Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On October 15, 2021, Flotek Industries, Inc. (the “Company”) entered into new employment agreements with Michael Borton, the Company’s Chief Financial Officer, and TengBeng Koid, the Company’s President, Data Analytics, as described below. The new employment agreements were entered into in order to bring Mr. Borton and Mr. Koid’s employment arrangements in line with other similarly-situated executives of the Company, and did not change the base salary for either Mr. Borton or Mr. Koid.
Mr. Borton’s Employment Agreement
Pursuant to the employment agreement with Mr. Borton, (the “Borton Agreement”), Mr. Borton will continue to serve as the Company’s Chief Financial Officer. Under the Borton Agreement, Mr. Borton will earn an annual base salary of $340,000, will be eligible to participate in the Company’s long-term incentive plans, and is eligible for an annual bonus with a target of 100% of base salary. If the Borton Agreement is terminated by the Company without “Cause” or is terminated by Mr. Borton for “Good Reason” (in each case as defined in the Borton Agreement), upon execution of an acceptable separation and release agreement, the Company will pay to Mr. Borton (a) severance equal to Mr. Borton’s base salary (payable over 12 months), (b) a pro-rata portion of Mr. Borton’s annual bonus for the year of termination, based on actual performance and paid at the usual time, (c) any earned but unpaid annual bonus for the prior calendar year, and (d) the COBRA premiums necessary to continue Mr. Borton and his covered dependents’ health insurance coverage in effect for a period of 18 months. In addition, if such termination occurs within 18 months following a “Change of Control” (as defined in the Borton Agreement), all unvested equity awards that have been granted to Mr. Borton under any incentive plan will become fully vested.
The foregoing description of the Borton Agreement is qualified in its entirety by reference to the full text of the Borton Agreement, which is filed as Exhibit 10.1 to this Current Report on Form 8-K.
Mr. Koid’s Employment Agreement
Pursuant to the employment agreement with Mr. Koid, (the “Koid Agreement”), Mr. Koid will serve as the Company’s President, Data Analytics. Under the Koid Agreement, Mr. Koid will earn an annual base salary of $350,000, will be eligible to participate in the Company’s long-term incentive plans, and is eligible for an annual bonus with a target of 100% of base salary. If the Koid Agreement is terminated by the Company without “Cause” or is terminated by Mr. Koid for “Good Reason” (in each case as defined in the Koid Agreement), upon execution of an acceptable separation and release agreement, the Company will pay to Mr. Koid (a) severance equal to Mr. Koid’s base salary (payable over 12 months), (b) a pro-rata portion of Mr. Koid’s annual bonus for the year of termination, based on actual performance and paid at the usual time, (c) any earned but unpaid annual bonus for the prior calendar year, and (d) the difference between the amount Mr. Koid pays for COBRA premiums and the amount similarly situated employees of the Company would pay for such coverage for a period of 12 months. In addition, if such termination occurs within 18 months following a “Change of Control” (as defined in the Koid Agreement), all unvested equity awards that have been granted to Mr. Koid under any incentive plan will become fully vested.
The foregoing description of the Koid Agreement is qualified in its entirety by reference to the full text of the Koid Agreement, which is filed as Exhibit 10.2 to this Current Report on Form 8-K.