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): December 20, 2018

 

 

Flotek Industries, Inc.

(Exact name of registrant as specified in its charter)

 

 

 

Delaware   001-13270   90-0023731
(State or Other Jurisdiction
of Incorporation)
 

(Commission

File Number)

 

(IRS Employer

Identification No.)

 

10603 W. Sam Houston Pkwy N., Suite 300

Houston, Texas

  77064
(Address of principal executive offices)   (Zip Code)

(713) 849-9911

(Registrant’s telephone number, including area code)

(Not applicable)

(Former name or former address, if changed since last report.)

 

 

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:

 

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))

Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company  ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

 

 

 


Item 5.02.

Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

Appointment of Elizabeth T. Wilkinson as Chief Financial Officer

On December 20, 2018, Flotek Industries, Inc. (the “Company”) appointed Elizabeth T. Wilkinson, 61, as its Chief Financial Officer, effective as of December 28, 2018. In this role, Ms. Wilkinson will serve as the Company’s principal financial officer and principal accounting officer. Prior to joining the Company, from January 2012 through December 2018, Ms. Wilkinson served as a managing consultant at RPG, a publicly traded, global consulting firm, leading financial advisory projects for Fortune 100, Fortune 500, and private-equity-controlled clients. In this capacity, she served as interim CFO, interim treasurer, and in key financial reporting roles leading companies through significant accounting and finance transitions. Prior to her role at RPG, from March 2009 through March 2011, Ms. Wilkinson was CFO of Xtreme Drilling and Coil Services where she raised capital and managed debt and liquidity and directed all accounting, financial reporting and investor relations functions.

There are no arrangements or understandings between Ms. Wilkinson and any other person pursuant to which she was appointed to serve as the Company’s Chief Financial Officer. The Company is not aware of any related transactions or relationships between Ms. Wilkinson and the Company that would require disclosure under Item 404(a) of Regulation S-K.

Wilkinson Employment Agreement

On December 20, 2018, the Company and Ms. Wilkinson entered into an Employment Agreement (the “Wilkinson Employment Agreement”), effective as of December 28, 2018, pursuant to which Ms. Wilkinson will serve as Chief Financial Officer of the Company.

The Wilkinson Employment Agreement (i) provides for a term of employment until the earlier of (1) December 31, 2020, (2) Ms. Wilkinson’s resignation without or without Good Reason (as defined in the Wilkinson Employment Agreement) or Ms. Wilkinson’s death or disability, or (3) termination by the Company with or without Cause (as defined in the Wilkinson Employment Agreement); and (ii) provides that, upon termination of Ms. Wilkinson’s employment by the Company without Cause or by Ms. Wilkinson with Good Reason prior to the end of the term of employment and subject to the satisfaction of certain other specified conditions, Ms. Wilkinson will be entitled to receive severance compensation in an amount equal to 150% of her annual base salary payable in nine monthly installments equal to one-ninth of such severance compensation, subject to required withholding, payable at the end of each of the next nine full calendar months following the first full calendar month after Ms. Wilkinson’s execution and effectiveness of a release agreement.

Pursuant to the Wilkinson Employment Agreement, Ms. Wilkinson will earn an annual base salary of $300,000, a one-time bonus of $25,000, and will be granted 60,000 shares of restricted stock of the Company pursuant to the Wilkinson Restricted Stock Agreement as described below. In addition to the foregoing, Ms. Wilkinson will be entitled to certain other compensation and perquisites, including awards under the Company’s management incentive plan and performance unit plan and reimbursement for certain expenses. The description of the Wilkinson Employment Agreement is qualified in its entirety by reference to the copy thereof filed as Exhibit 10.1 to this Form 8-K, which is incorporated herein by reference.

Wilkinson Restricted Stock Agreement

Pursuant to the Restricted Stock Agreement to be entered into in connection with the Wilkinson Employment Agreement (the “Wilkinson Restricted Stock Agreement”), the restricted stock awards (the “RSAs”) granted thereunder will vest annually in two equal installments, with one-half vesting on December 31, 2019 (the “Initial Vesting Date”) and one-half vesting on the first anniversary of the Initial Vesting Date.

Any unvested RSAs will immediately vest in the following instances: (i) a Change of Control, (ii) the death of the grantee, (iii) the Disability of the grantee, or (iv) a termination by the grantee for Good Reason which occurs within 12 months following a Change of Control (each term as defined in the Wilkinson Restricted Stock Agreement).


The foregoing description of the form of Wilkinson Restricted Stock Agreement in this Item 5.02 is qualified in its entirety by reference to the full text of the form of Wilkinson Restricted Stock Agreement, which is filed as Exhibit 10.2 hereto and is incorporated herein by reference.

Departure of Matthew B. Marietta

Effective as of December 20, 2018, Matthew B. Marietta ceased to be the Company’s Executive Vice President of Finance and Corporate Development.

Departure of H. Richard Walton

Effective as of December 31, 2018, H. Richard Walton will cease to be the Company’s Chief Accounting Officer. Subsequent to his departure, Mr. Walton will be available to the Company on an as-needed consulting basis to facilitate the leadership transition described above.

 

Item 7.01.

Regulation FD Disclosure.

On December 27, 2018, the Company issued a press release announcing the leadership transition described above. The December 27, 2018 press release is furnished herewith as Exhibit 99.1 and is incorporated herein by reference.

The information furnished pursuant to Item 7.01 of this Current Report on Form 8-K and in Exhibit 99.1 shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, is not subject to the liabilities of that section and is not deemed incorporated by reference in any filing of the Company’s under the Securities Act of 1933, as amended, except as otherwise expressly stated in such filing.

 

Item 9.01.

Financial Statements and Exhibits.

(d)    Exhibits.

 

Exhibit
Number

  

Description

10.1    Wilkinson Employment Agreement, dated effective December 20, 2018
10.2    Form of Wilkinson Restricted Stock Agreement
99.1    Press Release dated December 27, 2018


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.

 

  FLOTEK INDUSTRIES, INC.

Date: December 27, 2018

 

/s/ John W. Chisholm

  Name:   John W. Chisholm
  Title:   President and Chief Executive Officer

Exhibit 10.1

EMPLOYMENT AGREEMENT

THIS AGREEMENT (this “Agreement”) is entered into on December 20, 2018 to be effective as of December 28, 2018 (“Effective Date”), between Flotek Industries, Inc., a Delaware corporation (the “Company”), and Elizabeth Wilkinson (“Employee”).

In consideration of the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

1.     Employment . The Company shall employ Employee, and Employee shall be employed with the Company, upon the terms set forth in this Agreement for the period beginning on December 28, 2018 and ending on December 31, 2020 (the “Expiration Date”), unless terminated earlier as set forth herein. The period during which the Employee is employed by the Company is referred to as the “Employment Period.”

2.     Position and Duties .

(a)    Employee shall serve as Chief Financial Officer of the Company and shall be responsible for such duties as may be reasonably prescribed by the Board of Directors of the Company or the Chief Executive Officer of the Company. Employee will report to the Chief Executive Officer of the Company and work in the Company’s Houston office.

(b)    Employee shall devote her reasonable best efforts and her full business time and attention (except for permitted vacation periods, periods of illness or other incapacity) to the business and affairs of the Company, and it shall not be considered a violation of this Agreement for the Employee to, (a) engage in or serve such professional, civic, trade association, charitable, community, religious or similar types of organizations or speaking selections as the Employee may select; (b) serve with the consent of the Chief Executive Officer of the Company on the boards of directors or advisory committees of any entities, or engage in other business activities; and (c) attend to the Employee’s personal matters and finances so long as such services and activities in (a) – (c) do not significantly interfere with the performance of Employee’s responsibilities as an employee of the Company.

3.     Base Salary, Equity Award and Benefits .

(a)    Employee’s annual base salary for the Employment Period shall initially be $300,000 (the “Base Salary”). The Base Salary shall be payable in equal installments in accordance with the Company’s general payroll practices and shall be subject to required withholding. Any change in Base Salary shall be at the sole discretion of the Compensation Committee of the Board of Directors of the Company. During the Employment Period, Employee will be eligible to participate in the Company’s employee benefit programs.

(b)    Employee shall be paid a one-time bonus of $25,000, payable with the first payroll cycle of the Company that follows her commencement of employment.


(c)    On the Effective Date, the Company shall issue to Employee 60,000 shares of restricted common stock of the Company (the “Restricted Stock”), which will be subject to the provisions of a restricted stock agreement between the Company and Employee issued under the Company’s 2018 Long-Term Incentive Plan.

(d)    Employee shall be eligible for annual bonuses in accordance with the Management Incentive Plan (the “MIP”) of the Company, pursuant to such terms as shall be established by the Compensation Committee of the Board. The Employee’s target bonus percentage for the 2019 MIP shall be seventy-five percent (75%). Employee will be eligible to participate in the Performance Unit Plan (the “PUP”) of the Company pursuant to the terms of that plan and such terms as shall be established by the Compensation Committee of the Board. The factor for the 2019 PUP to determine the Employee’s award value shall be 1.35.

(e)    The Company shall reimburse Employee for all reasonable expenses incurred in the course of performing duties under this Agreement which are consistent with the Company’s policies in effect with respect to travel, entertainment and other business expenses pursuant to applicable Treasury Regulations.

(f)    Employee may be eligible to receive annual merit raises approved at the discretion of the Compensation Committee of the Board of Directors of the Company.

(g)    Employee shall be eligible for vacations in accordance with Company policies with a minimum of four weeks’ vacation during each year in the Employment Period.

4.     Employment Term and Termination .

(a)    The Employment Period shall continue until terminated upon the earlier of (i) the Expiration Date, (ii) Employee’s resignation with or without Good Reason or Employee’s death or Disability or (iii) the termination of the Employee by the Company with or without Cause.

(b)    Employee’s employment with the Company will be “At Will,” meaning that either Employee or the Company may terminate Employee’s employment at any time and for any reason, with or without Cause or Good Reason. The date on which the Employees’ employment is terminated is referred herein as the “Termination Date.” If the reason for termination is without Cause or with Good Reason, Employee would receive a severance package consistent with the terms and conditions set forth in Section 5 below.

5.     Severance .

(a)    If Employee’s employment with the Company is terminated by the Company without Cause or by Employee with Good Reason prior to the Expiration Date, and provided that Employee signs and delivers to the Company a Confidential Severance and Release Agreement in a reasonable form as provided by the Company (the “Release Agreement”) within 60 days following the termination of Employee’s employment with the Company (such 60 th day being referred to as the “Release Date”) and does not revoke such signed Release Agreement pursuant to the terms thereof, Employee shall be entitled to receive severance compensation equal to the following:


(i)    150 percent of the Employee’s annual Base Salary in effect at the Termination Date, which amount under Section 5(a)(i) or (ii), as applicable, shall be payable in nine (9) monthly installments equal to one-ninth of such severance compensation, subject to required withholding, payable at the end of each of the next nine (9) full calendar months following the first full calendar month following the Release Date, and

(ii)    if the Employee timely and properly elects health continuation coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”), the Company shall reimburse the Employee for the monthly COBRA premium paid by the Employee for Employee and Employee’s dependents who were covered immediately preceding the Date of Termination. The reimbursement under Section 5(a)(2) shall be paid to the Employee prior to the last day of the month immediately following the month in which the Executive timely remits the premium payment, and the Employee shall be eligible to receive such reimbursement until the earliest of: (i) the 12-month anniversary of the Date of Termination; (ii) the date the Employee (or Employee’s dependents, if applicable) is no longer eligible to receive COBRA continuation coverage; and (iii) the date on which the Employee receives substantially similar coverage from another employer or other source.

(b)    Notwithstanding anything to the contrary herein contained, except to the extent required by law, the Company shall not be required to pay any amounts under this Section 5 or elsewhere in this Agreement if Employee is in breach of any of its obligations under this Agreement or any other Agreement with the Company, including without limitation, all employee policies of the Company and any obligation relating to the treatment of Company confidential information and any non-compete obligation, but as to all of these, only if materially injurious to the Company.

(c)    If Employee’s employment with the Company is terminated for Cause or death or Disability, or Employee resigns without Good Reason, Employee shall be entitled to receive: (i) Employee’s Base Salary earned and payable through the Termination Date; (ii) any accrued but unused vacation/time off to the extent required under applicable law; (iii) reimbursement for all incurred but unreimbursed expenses to the extent Employee is entitled to be reimbursed; and (iv) any other earned but unpaid compensation, if applicable, as of the Termination Date.

(d)    For purposes of this Agreement, the following terms shall have the meanings set forth below:

“Cause” shall mean (i) Employee’s failure to substantially perform one or more of Employee’s essential duties and obligations to the Company (other than any such failure resulting from a Disability) which Employee fails to remedy in a reasonable period of time (not to exceed 60 days) after receipt of written notice from the Company; (ii) Employee’s refusal or failure to comply with the reasonable and legal directives of the Board of Directors after written notice from the Board describing Employee’s failure to comply and Employee’s failure to remedy same within 21 days of receiving written


notice; (iii) any act of personal dishonesty, fraud or misrepresentation taken by Employee which was intended to result in or resulted in substantial gain or personal enrichment of the Employee at the expense of the Company; (iv) Employee’s violation of a federal or state law or regulation applicable to the Company’s business which violation was or is reasonably likely to be materially injurious to the Company; (v) Employee’s conviction of, or plea of nolo contendere or guilty to, a felony under the laws of the United States or any State that is reasonably likely to reasonably likely to be materially injurious to the Company; (vi) Employee’s abuse of drugs, other narcotics or alcohol during working hours or where such abuse (whenever occurring) impacts on Employee’s working day, (vii) Employee’s breach of any of his obligations under any written agreement with the Company (including without limitation this Agreement and any proprietary information and inventions assignment agreement with the Company) which, to the extent such breach is remediable, Employee fails to remedy in a reasonable period of time (not to exceed 60 days) after receipt of written notice from the Company; or (viii) Employee’s violation of a policy of the Company which, to the extent such failure is remediable, Employee fails to remedy in a reasonable period of time (not to exceed 30 days) after receipt of written notice from the Company.

“Disability” shall have the meaning assigned to such term in Section 22(e)(3) of the Internal Revenue Code of 1986, as amended (the “Code”).

“Good Reason” shall exist upon the occurrence of one of the following Company actions (unless Employee consents in writing to such action(s)): (i) a material reduction of the Employee’s salary and employee benefits to which the Employee was entitled immediately prior to such reduction unless such reduction applies to all similarly situated executives, (ii) a material reduction in the duties, authority or responsibilities relative to the Employee’s duties, authority or responsibilities as in effect immediately prior to such reduction, provided, however, that if the Company assigns to the Employee duties for another senior executive position with the Company, such assignment shall not constitute Good Reason; or (iii) the relocation of the Employee to a facility or a location more than fifty (50) miles from the Employee’s then present location; provided, however, that (A) Employee must provide the Company with written notice of the occurrence of such action(s) within 60 days of the initial occurrence of such action(s) and of her intent to terminate employment based on such action(s), (B) the written notice must describe the event constituting Good Reason in reasonable detail, and (C) within 30 days from the date that such written notice is received by the Company, the Company must cure such action(s).

(e)    If there is a Change of Control of the Company prior to the Expiration Date: (i) Restricted Stock granted pursuant to Section 3(b) will become vested as set forth in the Restricted Stock Agreement, (ii) awards granted pursuant to the then applicable MIP and PUP will become subject to, and affected by, the Change of Control provisions contained in such plans, and (iii) if Employee’s employment with the Company is terminated by the Company without Cause or by Employee for Good Reason prior to the Expiration Date, Employee will thereafter be entitled to receive severance pursuant and subject to the terms and conditions of Section 5 of this Agreement.


(f)    Notwithstanding anything herein to the contrary, (i) to the extent required by Section 409A of the Code, each reimbursement or in-kind benefit provided under this Agreement shall be provided in a manner and at a time that complies with Section 409A; (ii) if at the time of Employee’s termination of employment with the Company, Employee is a “specified employee” within the meaning of Section 409A of the Code, and the deferral of the commencement of any payments or benefits (or portions thereof) otherwise payable hereunder as a result of such termination of employment is necessary in order to prevent any accelerated or additional tax under Section 409A of the Code, then the payment or benefits shall be delayed to the earliest date required under Section 409A of the Code to the extent and amount necessary to comply with Section 409A of the Code, with such delayed payments to be accumulated and made in lump sum on the first business day following the earliest date permitted by Section 409A of the Code, (iii) for purposes of this Section 5, a termination of employment only occurs if it constitutes a “separation from service” under Section 409A of the Code, and (iv) each payment identified in Section 5(a)(i)-(iii), including each separate installment payment identified thereunder, will be considered the right to a series of separate payments. Notwithstanding any other provision in the Agreement, the Company and Employee will cooperate in good faith to amend or modify the Agreement so that the payments under this Agreement qualify for exemption from or comply with Code Section 409A; provided, however, that the Company makes no representations that the payments under the Agreement shall be exempt from or comply with Section 409A of the Code.

6.     Notices . Any notice provided for in this Agreement shall be in writing and shall be either personally delivered, sent by a nationally recognized overnight delivery service, or mailed by first class mail, return receipt requested, to the recipient at the address below indicated:

Notices to Employee :

Elizabeth Wilkinson

827 Greenbelt Drive

Houston, Texas 77079

Notices to the Company:

Flotek Industries, Inc.

Attn: General Counsel

10603 W. Sam Houston Pkwy. N., Suite 300

Houston, TX 77043

or such other address or to the attention of such other person as the recipient party shall have specified by prior written notice to the sending party. Any notice under this Agreement shall be deemed to have been given when so delivered or, if sent by first class mail, three (3) days after so mailed.

7.     Severability . Whenever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision


of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other provision or any other jurisdiction, but this Agreement shall be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision had never been contained herein.

8.     Complete Agreement . Except with respect to any proprietary information and inventions assignment agreement between the Company and the Employee, this Agreement embodies with respect to the subject matter hereof the complete agreement and understanding among the parties and supersedes and preempts with respect to the subject matter hereof any prior understandings, agreements or representations by or among the parties, written or oral, which may have related to the subject matter hereof in any way.

9.     Counterparts . This Agreement may be executed in separate counterparts, each of which is deemed to be an original and all of which taken together constitute one and the same agreement.

10.     Successors and Assigns . This Agreement is intended to bind and inure to the benefit of and be enforceable by Employee, the Company and their respective heirs, successors and assigns, except that Employee may not assign her rights or delegate her obligations hereunder without the prior written consent of the Company except by operation of law to Employee’s estate upon the death of Employee.

11.     Choice of Law . All issues and questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be governed by, and construed in accordance with, the laws of the State of Texas, without giving effect to any choice of law or conflict of law rules or provisions (whether of the State of Texas or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Texas.

12.     Consent to Personal Jurisdiction . Any suit, action or other proceeding arising out of or based upon this Agreement and any other agreement with the Company which is not subject to the arbitration provisions of Section 13, shall be brought in the U.S. District Court for the Southern District of Texas, Houston Division.

13.     Arbitration and Equitable Remedies . Employee agrees that any dispute or controversy arising out of or relating to any interpretation, construction, performance or breach of this Agreement, shall be settled by arbitration to be held in Houston, Texas, in accordance with the rules then in effect of the American Arbitration Association, provided however, the parties will be entitled to full and liberal evidentiary discovery in accordance with the rules governing civil litigation in courts of the same jurisdiction. The arbitrator may grant injunctions or other relief in such dispute or controversy. The decision of the arbitrator shall be final, conclusive and binding on the parties to the arbitration. Judgment may be entered on the arbitrator’s decision in any court having jurisdiction. The Company shall pay the legal costs and expenses of such arbitration; however, the prevailing party shall be entitled to recover from the non-prevailing party all reasonable legal costs and expenses incurred including time of law firm staff, court costs, attorneys’ fees, and all other related expenses incurred in such arbitration.


14.     Amendment and Waiver . The provisions of this Agreement may be amended or waived only with the prior written consent of the Company and Employee, and no course of conduct or failure or delay in enforcing the provisions of this Agreement shall affect the validity, binding effect or enforceability of such provision or any other provision of this Agreement.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the Effective Date.

 

FLOTEK INDUSTRIES, INC.
By:   /s/William H. York
Name:   William H. York
Title:   Chief Administrative Officer

 

/s/Elizabeth T. Wilkinson
Elizabeth Wilkinson

SIGNATURE PAGE TO EMPLOYMENT AGREEMENT

Exhibit 10.2

FLOTEK INDUSTRIES, INC.

RESTRICTED STOCK AGREEMENT

1.      Grant of Restricted Stock. Subject to the conditions described in this agreement (the “Award Agreement”) and in the Flotek Industries Inc. 2018 Long-Term Incentive Plan, as amended from time to time (the “Plan”), Flotek Industries, Inc., a Delaware corporation (the “Company”), hereby agrees to grant              (“Participant”) shares of “Restricted Stock” of the Company.

2.      Number of Shares of Restricted Stock Granted .              shares of Restricted Stock (Common Stock of the Company, $0.0001 par value per share).

3.      Grant Date.                      .

4.      Vesting. Subject to the satisfaction of the terms and conditions set forth in the Plan and this Award Agreement, including Participant’s continued employment/service with the Company through the applicable Vesting date(s), one-half (1/2) of the Restricted Stock granted hereunder shall Vest on December 31, 2019, and the remaining one-half (1/2) of the Restricted Stock granted hereunder shall Vest on December 31, 2020.

5.      Issuance and Transferability .

(a)     Registration and Restricting Legend . Upon grant, the Restricted Stock granted hereunder shall be registered in the name of Participant and, unless and until such Restricted Stock vests, shall be left on deposit with the Company, or in trust or escrow pursuant to an agreement satisfactory to the Company, until such time as the restrictions on transfer have lapsed. If the shares of Restricted Stock are represented by certificates, such certificates shall be marked with the following legend:

“The shares represented by this certificate have been issued pursuant to the terms of the Flotek Industries, Inc. 2018 Long-Term Incentive Plan, as amended from time to time, 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                      .”

(b)     Book Entry Form . If the shares are held in book entry form, then such entry will reflect, in a manner sufficient to effect in a legally enforceable form that such shares of Restricted Stock are subject to the restrictions of this Award Agreement and the Plan.

(c)     Stock Power . Participant will deliver to the Company a stock power, in substantially the form as Exhibit A-1 attached hereto or such form as required by the Company, endorsed in blank, with respect to each Award of Restricted Stock.

(d)     Release of Restrictions . Upon Vesting of any portion of the shares of Restricted Stock and satisfaction of any other conditions required by the Plan or pursuant to this Award Agreement, the Company shall promptly either issue a stock certificate, without such restricted legend, for any shares of the Restricted Stock that have Vested, or, if the shares are held in book entry form, the Company shall remove the notations on the book entry registrations for any shares of the Restricted Stock that have Vested.


(e)     Prohibition on Transfer . Until restrictions lapse, the Restricted Stock shall not be transferable. No right or benefit hereunder shall in any manner be liable for or subject to any debts, contracts, liabilities, or torts of Participant. Any purported assignment, alienation, pledge, attachment, sale, transfer or other encumbrance of the Restricted Stock, regardless of by whom initiated or attempted, prior to the lapse of restrictions shall be void and unenforceable against the Company. If, notwithstanding the foregoing, an assignment, alienation, pledge, attachment, sale, transfer or other encumbrance of the Restricted Stock is effected by operation of law, court order or otherwise, the affected Restricted Stock shall remain subject to the risk of forfeiture, Vesting requirement and all other terms and conditions of this Award Agreement. In the case of Participant’s death or Disability, Participant’s Vested rights under this Award Agreement (if any) may be exercised and enforced by Participant’s guardian or legal representative.

 

  6.    Forfeiture.

(a)    In the event of Participant’s Termination for a reason other than a reason that causes Vesting pursuant to Section 6(b) of this Agreement, the unvested portion of the Restricted Stock held by Participant at that time shall immediately be forfeited and the Company shall repurchase such forfeited shares from the Participant for the lesser of (i) the amount paid by the Participant to the Company for such shares, if any, or (ii) the Fair Market Value of an equivalent number of shares of Common Stock determined on the date the Restricted Stock is forfeited.

(b)    The occurrence of any of the following events shall cause the portion of the Restricted Stock which is not yet Vested to be considered immediately Vested: (i) a Change of Control, (ii) the death of Participant, or (iii) a termination which results from the Disability of Participant.


7.      Ownership Rights . Subject to any reservations, conditions or restrictions set forth in this Award Agreement and/or the Plan, upon grant to Participant of the Restricted Stock, Participant shall be entitled to all voting rights applicable to the Restricted Stock during the Restricted Period. In the event of forfeiture of shares of Restricted Stock, the Participant shall have no further rights with respect to such Restricted Stock.

8.      Reorganization of the Company . The existence of this Award Agreement shall not affect in any way the right or power of the 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; any merger or consolidation of the Company; any issue of bonds, debentures, preferred or prior preference stock ahead of or affecting the Restricted Stock or the rights thereof; the dissolution or liquidation of the 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.

9.      Certain Restrictions . By executing this Award Agreement, Participant acknowledges that he will enter into such written representations, warranties and agreements and execute such documents as the Company may reasonably request in order to comply with the securities law or any other applicable laws, rules or regulations, or with this Award Agreement or the terms of the Plan.

10.      Amendment and Termination . This Award Agreement or the Plan may be amended or terminated in accordance with the terms of the Plan.

11.      Taxes and Withholdings .

(a)     Tax Consequences . The granting, Vesting and/or sale of all or any portion of the Restricted Stock may trigger tax liability. Participant agrees that he shall be solely responsible for any such tax liability. Participant is encouraged to contact his/her tax advisor to discuss any tax implications which may arise in connection with the Restricted Stock.

(b)     Withholding . Participant acknowledges that the Vesting of Restricted Stock granted pursuant to this Award Agreement, the making of an election under Section 83(b) of the Code and the Vesting and payment of any accrued dividends may result in federal, state or local tax withholding obligations. Participant understands and acknowledges that the Company will not deliver shares of Common Stock or make any payment of accrued dividends until it is satisfied that appropriate arrangements have been made to satisfy any tax obligation under this Award Agreement or the Plan and agrees to make appropriate arrangements suitable to the Company for satisfaction of all tax withholding obligations. Further, Participant hereby agrees and grants to the Company the right to withhold from any payments or amounts of compensation, payable in cash or otherwise, in order to meet any tax withholding obligations under this Award Agreement or the Plan. As such, if the Company requests that Participant take any action required to effect any action described in this Section and to satisfy the tax withholding obligation pursuant to this Award Agreement and the Plan, Participant hereby agrees to promptly take any such action.

(c)     Section 83(b) . Participant understands that any election under Section 83(b) of the Code with regard to the Restricted Stock must be made within thirty (30) days of the Grant Date and that, in the event of such election, Participant will so notify the Company in writing on or before such date.


12.      No Guarantee of Tax Consequences . The Company, Board and Committee make no commitment or guarantee to Participant that any federal, state or local tax treatment will apply or be available to any person eligible for benefits under this Award Agreement and assumes no liability whatsoever for the tax consequences to Participant.

13.      Severability . In the event that any provision of this Award Agreement is, becomes or is deemed to be illegal, invalid, or unenforceable for any reason, or would disqualify the Plan or this Award Agreement under any law deemed applicable by the Board or the Committee, such provision shall be construed or deemed amended as necessary to conform to the applicable laws, or if it cannot be construed or deemed amended without, in the determination of the Board or the Committee, materially altering the intent of the Plan or this Award Agreement, such provision shall be stricken as to such jurisdiction, the Participant or this Award Agreement, and the remainder of this Award Agreement shall remain in full force and effect.

14.      Terms of the Plan Control . This Award Agreement and the underlying Award are made pursuant to the Plan. Notwithstanding anything in this Award Agreement to the contrary, the terms of the Plan, as amended from time to time and interpreted and applied by the Committee, shall govern and take precedence. All capitalized terms not otherwise defined herein shall have the meanings set forth in the Plan, the terms of which are incorporated herein by reference.

15.      Governing Law . This Award Agreement shall be construed in accordance with (excluding any conflict or choice of law provisions of) the laws of the State of Delaware to the extent federal law does not supersede and preempt Delaware law.

16.      Consent to Electronic Delivery; Electronic Signature . Except as otherwise prohibited by law, 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, prospectuses 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/her electronic signature is the same as, and shall have the same force and effect as, his/her manual signature.

[ SIGNATURE PAGE FOLLOWS ]


COMPANY:
FLOTEK INDUSTRIES, INC.

By:

 

 

Name:

 

 

Title:

 

 

Date:

 

 

PARTICIPANT:

 

Address:

 

 

 

Date:

 

 

Exhibit 99.1

 

LOGO

FLOTEK ANNOUNCES LEADERSHIP CHANGES

HOUSTON, December  27, 2018 — Flotek Industries, Inc. (“Flotek” or the “Company”) (NYSE: FTK) announces changes among its executive leadership team.

Flotek is pleased to announce Elizabeth T. Wilkinson has been appointed as Chief Financial Officer (CFO) of Flotek Industries, effective December 28, 2018. In this role, she will serve as the senior executive responsible for the Company’s financial strategy, planning and reporting, as well as investor relations, treasury and corporate development functions. She will be based in Houston, reporting directly to Flotek’s Chief Executive Officer, President  & Chairman of the Board, John W. Chisholm.

Wilkinson, a certified public accountant, brings more than 30 years of experience to Flotek. She joins the Company from RGP, a publicly traded, global consulting firm, where she served as managing consultant, leading financial advisory projects for Fortune 100, Fortune 500 and private-equity-controlled clients. In this capacity, she served as interim CFO, interim treasurer and in key financial reporting roles leading companies through significant accounting and finance transitions. Her depth of experience includes technical accounting and controllership, tax planning and compliance, treasury, capital market transactions, enterprise risk management, M&A, investor relations, strategy development, and managing banking and rating agency relationships.

“Elizabeth is a strong and experienced executive who has served in diverse leadership roles for E&P, energy service, and midstream organizations, ranging from CFO to controller to vice president-investor relations and treasurer,” said Chisholm. “We welcome the tremendous strengths she brings to help deliver value to all of our stakeholders by expanding our market penetration through differentiated chemistry technology, strengthening our balance sheet and managing general and administrative costs to deliver positive operating cash flow.”

Prior to her role at RGP, Wilkinson was CFO of Xtreme Drilling and Coil Services where she raised capital, managed debt and liquidity, and directed all accounting, financial reporting and investor relations functions. Additionally, she has served in financial and treasury leadership roles at Kerr-McGee Corporation, Eagle Rock Energy Partners, LP and GlobalSantaFe Corporation.

“I’m truly honored to join the Flotek team. One of the most exciting aspects about the Company is its maturity as a business, which is underpinned by its strong, proven technology. I look forward to collaborating with the team on developing and executing the Company’s strategy and rationalizing cost structure to deliver value to shareholders,” said Wilkinson.

Matt Marietta, Executive Vice President of Finance  & Corporate Development, will leave Flotek on December  31, 2018. Marietta joined the Company in 2017.

Additionally, H. Richard Walton, will no longer serve as Chief Accounting Officer, effective December 31, 2018; however, he will continue with the company as a consultant to facilitate the leadership transition, as needed. Walton joined the Company in 2013.

“Rich and Matt have made a significant impact on the organization Flotek is today. I thank them both for their leadership and many contributions,” said Chisholm.

He continued, “As we focus on our strategy and execution as a leading chemistry technology company, we enter 2019 with a streamlined executive team aligned to lead Flotek into the future to maximize the Company’s full potential for all stakeholders.”


Sally Cheadle, certified public accountant, will continue to serve as Vice President and Corporate Controller where she has direct responsibility for the Company’s financial reporting, tax compliance and internal controls. Cheadle joined Flotek in 2017, following a nearly 25-year career at Baker Hughes, where she was a senior accounting and controls executive.

About Flotek Industries, Inc.

Flotek develops and delivers prescriptive chemistry-based technology, including specialty chemicals, to clients in the energy, consumer industrials and food & beverage industries. Flotek’s inspired chemists draw from the power of bio-derived solvents to deliver solutions that enhance energy production, cleaning products, foods  & beverages and fragrances. In the oil and gas sector, Flotek serves major and independent energy producers and oilfield service companies, both domestic and international. Flotek Industries, Inc. is a publicly traded company headquartered in Houston, Texas, and its common shares are traded on the New York Stock Exchange under the ticker symbol “FTK.” For additional information, please visit Flotek’s web site at www.flotekind.com .

Forward-Looking Statements

Certain statements set forth in this Press Release constitute forward-looking statements (within the meaning of Section  27A of the Securities Act of 1933 and Section  21E of the Securities Exchange Act of 1934) regarding Flotek Industries, Inc.‘s business, financial condition, results of operations and prospects. Words such as expects, anticipates, intends, plans, believes, seeks, estimates and similar expressions or variations of such words are intended to identify forward-looking statements, but are not the exclusive means of identifying forward-looking statements in this Press Release.

Although forward-looking statements in this Press Release reflect the good faith judgment of management, such statements can only be based on facts and factors currently known to management. Consequently, forward-looking statements are inherently subject to risks and uncertainties, and actual results and outcomes may differ materially from the results and outcomes discussed in the forward-looking statements. Factors that could cause or contribute to such differences in results and outcomes include, but are not limited to, demand for oil and natural gas drilling services in the areas and markets in which the Company operates, competition, obsolescence of products and services, the Company’s ability to obtain financing to support its operations, environmental and other casualty risks, and the impact of government regulation.

Further information about the risks and uncertainties that may impact the Company are set forth in the Company’s most recent filings on Form 10-K (including without limitation in the “Risk Factors” Section), and in the Company’s other SEC filings and publicly available documents. Readers are urged not to place undue reliance on these forward-looking statements, which speak only as of the date of this Press Release. The Company undertakes no obligation to revise or update any forward-looking statements in order to reflect any event or circumstance that may arise after the date of this Press Release.

Media Inquiries, contact:

Danielle Allen

Senior Vice President

Global Communications & Technology Commercialization

E: DAllen@flotekind.com

P: (713) 726-5322

IR Inquiries, contact:

Elizabeth T. Wilkinson

Flotek Industries

E: ewilkinson@flotekind.com

P: (713) 726-5376

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