board of Directors that the Company would enter into a transition agreement with Mr. Hertel.
On May 5, 2009, the Board of Directors of the Company approved a Transition Agreement between the Company and Mr. Hertel (the "Agreement") in connection with Mr. Hertel's resignation as the Company's President and Chief Executive Officer. The Agreement, which was signed by the Company and Mr. Hertel on May 5, 2009, extends Mr. Hertel's employment with the Company from May 5, 2009 through January 5, 2012 (the "Employment Period"), subject to earlier termination in accordance with the terms of the Agreement.
During the Employment Period, Mr. Hertel will provide such services to the
Company as may be determined from time to time by the Board of Directors, and he
will be subject to the supervision of the Company's Chief Executive Officer. The
Agreement also provides that during the Employment Period the Company shall
(i) upon recommendation of the Nominating and Corporate Governance Committee of
the Board of Directors, nominate Mr. Hertel as a director of the Company, and
(ii) use commercially reasonable efforts to cause Mr. Hertel to be nominated to
the board of directors of Compressco Partners GP Inc. and to serve as its
Chairman.
As cash compensation for his services during the Employment Period, Mr. Hertel will receive a monthly base salary of $33,333, and he will be eligible to participate in all incentive, stock option, savings and retirement plans, practices, policies and programs generally available to the executive officers of the Company. For each calendar year ending during the employment period, Mr. Hertel will be eligible for an annual bonus on the same basis as the executive officers of the Company under the Company's then current discretionary performance-based cash bonus program, and payment of the bonus, if awarded, will be made in a lump sum cash payment in accordance with the terms of the program. Target payout of the annual bonus will be $200,000 for each of the 2009 and 2010 calendar years, and $83,200 for the 2011 calendar year. Payout of the annual bonus is subject to Mr. Hertel's continued employment during the period to which each bonus relates. In the event a change in control (as defined in the Agreement) occurs on or before December 31, 2009, Mr. Hertel will be entitled to receive the target payout for the 2009 annual bonus, which will be payable within seven days following the change in control.
It is contemplated that Mr. Hertel's duties as an employee of the Company will include assisting with the completion of an initial public offering by Compressco Partners, L.P. Under the Agreement, Mr. Hertel is eligible for an additional cash bonus of between $250,000 and $900,000 if the offering is closed on or before June 30, 2010, based on the market capitalization of Compressco Partners after the closing of the offering. Mr. Hertel is also eligible to receive bonuses based on the successful transitions of Mr. Brightman to the positions of President and Chief Executive Officer and Edwin H. Goldman to the position of Senior Vice President. Subject to the complete discretion of the Board of Directors based on its subjective evaluation of the success of the transition over two performance periods, Mr. Hertel may be eligible to receive cash bonuses of up to $200,000 in the aggregate for the period from May 5, 2009 until May 4, 2010, and $200,000 in the aggregate for the period from May 5, 2010 until May 4, 2011. Payout of the transition bonuses is subject to the continued employment of Messrs. Brightman and Goldman, respectively, during the period to which each bonus relates. In the event a change in control
occurs on or before May 4, 2010 and Mr. Brightman and/or Mr. Goldman remain employed by the Company immediately prior to the change of control, the payment of all or a portion of the initial transition bonus will be accelerated and payable within seven days following the change in control.
Mr. Hertel's employment shall automatically terminate upon his death and may be terminated by the Company in the event of his "disability" (as defined in the Agreement) during the Employment Period. In addition, Mr. Hertel may terminate his employment with the Company for "Good Reason," as specified in the Agreement, or for any other reason upon 30 days' advance notice. The Agreement defines "Good Reason" as (i) any failure by the Company to comply with the compensation provisions of the Agreement other than an isolated, insubstantial and inadvertent failure; (ii) the Company requiring Mr. Hertel to be based at any office or location other than the Company's headquarters in The Woodlands, Texas; (iii) any purported termination by the Company of Mr. Hertel's employment other than as expressly permitted by the Agreement; or (iv) any failure by the Company to require the Agreement to be assumed by any successor of the Company.
The Agreement also provides that Mr. Hertel's employment may be terminated by
the Company for "Cause," as specified in the Agreement. "Cause" is defined as
(i) the willful and continued failure of Mr. Hertel to perform substantially his
duties and obligations under the Agreement (for reasons other than injury,
illness or incapacity) after a written demand for such performance is provided
by the Company; (ii) Mr. Hertel's conviction or the entry of a plea of guilty or
nolo contendre to a misdemeanor involving moral turpitude or a felony;
(iii) fraud, theft, embezzlement or a similar misappropriation of funds or
property of the Company or its affiliates; or (iv) the willful engagement in
illegal conduct or gross misconduct which is materially injurious to the Company
or its affiliates.
If Mr. Hertel's employment terminates as a result of his death, if the Company
terminates Mr. Hertel's employment as a result of his disability or other than
for Cause, or if Mr. Hertel terminates his employment for "Good Reason," then
(i) the Company shall continue to pay his base salary through the end of the
Employment Period; (ii) the Company shall pay an amount equal to any bonus that
would have been payable as a result of the initial public offering of Compressco
Partners as if his employment had not been terminated; (iii) the Company shall
pay an amount equal to any Transition Bonus that would have been payable as if
Mr. Hertel's employment had not been terminated; (iv) Mr. Hertel or his heirs
will continue to be eligible to participate in welfare benefit plans; and
(v) the Company shall pay any business expenses which have been incurred through
the date of termination in accordance with the Company's policies. If at any
time following the termination of Mr. Hertel's employment and during the
noncompetition period thereafter he breaches any of the nondisclosure,
noncompetition and nonsolicitation provisions provided for under the Agreement,
the Company will no longer be obligated to make the foregoing payments.
If the Company terminates Mr. Hertel's employment for "Cause," Mr. Hertel will
only be entitled to receive payment of his base salary through the date of
termination and any deferred compensation or other employee benefits which he is
otherwise entitled to receive. If Mr. Hertel terminates his employment for any
reason other than "Good Reason," Mr. Hertel will be entitled to receive (i) his
base salary through the date of termination; (ii) the payment of any business
expenses incurred but not reimbursed through the date of termination; and
(iii) the payment of any deferred compensation or other employee benefits which
he is entitled to receive.
The Agreement includes nondisclosure, noncompetition, and non-solicitation provisions binding on Mr. Hertel during the Employment Period and for a period of three years after his Separation of Service under the Agreement.
The foregoing summary of the Transition Agreement does not purport to be complete and is qualified in its entirety by reference to the Transition Agreement, a copy of which is filed as Exhibit 10.1 hereto and incorporated herein by reference.
(d) Exhibits.
Exhibit Number Description
10.1 Transition Agreement effective as of May 5, 2009, by
and among TETRA Technologies, Inc. and Geoffrey M.
Hertel.
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