UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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 2, 2006
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
of Incorporation)
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(Commission
File Number)
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(I.R.S.
Employer Identification Number)
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25025 Interstate 45 North, Suite 600
The Woodlands, Texas 77380
(Address of Principal Executive Offices and Zip Code)
(281) 367-1983
(Registrant's Telephone Number, Including Area Code)
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
1.01. Entry into a Material Definitive Agreement.
TETRA
Technologies, Inc. 2006 Equity Incentive Compensation Plan
At the 2006 Annual Meeting of Stockholders of TETRA Technologies, Inc. (the
“Company”) held on May 2, 2006 (the “2006 Annual Meeting”),
the Company’s stockholders approved the TETRA Technologies, Inc. 2006
Equity Incentive Compensation Plan, effective as of May 2, 2006 (the “2006
Plan”). The Company’s Board of Directors (the “Board”)
previously approved the 2006 Plan at a meeting held on February 23, 2006,
subject to stockholder approval.
The 2006 Plan provides that grants may be made to participants in the following
forms: (i) incentive stock options, (ii) nonqualified stock options, (iii)
stock appreciation rights, (iv) restricted stock, (v) bonus stock awards,
and (vi) performance awards. The number of shares of the Company’s common
stock authorized for issuance under the 2006 Plan is 650,000 shares, subject
to adjustments as provided in the 2006 Plan. The Board has declared a 2-for-1
stock split to be effected in the form of a stock dividend to stockholders
of record on May 15, 2006. As a result of the stock split, the Management
and Compensation Committee of the Board has proportionately adjusted and increased
the number of shares of common stock available under the 2006 Plan to 1,300,000
shares, to be effective as of the distribution date for the stock split.
As a result of the approval and adoption of the 2006 Plan, no further options
may be awarded under the Company’s previously existing stock option
plans although such previously existing plans will remain in effect in accordance
with their terms to the extent necessary for the administration of outstanding
options under such plans.
The foregoing summary of the 2006 Plan is qualified in its entirety by the
full text of the 2006 Plan which is incorporated herein by reference from
the Company’s Registration Statement on Form S-8 filed with the Securities
and Exchange Commission on May 4, 2006.
Forms of Award Agreements
The equity awards made to participants pursuant to the 2006 Plan will be made
by the Company through the use of various forms of award agreements, which
set forth additional terms applicable to the specific award. Forms of the
Employee Incentive Stock Option Agreement, Employee Nonqualified Stock Option
Agreement and Employee Restricted Stock Agreement are attached hereto as exhibits
and incorporated by reference herein.
Item
5.03. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal
Year.
Certificate
of Amendment of Restated Certificate of Incorporation
On May 2, 2006, a Certificate of Amendment of Restated Certificate of Incorporation
of TETRA Technologies, Inc. (the “Certificate of Amendment”) was
filed with the Delaware Secretary of State’s office. The Certificate
of Amendment was approved by the Company’s stockholders at the 2006
Annual Meeting.
A description of the changes to the Company’s Restated Certificate of
Amendment is provided below and such changes are further described in the
Company’s Proxy Statement furnished to the stockholders in connection
with the 2006 Annual Meeting.
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Article
FOURTH: Article FOURTH was amended to increase the number of shares of common
stock which the Company is authorized to issue from 70,000,000 shares to 100,000,000.
Article SEVENTH: Amendments were made to Article SEVENTH to repeal the provisions
that provide for the classification of the Company’s Board and to provide
for the annual election of directors. Commencing with the 2007 annual meeting
of stockholders, the Board shall no longer be classified and directors shall
be elected on an annual basis. Article SEVENTH was further amended to provide
that from and after the election of directors at the 2007 annual meeting of
stockholders and subject to the rights of any class or series having preference
over the Company’s common stock, directors may be removed from office,
with or without cause, by the affirmative vote of at least a majority of the
combined voting power of the Company’s voting stock.
Article THIRTEENTH: Article THIRTEENTH was amended to remove Article SEVENTH
from the provisions of Article THIRTEENTH which would otherwise require the
affirmative vote of at least 66 2/3 percent of the combined voting power of
the Company’s voting stock to amend or repeal such provision.
The
foregoing summary of the Certificate of Amendment does not purport to be complete
and is qualified in its entirety by the full text of the Certificate of Amendment
which is incorporated herein by reference from the Company’s Registration
Statement on Form S-8 filed with the Securities and Exchange Commission on
May 4, 2006.
Amended and Restated Bylaws
On May 2, 2006, the Board approved amendments to the Company’s Bylaws
and adopted the Amended and Restated Bylaws (the “Restated Bylaws”).
Various provisions of the Company’s former Bylaws were either revised,
reworded or reordered or new provisions were adopted to update the former
Bylaws for changes in the Delaware General Corporation Law (the “DGCL”),
to clarify certain former Bylaw provisions and to make conforming revisions
to the Bylaws as a result of the declassification of the Company’s Board.
The Restated Bylaws became effective immediately upon their adoption by the
Board on May 2, 2006. A description of the changes to the former Bylaws is
provided below.
Article II
Meetings of Stockholders
Art. II, § 1 was amended to more closely track the language of the DGCL
regarding stockholder meetings. In addition, Art. II, § 1 was amended
to allow for stockholder meetings by remote communication as permitted by
recent amendments to the DGCL.
Art. II, § 2 was amended to delete the reference to the plurality vote
which has been moved to Art. II, § 9.
Art. II, § 3 was amended by combining the first paragraph of Art. II,
§ 3 and Art. II, § 6 into a new Art. II, § 4 which sets forth
the manner in which notice may be given to stockholders. New Art. II, §
4 also provides for notice by electronic transmission. The remaining paragraphs
of Art. II, § 3 were moved to new Art. II, § 5.
Art. II, § 4 was moved to a new Art. II, § 6 and was amended to
give effect to recent amendments to the DGCL that the stock list must be available
ten days before stockholders’ meetings: (1) on a reasonably accessible
electronic network, provided that the information
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required
to gain access to the stock list is furnished with a notice of the stockholders’
meeting or (2) during ordinary business hours, at the principal place of business
of the Corporation.
Art. II, § 5 was moved to new Art. II, § 3.
Art. II, § 6 was deleted and its provisions were combined with the first
paragraph of Art. II, § 3 into a new Art. II, § 4.
Art. II, § 7 was amended to provide that where a separate vote by class
or series or classes or series is required, a majority of the issued and outstanding
shares of such class or series or classes or series, present in person or
represented by proxy, shall constitute a quorum entitled to take action with
respect to that vote on that matter. In addition, Art. II, § 7 was amended
to provide that once a quorum is established, the quorum shall not be broken
by the withdrawal of votes at such meeting.
Art. II, § 8 was amended to include within its procedures provisions
regarding remote communications for adjourned meetings.
Art. II, § 9 was amended to include provisions of Art. II, § 10
and to provide that unless otherwise provided in the Company’s Restated
Certificate of Incorporation, each stockholder will be entitled to one vote.
Art. II, § 9 was further amended to provide that where a separate vote
by a class or classes is required, the affirmative vote of the holders of
a majority of the shares of such class or classes, present in person or represented
by proxy at the meeting, shall be the act of such class. Art. II, § 9
was further amended to include a provision originally contained in Art. II,
§ 2 providing that the directors shall be elected by a plurality vote.
Art. II, § 10 was deleted and its provisions were included in amended
Art. II, § 9.
New Art. II, § 10 sets forth means under the DGCL by which a stockholder
may authorize another person or persons to act for the stockholder by proxy.
New Art. II, § 11 adds procedures for the establishment of rules regarding
the conduct of stockholders’ meetings.
New Art. II, § 12 describes the duties of inspectors of election for
stockholders’ meetings.
New Art. II, § 13 sets forth the criteria under the DGCL for allowing
stockholders to participate in meetings by remote communication, if authorized
by the Board.
Art. II, § 11 regarding stockholders action without meeting was moved
to New Art. II, § 14.
Art. II, § 12 was amended to provide that the Chairman of the Board,
or in his absence, the Chief Executive Officer or President, shall preside
at stockholders’ meetings and was moved to new Art. II, § 15.
Article III
Directors
Art. III, § 1 was amended to delete the term of office of a director
and to acknowledge that in addition to the election of directors by the stockholders,
directors may be appointed as permitted by the Restated Bylaws.
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Art.
III, § 2 was amended to conform to the amendments made to the Company’s
Restated Certificate of Incorporation as a result of the declassification
of the Board as described above. Beginning with the annual meeting of stockholders
in 2007, all of the Company’s directors shall be subject to election
on an annual basis.
Art. III, § 4 was amended as a result of the declassification of the
Board and now provides that directors appointed to fill a vacancy or a newly-created
directorship shall hold office until the next annual meeting of stockholders.
Art. III, § 5 was amended by adding subsection (a) which, consistent
with applicable provisions of the DGCL, clarifies that each director may resign
at any time upon providing notice to the Company. Art. III, § 5 was further
amended to conform to the amendments made to the Company’s Restated
Certificate of Incorporation as a result of the declassification of the Board.
From and after the annual meeting of stockholders in 2007 and subject to the
rights of any class or series having preference over the Company’s common
stock, the directors may be removed from office, with or without cause, by
an affirmative vote of the holders of at least a majority of the combined
voting power of the Company’s voting stock.
Art. III, § 8 was moved to and combined with Art. III, § 7.
Art. III, § 9 was moved to Art. III, § 8.
Art. III, § 10 was moved to Art. III, § 9 and amended to provide
for the manner of notice including electronic transmission.
Art. III, § 11 was moved to Art. III, § 10.
New Art. III, § 11 clarifies that members of the Board may participate
in Board meetings by telephone or other communications equipment, as permitted
by the DGCL.
Art. III, § 12 was amended to permit directors to take action without
a meeting by electronic transmission.
Art. III, § 13 was amended to provide that in the absence of the Chairman
of the Board, the Chief Executive Officer, if he is a director, shall preside
over meetings of the Board.
Art. III, § 14 was amended by separating the existing provisions into
subsections (a) and (b) and adding a new subsection (c) providing that the
procedures otherwise applicable to the Board shall apply to committees of
the Board unless otherwise provided in the resolutions establishing such committee.
Art. III, § 15 was moved to Art. II, § 14.
Art. III, § 16 was moved to Art. II, § 15 and amended to expressly
acknowledge that the Board shall have the authority to fix the amount of compensation
of directors and to grant the Board greater flexibility in establishing compensation
for directors.
Article IV
Notices
Art. IV, § 1 was amended to allow, with respect to directors, oral notice
given telephonically or written or printed notice either in person, by mail,
wire, telephone or electronic transmission, and with respect to stockholders,
written or printed notice either given personally or by mail, wire or electronic
transmission to the extent permitted by the DGCL.
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Art.
IV, § 2 was amended to permit a written waiver of notice to be provided
by electronic transmission. Art. IV, § 2 was further amended to provide
that the attendance of a person at a meeting shall constitute waiver of notice
of that meeting except where the attendance is for the express purpose of
objecting, at the beginning of the meeting, to the transaction of any business
at such meeting.
Article
V
Officers
Art. V, § 1 was amended to provide that the Board may elect a Chairman
of the Board and at the time of such election, the Board may determine whether
the Chairman of the Board shall serve in an executive or non-executive capacity.
Art. V, § 1 was further amended to permit Vice Presidents to be given
distinctive designations such as Executive Vice President or Senior Vice President.
Art. V, § 3 was amended to permit the Board to empower the Chief Executive
Officer to appoint subordinate officers and agents of the Company.
Art. V, § 4 was amended to acknowledge that the compensation of officers
and agents elected by the Board may be fixed by the Board or a committee of
the Board.
Art. V, § 5 was amended to clarify that officers may be removed, with
or without cause, by the Board and to further provide that with respect to
officers who were not elected or appointed by the Board, such officers may
be removed by any officer upon whom such power of removal may be conferred
by the Board. Art. V, § 5 was further amended to provide that any officer
may resign at any time by giving written notice to the Company.
New Art. V, § 6 was added to describe the powers and duties of the Chairman
of the Board.
Art. V, §§ 6-10 were renumbered and were amended to describe the
duties of the Chief Executive Officer, President, Vice Presidents, Secretary
and Assistant Secretary of the Company.
New Art. V, § 12 was added to describe the duties of the Chief Financial
Officer.
Art. V, §§ 11-12 were renumbered and amended to describe the duties
of the Treasurer and Assistant Treasurer.
New Art. V, § 15 was added to provide that the Board may delegate the
powers and duties of officers to other officers notwithstanding any provision
of the Restated Bylaws.
New Art. V, § 16 was added to address the rights of the officers of the
Company to take action with respect to the securities of other business entities
owned by the Company.
Article VI
Certificates of Stock
Art. VI, § 1 was amended to allow uncertificated shares of stock with
the approval of the Board.
Art. VI, § 3 was amended to permit the Company, rather than the Board
alone, to direct the issuance of new certificate or certificates in place
of any lost, stolen or destroyed certificate or certificates.
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5
Art.
VI, § 4 was amended to provide for the procedures applicable to the transfer
of uncertificated shares.
Article
VII
General
Provisions
New Art. VII, § 7 adds the DGCL definition of “electronic transmission,”
which is used elsewhere in the Restated Bylaws.
Art. VII, § 7 pertaining to interested directors and officers was moved
to new Art. VII, § 8 and amended to more closely follow the applicable
provision of the DGCL.
The foregoing summary of the Restated Bylaws is qualified in its entirety
by the full text of the Restated Bylaws which is incorporated herein by reference
from the Company’s Registration Statement on Form S-8 filed with the
Securities and Exchange Commission on May 4, 2006.
Item
9.01. Financial Statements and Exhibits.
(d)
Exhibits.
3.1
Certificate
of Amendment of Restated Certificate of Incorporation of TETRA Technologies,
Inc. (incorporated by reference to Exhibit 4.5 to the Company’s
Registration Statement on Form S-8 filed on May 4, 2006 (SEC File No.
333-133790)).
3.2
Amended
and Restated Bylaws of TETRA Technologies, Inc. (incorporated by reference
to Exhibit 4.6 to the Company’s Registration Statement on Form
S-8 filed on May 4, 2006 (SEC File No. 333-133790)).
10.1
TETRA
Technologies, Inc. 2006 Equity Incentive Compensation Plan (incorporated
by reference to Exhibit 4.12 to the Company’s Registration Statement
on Form S-8 filed on May 4, 2006 (SEC File No. 333-133790)).
10.2
Form
of Employee Incentive Stock Option Agreement under the TETRA Technologies,
Inc. 2006 Equity Incentive Compensation Plan.
10.3
Form
of Employee Nonqualified Stock Option Agreement under the TETRA Technologies,
Inc. 2006 Equity Incentive Compensation Plan.
10.4
Form
of Employee Restricted Stock Agreement under the TETRA Technologies,
Inc. 2006 Equity Incentive Compensation Plan.
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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/Geoffrey M. Hertel
Geoffrey
M. Hertel
President
& Chief Executive Officer
Date:
May 8, 2006
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EXHIBIT
INDEX
3.1
Certificate
of Amendment of Restated Certificate of Incorporation of TETRA Technologies,
Inc. (incorporated by reference to Exhibit 4.5 to the Company’s
Registration Statement on Form S-8 filed on May 4, 2006 (SEC File No.
333-133790)).
3.2
Amended
and Restated Bylaws of TETRA Technologies, Inc. (incorporated by reference
to Exhibit 4.6 to the Company’s Registration Statement on Form
S-8 filed on May 4, 2006 (SEC File No. 333-133790)).
10.1
TETRA
Technologies, Inc. 2006 Equity Incentive Compensation Plan (incorporated
by reference to Exhibit 4.12 to the Company’s Registration Statement
on Form S-8 filed on May 4, 2006 (SEC File No. 333-133790)).
10.2
Form
of Employee Incentive Stock Option Agreement under the TETRA Technologies,
Inc. 2006 Equity Incentive Compensation Plan.
10.3
Form
of Employee Nonqualified Stock Option Agreement under the TETRA Technologies,
Inc. 2006 Equity Incentive Compensation Plan.
10.4
Form
of Employee Restricted Stock Agreement under the TETRA Technologies,
Inc. 2006 Equity Incentive Compensation Plan.
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Exhibit 10.2
TETRA Technologies, Inc.
EMPLOYEE INCENTIVE STOCK OPTION AGREEMENT
Pursuant to the terms of the TETRA Technologies, Inc. 2006 Equity Incentive Compensation Plan
1. Grant of Incentive Option. TETRA Technologies, Inc., a Delaware corporation (“Company”), hereby grants to (“Optionee”) the right, privilege and option as herein set forth (the “Incentive Option”) to purchase up to xx,xxx shares (the “Shares”) of common stock, $0.01 par value per share, of the Company (“Common Stock”), subject to and in accordance with the terms and conditions of this document. This Employee Incentive Stock Option Agreement (the “Agreement”) is dated as of xx/xx/xx. The Shares, when issued to Optionee upon exercise of the Incentive Option, shall be fully paid and nonassessable and the Optionee (or the person permitted to exercise the Incentive Option in the event of Optionee’s death) shall be and have all the rights and privileges of a stockholder of record of the Company with respect to the Shares acquired upon exercise of the Incentive Option, effective upon such exercise. The Incentive Option is granted pursuant to and to implement in part the TETRA Technologies, Inc. 2006 Equity Incentive Compensation Plan (as amended and in effect from time to time, the “Plan”) and is subject to the provisions of the Plan, which is hereby incorporated herein and is made a part hereof, as well as the provisions of this Agreement. By execution of this Agreement, Optionee agrees to be bound by all of the terms, provisions, conditions and limitations of the Plan as implemented by the Incentive Option and this Agreement, together with all rules and determinations from time to time issued by the Committee pursuant to the Plan. All capitalized terms have the meanings set forth in the Plan unless otherwise specifically provided. All references to specified paragraphs pertain to paragraphs of this Incentive Option unless otherwise provided. The Incentive Option is intended to qualify as an “incentive stock option” within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”).
2. Option Terms. Subject to earlier termination as provided herein, the Incentive Option shall expire on the 10th anniversary of the date of grant of Incentive Option, which anniversary shall be xx/xx/xx. The period during which the Incentive Option is in effect is referred to as the “Option Period”.
3. Option Exercise Price. The exercise price (the “Exercise Price”) of the Shares subject to the Incentive Option shall be $xx.xx per Share which has been determined to be no less than the Fair Market Value Per Share of the Common Stock on the date of grant of the Incentive Option or if the Optionee, at the date if grant, owned more than ten percent (10%) of the total combined voting power of the Company’s voting securities, the Exercise Price has been determined to be no less than one hundred ten percent (110%) of the Fair Market Value Per Share of the Common Stock on that date of grant of the Incentive Option.
4. Vesting. Subject to the provisions of this Agreement including, without limitation, the following provisions of this Paragraph 4, the total number of Shares subject to this Incentive Option shall vest and be exercisable only in accordance with the following schedule:
[schedule to be specified]
The vested Shares that may be acquired under the Incentive Option may be purchased, in whole or in part, at any time after they become vested during the Option Period. In addition, upon the occurrence of a Change in Control the Committee may, in accordance with Paragraph 8 below, accelerate vesting and the time at which the Incentive Option may be exercised.
5. Method of Exercise. To exercise the Incentive Option, Optionee shall deliver notice to the Company at its principal executive office, directed to the Plan Administrator, such exercise to
be effective at the time of receipt of such notice at the Company’s principal executive office during normal business hours, stating the number of Shares with respect to which the Incentive Option is being exercised together with payment for such Shares plus any required withholding taxes, unless other arrangements for withholding tax liability have been made with the Committee. The exercise notice shall be delivered in person, by certified or regular mail, or by such other method (including electronic transmission) as determined from time to time by the Committee or the Plan Administrator. Any exercise of the Incentive Option must be for a minimum of 100 Shares or, if less, for all remaining Shares subject to the Incentive Option.
6. Payment of Exercise Price and Required Withholding. In order to exercise the Incentive Option, the Optionee or other person or persons entitled to exercise such Incentive Option shall deliver to Company payment in full for (i) the Shares being purchased and (ii) unless other arrangements have been made with the Committee, any required withholding taxes. The payment of the Exercise Price for the Incentive Option shall either be (i) in cash, or by check payable and acceptable to the Company, (ii) with the consent of the Committee, by tendering to Company shares of Common Stock owned by the person exercising the Incentive Option for more than six months having an aggregate Fair Market Value as of the date of exercise that is not greater than the full exercise price for the Shares with respect to which the Incentive Option is being exercised and by paying any remaining amount of the Exercise Price (and any required withholding taxes) as provided in (i) above, or (iii) with the consent of the Committee and compliance with such instructions as the Committee may specify, by delivering to the Company and to a broker a properly executed exercise notice and irrevocable instructions to such broker to deliver to the Company cash or a check payable and acceptable to the Company to pay the exercise price and any applicable withholding taxes. Upon receipt of the cash or check from the broker, the Company will deliver to the broker the shares for which the Incentive Option is exercised. In the event that the person elects to make payment as allowed under clause (ii) above, the Committee may, upon confirming that the Optionee owns the number of additional Shares being tendered, authorize the issuance of a new certificate for the number of Shares being acquired pursuant to the exercise of the Incentive Option less that number of Shares being tendered upon the exercise and return to the person (or not require surrender of) the certificate for the Shares being tendered upon the exercise. The date of sale of the shares by the broker pursuant to a cashless exercise under (iii) above shall be the date of exercise of the Incentive Option. If the Committee so requires, such person or persons shall also deliver a written representation that all Shares being purchased are being acquired for investment and not with a view to, or for resale in connection with, any distribution of such Shares.
7. Termination of Employment. Termination of Employment, Retirement, death or Disability of Optionee, shall affect Optionee’s rights under the Incentive Option as follows:
(a) Termination of Employment. If Employment of Optionee is terminated for any reason whatsoever other than death, Disability or Retirement, subject to the provisions of this Section 7, any nonvested portion of the Incentive Option outstanding at the time of such termination and all rights thereunder shall wholly and completely terminate and no further vesting shall occur, and Optionee shall be entitled to exercise his or her rights with respect to the portion of the Incentive Option vested as of the date of termination for a period that shall end on the earlier of (i) the expiration date set forth in the Incentive Option with respect to the vested portion of the Incentive Option or (ii) the date that occurs three (3) months after such termination date.
(b) Retirement. Upon the Retirement of Optionee:
(i) any nonvested portion of the Incentive Option shall immediately terminate and no further vesting shall occur; and
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(ii) any vested portion of the Incentive Option shall expire on the earlier of (A) the expiration of the Option Period; or (B) the expiration of twelve (12) months after the date of Retirement; provided, however, any exercise more than three (3) months after the Optionee’s Retirement shall result in the Incentive Option becoming a Nonqualified Option.
(c) Disability or Death . Upon termination of Employment as a result of Disability or death of Optionee or if Optionee retires and dies during the period described in Section 7(b)(ii) above (hereinafter the “Applicable Retirement Period”), or if the Optionee’s Employment was terminated as a result of Disability and the Optionee dies during the period that expires on the earlier of the expiration of the Option Period or the first anniversary of the Optionee’s termination of Employment due to Disability (hereinafter the “Applicable Disability Period”),
(i) any nonvested portion of the Incentive Option that has not already terminated shall immediately terminate and no further vesting shall occur; and
(ii) any vested portion of the Incentive Option shall expire upon the earlier of (A) the expiration of the Option Period or (B) the later of (1) the first anniversary of such termination of Employment as a result of Disability or death, or (2) the first anniversary of Optionee’s death during the Applicable Retirement Period or the Applicable Disability Period; provided, however, if the Optionee’s death occurs in any Applicable Retirement Period more than three (3) months after the Optionee’s Retirement, the Incentive Option shall automatically become a Nonqualified Option.
(d) Notwithstanding any other provision of the Incentive Option, the Committee, in its discretion, may provide for the continuation of the Incentive Option for such period and upon such terms and conditions as are determined by the Committee in the event that the Optionee ceases to be an Employee.
8. Change in Control.
(a) Change in Control. In the event of a Change in Control described in clauses (ii), (iii) and (iv) of the definition of Change in Control under Section 1.2 of the Plan, the Committee may accelerate vesting and the time at which the Incentive Option may be exercised so that the Incentive Option may be exercised in full for a limited period of time on or before a specified date fixed by the Committee, after which the unexercised Incentive Option and all rights of Optionee thereunder shall terminate, or the Committee may accelerate vesting and the time at which the Incentive Option may be exercised so that the Incentive Option may be exercised in full for its then remaining term.
Notwithstanding the above, the Committee shall not be required to take any action described in the preceding sentence and any decision made by the Committee, in its sole discretion, not to take some or all of the actions described in the preceding sentence shall be final, binding and conclusive with respect to the Company and all other interested persons.
(b) Right of Cash-Out. If approved by the Board prior to or within thirty (30) days after such time as a Change in Control shall be deemed to have occurred, the Board shall have the right for a forty-five (45) day period immediately following the date that the Change in Control is deemed to have occurred to require Optionee to transfer and deliver to Company the Incentive Option in exchange for an amount equal to the “cash value”
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(defined below) of the Incentive Option. Such right shall be exercised by written notice to Optionee. The cash value of the Incentive Option shall equal the excess of the “market value” (defined below) per Share over the Exercise Price, if any, multiplied by the number of Shares subject to the Incentive Option. For purposes of the preceding sentence, “market value” per Share shall mean the higher of (i) the average of the Fair Market Value per Share of Common Stock on each of the five trading days immediately following the date a Change in Control is deemed to have occurred or (ii) the highest price, if any, offered in connection with the Change in Control. The amount payable to Optionee by Company pursuant to this Paragraph 8(b) shall be in cash or by certified check and shall be reduced by any taxes required to be withheld.
9. Reorganization of Company and Subsidiaries. The existence of the Incentive Option shall not affect in any way the right or power of Company or its stockholders to make or authorize any or all adjustments, recapitalizations, reorganizations or other changes in the Company’s capital structure or its business, or any merger or consolidation of Company or any issue of bonds, debentures, preferred or prior preference stock ahead of or affecting the Shares or the rights thereof, or the dissolution or liquidation of Company, or any sale or transfer of all or any part of its assets or business, or any other corporate act or proceeding, whether of a similar character or otherwise.
10. Adjustment of Shares. In the event of stock dividends, spin-offs of assets or other extraordinary dividends, stock splits, combinations of shares, recapitalizations, mergers, consolidations, reorganizations, liquidations, issuances of rights or warrants and similar transactions or events involving Company, the Committee shall, in such manner as it may deem equitable, make adjustments to the terms and provisions of this Incentive Option.
11. No Rights in Shares. Optionee shall have no rights as a stockholder in respect of Shares until such Optionee becomes the holder of record of such Shares.
12. Certain Restrictions. The certificate issued for the Shares subject to the restrictions described in this Paragraph 12 may, in the Committee’s discretion, be issued with an appropriate legend describing such restrictions, and the Committee may establish an escrow or other custodial arrangement for holding of the certificate by a person (other than Optionee) selected by the Committee.
By exercising the Incentive Option, Optionee agrees that if at the time of such exercise the sale of Shares issued hereunder is not covered by an effective registration statement filed under the Securities Act of 1933 (Act), Optionee will acquire the Shares for Optionee’s own account and without a view to resale or distribution in violation of the Act or any other securities law, and upon any such acquisition Optionee will enter into such written representations, warranties and agreements as Company may reasonably request in order to comply with the Act or any other securities law or with this Agreement. Optionee agrees that Company shall not be obligated to take any affirmative action in order to cause the issuance or transfer of Shares hereunder to comply with any law, rule or regulation that applies to the Shares subject to the Incentive Option.
13. Shares Reserved. Company shall at all times during the Option Period reserve and keep available such number of Shares as will be sufficient to satisfy the requirements of this Incentive Option.
14. Nontransferability of Option. The Incentive Option evidenced by this Agreement is not transferable other than by will, and the laws of descent and distribution. The Incentive Option will be exercisable during Optionee’s lifetime only by Optionee or by Optionee’s guardian or legal
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representative. No right or benefit hereunder shall in any manner be liable for or subject to any debts, contracts, liabilities, or torts of Optionee.
15. Amendment and Termination. The Incentive Option may not be terminated by the Board or the Committee at any time without the written consent of Optionee. This Agreement may be amended in writing by the Company and Optionee, provided the Company may amend this Agreement unilaterally (i) if the amendment does not adversely affect the Optionee’s rights hereunder in any material respect, (ii) if the Company determines that an amendment is necessary to comply with Rule 16b-3 under the Exchange Act, or (iii) if the Company determines that an amendment is necessary to meet the requirements of the Code or to prevent adverse tax consequences to the Optionee.
16. No Guarantee of Employment. The Incentive Option shall not confer upon Optionee any right with respect to continuance of employment or other service with the Company or any Affiliate, nor shall it interfere in any way with any right Company or any Affiliate would otherwise have to terminate such Optionee’s employment or other service at any time.
17. Notice of Disqualifying Disposition. If the Optionee sells or otherwise disposes of any of the Shares acquired pursuant to the exercise of the Incentive Option on or before the later of (i) the date that is two years after the date of grant of the Incentive Option, and (ii) the date that is one (1) year after the transfer of the Shares to the Optionee upon exercise of the Incentive Option, the Optionee shall make the information regarding such disposition available to the Company upon the Company’s request.
18. Withholding of Taxes. Any issuance of Common Stock pursuant to the exercise of the Incentive Option shall not be made until appropriate arrangements satisfactory to the Company have been made for the payment of any tax amounts (federal, state, local or other) that may be required to be withheld or paid by the Company with respect thereto at the minimum statutory rate. Company shall have the right to take such action as may be necessary or appropriate to satisfy any such tax withholding obligations.
19. No Guarantee of Tax Consequences. Neither Company nor any Affiliate nor the Board or Committee makes any commitment or guarantee that any federal or state tax treatment will apply or be available to any person eligible for the benefits under the Incentive Option.
20. Consent to Electronic Delivery; Electronic Signature. In lieu of receiving documents in paper format, Optionee agrees, to the fullest extent permitted by law, to accept electronic delivery of any documents that the Company may be required to deliver (including, but not limited to, prospectuses, prospectus supplements, grant or award notifications and agreements, account statements, annual and quarterly reports, and all other forms of communications) in connection with this and any other award made or offered by the Company. Electronic delivery may be via a Company electronic mail system or by reference to a location on a Company intranet to which Optionee has access. Optionee hereby consents to any and all procedures the Company has established or may establish for an electronic signature system for delivery and acceptance of any such documents that the Company may be required to deliver, and agrees that his or her electronic signature is the same as, and shall have the same force and effect as, his or her manual signature.
21. Severability. In the event that any provision of the Incentive Option shall be held illegal, invalid, or unenforceable for any reason, such provision shall be fully severable, but shall not affect the remaining provisions of the Incentive Option, and the Incentive Option shall be construed and enforced as if the illegal, invalid, or unenforceable provision had never been included herein.
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22. Governing Law. The Incentive Option and this Agreement shall be construed in accordance with the laws of the State of Delaware to the extent federal law does not supersede and preempt Delaware law.
COMPANY
TETRA Technologies, Inc.
By: ____________________
Geoffrey M. Hertel
President & Chief Executive Officer
OPTIONEE
By: ____________________
Employee
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Exhibit 10.3
TETRA Technologies, Inc.
EMPLOYEE NONQUALIFIED STOCK OPTION AGREEMENT
Pursuant to the terms of the TETRA Technologies, Inc. 2006 Equity Incentive Compensation Plan
1. Grant of Nonqualified Option. TETRA Technologies, Inc., a Delaware corporation (“Company”), hereby grants to (“Optionee”) the right, privilege and option as herein set forth (the “Nonqualified Option”) to purchase up to xx,xxx shares (the “Shares”) of common stock, $0.01 par value per share, of the Company (“Common Stock”), subject to and in accordance with the terms and conditions of this document. This Employee Nonqualified Stock Option Agreement (the “Agreement”) is dated as of xx/xx/xx. The Shares, when issued to Optionee upon exercise of the Nonqualified Option, shall be fully paid and nonassessable and the Optionee (or the person permitted to exercise the Nonqualified Option in the event of Optionee’s death) shall be and have all the rights and privileges of a stockholder of record of the Company with respect to the Shares acquired upon exercise of the Nonqualified Option, effective upon such exercise. The Nonqualified Option is granted pursuant to and to implement in part the TETRA Technologies, Inc. 2006 Equity Incentive Compensation Plan (as amended and in effect from time to time, the “Plan”) and is subject to the provisions of the Plan, which is hereby incorporated herein and is made a part hereof, as well as the provisions of this Agreement. By execution of this Agreement, Optionee agrees to be bound by all of the terms, provisions, conditions and limitations of the Plan as implemented by the Nonqualified Option and this Agreement, together with all rules and determinations from time to time issued by the Committee pursuant to the Plan. All capitalized terms have the meanings set forth in the Plan unless otherwise specifically provided. All references to specified paragraphs pertain to paragraphs of this Nonqualified Option unless otherwise provided. The Nonqualified Option is not intended to qualify as an “incentive stock option” within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”).
2. Option Terms. Subject to earlier termination as provided herein, the Nonqualified Option shall expire on the 10th anniversary of the date of grant of Nonqualified Option, which anniversary shall be xx/xx/xx. The period during which the Nonqualified Option is in effect is referred to as the “Option Period”.
3. Option Exercise Price. The exercise price (the “Exercise Price”) of the Shares subject to the Nonqualified Option shall be $xx.xx per Share which has been determined to be no less than the Fair Market Value Per Share of the Common Stock on the date of grant of the Nonqualified Option.
4. Vesting. Subject to the provisions of this Agreement, including, without limitation, the following provisions of this Paragraph 4, the total number of Shares subject to this Nonqualified Option shall vest and be exercisable only in accordance with the following schedule:
[schedule to be specified]
The vested Shares that may be acquired under the Nonqualified Option may be purchased, in whole or in part, at any time after they become vested during the Option Period. In addition, upon the occurrence of a Change in Control the Committee may, in accordance with Paragraph 8 below, accelerate vesting and the time at which the Nonqualified Option may be exercised.
5. Method of Exercise. To exercise the Nonqualified Option, Optionee shall deliver notice to the Company at its principal executive office, directed to the Plan Administrator, such exercise to be effective at the time of receipt of such notice at the Company’s principal executive office during normal business hours, stating the number of Shares with respect to which the
Nonqualified Option is being exercised together with payment for such Shares plus any required withholding taxes, unless other arrangements for withholding tax liability have been made with the Committee. The exercise notice shall be delivered in person, by certified or regular mail, or by such other method (including electronic transmission) as determined from time to time by the Committee or the Plan Administrator. Any exercise of the Nonqualified Option must be for a minimum of 100 Shares or, if less, for all remaining Shares subject to the Nonqualified Option.
6. Payment of Exercise Price and Required Withholding. In order to exercise the Nonqualified Option, the Optionee or other person or persons entitled to exercise such Nonqualified Option shall deliver to Company payment in full for (i) the Shares being purchased and (ii) unless other arrangements have been made with the Committee, any required withholding taxes. The payment of the Exercise Price for the Nonqualified Option shall either be (i) in cash, or by check payable and acceptable to the Company, (ii) with the consent of the Committee, by tendering to Company shares of Common Stock owned by the person exercising the Nonqualified Option for more than six months having an aggregate Fair Market Value as of the date of exercise that is not greater than the full exercise price for the Shares with respect to which the Nonqualified Option is being exercised and by paying any remaining amount of the Exercise Price (and any required withholding taxes) as provided in (i) above, or (iii) with the consent of the Committee and compliance with such instructions as the Committee may specify, by delivering to the Company and to a broker a properly executed exercise notice and irrevocable instructions to such broker to deliver to the Company cash or a check payable and acceptable to the Company to pay the exercise price and any applicable withholding taxes. Upon receipt of the cash or check from the broker, the Company will deliver to the broker the shares for which the Nonqualified Option is exercised. In the event that the person elects to make payment as allowed under clause (ii) above, the Committee may, upon confirming that the Optionee owns the number of additional Shares being tendered, authorize the issuance of a new certificate for the number of Shares being acquired pursuant to the exercise of the Nonqualified Option less that number of Shares being tendered upon the exercise and return to the person (or not require surrender of) the certificate for the Shares being tendered upon the exercise. The date of sale of the shares by the broker pursuant to a cashless exercise under (iii) above shall be the date of exercise of the Nonqualified Option. If the Committee so requires, such person or persons shall also deliver a written representation that all Shares being purchased are being acquired for investment and not with a view to, or for resale in connection with, any distribution of such Shares.
7. Termination of Employment. Termination of Employment, Retirement, death or Disability of Optionee, shall affect Optionee’s rights under the Nonqualified Option as follows:
(a) Termination of Employment. If Employment of Optionee is terminated for any reason whatsoever other than death, Disability or Retirement, subject to the provisions of this Section 7, any nonvested portion of the Nonqualified Option outstanding at the time of such termination and all rights thereunder shall wholly and completely terminate and no further vesting shall occur, and Optionee shall be entitled to exercise his or her rights with respect to the portion of the Nonqualified Option vested as of the date of termination for a period that shall end on the earlier of (i) the expiration date set forth in the Nonqualified Option with respect to the vested portion of the Nonqualified Option or (ii) the date that occurs three (3) months after such termination date.
(b) Retirement. Upon the Retirement of Optionee:
(i) any nonvested portion of the Nonqualified Option shall immediately terminate and no further vesting shall occur; and
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(ii) any vested portion of the Nonqualified Option shall expire on the earlier of (A) the expiration of the Option Period; or (B) the expiration of twelve (12) months after the date of Retirement.
(c) Disability or Death. Upon termination of Employment as a result of Disability or death of Optionee or if Optionee retires and dies during the period described in Section 7(b)(ii) above (hereinafter the “Applicable Retirement Period”), or if the Optionee’s Employment was terminated as a result of Disability and the Optionee dies during the period that expires on the earlier of the expiration of the Option Period or the first anniversary of the Optionee’s termination of Employment due to Disability (hereinafter the “Applicable Disability Period”),
(i) any nonvested portion of the Nonqualified Option that has not already terminated shall immediately terminate and no further vesting shall occur; and
(ii) any vested portion of the Nonqualified Option shall expire upon the earlier of (A) the expiration of the Option Period or (B) the later of (1) the first anniversary of such termination of Employment as a result of Disability or death, or (2) the first anniversary of Optionee’s death during the Applicable Retirement Period or the Applicable Disability Period.
(d) Notwithstanding any other provision of the Nonqualified Option, the Committee, in its discretion, may provide for the continuation of the Nonqualified Option for such period and upon such terms and conditions as are determined by the Committee in the event that the Optionee ceases to be an Employee.
8. Change in Control.
(a) Change in Control. In the event of a Change in Control described in clauses (ii), (iii) and (iv) of the definition of Change in Control under Section 1.2 of the Plan, the Committee may accelerate vesting and the time at which the Nonqualified Option may be exercised so that the Nonqualified Option may be exercised in full for a limited period of time on or before a specified date fixed by the Committee, after which the unexercised Nonqualified Option and all rights of Optionee thereunder shall terminate, or the Committee may accelerate vesting and the time at which the Nonqualified Option may be exercised so that the Nonqualified Option may be exercised in full for its then remaining term.
Notwithstanding the above, the Committee shall not be required to take any action described in the preceding sentence and any decision made by the Committee, in its sole discretion, not to take some or all of the actions described in the preceding sentence shall be final, binding and conclusive with respect to the Company and all other interested persons.
(b) Right of Cash-Out. If approved by the Board prior to or within thirty (30) days after such time as a Change in Control shall be deemed to have occurred, the Board shall have the right for a forty-five (45) day period immediately following the date that the Change in Control is deemed to have occurred to require Optionee to transfer and deliver to Company the Nonqualified Option in exchange for an amount equal to the “cash value” (defined below) of the Nonqualified Option. Such right shall be exercised by written notice to Optionee. The cash value of the Nonqualified Option shall equal the excess of the “market value” (defined below) per Share over the Exercise Price, if any, multiplied by the number of Shares subject to the Nonqualified Option. For purposes of the preceding sentence, “market value” per Share shall mean the higher of (i) the average of the Fair
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Market Value per Share of Common Stock on each of the five trading days immediately following the date a Change in Control is deemed to have occurred or (ii) the highest price, if any, offered in connection with the Change in Control. The amount payable to Optionee by Company pursuant to this Paragraph 8(b) shall be in cash or by certified check and shall be reduced by any taxes required to be withheld.
9. Reorganization of Company and Subsidiaries. The existence of the Nonqualified Option shall not affect in any way the right or power of Company or its stockholders to make or authorize any or all adjustments, recapitalizations, reorganizations or other changes in the Company’s capital structure or its business, or any merger or consolidation of Company or any issue of bonds, debentures, preferred or prior preference stock ahead of or affecting the Shares or the rights thereof, or the dissolution or liquidation of Company, or any sale or transfer of all or any part of its assets or business, or any other corporate act or proceeding, whether of a similar character or otherwise.
10. Adjustment of Shares. In the event of stock dividends, spin-offs of assets or other extraordinary dividends, stock splits, combinations of shares, recapitalizations, mergers, consolidations, reorganizations, liquidations, issuances of rights or warrants and similar transactions or events involving Company, the Committee shall, in such manner as it may deem equitable, make adjustments to the terms and provisions of this Nonqualified Option.
11. No Rights in Shares. Optionee shall have no rights as a stockholder in respect of Shares until such Optionee becomes the holder of record of such Shares.
12. Certain Restrictions. The certificate issued for the Shares subject to the restrictions described in this Paragraph 12 may, in the Committee’s discretion, be issued with an appropriate legend describing such restrictions, and the Committee may establish an escrow or other custodial arrangement for holding of the certificate by a person (other than Optionee) selected by the Committee.
By exercising the Nonqualified Option, Optionee agrees that if at the time of such exercise the sale of Shares issued hereunder is not covered by an effective registration statement filed under the Securities Act of 1933 (Act), Optionee will acquire the Shares for Optionee’s own account and without a view to resale or distribution in violation of the Act or any other securities law, and upon any such acquisition Optionee will enter into such written representations, warranties and agreements as Company may reasonably request in order to comply with the Act or any other securities law or with this Agreement. Optionee agrees that Company shall not be obligated to take any affirmative action in order to cause the issuance or transfer of Shares hereunder to comply with any law, rule or regulation that applies to the Shares subject to the Nonqualified Option.
13. Shares Reserved. Company shall at all times during the Option Period reserve and keep available such number of Shares as will be sufficient to satisfy the requirements of this Nonqualified Option.
14. Nontransferability of Option. The Nonqualified Option evidenced by this Agreement is not transferable other than by will, the laws of descent and distribution, or pursuant to a qualified domestic relations order. The Nonqualified Option will be exercisable during Optionee’s lifetime only by Optionee or by Optionee’s guardian or legal representative. No right or benefit hereunder shall in any manner be liable for or subject to any debts, contracts, liabilities, or torts of Optionee. The Optionee (or his guardian) may, in accordance with rules and procedures established by the Committee from time to time, transfer, for estate planning purposes, all or part of the Nonqualified Option to one or more immediate family members or related family trusts or
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partnerships or similar entities as determined by the Committee. To the extent the Nonqualified Option is transferred in accordance with the provisions of this Paragraph 14, the Nonqualified Option may only be exercised by the person or persons who acquire a proprietary interest in the Nonqualified Options pursuant to the transfer.
15. Amendment and Termination. The Nonqualified Option may not be terminated by the Board or the Committee at any time without the written consent of Optionee. This Agreement may be amended in writing by the Company and Optionee, provided the Company may amend this Agreement unilaterally (i) if the amendment does not adversely affect the Optionee’s rights hereunder in any material respect, (ii) if the Company determines that an amendment is necessary to comply with Rule 16b-3 under the Exchange Act, or (iii) if the Company determines that an amendment is necessary to meet the requirements of the Code or to prevent adverse tax consequences to the Optionee.
16. No Guarantee of Employment. The Nonqualified Option shall not confer upon Optionee any right with respect to continuance of employment or other service with the Company or any Affiliate, nor shall it interfere in any way with any right Company or any Affiliate would otherwise have to terminate such Optionee’s employment or other service at any time.
17. Withholding of Taxes. Any issuance of Common Stock pursuant to the exercise of the Nonqualified Option shall not be made until appropriate arrangements satisfactory to the Company have been made for the payment of any tax amounts (federal, state, local or other) that may be required to be withheld or paid by the Company with respect thereto at the minimum statutory rate. Company shall have the right to take such action as may be necessary or appropriate to satisfy any such tax withholding obligations.
18. No Guarantee of Tax Consequences. Neither Company nor any Affiliate nor the Board or Committee makes any commitment or guarantee that any federal or state tax treatment will apply or be available to any person eligible for the benefits under the Nonqualified Option.
19. Severability. In the event that any provision of the Nonqualified Option shall be held illegal, invalid, or unenforceable for any reason, such provision shall be fully severable, but shall not affect the remaining provisions of the Nonqualified Option, and the Nonqualified Option shall be construed and enforced as if the illegal, invalid, or unenforceable provision had never been included herein.
20. Consent to Electronic Delivery; Electronic Signature. In lieu of receiving documents in paper format, Optionee agrees, to the fullest extent permitted by law, to accept electronic delivery of any documents that the Company may be required to deliver (including, but not limited to, prospectuses, prospectus supplements, grant or award notifications and agreements, account statements, annual and quarterly reports, and all other forms of communications) in connection with this and any other award made or offered by the Company. Electronic delivery may be via a Company electronic mail system or by reference to a location on a Company intranet to which Optionee has access. Optionee hereby consents to any and all procedures the Company has established or may establish for an electronic signature system for delivery and acceptance of any such documents that the Company may be required to deliver, and agrees that his or her electronic signature is the same as, and shall have the same force and effect as, his or her manual signature.
21. Governing Law. The Nonqualified Option and this Agreement shall be construed in accordance with the laws of the State of Delaware to the extent federal law does not supersede and preempt Delaware law.
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COMPANY
TETRA Technologies, Inc.
By: ____________________
Geoffrey M. Hertel
President & Chief Executive Officer
OPTIONEE
By: ____________________
Employee
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Exhibit 10.4
TETRA Technologies, Inc.
EMPLOYEE RESTRICTED STOCK AGREEMENT
Pursuant to the terms of the TETRA Technologies, Inc. 2006 Equity Incentive Compensation Plan
1. Grant of Restricted Stock. TETRA Technologies, Inc., a Delaware corporation (“Company”), hereby awards to (“Participant”) all rights, title and interest in the record and beneficial ownership of xx,xxx shares (the “Restricted Stock”) of common stock, $0.01 par value per share, of the Company (“Common Stock”), subject to and in accordance with the terms and conditions of this document. This Employee Restricted Stock Agreement (“Restricted Stock Agreement”) is dated as of xx/xx/xx. The Restricted Stock is awarded pursuant to and to implement in part the TETRA Technologies, Inc. 2006 Equity Incentive Compensation Plan (as amended and in effect from time to time, the “Plan”) and is subject to the restrictions, forfeiture provisions and other terms and conditions of the Plan, which is hereby incorporated herein and is made a part hereof, and this Restricted Stock Agreement. By execution of this Restricted Stock Agreement, Participant agrees to be bound by all of the terms, provisions, conditions and limitations of the Plan as implemented by the Restricted Stock Agreement and this Agreement, together with all rules and determinations from time to time issued by the Committee pursuant to the Plan. All capitalized terms have the meanings set forth in the Plan unless otherwise specifically provided. All references to specified paragraphs pertain to paragraphs of this Restricted Stock Agreement unless otherwise provided.
2. Custody of Restricted Stock. The stock certificate(s) evidencing the Restricted Stock shall be issued and registered on the Company’s books and records in the name of the Participant as soon as practicable following the date of this Restricted Stock Agreement. The Company shall retain physical possession and custody of each stock certificate representing the Restricted Stock until such time as the Restricted Stock becomes vested, and the restrictions imposed thereon lapse, in accordance with Paragraph 4 below. The Participant will deliver to the Company a stock power in substantially the form of Exhibit A attached hereto, endorsed in blank, with respect to each award of the Restricted Stock. Each stock certificate shall bear a restrictive legend in substantially the following form:
The shares represented by this certificate have been issued pursuant to the terms of the TETRA Technologies, Inc. 2006 Equity Incentive Compensation Plan (as amended and restated) and may not be sold, pledged, transferred, assigned or otherwise encumbered in any manner except as is set forth in the terms of the Restricted Stock Agreement dated _______________, 200___.
Upon the written request of the Participant following the vesting of any portion of the shares of the Restricted Stock and the removal of any restrictions thereon in accordance with Paragraph 4 below, the Company will promptly issue a stock certificate, without such restrictive legend, with respect to the vested portion of the shares of the Restricted Stock registered on the Company’s books and records in the name of the Participant. Following the expiration of the Restricted Period, the Company will promptly issue a stock certificate, without such restrictive legend, for any shares of the Restricted Stock that have vested and with respect to which the restrictions imposed thereon have lapsed to the extent a stock certificate has not previously been reissued without a restrictive legend as provided in the preceding sentence.
3. Risk of Forfeiture. Participant shall immediately forfeit all rights to any shares of the Restricted Stock which have not vested and with respect to which the restrictions thereon have not lapsed in the event of termination, resignation, or removal of Participant from Employment with the Company or any Affiliate under circumstances that do not cause Participant to become fully vested, and the restrictions on such shares of Restricted Stock to lapse, under the terms of the Plan.
4. Restricted Period; Vesting. Subject to the provisions of this Restricted Stock Agreement including, without limitation, the following provisions of this Paragraph 4, the total number of shares subject to this Restricted Stock Agreement shall vest, and the restrictions imposed thereon shall lapse, in accordance with the following schedule:
[schedule to be specified]
The period from the date hereof until the shares of the Restricted Stock have become 100% vested and the restrictions thereon have lapsed shall be referred to as the “Restricted Period.”
The Committee may, upon the occurrence of a Change in Control and in accordance with Paragraph 8 below, waive all restrictions and conditions of the Restricted Stock with the result that the shares of Restricted Stock shall be fully vested and the restrictions thereon shall have lapsed.
5. Transferability. During the Restricted Period, the Participant shall not sell, assign, transfer, pledge, exchange, hypothecate, or otherwise dispose of any shares of the Restricted Stock prior to vesting in accordance with Paragraph 4 above. Upon receipt by the Participant of stock certificate(s) representing the vested shares without a restrictive legend pursuant to Paragraph 2 above, the Participant may hold or dispose of the shares represented by such certificate(s), subject to compliance with (i) the terms and conditions of the Plan and this Restricted Stock Agreement, (ii) applicable federal or state securities laws or other applicable law, (iii) applicable rules of any exchange on which the Company’s securities are traded or listed, and (iv) the Company’s rules or policies as established by the Company in its sole discretion.
6. Ownership Rights. Prior to any forfeiture of the shares of Restricted Stock and while such nonvested shares are restricted, the Participant shall, subject to the terms and restrictions of this Restricted Stock Agreement and the Plan, have all rights with respect to the shares of Restricted Stock awarded hereunder including the right to vote the shares of Restricted Stock, whether or not vested in accordance with Paragraph 4 above, and the right to receive all dividends, cash or stock, paid or delivered thereon from and after the date hereof in accordance with the following provisions. During the Restricted Period, any dividends, cash or stock, paid or delivered on any of the nonvested shares of the Restricted Stock, shall be credited to an account for the benefit of the Participant. In the event of the forfeiture of any nonvested shares of the Restricted Stock, the Participant shall have no further rights with respect to such Restricted Stock and shall forfeit any dividends, cash or stock, credited to the account for the benefit of the Participant which are related to the forfeited shares of Restricted Stock. To the extent the shares of Restricted Stock shall become fully vested and the restrictions imposed thereon shall lapse pursuant to Paragraph 4 above, all dividends, cash and stock, if any, credited to the account for the benefit of the Participant shall be distributed to the Participant without interest.
7. Termination of Employment. If Employment of Participant is terminated for any reason whatsoever including, without limitation, death, Disability or Retirement, any nonvested shares of the Restricted Stock outstanding at the time of such termination and all rights thereunder shall be forfeited and no further vesting shall occur, and the Company shall have the right to repurchase or recover such shares for the amount of any cash paid therefor.
8. Change in Control.
(a) Change in Control. In the event of a Change in Control described in clauses (ii), (iii) and (iv) of the definition of Change in Control under Section 1.2 of the Plan, the Committee may waive all restrictions and conditions of all Restricted Stock then outstanding with the result that the shares of Restricted Stock shall be fully vested and all
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restrictions shall be deemed satisfied, and the Restricted Period shall be deemed to have expired as of the date of the Change in Control or such other date as may be determined by the Committee.
Notwithstanding the above, the Committee shall not be required to take any action described in the preceding sentence and any decision made by the Committee, in its sole discretion, not to take some or all of the actions described in the preceding sentence shall be final, binding and conclusive with respect to the Company and all other interested persons.
(b) Right of Cash-Out. If approved by the Board prior to or within thirty (30) days after such time as a Change in Control shall be deemed to have occurred, the Board shall have the right for a forty-five (45) day period immediately following the date that the Change in Control is deemed to have occurred to require Participant to transfer and deliver to Company all unvested shares of Restricted Stock hereunder with respect to which the restrictions have not lapsed in exchange for an amount equal to the “cash value” (defined below) of such shares of Restricted Stock. Such right shall be exercised by written notice to Participant. The cash value of such shares of Restricted Stock shall equal the “market value” (defined below) per share, multiplied by the number of unvested shares of Restricted Stock hereunder with respect to which the restrictions have not lapsed. For purposes of the preceding sentence, “market value” per share shall mean the higher of (i) the average of the Fair Market Value per share of Common Stock on each of the five trading days immediately following the date a Change in Control is deemed to have occurred or (ii) the highest price, if any, offered in connection with the Change in Control. The amount payable to Participant by Company pursuant to this Section 8(b) shall be paid in cash or by certified check and shall be reduced by any taxes required to be withheld.
9. Reorganization of Company and Subsidiaries. The existence of the Restricted Stock shall not affect in any way the right or power of Company or its stockholders to make or authorize any or all adjustments, recapitalizations, reorganizations or other changes in the Company’s capital structure or its business, or any merger or consolidation of Company or any issue of bonds, debentures, preferred or prior preference stock ahead of or affecting the shares of Restricted Stock or the rights thereof, or the dissolution or liquidation of Company, or any sale or transfer of all or any part of its assets or business, or any other corporate act or proceeding, whether of a similar character or otherwise.
10. Adjustment of Shares. In the event of stock dividends, spin-offs of assets or other extraordinary dividends, stock splits, combinations of shares, recapitalizations, mergers, consolidations, reorganizations, liquidations, issuances of rights or warrants and similar transactions or events involving Company, the Committee shall, in such manner as it may deem equitable, make adjustments to the terms and provisions of this Restricted Stock Agreement.
11. Certain Restrictions. By executing this Restricted Stock Agreement, Participant agrees that if at the time of delivery of certificates for the shares of Restricted Stock issued hereunder any sale of such shares of Common Stock is not covered by an effective registration statement filed under the Securities Act of 1933 (“Act”), the certificates so delivered may contain such legends as the Company shall require and the Participant will acquire the shares of Restricted Stock for Participant’s own account and without a view to resale or distribution in violation of the Act or any other securities law, and upon any such acquisition Participant will enter into such written representations, warranties and agreements as Company may reasonably request in order to comply with the Act or any other securities law or with this Restricted Stock Agreement. Participant agrees that the Company shall not be obligated to take any affirmative action in order to cause the issuance or transfer of shares of Restricted Stock hereunder to
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comply with any law, rule or regulation that applies to the shares of Restricted Stock subject to this Restricted Stock Agreement.
12. Amendment and Termination. The Restricted Stock Agreement may not be terminated by the Board or the Committee at any time without the written consent of Participant. This Agreement may be amended in writing by the Company and Participant, provided the Company may amend this Agreement unilaterally (i) if the amendment does not adversely affect the Participant’s rights hereunder in any material respect, (ii) if the Company determines that an amendment is necessary to comply with Rule 16b-3 under the Exchange Act, or (iii) if the Company determines that an amendment is necessary to meet the requirements of the Code or to prevent adverse tax consequences to the Participant.
13. No Guarantee of Employment. Neither this Restricted Stock Agreement nor the award of Restricted Stock evidenced hereby shall confer upon Participant any right with respect to continuance of employment or other service with the Company or any Affiliate, nor shall it interfere in any way with any right Company or any Affiliate would otherwise have to terminate such Participant’s employment or other service at any time.
14. Tax Matters.
(a) Company shall have the right to (i) make deductions from the number of shares of Restricted Stock otherwise deliverable upon vesting of the Restricted Stock and satisfaction of the conditions precedent under this Restricted Stock Agreement in an amount sufficient to satisfy withholding of any federal, state or local taxes required by law, or (ii) take such other action as may be necessary or appropriate to satisfy any such tax withholding obligations.
(b) Under Section 83 of the Internal Revenue Code of 1986, as amended (the “Code”), the difference between the purchase price paid, if any, for the shares of Restricted Stock and their fair market value on the date of vesting when any forfeiture restrictions applicable to such shares lapse will be reportable as ordinary income at that time. For this purpose, “forfeiture restrictions” include the Company’s rights to reacquire the shares of the unvested Restricted Stock described above. Participant may elect to be taxed at the effective time of this award when the shares are acquired rather than when such shares vest and cease to be subject to such forfeiture restrictions by filing an election under Section 83(b) of the Code with the Internal Revenue Service within thirty (30) days after the date hereof. If such an election is made, Participant will have to make a tax payment to the extent the purchase price, if any, is less than the fair market value of the shares on the date hereof. No tax payment will have to be made to the extent the purchase price, if any, is at least equal to the fair market value of the shares on the date hereof. Failure to make this filing within the thirty (30) day period will result in the recognition of ordinary income by you as the shares of Restricted Stock vest and the forfeiture restrictions lapse.
PARTICIPANT ACKNOWLEDGES THAT IT IS PARTICIPANT’S SOLE RESPONSIBILITY, AND NOT THE COMPANY’S, TO FILE A TIMELY ELECTION UNDER SECTION 83(b) IF PARTICIPANT ELECTS TO DO SO, EVEN IF PARTICIPANT REQUESTS THE COMPANY OR ITS REPRESENTATIVES TO MAKE THIS FILING ON PARTICIPANT’S BEHALF. PARTICIPANT MUST AND IS RELYING SOLELY ON PARTICIPANT’S OWN ADVISORS WITH RESPECT TO THE DECISION AS TO WHETHER OR NOT TO FILE ANY SECTION 83(b) ELECTION.
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(c) Neither Company nor the Board or Committee makes any commitment or guarantee that any federal or state tax treatment will apply or be available to any person eligible for the benefits under this Restricted Stock Agreement.
15. Community Interest of Spouse. The community interest, if any, of any spouse of Participant in any Restricted Stock shall be subject to all of the terms, conditions and restrictions of this Restricted Stock Agreement and the Plan.
16. Consent to Electronic Delivery; Electronic Signature. In lieu of receiving documents in paper format, Participant agrees, to the fullest extent permitted by law, to accept electronic delivery of any documents that the Company may be required to deliver (including, but not limited to, prospectuses, prospectus supplements, grant or award notifications and agreements, account statements, annual and quarterly reports, and all other forms of communications) in connection with this and any other award made or offered by the Company. Electronic delivery may be via a Company electronic mail system or by reference to a location on a Company intranet to which Participant has access. Participant hereby consents to any and all procedures the Company has established or may establish for an electronic signature system for delivery and acceptance of any such documents that the Company may be required to deliver, and agrees that his or her electronic signature is the same as, and shall have the same force and effect as, his or her manual signature.
17. Severability. In the event that any provision of this Restricted Stock Agreement shall be held illegal, invalid, or unenforceable for any reason, such provision shall be fully severable, but shall not affect the remaining provisions of this Restricted Stock Agreement, and this Restricted Stock Agreement shall be construed and enforced as of the illegal, invalid, or unenforceable provision had never been included herein.
18. Governing Law. This Restricted Stock Agreement shall be construed in accordance with the laws of the State of Delaware to the extent federal law does not supersede and preempt Delaware law.
COMPANY
TETRA Technologies, Inc.
By: ____________________
Geoffrey M. Hertel
President & Chief Executive Officer
PAARTICIPANT
By: ____________________
(Signature)
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Exhibit A
Assignment Separate from Certificate
FOR VALUE RECEIVED, __________________ hereby sells, assigns and transfers unto TETRA Technologies, Inc., a Delaware corporation (the “Company”), ______________ (____________) shares of common stock of the Company represented by Certificate No. _________ herewith and does hereby irrevocably constitute and appoint ______________________, or his designee or successor, attorney to transfer the said stock on the books of the Company with full power of substitution in the premises.
Dated: ________________, 20____.
________________
Print Name
________________
Signature
Spouse Consent (if applicable)
________________ (Purchaser’s spouse) indicates by the execution of this Assignment his or her consent to be bound by the terms of the Restricted Stock Agreement as to his or her interests, whether as community property or otherwise, if any, in the shares of common stock of the Company.
________________
Signature
INSTRUCTIONS: PLEASE DO NOT FILL IN ANY BLANKS OTHER THAN THE SIGNATURE LINE. THE PURPOSE OF THIS ASSIGNMENT IS TO ENABLE THE COMPANY TO EXERCISE ITS “REPURCHASE OPTION” SET FORTH IN THE RESTRICTED STOCK AGREEMENT WITHOUT REQUIRING ADDITIONAL SIGNATURES ON THE PART OF THE PURCHASER.