WTTR Select Water Solutions Inc

ITEM 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On May 5, 2023 (the “Effective Date”), Select Energy Services, LLC (a subsidiary of Select Energy Services, Inc. (“Select”) and herein referred to together with Select as the “Company”) entered into an employment agreement (the “Employment Agreement”) with John D. Schmitz, the Company’s Chairman of the Board of Directors, Chief Executive Officer and President. The Employment Agreement supersedes and replaces that certain letter agreement by and between Mr. Schmitz and the Company dated March 1, 2021. The initial term of the Employment Agreement is for the period beginning on the Effective Date and ending on December 31, 2025, and the term will automatically renew annually for successive 12-month periods unless either party provides written notice of non-renewal at least 60 days prior to the expiration of the initial term or renewal term. Notwithstanding the foregoing, Mr. Schmitz’s employment may be earlier terminated in accordance with the terms of the Employment Agreement.

Pursuant to the Employment Agreement, Mr. Schmitz will receive an annualized base salary of $800,000 and will continue to be eligible to receive (i) an annual bonus with an annual bonus target amount of 115% of his annualized base salary under the Company’s short-term incentive bonus program (the “STI Plan”) for each year within the initial term or renewal term, as applicable, provided that Mr. Schmitz remains employed through the date on which each such bonus is paid and (ii) annual equity awards pursuant to the Company’s equity incentive plan.

The Employment Agreement also provides for certain severance benefits upon Mr. Schmitz’s termination of employment without “Cause,” upon expiration of the initial term or a renewal term as a result of the Company’s issuance of a notice of non-renewal, upon Mr. Schmitz’s resignation for “Good Reason,” or due to Mr. Schmitz’s death or “Disability” (each quoted term as defined in the Employment Agreement), including (i) cash severance equal to two times (or, if such termination occurs within 60 days prior to, or within 24 months following, a “Change in Control” (such quoted term as defined in the Employment Agreement), three times) the sum of (a) the then-current annualized base salary and (b) the target annual bonus for the year of termination, payable in substantially equal installments over the 12-month (or, if such termination occurs within 60 days prior to, or within 24 months following, a Change in Control, 24-month) period following the termination date, (ii) a pro-rated annual bonus under the STI Plan for the year in which the termination occurs, based on actual performance and payable at the time such bonuses are paid to other participants in the STI Plan, (iii) an annual bonus under the STI Plan for the year prior to the year in which the termination occurs, to the extent such bonus has not yet been paid as of the termination date, payable at the time such bonuses are paid to other participants in the STI Plan and (iv) reimbursement of certain premiums paid for continuation coverage under the Company’s group health plans. All severance payments and benefits are contingent upon Mr. Schmitz’s execution and non-revocation of a release of claims in favor of the Company and its affiliates. Additionally, the Employment Agreement contains certain restrictive covenants regarding confidential information, non-competition, non-solicitation, and intellectual property. The foregoing description of the Employment Agreement is not complete and is qualified in its entirety to the full text of the Employment Agreement, which is filed herewith as Exhibit 10.1 and incorporated herein by reference.