UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
FORM
8-K
CURRENT
REPORT
PURSUANT TO SECTION
13 OR 15(d) OF THE
SECURITIES EXCHANGE
ACT OF 1934
Date of report (date of earliest event
reported): May 5,
2009
TETRA
Technologies, Inc.
(Exact name of
registrant as specified in its charter)
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Delaware
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1-13455
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74-2148293
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(State or
other jurisdiction
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(Commission
File Number)
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(IRS
Employer
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of
incorporation)
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Identification
No.)
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24955
Interstate 45 North
The
Woodlands, Texas 77380
(Address of
Principal Executive Offices and Zip Code)
Registrant’s
telephone number, including area code: (281) 367-1983
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions (see General Instruction A.2. below):
[ ]
Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
[ ]
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[ ]
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act
(17 CFR 240.14d-2(b))
[ ]
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act
(17 CFR 240.13e-4(c))
Item
5.02. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
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.
Item
9.01. Financial Statements and Exhibits.
(d) Exhibits.
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Exhibit
Number
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Description
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10.1
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Transition
Agreement effective as of May 5, 2009, by and among TETRA Technologies,
Inc. and Geoffrey M. Hertel.
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SIGNATURES
Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned hereunto duly authorized.
TETRA Technologies, Inc.
By: /s/ Bass C. Wallace,
Jr.
Bass C. Wallace, Jr.
General Counsel and Corporate
Secretary
Date: May 8,
2009
EXHIBIT
INDEX
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Exhibit
Number
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Description
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10.1
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Transition
Agreement effective as of May 5, 2009, by and among TETRA Technologies,
Inc. and Geoffrey M. Hertel.
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