| Item 1.01. | Entry into a Material Definitive Agreement. |
On February 28, 2019, in connection with the consummation of the transactions contemplated by that certain Share Purchase Agreement (the “Purchase Agreement”), dated January 10, 2019, by and between Flotek Industries, Inc. (the “Company”) and Archer-Daniels-Midland Company (“ADM”), Florida Chemistry, LLC, a wholly owned subsidiary of the Company, entered into a terpene Supply Agreement and a citrus burst Supply Agreement (collectively, the “Supply Agreements”) with Florida Chemical Company, LLC (“FCC”).
The material terms of the Supply Agreements were previously reported under the headings “Terpene Supply Agreement” and “Citrus Burst Supply Agreement” in Item 1.01 of the Company’s Current Report on Form8-K filed with the U.S. Securities and Exchange Commission (the “SEC”) on January 16, 2019 (the “January 2019 Report”) and are incorporated herein by reference.
| Item 2.01. | Completion of Acquisition or Disposition of Assets. |
Effective as of February 28, 2019, the Company completed the previously announced divestiture (the “Divestiture”) of all of the shares representing membership interests in FCC pursuant to the terms of the Purchase Agreement. The material terms of the Divesture were previously reported under the heading “Share Purchase Agreement” under Item 1.01 of the January 2019 Report and are incorporated herein by reference.
The description of the Purchase Agreement included or incorporated by reference in this Current Report on Form8-K (this “Report”) is a summary only and is qualified in its entirety by reference to the Purchase Agreement, a copy of which is filed as Exhibit 2.1 to this Report, and is incorporated herein by reference.
| Item 5.02. | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
On February 27, 2019, the board of directors of the Company approved the termination of Joshua A. Snively’s employment with the Company without cause, as such term is defined in his Employment Agreement, dated effective March 16, 2018 (the “Employment Agreement”), which termination is effective as of February 28, 2019. As of February 28, 2019, Mr. Snively ceased to be an officer of the Company. Reference is hereby made to the Employment Agreement, a copy of which was filed as Exhibit 10.1 to the Company’s Current Report on Form8-K filed with the SEC on March 22, 2018. Mr. Snively’s departure was in connection with the Divestiture and did not result from a disagreement by Mr. Snively with the Company on any matter relating to the Company’s operations, policies or practices.
In connection with Mr. Snively’s departure, the Company accelerated the vesting of all of Mr. Snively’s outstanding equity incentive awards.
| Item 7.01. | Regulation FD Disclosure. |
On March 1, 2019, the Company issued a press release announcing the Divestiture. The March 1, 2019 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 Form8-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. |
(b) The Company’s unaudited pro forma condensed consolidated financial statements reflecting the Divestiture are attached hereto as Exhibit 99.2 and are incorporated herein by reference.
(d) Exhibits.
