10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington D.C. 20549

FORM 10-Q

 (Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 

For the quarterly period ended September 30, 2020

or 

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 For the transition period from             to            .

Commission File Number 1-13455

TETRA Technologies, Inc.

(Exact name of registrant as specified in its charter)

Delaware	74-2148293
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)
24955 Interstate 45 North
The Woodlands,
Texas	77380
(Address of Principal Executive Offices)	(Zip Code)

(281) 367-1983

(Registrant’s Telephone Number, Including Area Code)

_______________________________________________________________________

Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	TTI	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes ☒  No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒  No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Smaller reporting company	☒
		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. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐  No ☒

 As of November 2, 2020, there were 125,976,728 shares outstanding of the Company’s Common Stock, $0.01 par value per share.

TETRA Technologies, Inc. and Subsidiaries
Table of Contents
	Page
PART I—FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Statements of Operations	1
Consolidated Statements of Comprehensive Income (Loss)	2
Consolidated Balance Sheets	3
Consolidated Statements of Equity	5
Consolidated Statements of Cash Flows	7
Notes to Consolidated Financial Statements	8
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	26
Item 3. Quantitative and Qualitative Disclosures about Market Risk	42
Item 4. Controls and Procedures	42
PART II—OTHER INFORMATION
Item 1. Legal Proceedings	42
Item 1A. Risk Factors	42
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	43
Item 3. Defaults Upon Senior Securities	44
Item 4. Mine Safety Disclosures	44
Item 5. Other Information	44
Item 6. Exhibits	45
SIGNATURES	46

Table of Contents

PART I

FINANCIAL INFORMATION

Item 1. Financial Statements.

TETRA Technologies, Inc. and Subsidiaries

Consolidated Statements of Operations

(In Thousands, Except Per Share Amounts)

(Unaudited)

	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
Revenues:
Product sales	$	68,810	$	93,377	$	252,016	$	320,508
Services	83,791		152,570		315,968		457,963
Total revenues	152,601		245,947		567,984		778,471
Cost of revenues:
Cost of product sales	50,541		71,957		184,512		254,798
Cost of services	52,441		98,356		201,056		298,911
Depreciation, amortization, and accretion	29,604		30,867		88,906		93,312
Impairments and other charges	97		849		14,445		3,306
Insurance recoveries	(52)		(1,042)		(643)		(1,392)
Total cost of revenues	132,631		200,987		488,276		648,935
Gross profit	19,970		44,960		79,708		129,536
General and administrative expense	25,256		34,926		89,807		105,498
Interest expense, net	17,631		18,146		53,073		55,054
Warrants fair value adjustment (income) expense	—		78		(327)		(1,035)
CCLP Series A Preferred Units fair value adjustment expense	—		—		—		1,309
Other (income) expense, net	(2,137)		(690)		2,141		(1,014)
Loss before taxes and discontinued operations	(20,780)		(7,500)		(64,986)		(30,276)
Provision for income taxes	645		1,579		3,800		5,678
Loss before discontinued operations	(21,425)		(9,079)		(68,786)		(35,954)
Discontinued operations:
Loss from discontinued operations, net of taxes	(173)		(9,130)		(155)		(9,901)
Net loss	(21,598)		(18,209)		(68,941)		(45,855)
Less: loss attributable to noncontrolling interest	8,296		2,378		32,833		12,273
Net loss attributable to TETRA stockholders	$	(13,302)	$	(15,831)	$	(36,108)	$	(33,582)
Basic net loss per common share:
Loss before discontinued operations attributable to TETRA stockholders	$	(0.10)	$	(0.06)	$	(0.29)	$	(0.19)
Loss from discontinued operations attributable to TETRA stockholders	—		(0.07)		—		(0.08)
Net loss attributable to TETRA stockholders	$	(0.10)	$	(0.13)	$	(0.29)	$	(0.27)
Average shares outstanding	125,893		125,568		125,789		125,620
Diluted net loss per common share:
Loss before discontinued operations attributable to TETRA stockholders	$	(0.10)	$	(0.06)	$	(0.29)	$	(0.19)
Loss from discontinued operations attributable to TETRA stockholders	—		(0.07)		—		(0.08)
Net loss attributable to TETRA stockholders	$	(0.10)	$	(0.13)	$	(0.29)	$	(0.27)
Average diluted shares outstanding	125,893		125,568		125,789		125,620

See Notes to Consolidated Financial Statements

1

Table of Contents

TETRA Technologies, Inc. and Subsidiaries

Consolidated Statements of Comprehensive Income (Loss)

(In Thousands)

(Unaudited)

	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
Net loss	$	(21,598)	$	(18,209)	$	(68,941)	$	(45,855)
Foreign currency translation adjustment, net of taxes of $0 in 2020 and 2019	2,874		(3,742)		(2,498)		(3,300)
Comprehensive loss	(18,724)		(21,951)		(71,439)		(49,155)
Less: Comprehensive loss attributable to noncontrolling interest	8,229		2,358		32,880		11,994
Comprehensive loss attributable to TETRA stockholders	$	(10,495)	$	(19,593)	$	(38,559)	$	(37,161)

See Notes to Consolidated Financial Statements

2

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TETRA Technologies, Inc. and Subsidiaries

Consolidated Balance Sheets

(In Thousands)

	September 30, 2020		December 31, 2019
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	75,165	$	17,704
Restricted cash	59		64
Trade accounts receivable, net of allowances of $7,742 in 2020 and $5,262 in 2019	108,222		175,918
Inventories	113,020		136,510
Prepaid expenses and other current assets	21,176		21,158
Total current assets	317,642		351,354
Property, plant, and equipment:
Land and building	39,534		60,586
Machinery and equipment	1,341,905		1,335,157
Automobiles and trucks	26,581		31,681
Chemical plants	60,195		57,692
Construction in progress	10,819		34,393
Total property, plant, and equipment	1,479,034		1,519,509
Less accumulated depreciation	(804,466)		(760,872)
Net property, plant, and equipment	674,568		758,637
Other assets:
Patents, trademarks and other intangible assets, net of accumulated amortization of $93,976 in 2020 and $88,422 in 2019	68,350		74,199
Deferred tax assets, net	24		24
Operating lease right-of-use assets	78,867		68,131
Other assets	22,089		19,577
Total other assets	169,330		161,931
Total assets	$	1,161,540	$	1,271,922

See Notes to Consolidated Financial Statements

3

Table of Contents

TETRA Technologies, Inc. and Subsidiaries

Consolidated Balance Sheets

(In Thousands, Except Share Amounts)

	September 30, 2020		December 31, 2019
	(Unaudited)
LIABILITIES AND EQUITY
Current liabilities:
Trade accounts payable	$	42,406	$	88,917
Unearned income	7,310		9,831
Accrued liabilities and other	80,500		87,877
Liabilities of discontinued operations	1,852		2,098
Total current liabilities	132,068		188,723
Long-term debt, net	843,216		842,871
Deferred income taxes	3,421		2,988
Asset retirement obligations	12,973		12,762
Warrants liability	123		449
Operating lease liabilities	64,200		53,919
Other liabilities	10,364		7,384
Total long-term liabilities	934,297		920,373
Commitments and contingencies
Equity:
TETRA stockholders’ equity:
Common stock, par value 0.01 per share; 250,000,000 shares authorized at September 30, 2020 and December 31, 2019; 128,930,704 shares issued at September 30, 2020 and 128,304,354 shares issued at December 31, 2019	1,289		1,283
Additional paid-in capital	471,146		466,959
Treasury stock, at cost; 2,953,976 shares held at September 30, 2020, and 2,823,191 shares held at December 31, 2019	(19,484)		(19,164)
Accumulated other comprehensive (loss)	(54,634)		(52,183)
Retained deficit	(398,630)		(362,522)
Total TETRA stockholders’ equity	(313)		34,373
Noncontrolling interests	95,488		128,453
Total equity	95,175		162,826
Total liabilities and equity	$	1,161,540	$	1,271,922

See Notes to Consolidated Financial Statements

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TETRA Technologies, Inc. and Subsidiaries

Consolidated Statements of Equity

(In Thousands)

(Unaudited)

	Common Stock Par Value		Additional Paid-In Capital		Treasury Stock		Accumulated Other  Comprehensive Income (Loss)		Retained Deficit		Noncontrolling Interest		Total Equity
							Currency Translation
Balance at December 31, 2019	$	1,283	$	466,959	$	(19,164)	$	(52,183)	$	(362,522)	$	128,453	$	162,826
Net loss for first quarter 2020	—		—		—		—		(1,551)		(8,825)		(10,376)
Translation adjustment, net of taxes of $0	—		—		—		(6,238)		—		(229)		(6,467)
Comprehensive loss	—		—		—		—		—		—		(16,843)
Distributions to public unitholders	—		—		—		—		—		(309)		(309)
Equity award activity	4		—		—		—		—		—		4
Treasury stock activity, net	—		—		(89)		—		—		—		(89)
Equity compensation expense	—		1,145		—		—		—		228		1,373
Other	—		(16)		—		—		—		(15)		(31)
Balance at March 31, 2020	$	1,287	$	468,088	$	(19,253)	$	(58,421)	$	(364,073)	$	119,303	$	146,931
Net loss for second quarter 2020	—		—		—		—		(21,255)		(15,712)		(36,967)
Translation adjustment, net of taxes of $0	—		—		—		980		—		115		1,095
Comprehensive loss	—		—		—		—		—		—		(35,872)
Distributions to public unitholders	—		—		—		—		—		(311)		(311)
Equity award activity	1		—		—		—		—		—		1
Treasury stock activity, net	—		—		(181)		—		—		—		(181)
Equity compensation expense	—		1,685		—		—		—		449		2,134
Other	—		4		—		—		—		(20)		(16)
Balance at June 30, 2020	$	1,288	$	469,777	$	(19,434)	$	(57,441)	$	(385,328)	$	103,824	$	112,686
Net loss for third quarter 2020	—		—		—		—		(13,302)		(8,296)		(21,598)
Translation adjustment, net of taxes of $0	—		—		—		2,807		—		67		2,874
Comprehensive loss	—		—		—		—		—		—		(18,724)
Distributions to public unitholders	—		—		—		—		—		(312)		(312)
Equity award activity	1		—		—		—		—		—		1
Treasury stock activity, net	—		—		(50)		—		—		—		(50)
Equity compensation expense	—		1,363		—		—		—		232		1,595
Other	—		6		—		—		—		(27)		(21)
Balance at September 30, 2020	$	1,289	$	471,146	$	(19,484)	$	(54,634)	$	(398,630)	$	95,488	$	95,175

See Notes to Consolidated Financial Statements

5

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TETRA Technologies, Inc. and Subsidiaries

Consolidated Statements of Equity

(In Thousands)

(Unaudited)

	Common Stock Par Value		Additional Paid-In Capital		Treasury Stock		Accumulated Other  Comprehensive Income (Loss)		Retained Deficit		Noncontrolling Interest		Total Equity
							Currency Translation
Balance at December 31, 2018	$	1,285	$	460,680	$	(18,950)	$	(51,663)	$	(217,952)	$	139,349	$	312,749
Net loss for first quarter 2019	—		—		—		—		(10,838)		(8,262)		(19,100)
Translation adjustment, net of taxes of $0	—		—		—		(582)		—		176		(406)
Comprehensive loss	—		—		—		—		—		—		(19,506)
Distributions to public unitholders	—		—		—		—		—		(307)		(307)
Equity award activity	(1)		—		—		—		—		—		(1)
Treasury stock activity, net	—		—		(155)		—		—		—		(155)
Equity compensation expense	—		1,628		—		—		—		311		1,939
Conversions of CCLP Series A Preferred	—		—		—		—		—		2,539		2,539
Cumulative effect adjustment	—		—		—		—		2,843		—		2,843
Other	—		(67)		—		—		—		76		9
Balance at March 31, 2019	$	1,284	$	462,241	$	(19,105)	$	(52,245)	$	(225,947)	$	133,882	$	300,110
Net loss for second quarter 2019	—		—		—		—		(6,913)		(1,633)		(8,546)
Translation adjustment, net of taxes of $0	—		—		—		765		—		83		848
Comprehensive loss	—		—		—		—		—		—		(7,698)
Distributions to public unitholders	—		—		—		—		—		(308)		(308)
Treasury stock activity, net	—		—		(11)		—		—		—		(11)
Equity compensation expense	—		2,100		—		—		—		567		2,667
Other	—		(36)		—		—		—		(33)		(69)
Balance at June 30, 2019	$	1,284	$	464,305	$	(19,116)	$	(51,480)	$	(232,860)	$	132,558	$	294,691
Net loss for third quarter 2019	—		—		—		—		(15,831)		(2,378)		(18,209)
Translation adjustment, net of taxes of $0	—		—		—		(3,762)		—		20		(3,742)
Comprehensive loss	—		—		—		—		—		—		(21,951)
Distributions to public unitholders	—		—		—		—		—		(309)		(309)
Equity award activity	—		—		—		—		—		—		—
Treasury stock activity, net	—		—		(48)		—		—		—		(48)
Equity compensation expense	—		1,316		—		—		—		(211)		1,105
Other	—		(6)		—		—		—		46		40
Balance at September 30, 2019	$	1,284	$	465,615	$	(19,164)	$	(55,242)	$	(248,691)	$	129,726	$	273,528

See Notes to Consolidated Financial Statements

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TETRA Technologies, Inc. and Subsidiaries

Consolidated Statements of Cash Flows

(In Thousands)

(Unaudited) 

	Nine Months Ended September 30,
	2020		2019
Operating activities:
Net loss	$	(68,941)	$	(45,855)
Reconciliation of net loss to net cash provided by operating activities:
Depreciation, amortization, and accretion	88,906		93,364
Impairment and other charges	14,445		3,306
Benefit for deferred income taxes	550		545
Equity-based compensation expense	4,847		6,260
Provision for doubtful accounts	5,907		3,351
Loss on disposition of business	—		7,500
Amortization and expense of financing costs	3,698		4,614
Insurance recoveries associated with damaged equipment	(643)		(1,392)
Equipment received in lieu of cash	725		—
Debt exchange expenses	4,777		—
CCLP Series A Preferred Unit distributions and adjustments	—		3,574
Warrants fair value adjustment	(326)		(1,035)
Contingent consideration liability fair value adjustment	—		(800)
Gain on sale of assets	(4,340)		(1,583)
Changes in operating assets and liabilities:
Accounts receivable	61,314		13,309
Inventories	11,780		(6,847)
Prepaid expenses and other current assets	(916)		(1,831)
Trade accounts payable and accrued expenses	(57,844)		10,344
Other	888		(3,234)
Net cash provided by operating activities	64,827		83,590
Investing activities:
Purchases of property, plant, and equipment, net	(22,011)		(89,192)
Acquisition of businesses, net of cash acquired	—		(12,024)
Proceeds on sale of property, plant, and equipment	24,704		2,152
Insurance recoveries associated with damaged equipment	643		1,392
Other investing activities	(576)		(890)
Net cash provided by (used in) investing activities	2,760		(98,562)
Financing activities:
Proceeds from long-term debt	404,060		246,090
Principal payments on long-term debt	(408,666)		(204,718)
CCLP distributions	(932)		(924)
Redemptions of CCLP Series A Preferred	—		(28,049)
Tax remittances on equity based compensation	(341)		(571)
Debt issuance costs and other financing activities	(3,897)		(373)
Net cash provided by (used in) financing activities	(9,776)		11,455
Effect of exchange rate changes on cash	(355)		(606)
Increase (decrease) in cash and cash equivalents	57,456		(4,123)
Cash and cash equivalents and restricted cash at beginning of period	17,768		40,102
Cash and cash equivalents and restricted cash at end of period	$	75,224	$	35,979
Supplemental cash flow information:
Interest paid	$	42,199	$	49,073
Income taxes paid	4,692		6,226

See Notes to Consolidated Financial Statements

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TETRA Technologies, Inc. and Subsidiaries

Notes to Consolidated Financial Statements

(Unaudited)

NOTE 1 – ORGANIZATION, BASIS OF PRESENTATION, AND SIGNIFICANT ACCOUNTING POLICIES

Organization 

We are a geographically diversified oil and gas services company, focused on completion fluids and associated products and services, water management, frac flowback, production well testing and offshore rig cooling services, and compression services and equipment. We were incorporated in Delaware in 1981. We are composed of three divisions – Completion Fluids & Products, Water & Flowback Services, and Compression. Unless the context requires otherwise, when we refer to “we,” “us,” and “our,” we are describing TETRA Technologies, Inc. and its consolidated subsidiaries on a consolidated basis.

Presentation  

Our unaudited consolidated financial statements include the accounts of our wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The information furnished reflects all normal recurring adjustments, which are, in the opinion of management, necessary to provide a fair statement of the results for the interim periods. Operating results for the period ended September 30, 2020 are not necessarily indicative of results that may be expected for the twelve months ended December 31, 2020.

We consolidate the financial statements of our CSI Compressco LP subsidiary (“CCLP”) as part of our Compression Division, as we determined that CCLP is a variable interest entity and we are the primary beneficiary. We control the financial interests of CCLP and have the ability to direct the activities of CCLP that most significantly impact its economic performance through our ownership of its general partner. The share of CCLP net assets and earnings that is not owned by us is presented as noncontrolling interest in our consolidated financial statements. Our cash flows from our investment in CCLP are limited to the quarterly distributions we receive on our CCLP common units and general partner interest (including incentive distribution rights) and the amounts collected for services we perform on behalf of CCLP, as TETRA’s capital structure and CCLP’s capital structure are separate, and do not include cross default provisions or cross guarantees.

The accompanying unaudited consolidated financial statements have been prepared in accordance with Rule 10-01 of Regulation S-X for interim financial statements required to be filed with the U.S. Securities and Exchange Commission (“SEC”) and do not include all information and footnotes required by U.S. generally accepted accounting principles (“U.S. GAAP”) for complete financial statements. These financial statements should be read in conjunction with the financial statements for the year ended December 31, 2019 and notes thereto included in our Annual Report on Form 10-K, which we filed with the SEC on March 16, 2020.

Significant Accounting Policies

    Our significant accounting policies are described in the notes to our consolidated financial statements for the year ended December 31, 2019 included in our Annual Report on Form 10-K. There have been no significant changes in our accounting policies or the application thereof during the third quarter of 2020.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclose contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues, expenses, and impairments during the reporting period. Actual results could differ from those estimates, and such differences could be material.

Reclassifications

    Certain previously reported financial information has been reclassified to conform to the current year's presentation. The impact of such reclassifications was not significant to the prior year’s overall presentation.

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Impairments and Other Charges

Impairments of long-lived assets, including identified intangible assets, are determined periodically when indicators of impairment are present. If such indicators are present, the determination of the amount of impairment is based on our judgment as to the future undiscounted operating cash flows to be generated from the relevant assets throughout their remaining estimated useful lives. If these undiscounted cash flows are less than the carrying amount of the related assets, an impairment is recognized for the excess of the carrying value over fair value. Fair value of intangible assets is generally determined using the discounted present value of future cash flows using discount rates commensurate with the risks inherent with the specific assets. Assets held for disposal are recorded at the lower of carrying value or estimated fair value less estimated selling costs. See Note 3 - “Impairments and Other Charges” for additional discussion of recorded impairments.

Revenue Recognition

    Performance Obligations. Revenue is generally recognized when we transfer control of our products or services to our customers. Revenue is measured as the amount of consideration we expect to receive in exchange for transferring products or providing services to our customers. We receive cash equal to the invoice price for most sales of product and services and payment terms typically range from 30 to 60 days from the date we invoice our customer. Since the period between when we deliver products or services and when the customer pays for such products or services is not expected to exceed one year, we have elected not to calculate or disclose a financing component for our customer contracts.

    Depending on the terms of the arrangement, we may also defer the recognition of revenue for a portion of the consideration received because we have to satisfy a future performance obligation. For example, consideration received from customers during the fabrication of new compressor packages is typically deferred until control of the compressor package is transferred to our customer.

    For any arrangements with multiple performance obligations, we use management’s estimated selling price to determine the stand-alone selling price for separate performance obligations. For revenue associated with mobilization of service equipment as part of a service contract arrangement, such revenue, if significant, is deferred and amortized over the estimated service period.

    Product Sales. Product sales revenues are generally recognized when we ship products from our facility to our customer. The product sales for our Completion Fluids & Products Division consist primarily of clear brine fluids (“CBFs”), additives, and associated manufactured products. Product sales for our Water & Flowback Services Division are typically attributed to specific performance obligations within certain production testing service arrangements. Parts and equipment sales comprise the product sales for the Compression Division.

    Services. Service revenues represent revenue recognized over time, as our customer arrangements typically provide agreed upon day-rates (monthly service rates for compression services) and we recognize service revenue based upon the number of days services have been performed. Service revenue recognized over time is associated with a majority of our Water & Flowback Services Division arrangements, compression service and aftermarket service contracts within our Compression Division, and a small portion of Completion Fluids & Products Division revenue that is associated with completion fluid service arrangements. With the exception of the initial terms of the compression services contracts for medium- and high-horsepower compressor packages of our Compression Division, our customer contracts are generally for terms of one year or less. The majority of the service arrangements in the Water & Flowback Services Division are for a period of 90 days or less.

    Sales taxes, value added taxes, and other taxes we collect concurrent with revenue-producing activities are excluded from revenue. We have elected to recognize the cost for freight and shipping costs as part of cost of product sales when control over our products (i.e. delivery) has transferred to the customer.

    Use of Estimates. In recognizing revenue for variable consideration arrangements, the amount of variable consideration recognized is limited so that it is probable that significant amounts of revenues will not be reversed in future periods when the uncertainty is resolved. For products returned by the customer, we estimate the expected returns based on an analysis of historical experience. For volume discounts earned by the customer, we estimate the discount (if any) based on our estimate of the total expected volume of products sold or services to be provided to the customer during the discount period. In certain contracts for the sale of CBFs, we may agree to issue credits

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for the repurchase of reclaimable used fluids from certain customers at an agreed price that is based on the condition of the fluids.

    Contract Assets and Liabilities. We consider contract assets to be trade accounts receivable when we have an unconditional right to consideration and only the passage of time is required before payment is due. In certain instances, particularly those requiring customer specific documentation prior to invoicing, our invoicing of the customer is delayed until certain documentation requirements are met. In those cases, we recognize a contract asset rather than a billed trade accounts receivable until we are able to invoice the customer. Contract assets, along with billed trade accounts receivable, are included in trade accounts receivable in our consolidated balance sheets.

    We classify contract liabilities as unearned income in our consolidated balance sheets. Such deferred revenue typically results from advance payments received on orders for new compressor equipment prior to the time such equipment is completed and transferred to the customer in accordance with the customer contract. New equipment sales orders generally take less than twelve months to build and deliver.

    Bill-and-Hold Arrangements. We design and fabricate compressor packages based on our customer’s specifications. In some cases, the customer will request us to hold the equipment, upon completion of the unit, until the job site is ready to receive the equipment. When this occurs, we along with the customer sign a bill-and-hold agreement, which outlines that the customer has title to the equipment, the equipment is ready for delivery, we cannot use the equipment or direct it to another customer, and we have a present right to payment. When those criteria have been met and the agreement is executed, we recognize the revenue on the equipment because control of the equipment has passed to our customer and our performance obligations are complete. Entering into these arrangements is something we have done as a courtesy for certain customers for many years. The equipment subject to the bill-and-hold agreements has generally been invoiced and paid for through progressive billings such that at the time the bill-and-hold agreement is executed, the majority of the contractual cash obligation of the customer has been received by us.

Operating Costs

Cost of product sales includes direct and indirect costs of manufacturing and producing our products, including raw materials, fuel, utilities, labor, overhead, repairs and maintenance, materials, services, transportation, warehousing, equipment rentals, insurance, and certain taxes. Cost of services includes operating expenses we incur in delivering our services, including labor, equipment rental, fuel, repair and maintenance, transportation, overhead, insurance, and certain taxes. We include in product sales revenues the reimbursements we receive from customers for shipping and handling costs. Shipping and handling costs are included in cost of product sales. Amounts we incur for “out-of-pocket” expenses in the delivery of our services are recorded as cost of services. Reimbursements for “out-of-pocket” expenses we incur in the delivery of our services are recorded as service revenues. Depreciation, amortization, and accretion includes depreciation expense for all of our facilities, equipment and vehicles, amortization expense on our intangible assets, and accretion expense related to our decommissioning and other asset retirement obligations.

We include in general and administrative expense all costs not identifiable to our specific product or service operations, including divisional and general corporate overhead, professional services, corporate office costs, sales and marketing expenses, insurance, and certain taxes. 

Foreign Currency Translation

    We have designated the Euro, the British pound, the Norwegian krone, the Canadian dollar, the Brazilian real, and the Mexican peso as the functional currencies for our operations in Finland and Sweden, the United Kingdom, Norway, Canada, Brazil, and certain of our operations in Mexico, respectively. The U.S. dollar is the designated functional currency for all of our other foreign operations. The cumulative translation effects of translating the applicable accounts from the functional currencies into the U.S. dollar at current exchange rates are included as a separate component of equity. Foreign currency exchange (gains) and losses are included in other (income) expense, net and totaled $(0.8) million and $(3.2) million during the three and nine months ended September 30, 2020, respectively, and $(1.7) million and $(2.2) million during the three and nine months ended September 30, 2019, respectively.

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Fair Value Measurements

We utilize fair value measurements to account for certain items and account balances within our consolidated financial statements. Fair value measurements are utilized on a recurring basis in the determination of the carrying values of certain liabilities, including the liabilities for the warrants to purchase 11.2 million shares of our common stock (the “Warrants”) and our foreign currency derivative contracts. See Note 9 - “Fair Value Measurements” for further discussion.

Fair value measurements are also utilized on a nonrecurring basis in certain circumstances, such as in the allocation of purchase consideration for acquisition transactions to the assets and liabilities acquired, including intangible assets and goodwill (a Level 3 fair value measurement), the initial recording of our asset retirement obligations, and for the impairment of long-lived assets, including goodwill (a Level 3 fair value measurement).

New Accounting Pronouncements

Standards adopted in 2020

    In August 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2018-15, “Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract.” ASU 2018-15 clarifies the accounting for implementation costs in cloud computing arrangements. ASU 2018-15 is effective for interim and annual reporting periods beginning after December 15, 2019, and early adoption is permitted. The adoption of this standard did not have a material impact on our consolidated financial statements.

Standards not yet adopted

    In June 2016, the FASB issued ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” ASU 2016-13 amends the impairment model to utilize an expected loss methodology in place of the currently used incurred loss methodology, which will result in the more timely recognition of losses on financial instruments not accounted for at fair value through net income. The provisions require credit impairments to be measured over the contractual life of an asset and developed with consideration for past events, current conditions, and forecasts of future economic information. Credit impairment will be accounted for as an allowance for credit losses deducted from the amortized cost basis at each reporting date. We are continuing to work through our implementation plan which includes evaluating the impact on our allowance for doubtful accounts methodology, identifying new reporting requirements, and implementing changes to business processes, systems, and controls to support adoption of the standard. Upon adoption, the allowance for doubtful accounts is expected to increase with an offsetting adjustment to retained earnings. Updates at each reporting date after initial adoption will be recorded through selling, general, and administrative expense. ASU 2016-13 has an effective date of the first quarter of fiscal 2023. We continue to assess the potential effects of these changes to our consolidated financial statements.

    In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes.” ASU 2019-12 simplifies the accounting for income taxes by eliminating certain exceptions related to intraperiod tax allocation, interim period income tax calculation methodology, and the recognition of deferred tax liabilities for outside basis differences. It also simplifies certain aspects of accounting for franchise taxes and clarifies the accounting for transactions that results in a step-up in the tax basis of goodwill. ASU 2019-12 is effective for us the first quarter of fiscal 2021. We continue to assess the potential effects of these changes to our consolidated financial statements.

    In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848)”, which provides optional expedients and exceptions for applying U.S. GAAP to contracts, hedging relationships, and other transactions affected by the discontinuation of the London Interbank Offered Rate (“LIBOR”) or by another reference rate expected to be discontinued. The amendments are effective for all entities as of March 12, 2020 through December 31, 2022. Entities may elect to apply the amendments for contract modifications as of any date from the beginning of an interim period that includes or is subsequent to March 12, 2020, or prospectively from a date within an interim period that includes or is subsequent to March 12, 2020. We are currently evaluating the impacts of the provisions of ASU 2020-04 on our consolidated financial statements.

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NOTE 2 – REVENUE FROM CONTRACTS WITH CUSTOMERS

    As of September 30, 2020, we had $47.1 million of remaining contractual performance obligations for compression services. As a practical expedient, this amount does not reflect revenue for compression service contracts whose original expected duration is less than twelve months and does not consider the effects of the time value of money. Expected revenue to be recognized in the future as of September 30, 2020 for completion of performance obligations of compression service contracts are as follows:

	2020		2021		2022		2023		2024		Total
	(In Thousands)
Compression service contracts remaining performance obligations	$	13,939	$	26,608	$	5,785	$	703	$	56	$	47,091

    For sales of CBFs where we have agreed to issue credits for the repurchase of reclaimable used fluids at an agreed price based on the condition of the fluid upon return, we adjust the revenue recognized in the period of shipment by an estimated amount, based on historical experience, of the credit expected to be issued. As of September 30, 2020, the amount of remaining credits expected to be issued for the repurchase of reclaimable used fluids was $1.1 million recorded in inventory (right of return asset) and either accounts payable or as a reduction to accounts receivable. There were no material differences between amounts recognized during the three and nine month period ended September 30, 2020, compared to estimates made in a prior period from these variable consideration arrangements.

    Our contract asset balances, primarily associated with customer documentation requirements, were $17.2 million and $34.9 million as of September 30, 2020 and December 31, 2019, respectively. Contract assets, along with billed trade accounts receivable, are included in trade accounts receivable in our consolidated balance sheets.

    Collections primarily associated with progressive billings to customers for the construction of compression equipment is included in unearned income in the consolidated balance sheets. The following table reflects the changes in unearned income in our consolidated balance sheets for the periods indicated:

	Nine Months Ended September 30,
	2020		2019
	(In Thousands)
Unearned Income, beginning of period	$	9,678	$	25,333
Additional unearned income	38,979		106,744
Revenue recognized	(41,624)		(105,486)
Unearned income, end of period	$	7,033	$	26,591

    During the nine month period ended September 30, 2020, we recognized product sales revenue of $9.4 million from unearned income that was deferred as of December 31, 2019. During the nine months ended September 30, 2019, we recognized product sales revenue of $22.2 million from unearned income that was deferred as of December 31, 2018.

    As of September 30, 2020, contract costs were immaterial.

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    We disaggregate revenue from contracts with customers into Product Sales and Services within each segment, as noted in our three reportable segments in Note 12. In addition, we disaggregate revenue from contracts with customers by geography based on the following table below.

	Three months ended September 30,		Nine months ended September 30,
	2020	2019	2020		2019
	(In Thousands)
Completion Fluids & Products
U.S.	15,013	31,480	$	85,073	$	100,622
International	36,937	27,860	113,460		100,066
	51,950	59,340	198,533		200,688
Water & Flowback Services
U.S.	19,767	68,052	97,016		209,663
International	1,767	4,789	6,708		14,980
	21,534	72,841	103,724		224,643
Compression
U.S.	71,478	105,153	240,661		324,792
International	7,639	8,613	25,066		28,348
	79,117	113,766	265,727		353,140
Total Revenue
U.S.	106,258	204,685	422,750		635,077
International	46,343	41,262	145,234		143,394
	152,601	245,947	$	567,984	$	778,471

NOTE 3 – IMPAIRMENTS AND OTHER CHARGES

Impairments of Long-Lived Assets

    During the first nine months of 2020, the COVID-19 pandemic and decline in oil and gas prices had a significant impact on our customers and industry. These events led to a significant reduction in the operations of our customers resulting in a decrease in demand in certain of our service lines.

    During the first quarter of 2020, we started to see our customers revise their capital budgets downwards and adjust their operations accordingly, which led to a decline in orders for new compression equipment to be fabricated and sold to third parties. We concluded that these events were indicators of impairment for all our asset groups within our Compression Division and certain asset groups within our Completion Fluids & Products Division. We performed recoverability analyses on the relevant asset groups within these divisions. Based upon these recoverability analyses, we determined that the carrying values of our Midland manufacturing facility and related new unit sales inventory in our Compression Division exceeded their respective fair values. Therefore, we recorded impairments of approximately $5.4 million related to these assets. Fair value was estimated based on a market approach.

    During the second quarter of 2020, primarily as a result of continued negative impacts on our compression fleet associated with the COVID-19 pandemic and declines in oil and gas prices, our Compression Division recorded impairments and other charges of approximately $9.0 million associated with non-core used compressor equipment that we have held for sale, the low-horsepower class of our compression fleet, and field inventory for compression and related services. During the third quarter of 2020, no further impairments were recorded. Impairment charges are reflected in impairment and other charges in our consolidated statements of operations. Fair value used to determine impairments was estimated based on a market approach. Given the dynamic nature of the events, we are not able to reasonably estimate how long our operations will be adversely impacted and the full impact these events will have on our operations. As a result, we could have indicators of impairment again in future periods resulting in additional asset impairments.

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NOTE 4 – INVENTORIES

Components of inventories as of September 30, 2020 and December 31, 2019 are as follows: 

	September 30, 2020		December 31, 2019
	(In Thousands)
Finished goods	$	70,452	$	70,135
Raw materials	3,744		4,125
Parts and supplies	32,340		47,793
Work in progress	6,484		14,457
Total inventories	$	113,020	$	136,510

Finished goods inventories include newly manufactured clear brine fluids as well as used brines that are repurchased from certain customers for recycling. Work in progress inventory consists primarily of new compressor packages located at our Compression Division manufacturing facility in Midland, Texas as well as work in progress on certain compression services jobs.

NOTE 5 – LEASES

    We have operating leases for some of our transportation equipment, office space, warehouse space, operating locations, and machinery and equipment. We have finance leases for certain storage tanks and equipment rentals. These finance leases are not material to our financial statements. Our leases have remaining lease terms ranging from 1 to 16 years. Some of our leases have options to extend for various periods, while some have termination options with prior notice of generally 30 days or six months. The office space, warehouse space, operating location leases, and machinery and equipment leases generally require us to pay all maintenance and insurance costs. During the fourth quarter of 2019, CCLP entered into a lease agreement commitment for 14 compressor packages. The leases are for an initial term of seven years and commenced upon the completion of the equipment fabrication. During the first quarter, CCLP took delivery of eight compressor packages. During the second quarter, CCLP took delivery of the remaining six compressor packages. We have no other lease commitments that have not yet commenced that create significant rights and obligations. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. Variable rent expense was not material.

    Our corporate headquarters facility located in The Woodlands, Texas, was sold on December 31, 2012, pursuant to a sale and leaseback transaction. As a condition to the completion of the purchase and sale of the facility, the parties entered into a lease agreement for the facility having an initial lease term of 15 years, which is classified as an operating lease. Under the terms of the lease agreement, we have the ability to extend the lease for five successive five-year periods at base rental rates to be determined at the time of each extension.

    Components of lease expense, included in either cost of revenues or general and administrative expense based on the use of the underlying asset, are as follows (inclusive of lease expense for leases not included on our consolidated balance sheet based on our accounting policy election to exclude leases with a term of 12 months or less):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
	(In Thousands)
Operating lease expense	$	5,822	$	5,075	$	17,839	$	15,106
Short-term lease expense	3,758		9,556		17,061		30,269
Total lease expense	$	9,580	$	14,631	$	34,900	$	45,375

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Supplemental cash flow information:

	Nine Months Ended September 30,
	2020		2019
	(In Thousands)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows - operating leases	$	17,861	$	14,868
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	24,201	$	7,631

Supplemental balance sheet information:

	September 30, 2020		December 31, 2019
	(In Thousands)
Operating leases:
Operating lease right-of-use assets	$	78,867	$	68,131
Accrued liabilities and other	$	16,362	$	15,850
Operating lease liabilities	64,200		53,919
Total operating lease liabilities	$	80,562	$	69,769

Additional operating lease information:

	September 30, 2020		December 31, 2019
Weighted average remaining lease term:
Operating leases	6.09 years		6.43 years
Weighted average discount rate:
Operating leases	9.33	%	9.46	%

    Future minimum lease payments by year and in the aggregate, under non-cancellable operating leases with terms in excess of one year consist of the following at September 30, 2020:

		Operating Leases
	(In Thousands)
Remainder of 2020		$	5,809
2021		22,322
2022		18,896
2023		15,803
2024		12,067
Thereafter		32,611
Total lease payments		107,508
Less imputed interest		(26,946)
Total lease liabilities		$	80,562

    At September 30, 2020, future minimum rental receipts under a non-cancellable sublease for office space in one of our locations totaled $5.0 million. For the three and nine months ended September 30, 2020, we recognized sublease income of $0.3 million and $0.9 million.

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NOTE 6 – LONG-TERM DEBT AND OTHER BORROWINGS

We believe our capital structure, excluding CCLP, (“TETRA”) and CCLP’s capital structure should be considered separately, as there are no cross default provisions or cross guarantees between CCLP’s debt and TETRA’s debt.

Consolidated long-term debt as of September 30, 2020 and December 31, 2019, consists of the following:

		September 30, 2020		December 31, 2019
		(In Thousands)
TETRA	Scheduled Maturity
Asset-based credit agreement (presented net of unamortized deferred financing costs of $0 million as of September 30, 2020 and $1.0 million as of December 31, 2019)	September 10, 2023	$	—	$	—
Term credit agreement (presented net of the unamortized discount of $5.7 million as of September 30, 2020 and $6.4 million as of December 31, 2019 and net of unamortized deferred financing costs of $8.5 million as of September 30, 2020 and $9.5 million as of December 31, 2019)	September 10, 2025	206,273		204,633
TETRA total long-term debt		$	206,273	$	204,633
CCLP
CCLP asset-based credit agreement (presented net of unamortized deferred financing costs of $0 million as of September 30, 2020 and $0.9 million of December 31, 2019)	June 29, 2023	—		2,622
CCLP 7.25% Senior Notes (presented net of the unamortized discount of $0.3 million as of September 30, 2020 and $1.7 million as of December 31, 2019 and net of unamortized deferred financing costs of $0.5 million as of September 30, 2020 and $2.8 million as of December 31, 2019)	August 15, 2022	79,893		291,444
CCLP 7.50% First Lien Notes (presented net of unamortized deferred financing costs of $5.4 million as of September 30, 2020 and $5.8 million as of December 31, 2019, net of the unamortized discount of $0.2 million as of September 30, 2020, and net of deferred restructuring gain of $5.3 million as of September 30, 2020)	April 1, 2025	399,640		344,172
CCLP 10.00%/10.75% Second Lien Notes (presented net of the unamortized discount of $0.8 million as of September 30, 2020, net of unamortized deferred financing costs of $1.2 million as of September 30, 2020, and net of deferred restructuring gain of $3.9 million as of September 30, 2020)	April 1, 2026	157,410		—
CCLP total long-term debt		$	636,943	$	638,238
Consolidated total long-term debt		$	843,216	$	842,871

    As of September 30, 2020, TETRA had no outstanding balance and $6.4 million in letters of credit against its asset-based credit agreement (“ABL Credit Agreement”). Because there was no outstanding balance on this Credit Agreement, associated deferred financing costs of $1.1 million as of September 30, 2020, were classified as other long-term assets on the accompanying consolidated balance sheet. As of September 30, 2020, subject to compliance with the covenants, borrowing base, and other provisions of the ABL Credit Agreement that may limit borrowings, TETRA had an availability of $25.8 million under this agreement.

As of September 30, 2020, CCLP had no balance outstanding and $2.5 million in letters of credit against its asset-based credit agreement (“CCLP Credit Agreement”). Because there was no outstanding balance under the CCLP Credit Agreement, associated deferred financing costs of $0.7 million were classified as other long-term assets on the accompanying consolidated balance sheet. As of September 30, 2020, and subject to compliance with the covenants, borrowing base, and other provisions of the CCLP Credit Agreement that may limit borrowings, CCLP had availability of $14.5 million.

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    TETRA and CCLP credit and senior note agreements contain certain affirmative and negative covenants, including covenants that restrict the ability to pay dividends or other restricted payments. TETRA and CCLP are both in compliance with all covenants of their respective credit and senior note agreements as of September 30, 2020.

Second Amendment to Credit Agreement

    On June 11, 2020, CSI Compressco, LP and CSI Compressco Sub Inc (the “Borrowers”) entered into the Second Amendment to Loan and Security Agreement (the “Amendment”) amending the Loan and Security Agreement dated June 29, 2018 (as amended, restated, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”) with Bank of America, N.A., in its capacity as administrative agent, issuing bank and swing line issuer (“Administrative Agent”), and the other lenders and loan parties party thereto. The Amendment provided for changes and modifications to the Credit Agreement which include, among other things, changes to certain terms of the Credit Agreement as follows: (i) resizing of the maximum credit commitment under the Credit Agreement from $50,000,000 to $35,000,000; (ii) the inclusion of a $5,000,000 reserve with respect to the Borrowing Base (as defined in the Credit Agreement) thereunder, which would result in reduced borrowing availability; (iii) the removal of the financial covenant compliance test with respect to the Consolidated Fixed Charge Coverage Ratio (as defined in the Credit Agreement); (iv) an increase in the applicable margin related to (x) LIBOR Rate Loans (as defined in the Credit Agreement) to a range between 3.00% and 3.50% and (y) Base Rate Loans (as defined in the Credit Agreement) to a range between 2.00% and 2.50%, in each case, which shall be determined according to average daily excess availability under the Credit Agreement; and (v) an increase in the rate used to calculate the commitment fee in respect of the unutilized commitments under the Credit Agreement to 0.50%. In connection to this amendment, $0.2 million of financing costs were incurred by CCLP and deferred against the carrying value of the amount outstanding, if any. Additionally, $0.2 million of financing fees were charged to other (income) expense, net during the nine month period ended September 30, 2020.

First Supplemental Indenture for the Old Notes

    On June 11, 2020, CSI Compressco, LP and CSI Compressco Finance Inc. (the “Issuers”) announced that they had accepted for exchange $215,208,000, or approximately 72.7%, of their outstanding 7.25% Senior Notes due 2022 (the “Old Notes”) that were validly tendered (and not validly withdrawn) by 11:59 p.m., New York City time, on June 10, 2020, for (i) $50,000,000 of the Issuers’ 7.50% Senior Secured First Lien Notes due 2025 (the “7.50% First Lien Notes”) and (ii) $155,529,000 aggregate principal amount of new 10.00%/10.75% Senior Secured Second Lien Notes due 2026 (the “10.00%/10.75% Second Lien Notes” and, together with the 7.50% First Lien Notes, the “New Notes”), pursuant to its previously announced exchange offer and consent solicitation (the “Exchange Offer”), which commenced on April 17, 2020. In connection with the exchange offer, CCLP incurred financing fees of $4.6 million which were charged to other (income) expense, net during the nine month period ended September 30, 2020.

    On June 12, 2020, following receipt of the requisite consents of the holders of the Old Notes, the Issuers entered into the First Supplemental Indenture (the “First Supplemental Indenture”), by and among the Issuers, the subsidiary guarantors named therein and U.S. Bank National Association, as trustee, to the Indenture, dated as of August 4, 2014 (the “Unsecured Indenture”), by and among the Issuers, the subsidiary guarantors named therein and U.S. Bank National Association, as trustee.

    The First Supplemental Indenture eliminated substantially all of the restrictive covenants and certain of the default provisions in the Unsecured Indenture and became operative upon the consummation by the Issuers of the Exchange Offer.

    On June 12, 2020, the Issuers issued $50,000,000 in aggregate principal amount of New First Lien Notes to certain holders of the Old Notes pursuant to the terms of the Exchange Offer. In March 2018, the Issuers had issued $350,000,000 in aggregate principal amount of 7.50% Senior Secured Notes due 2025 (the “Existing First Lien Notes” and, together with the New First Lien Notes, the “7.50% First Lien Notes”) pursuant to the First Lien Base Indenture. The New First Lien Notes were issued as “additional notes” under the First Lien Base Indenture and will be treated as a single class with such notes but will not trade fungibly with the Existing First Lien Notes.

Second Lien Notes Indenture

    On June 12, 2020, the Issuers issued $155,529,000 in aggregate principal amount of the 10.00%/10.75% Second Lien Notes to certain holders of the Old Notes pursuant to the terms of the Exchange Offer. The Issuers

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issued the 10.00%/10.75% Second Lien Notes pursuant to an indenture, dated June 12, 2020 (the “Second Lien Notes Indenture”),by and among the Issuers, the subsidiary guarantors named therein and U.S. Bank National Association, as trustee (the “Second Lien Trustee”). In connection with the payment of PIK Interest (as defined below), if any, in respect of the 10.00%/10.75% Second Lien Notes, the Issuers will be entitled, without the consent of the Holders, to increase the outstanding aggregate principal amount of the 10.00%/10.75% Second Lien Notes or issue additional notes (“PIK notes”) under the Second Lien Notes Indenture on the same terms and conditions as the 10.00%/10.75% Second Lien Notes offered hereby (each such increase or issuance, a “PIK Payment”). The Issuers may issue additional 10.00%/10.75% Second Lien Notes under the Second Lien Notes Indenture from time to time. Any issuance of additional 10.00%/10.75% Second Lien Notes (including PIK notes) is subject to all of the covenants in the Second Lien Notes Indenture. The 10.00%/10.75% Second Lien Notes and any additional 10.00%/10.75% Second Lien Notes subsequently issued under the indenture, will be treated as a single class for all purposes under the indenture, including, without limitation, waivers, amendments, redemptions and offers to purchase. Subject to the making of PIK Payments, the Issuers will issue 10.00%/10.75% Second Lien Notes in denominations of $2,000 and integral multiples of $1,000 in excess of $2,000; provided that PIK Payments may result in 10.00%/10.75% Second Lien Notes being issued in denominations of $1.00 and integral multiples of $1.00. The 10.00%/10.75% Second Lien Notes will mature on April 1, 2026. Interest on the 10.00%/10.75% Second Lien Notes will be payable semi-annually in arrears on April 1 and October 1, commencing on October 1, 2020. The Issuers will make each interest payment to the holders of record on March 15 and September 15 immediately preceding each interest payment date. Interest will accrue at (1) the annual rate of 7.250% payable in cash, plus (2) at the election of the Issuers (made by delivering a notice to the Second Lien Trustee not less than five business days prior to the record date), the annual rate of (i) 2.750% payable in cash (together with the annual rate set forth in clause (1), the “Cash Interest Rate”) or (ii) 3.500% payable by increasing the principal amount of the outstanding 10.00%/10.75% Second Lien Notes or by issuing additional PIK notes, in each case rounding up to the nearest $1.00 (such increased principal amount or additional PIK notes, the “PIK Interest”). In the absence of an interest payment election made by the Issuers as set forth above, interest on the notes will be payable as if the Issuers had elected to pay PIK Interest with respect to the portion of interest payable pursuant to clause (2) above.

    The 10.00%/10.75% Second Lien Notes are jointly and severally, and fully and unconditionally, guaranteed (the “Guarantees”) on a senior secured basis initially by each of the Partnership’s domestic restricted subsidiaries (other than Finance Corp, certain immaterial subsidiaries and certain other excluded domestic subsidiaries, the “Guarantors”) and will be secured by a second-priority security interest in substantially all of the Issuers’ and the Guarantors’ assets (other than certain excluded assets) (the “Collateral”) as collateral security for their obligations under the 10.00%/10.75% Second Lien Notes, subject to certain permitted encumbrances and exceptions. At any time prior to April 1, 2023, the Issuers may on any one or more occasions redeem up to 35% of the aggregate principal amount of the 10.00%/10.75% Second Lien Notes issued under the Second Lien Notes Indenture at a redemption price of 110.000% of the principal amount of the 10.00%/10.75% Second Lien Notes, plus accrued and unpaid interest to the redemption date, with an amount of cash equal to the net cash proceeds of certain equity offerings. On or after April 1, 2023, the Issuers may redeem all or part of the 10.00%/10.75% Second Lien Notes at redemption prices (expressed as percentages of the principal amount) equal to (i) 107.500% for the twelve month period beginning on April 1, 2023; (ii) 105.000% for the twelve-month period beginning on April 1, 2024 and (iii) 100.000% at any time thereafter, plus accrued and unpaid interest up to, but not including, the redemption date. In addition, at any time prior to April 1, 2023, the Company may redeem all or a part of the 10.00%/10.75% Second Lien Notes at a redemption price equal to 100% of the principal amount of the 10.00%/10.75% Second Lien Notes to be redeemed plus a make-whole premium, plus accrued and unpaid interest up to, but not including, the redemption date.

    The Second Lien Notes Indenture contains customary covenants restricting the Partnership’s ability and the ability of its restricted subsidiaries to: (i) pay distributions on, purchase or redeem its common units or purchase or redeem its subordinated debt; (ii) incur or guarantee additional indebtedness or issue certain kinds of preferred equity securities; (iii) create or incur certain liens securing indebtedness; (iv) sell assets, including dispositions of the Collateral; (v) consolidate, merge or transfer all or substantially all of its assets; (vi) enter into transactions with affiliates; and (vii) enter into agreements that restrict distributions or other payments from its restricted subsidiaries to the Partnership. These covenants are subject to a number of important limitations and exceptions, including certain provisions permitting the Partnership, subject to the satisfaction of certain conditions, to transfer assets to certain of its unrestricted subsidiaries. Moreover, if the 10.00%/10.75% Second Lien Notes receive an investment grade rating from at least two rating agencies and no default has occurred and is continuing under the 10.00%/10.75% Second Lien Notes Indenture, many of the restrictive covenants in the Second Lien Notes Indenture will be terminated. The Second Lien Notes Indenture also contains customary events of default and acceleration provisions relating to such events of default, which provide that upon an event of default under the

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Second Lien Notes Indenture, the Second Lien Trustee or the holders of at least 25% in aggregate principal amount of the then outstanding 10.00%/10.75% Second Lien Notes may declare all of the 10.00%/10.75% Second Lien Notes to be due and payable immediately.

NOTE 7 – DISCONTINUED OPERATIONS

    On March 1, 2018, we closed a series of related transactions that resulted in the disposition of our Offshore Division. As a result, we have accounted for our Offshore Division, consisting of our Offshore Services and Maritech segments, as discontinued operations. See Note 8 - “Commitments and Contingencies” for further discussion. A summary of financial information related to our discontinued operations is as follows:

Reconciliation of the Line Items Constituting Pretax Loss from Discontinued Operations to the After-Tax Loss from Discontinued Operations

(in thousands)

	Three Months Ended September 30, 2020						Three Months Ended September 30, 2019
	Offshore Services		Maritech		Total		Offshore Services		Maritech		Total
Major classes of line items constituting pretax loss from discontinued operations
Revenue	$	—	$	—	$	—	$	—	$	—	$	—
Cost of revenues	2		—		2		(273)		—		(273)
Depreciation, amortization, and accretion	—		—		—		52		—		52
General and administrative expense	171		—		171		1,734		—		1,734
Other expense, net	—		—		—		117		—		117
Pretax income (loss) from discontinued operations	(173)		—		(173)		(1,630)		—		(1,630)
Pretax (loss) on disposal of discontinued operations					—						(7,500)
Total pretax (loss) from discontinued operations					(173)						(9,130)
Income tax provision (benefit)					—						—
Total (loss) from discontinued operations					$	(173)					$	(9,130)

	Nine Months Ended September 30, 2020						Nine Months Ended September 30, 2019
	Offshore Services		Maritech		Total		Offshore Services		Maritech		Total
Major classes of line items constituting pretax loss from discontinued operations
Revenue	$	—	$	—	$	—	$	—	$	—	$	—
Cost of revenues	(332)		—		(332)		(251)		—		(251)
Depreciation, amortization, and accretion	—		—		—		52		—		52
General and administrative expense	487		—		487		2,483		—		2,483
Other expense, net	—		—		—		117		—		117
Pretax (loss) from discontinued operations	(155)		—		(155)		(2,401)		—		(2,401)
Pretax (loss) on disposal of discontinued operations					—						(7,500)
Total pretax (loss) from discontinued operations					(155)						(9,901)
Income tax provision (benefit)					—						—
Total (loss) from discontinued operations					$	(155)					$	(9,901)

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Reconciliation of Major Classes of Assets and Liabilities of the Discontinued Operations to Amounts Presented Separately in the Statement of Financial Position

(in thousands)

	September 30, 2020						December 31, 2019
	Offshore Services		Maritech		Total		Offshore Services		Maritech		Total
Carrying amounts of major classes of assets included as part of discontinued operations
Trade receivables	$	—	$	—	$	—	$	—	$	—	$	—
Other current assets	—		—		—		—		—		—
Assets of discontinued operations	$	—	$	—	$	—	$	—	$	—	$	—
Carrying amounts of major classes of liabilities included as part of discontinued operations
Trade payables	$	1,223	$	—	$	1,223	$	1,233	$	—	$	1,233
Accrued liabilities	401		228		629		745		120		865
Liabilities of discontinued operations	$	1,624	$	228	$	1,852	$	1,978	$	120	$	2,098

NOTE 8 – COMMITMENTS AND CONTINGENCIES

Litigation

We are named defendants in several lawsuits and respondents in certain governmental proceedings arising in the ordinary course of business. While the outcome of lawsuits or other proceedings against us cannot be predicted with certainty, management does not consider it reasonably possible that a loss resulting from such lawsuits or other proceedings in excess of any amounts accrued has been incurred that is expected to have a material adverse impact on our financial condition, results of operations, or liquidity.

Contingencies of Discontinued Operations

    In early 2018, we closed the Maritech Asset Purchase and Sale Agreement with Orinoco Natural Resources, LLC (“Orinoco”) that provided for the purchase by Orinoco of Maritech’s remaining oil and gas properties and related assets. Shortly thereafter, we closed the Maritech Membership Interest Purchase and Sale Agreement with Orinoco that provided for the purchase by Orinoco of all of the outstanding membership interests in Maritech. As a result of these transactions, we have effectively exited the business of our former Maritech segment.

    Under the Maritech Asset Purchase and Sale Agreement, Orinoco assumed all of Maritech’s decommissioning liabilities related to the leases sold to Orinoco (the “Orinoco Lease Liabilities”) and, under the Maritech Membership Interest Purchase and Sale Agreement, Orinoco assumed all other liabilities of Maritech, including the decommissioning liabilities associated with the oil and gas properties previously sold by Maritech (the “Legacy Liabilities”), subject to certain limited exceptions unrelated to the decommissioning liabilities. To the extent that Maritech or Orinoco fails to satisfy decommissioning liabilities associated with any of the Orinoco Lease Liabilities or the Legacy Liabilities, we may be required to satisfy such liabilities under third party indemnity agreements and corporate guarantees that we previously provided to the US Department of the Interior and other parties, respectively.

    Pursuant to a Bonding Agreement entered into as part of these transactions (the “Bonding Agreement”), Orinoco provided non-revocable performance bonds in an aggregate amount of $46.8 million to cover the performance by Orinoco and Maritech of the asset retirement obligations of Maritech (the “Initial Bonds”) and agreed to replace, within 90 days following the closing, the Initial Bonds with other non-revocable performance bonds, meeting certain requirements, in the aggregate sum of $47.0 million (collectively, the “Interim Replacement Bonds”). Orinoco further agreed to replace, within 180 days following the closing, the Interim Replacement Bonds with a maximum of three non-revocable performance bonds in the aggregate sum of $47.0 million, meeting certain requirements (the “Final Bonds”). Among the other requirements of the Final Bonds was that they must provide coverage for all of the asset retirement obligations of Maritech instead of only relating to specific properties. In the event Orinoco did not provide the Interim Replacement Bonds or the Final Bonds, Orinoco was required to make certain cash escrow payments to us.

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    The payment obligations of Orinoco under the Bonding Agreement were guaranteed by Thomas M. Clarke and Ana M. Clarke pursuant to a separate guaranty agreement (the “Clarke Bonding Guaranty Agreement”). Orinoco has not delivered such replacement bonds and neither it nor the Clarkes has made any of the agreed upon cash escrow payments and we filed a lawsuit against Orinoco and the Clarkes to enforce the terms of the Bonding Agreement and the Clarke Bonding Guaranty Agreement. A summary judgment was initially granted in favor of Orinoco and the Clarkes which dismissed our claims against Orinoco under the Bonding Agreement and against the Clarkes under the Clarke Bonding Guaranty Agreement. We filed an appeal and also asked the trial court to grant a new trial on the summary judgment or to modify the judgment because we believe this judgment should not have been granted. On November 5, 2019, the trial court signed an order granting our motion for new trial and vacating the prior order granting summary judgment for Orinoco and the Clarkes. The parties are awaiting direction from the court on a new scheduling order and/or trial setting. The Initial Bonds, which are non-revocable, remain in effect.

    If we become liable in the future for any decommissioning liability associated with any property covered by either an Initial Bond or an Interim Replacement Bond while such bonds are outstanding and the payment made to us under such bond is not sufficient to satisfy such liability, the Bonding Agreement provides that Orinoco will pay us an amount equal to such deficiency and if Orinoco fails to pay any such amount, such amount must be paid by the Clarkes under the Clarke Bonding Guaranty Agreement. However, if the Final Bonds or the full amount of the escrowed cash have been provided, neither Orinoco nor the Clarkes would be liable to pay us for any such deficiency. Our financial condition and results of operations may be negatively affected if Orinoco is unable to cover any such deficiency or if we become liable for a significant portion of the decommissioning liabilities.

     In early 2018, we also closed the sale of our Offshore Division to Epic Companies, LLC (“Epic Companies,” formerly known as Epic Offshore Specialty, LLC). Part of the consideration we received was a promissory note of Epic Companies in the original principal amount of $7.5 million (the “Epic Promissory Note”) payable to us in full, together with interest at a rate of 1.52% per annum, on December 31, 2019, along with a personal guaranty agreement from Thomas M. Clarke and Ana M. Clarke guaranteeing the payment obligations of Epic Companies pursuant to the Epic Promissory Note (the “Clarke Promissory Note Guaranty Agreement”). Additionally, pursuant to the Equity Interest Purchase Agreement (the “Offshore Services Purchase Agreement”) and other agreements with Epic Companies, certain other amounts relating to the Offshore Division totaling approximately $1.5 million were payable to us. At the end of August 2019, Epic Companies filed for bankruptcy. We recorded a reserve of $7.5 million for the full amount of the promissory note, including accrued interest, and the certain other receivables in the amount of $1.5 million during the quarter ended September 30, 2019. The Epic Promissory Note became due on December 31, 2019 but neither Epic nor the Clarkes made the required payment. Upon the default by Epic and the Clarkes, we filed a lawsuit against the Clarkes on January 15, 2020 in Montgomery County, Texas for breach of the Clarke Promissory Note Guaranty Agreement, seeking the amounts due under the Epic Promissory Note and related interest, as well as attorneys’ fees and expenses. The Clarkes each filed an answer and counterclaims for fraud and negligent misrepresentation and seek monetary damages in excess of $1 million, punitive damages, and attorneys’ fees. After taking discovery from the Clarkes, on August 21, 2020, we filed a Motion for Summary Judgment to recover the principal amount of the note plus interest from the Clarkes and to dismiss their counterclaims. The Court granted the Motion for Summary Judgment and entered Final Judgment in our favor, thereby dismissing the Clarkes’ counterclaims and awarding TETRA the full amount requested pursuant to an Order dated September 23, 2020. The Court awarded TETRA the full amount of $7,887,454, plus post-judgment interest at the rate of 3.52% per annum. On October 21, 2020, the Clarkes filed a Notice of Appeal. We will defend the Clarkes’ appeal and consider the options available to enforce the Court’s Order.

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NOTE 9 – FAIR VALUE MEASUREMENTS

Financial Instruments

Warrants

The Warrants are valued using a Black Scholes option valuation model that includes implied volatility of the trading price (a Level 3 fair value measurement).

Derivative Contracts

    We and CCLP each enter into short term foreign currency forward derivative contracts with third parties as part of a program designed to mitigate the currency exchange rate risk exposure on selected transactions of certain foreign subsidiaries. As of September 30, 2020, we and CCLP had the following foreign currency derivative contracts outstanding relating to portions of our foreign operations:

Derivative contracts	US Dollar Notional Amount	Traded Exchange Rate	Settlement Date
	(In Thousands)
Forward sale Mexican peso	5,464	21.87	October 1, 2020

Under this program, we and CCLP may enter into similar derivative contracts from time to time. Although contracts pursuant to this program will serve as an economic hedge of the cash flow of our currency exchange risk exposure, they are not formally designated as hedge contracts or qualify for hedge accounting treatment. Accordingly, any change in the fair value of these derivative contracts during a period will be included in the determination of earnings for that period.

The fair values of foreign currency derivative contracts are based on quoted market values (a Level 2 fair value measurement). The fair values of our and CCLP’s foreign currency derivative contracts as of September 30, 2020 and December 31, 2019, are as follows:

Foreign currency derivative contracts	Balance Sheet Location	Fair Value at September 30, 2020		Fair Value at December 31, 2019
		(In Thousands)
Forward purchase contracts	Current assets	$	59	$	86
Forward sale contracts	Current liabilities	—		(53)
Forward purchase contracts	Current liabilities	—		(3)
Net asset		$	59	$	30

None of our foreign currency derivative contracts contain credit risk related contingent features that would require us to post assets or collateral for contracts that are classified as liabilities. During the three and nine months ended September 30, 2020, we recognized $0.2 million and $(0.7) million, respectively, of net (gains) losses associated with our foreign currency derivative program. During the three and nine months ended September 30, 2019, we recognized $1.0 million and $1.8 million, respectively, of net (gains) losses associated with our foreign currency derivative program. These amounts are reflected in other (income) expense, net, in the accompanying consolidated statement of operations.

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During the nine months ended September 30, 2020, we recorded impairments of approximately $9.0 million, reflecting the decreased fair value for certain assets. The fair values used in these impairment calculations were estimated based on a market approach, which is based on significant unobservable inputs (Level 3) in accordance with the fair value hierarchy. See Note 3 - “Impairments and Other Charges” for further discussion.

Recurring and nonrecurring fair value measurements by valuation hierarchy as of September 30, 2020 and December 31, 2019, are as follows:

			Fair Value Measurements Using
	Total as of		Quoted Prices in Active Markets for Identical Assets or Liabilities		Significant Other Observable Inputs		Significant Unobservable Inputs
Description	September 30, 2020		(Level 1)		(Level 2)		(Level 3)
	(In Thousands)
Warrants liability	$	(123)	$	—	$	—	$	(123)
Asset for foreign currency derivative contracts	59		—		59		—
Net asset	$	(64)

			Fair Value Measurements Using
	Total as of		Quoted Prices in Active Markets for Identical Assets or Liabilities		Significant Other Observable Inputs		Significant Unobservable Inputs
Description	December 31, 2019		(Level 1)		(Level 2)		(Level 3)
	(In Thousands)
Warrants liability	$	(449)	$	—	$	—	$	(449)
Asset for foreign currency derivative contracts	86		—		86		—
Liability for foreign currency derivative contracts	(56)		—		(56)		—
Net liability	$	(419)

The fair values of cash, restricted cash, accounts receivable, accounts payable, accrued liabilities, short-term borrowings and long-term debt pursuant to TETRA’s ABL Credit Agreement and Term Credit Agreement, and the CCLP Credit Agreement approximate their carrying amounts. The fair values of the publicly traded CCLP 7.25% Senior Notes at September 30, 2020 and December 31, 2019, were approximately $59.7 million and $266.0 million, respectively. Those fair values compare to the face amount of $80.7 million and $295.9 million at September 30, 2020 and December 31, 2019, respectively. The fair values of the CCLP 7.50% Senior Secured Notes at September 30, 2020 and December 31, 2019 were approximately $360.0 million and $344.8 million, respectively. These fair values compare to aggregate principal amount of such notes at September 30, 2020 and December 31, 2019, of $400.0 million and $350.0 million, respectively. The fair value of the CCLP 10.00%/10.75% Second Lien Notes at September 30, 2020 was approximately $115.5 million. This fair value compares to aggregate principal amount of such notes at September 30, 2020 of $155.5 million. We based the fair values of the CCLP 7.25% Senior Notes, the CCLP 7.50% Senior Secured Notes, and the CCLP 10.00%/10.75% Second Lien Notes as of September 30, 2020 on recent trades for these notes. See Note 6 - “Long-Term Debt and Other Borrowings” for further discussion.

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NOTE 10 – SALE OF ASSETS

In April 2020, we entered into a purchase and sale agreement for the sale of the Midland manufacturing facility within our Compression Division. During the nine months ended September 30, 2020, we recorded an impairment of $3.1 million to reduce this asset to its approximate fair market value based on a market approach and expected net proceeds. The impairment charges are reflected in impairment and other charges in our statement of operations.

On July 2, 2020, we completed the previously announced sale of our Midland manufacturing facility for a total sale price of $17.0 million. The Midland facility was used to design, fabricate and assemble new standard and customized compressor packages. The sale of the Midland facility resulted in a gain of $0.3 million during the three and nine months ended September 30, 2020, which is reflected in other (income) expense, net in our statement of operations.

Additionally, in the third quarter of 2020, we sold the remaining inventory and equipment related to the fabrication of new compressors within our Compression Division for a gain of $0.5 million, which is reflected in other (income) expense, net in our statement of operations for the three and nine months ended September 30, 2020. During the nine months ended September 30, 2020, we recorded an impairment of $2.3 million to reduce the carrying value of the new unit sales inventory to its approximate fair market value based on a market approach. The impairment charges are reflected in impairment and other charges in our statement of operations.

During the third quarter ended September 30, 2020, we completed the sale of 58 low-horsepower units to one of our customers for $2.6 million. During the nine months ended September 30, 2020, we recorded an impairment of $3.7 million to reduce these assets to their approximate fair market value based on a market approach and expected net proceeds. The impairment charges are reflected in impairment and other charges in our statement of operations.

NOTE 11 – NET INCOME (LOSS) PER SHARE

The following is a reconciliation of the weighted average number of common shares outstanding with the number of shares used in the computations of net income (loss) per common and common equivalent share:

	Three Months Ended September 30,		Nine Months Ended September 30,
	2020	2019	2020	2019
	(In Thousands)
Number of weighted average common shares outstanding	125,893	125,568	125,789	125,620
Assumed exercise of equity awards and warrants	—	—	—	—
Average diluted shares outstanding	125,893	125,568	125,789	125,620

For the three and nine month periods ended September 30, 2020 and September 30, 2019, the average diluted shares outstanding excludes the impact of all outstanding equity awards and warrants, as the inclusion of these shares would have been anti-dilutive due to the net losses recorded during the periods. In addition, for the three and nine month period ended September 30, 2019, the calculation of diluted earnings per common share excludes the impact of the CSI Compressco LP Series A Convertible Preferred Units (the “CCLP Preferred Units”), as the inclusion of the impact from conversion of the CCLP Preferred Units into CCLP common units would have been anti-dilutive.

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NOTE 12 – INDUSTRY SEGMENTS

We manage our operations through three Divisions: Completion Fluids & Products, Water & Flowback Services, and Compression.

 Summarized financial information concerning the business segments is as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
	(In Thousands)
Revenues from external customers
Product sales
Completion Fluids & Products Division	$	49,986	$	55,444	$	187,419	$	185,578
Water & Flowback Services Division	23		100		56		831
Compression Division	18,801		37,833		64,541		134,099
Consolidated	$	68,810	$	93,377	$	252,016	$	320,508
Services
Completion Fluids & Products Division	$	1,964	$	3,896	$	11,114	$	15,110
Water & Flowback Services Division	21,511		72,741		103,668		223,812
Compression Division	60,316		75,933		201,186		219,041
Consolidated	$	83,791	$	152,570	$	315,968	$	457,963
Total revenues
Completion Fluids & Products Division	$	51,950	$	59,340	$	198,533	$	200,688
Water & Flowback Services Division	21,534		72,841		103,724		224,643
Compression Division	79,117		113,766		265,727		353,140
Interdivision eliminations	—		—		—		—
Consolidated	$	152,601	$	245,947	$	567,984	$	778,471
Income (loss) before taxes
Completion Fluids & Products Division	$	11,756	$	11,318	$	44,354	$	32,118
Water & Flowback Services Division	(7,746)		2,578		(18,408)		7,269
Compression Division	(11,321)		(3,464)		(47,117)		(14,748)
Interdivision eliminations	3		(1)		10		6
Corporate Overhead(1)	(13,472)		(17,931)		(43,825)		(54,921)
Consolidated	$	(20,780)	$	(7,500)	$	(64,986)	$	(30,276)

(1)Amounts reflected include the following general corporate expenses:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
	(In Thousands)
General and administrative expense	$	8,959	$	12,573	$	28,650	$	39,012
Depreciation and amortization	270		167		643		507
Interest expense	4,706		5,495		14,909		16,533
Warrants fair value adjustment (income) expense	—		78		(327)		(1,035)
Other general corporate income, net	(463)		(382)		(50)		(96)
Total	$	13,472	$	17,931	$	43,825	$	54,921

NOTE 13 – SUBSEQUENT EVENTS

In connection with the Midland manufacturing facility sale discussed in Note 10, we entered into an agreement with the buyer to continue to operate a portion of the facility, which allowed us to close out remaining backlog for the New Unit Sale business and operate our aftermarket services business for an interim period. Following the shipment of the last unit in October, we are no longer fabricating new compressor packages for sales to third parties or for our own service fleet. The operations associated with fabricating new compressor packages will be reported as a discontinued operation in the fourth quarter of 2020.

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In July 2020, we received a purchase order to sell $6.7 million of idle large horsepower compressor units to one of our significant customers. During the third quarter of 2020, we received proceeds and recognized $1.7 million relating to this order. In October 2020, we received the remaining $5.0 million of proceeds and started to deliver the compressor units to the customer. We have and will continue to evaluate the sale of other non-core assets, including our low-horsepower compression fleet. We can provide no assurance that we will consummate a future sale of our low-horsepower compression fleet or any other non-core asset.    

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following discussion and analysis of financial condition and results of operations should be read in conjunction with our unaudited consolidated financial statements and accompanying notes included in this Quarterly Report. In addition, the following discussion and analysis also should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2019 filed with the SEC on March 16, 2020 (“2019 Annual Report”). This discussion includes forward-looking statements that involve certain risks and uncertainties.

Business Overview  

We are a geographically diversified oil and gas services company, focused on completion fluids and associated products and services, comprehensive water management, frac flowback, production well testing and offshore rig cooling services, and compression services and equipment. We operate through three reporting segments organized into three Divisions - Completion Fluids & Products, Water & Flowback Services, and Compression.

Demand for the products and services of our Completion Fluids & Products Division has remained resilient despite the continued significant downward pressure on oil prices and ongoing uncertainty in many of the markets in which we operate. During the third quarter of 2020, lower domestic completion fluids product sales revenues as a result of hurricane activity in the Gulf of Mexico were offset by strong international sales mainly in the Middle East and Europe. However, continuing low prices for oil and gas and further price erosion could adversely affect the demand for our products and services in the future.

Recent macroeconomic uncertainty resulting from depressed commodity prices and the COVID-19 pandemic has particularly affected domestic onshore demand for our Water & Flowback Services Division. We experienced decreased water management services activity during the third quarter of 2020 and without a meaningful recovery, we expect our water management services operations to continue to be negatively impacted in the near future.

Our Compression Division is significantly dependent upon the demand for, and production of, oil and the associated natural gas from unconventional oil and natural gas production in the domestic and international markets in which we operate. During the third quarter of 2020, macroeconomic uncertainty in the oil and natural gas industry continued to drive steep declines in spending by the oil and gas operators but as oil prices stabilized around $40, the pace of horsepower being released slowed in comparison to the second quarter. In addition, the unprecedented drop in U.S. land oil and natural gas activity in the second quarter led to some of our customers temporarily shutting in wells and compression was placed on standby. Customers continued bringing production back online throughout the third quarter and we ended the third quarter with approximately 8% of our US domestic fleet on standby as compared to 15% in the second quarter.

During the first nine months of 2020, we saw our customers revise their capital budgets substantially downward and adjust their operations accordingly, which we believe will continue for an indefinite period. Given the decline in orders for new compression equipment to be fabricated and sold to third parties, in early April 2020, we announced our plan to shut down our Midland manufacturing facility. On July 2, 2020, we completed the previously announced sale of our Midland manufacturing facility for a total sale price of $17.0 million. We continued to operate the facility until the completion and sale of our remaining backlog, which was completed in October 2020. Following the completion of the backlog, we are no longer fabricating new compressor packages for sales to third parties or for our own service fleet.

    During the first quarter of 2020, we concluded that the impact on our customers and industry from the COVID-19 pandemic and decline in oil prices were indicators of impairment for all asset groups within our Compression Division and certain asset groups in our Completion Fluids & Products Division. As a result, we performed a recoverability analysis on all our long-lived asset groups and we determined that the carrying values of our Midland manufacturing facility and related new unit sales inventory exceeded their respective fair values.

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Therefore, we recorded impairments of approximately $5.4 million during the first quarter of 2020 related to these assets. During the second quarter of 2020, as a result of continued negative impacts on our compression fleet associated with the COVID-19 pandemic and declines in oil and gas prices, we recorded impairments and other charges of approximately $9.0 million in our Compression Division associated with non-core used compressor equipment that we have held for sale, the low-horsepower class of our compression fleet, and field inventory for compression and related services. During the third quarter of 2020, no further impairments were recorded. Given the dynamic nature of the events, we are not able to reasonably estimate how long our operations will be impacted and the full impact these events will have on our operations. As a result, we could have indicators of impairment again in future periods resulting in additional asset impairments. We have and will continue to evaluate the sale of non-core assets, including our low-horsepower compression fleet. We can provide no assurance that we will consummate a future sale of our low-horsepower compression fleet or any other non-core asset.

We actively managed our flexible cost structure as a proactive response to the changing market conditions throughout the second and third quarters while taking necessary actions to manage through these conditions, some of which could result in impairments or restructuring charges in future periods. Temporary and permanent cost reductions we have implemented include reductions in 2020 capital expenditures, workforce reductions, salary reductions, the suspension of 401(k) matching contributions for our employees, targeted reduction in SG&A expenses, and negotiated reductions in expenditures with many of our suppliers. While we are not able to predict how long market disruptions resulting from the COVID-19 pandemic will continue, or what impact it will ultimately have on our business, we have seen activity levels stabilizing at the end of the third quarter. Despite challenging market conditions, we will continue to maintain our commitment to safety and service quality for our customers.

How we Evaluate Operations

     We use U.S. GAAP financial measures such as revenues, gross profit, income (loss) before taxes, and net cash provided by operating activities, as well as certain non-GAAP financial measures, including Adjusted EBITDA, as performance measures for our business.

    Adjusted EBITDA. We view Adjusted EBITDA as one of our primary management tools, and we track it on a monthly basis, both in dollars and as a percentage of revenues (typically compared to the prior month, prior year period, and to budget). We define Adjusted EBITDA as earnings before interest, taxes, depreciation, amortization, impairments and certain other non-cash charges and non-recurring adjustments.

    Adjusted EBITDA is used as a supplemental financial measure by our management to:

•evaluate the financial performance of our assets without regard to financing methods, capital structure, or historical cost basis; and

•determine our ability to incur and service debt and fund capital expenditures.

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The following table reconciles net income (loss) to Adjusted EBITDA for the periods indicated:

	Three Months Ended
	September 30, 2020
	Net Income (Loss), as reported		Tax Provision		Income (Loss) Before Tax, as Reported		Impairments & Special Charges		Adjusted Income (Loss) Before Tax		Interest Expense, Net		Adjusted Depreciation & Amortization		Adjusted Equity Comp. Expense		Adjusted EBITDA
	(In Thousands)
Completion Fluids & Products Division					$	11,756	$	729	$	12,485	$	(291)	$	1,710	$	—	$	13,904
Water & Flowback Services Division					(7,746)		274		(7,472)		(77)		7,584		—		35
Compression Division					(11,321)		879		(10,442)		13,293		19,948		143		22,942
Eliminations and other					3		—		3		—		(3)		—		—
Subtotal					(7,308)		1,882		(5,426)		12,925		29,239		143		36,881
Corporate and other					(13,472)		1,031		(12,441)		4,706		173		983		(6,579)
TETRA excluding Discontinued Operations	$	(21,425)	$	645	$	(20,780)	$	2,913	$	(17,867)	$	17,631	$	29,412	$	1,126	$	30,302
	Three Months Ended
	September 30, 2019
	Net Income (Loss), as reported		Tax Provision		Income (Loss) Before Tax, as Reported		Impairments & Special Charges		Adjusted Income (Loss) Before Tax		Interest Expense, Net		Depreciation & Amortization		Equity Comp. Expense		Adjusted EBITDA
	(In Thousands)
Completion Fluids & Products Division					$	11,318	$	(736)	$	10,582	$	(216)	$	3,676	$	—	$	14,042
Water & Flowback Services Division					2,578		76		2,654		(2)		8,568		—		11,220
Compression Division					(3,464)		3,597		133		12,869		18,459		(211)		31,250
Eliminations and other					(1)		—		(1)		—		(3)		—		(4)
Subtotal					10,431		2,937		13,368		12,651		30,700		(211)		56,508
Corporate and other					(17,931)		379		(17,552)		5,495		167		1,539		(10,351)
TETRA excluding Discontinued Operations	$	(9,079)	$	1,579	$	(7,500)	$	3,316	$	(4,184)	$	18,146	$	30,867	$	1,328	$	46,157

Adjusted EBITDA is a financial measure that is not in accordance with U.S. GAAP and should not be considered an alternative to net income, operating income, cash provided by operating activities, or any other measure of financial performance presented in accordance with U.S. GAAP. This measure may not be comparable to similarly titled financial metrics of other companies, as other companies may not calculate Adjusted EBITDA in the same manner as we do. Management compensates for the limitations of Adjusted EBITDA as an analytical tool by reviewing the comparable U.S. GAAP measures, understanding the differences between the measures, and incorporating this knowledge into management’s decision-making processes.

Critical Accounting Policies and Estimates

    There have been no material changes or developments in the evaluation of the accounting estimates and

the underlying assumptions or methodologies pertaining to our Critical Accounting Policies and Estimates disclosed

in our 2019 Annual Report. In preparing our consolidated financial statements, we make assumptions, estimates, and judgments that affect the amounts reported. These judgments and estimates may change as new events occur, as new information is acquired, and as changes in our operating environments are encountered. Actual results are likely to differ from our current estimates, and those differences may be material.    

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Results of Operations

Three months ended September 30, 2020 compared with three months ended September 30, 2019.

Consolidated Comparisons

	Three Months Ended September 30,						Period to Period Change
	2020			2019			2020 vs 2019		% Change
	(In Thousands, Except Percentages)
Revenues	$	152,601		$	245,947		$	(93,346)	(38.0)	%
Gross profit	19,970			44,960			(24,990)		(55.6)	%
Gross profit as a percentage of revenue	13.1		%	18.3		%
General and administrative expense	25,256			34,926			(9,670)		(27.7)	%
General and administrative expense as a percentage of revenue	16.6		%	14.2		%
Interest expense, net	17,631			18,146			(515)		(2.8)	%
Warrants fair value adjustment expense	—			78			(78)		100.0	%
Other income, net	(2,137)			(690)			(1,447)		209.7	%
Loss before taxes and discontinued operations	(20,780)			(7,500)			(13,280)		(177.1)	%
Loss before taxes and discontinued operations as a percentage of revenue	(13.6)		%	(3.0)		%
Provision for income taxes	645			1,579			(934)		(59.2)	%
Loss before discontinued operations	(21,425)			(9,079)			(12,346)		136.0	%
Discontinued operations:
Loss from discontinued operations, net of taxes	(173)			(9,130)			8,957		(98.1)	%
Net loss	(21,598)			(18,209)			(3,389)		18.6	%
Loss attributable to noncontrolling interest	8,296			2,378			5,918		248.9	%
Net loss attributable to TETRA stockholders	$	(13,302)		$	(15,831)		$	2,529	(16.0)	%

Consolidated revenues during the current year quarter decreased compared to the prior year quarter due to the ongoing COVID-19 pandemic and associated decline in oil and gas prices resulting in decreases in demand and activity. See Divisional Comparisons section below for additional discussion.

Consolidated gross profit during the current year quarter decreased compared to the prior year quarter primarily due to decreased gross profit from our Water & Flowback Services and Compression Divisions.

Consolidated general and administrative expenses decreased during the current year quarter compared to the prior year quarter primarily due to decreased salary and employee expenses of $5.9 million, decreased provision for bad debt expense of $2.0 million, and decreased professional services fees of $1.3 million.

Consolidated other income, net, was $2.1 million of other income during the current year quarter compared to $0.7 million of other income during the prior year quarter. The increase in other income was primarily due to an increase of $1.5 million in gains in the current year period mainly from the sale of the Midland facility and a decrease of expense of $0.5 million associated with a redemption premium incurred in connection with the redemption of CCLP Preferred Units for cash in the prior year quarter. These increases in income were partially offset by an increase in foreign currency losses of $1.8 million in the current year quarter compared to the prior year quarter.

Our consolidated provision for income taxes during the three month period ended September 30, 2020 is attributable to taxes in certain foreign jurisdictions and Texas gross margin taxes. Our consolidated effective tax rate for the three month period ended September 30, 2020 of negative 3.1% was primarily the result of losses generated in entities for which no related tax benefit has been recorded. The losses generated by these entities do not result in tax benefits due to offsetting valuation allowances being recorded against the related net deferred tax assets. We establish a valuation allowance to reduce the deferred tax assets when it is more likely than not that some portion or all of the deferred tax assets will not be realized. Included in our deferred tax assets are net operating loss

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carryforwards and tax credits that are available to offset future income tax liabilities in the U.S. as well as in certain foreign jurisdictions.

Divisional Comparisons

Completion Fluids & Products Division

	Three Months Ended September 30,						Period to Period Change
	2020			2019			2020 vs 2019		% Change
	(In Thousands, Except Percentages)
Revenues	$	51,950		$	59,340		$	(7,390)	(12.5)	%
Gross profit	16,196			16,181			15		0.1	%
Gross profit as a percentage of revenue	31.2		%	27.3		%
General and administrative expense	4,619			4,865			(246)		(5.1)	%
General and administrative expense as a percentage of revenue	8.9		%	8.2		%
Interest income, net	(291)			(216)			(75)		34.7	%
Other expense, net	112			214			(102)		(47.7)	%
Income before taxes	$	11,756		$	11,318		$	438	3.9	%
Income before taxes as a percentage of revenue	22.6		%	19.1		%

The decrease in Completion Fluids & Products Division revenues during the current year quarter compared to the prior year quarter was primarily due to decreased revenues in the Gulf of Mexico because of project delays associated with hurricanes and storms in the Gulf of Mexico.

Completion Fluids & Products Division gross profit during the current year quarter remained relatively flat compared to the prior year quarter. Completion Fluids & Products Division profitability in future periods will continue to be affected by the mix of its products and services, market demand for our products and services, drilling and completions activity and commodity prices.

Water & Flowback Services Division

	Three Months Ended September 30,						Period to Period Change
	2020			2019			2020 vs 2019		% Change
	(In Thousands, Except Percentages)
Revenues	$	21,534		$	72,841		$	(51,307)	(70.4)	%
Gross profit (loss)	(5,714)			8,236			(13,950)		(169.4)	%
Gross profit (loss) as a percentage of revenue	(26.5)		%	11.3		%
General and administrative expense	2,545			5,957			(3,412)		(57.3)	%
General and administrative expense as a percentage of revenue	11.8		%	8.2		%
Interest income, net	(77)			(2)			(75)		3,750.0	%
Other income, net	(436)			(297)			(139)		46.8	%
Income (loss) before taxes	$	(7,746)		$	2,578		$	(10,324)	(400.5)	%
Income (loss) before taxes as a percentage of revenue	(36.0)		%	3.5		%

Water & Flowback Services Division revenues decreased significantly during the current year quarter primarily due to decreased customer drilling and completions activity as a result of lower oil and gas prices caused by the ongoing COVID-19 pandemic.

The Water & Flowback Services Division reported a gross loss during the current year quarter compared to the prior year quarter gross profit primarily due to lower revenues resulting from the decreased activity levels described above.

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The Water & Flowback Services Division reported a pretax loss compared to a pretax income in the prior year period primarily due to the substantial reduction in gross profit described above. General and administrative expense levels decreased compared to the prior year quarter primarily due to decreased wage and benefit related expenses of $2.7 million and a decrease in bad debt expense of $0.5 million.

Compression Division

	Three Months Ended September 30,						Period to Period Change
	2020			2019			2020 vs 2019		% Change
	(In Thousands, Except Percentages)
Revenues	$	79,117		$	113,766		$	(34,649)	(30.5)	%
Gross profit	9,755			20,710			(10,955)		(52.9)	%
Gross profit as a percentage of revenue	12.3		%	18.2		%
General and administrative expense	9,133			11,530			(2,397)		(20.8)	%
General and administrative expense as a percentage of revenue	11.5		%	10.1		%
Interest expense, net	13,293			12,869			424		3.3	%
Other income, net	(1,350)			(225)			(1,125)		500.0	%
Loss before taxes	$	(11,321)		$	(3,464)		$	(7,857)	(226.8)	%
Loss before taxes as a percentage of revenue	(14.3)		%	(3.0)		%

    Compression Division revenues decreased during the current year quarter compared to the prior year quarter primarily due to the ongoing COVID-19 pandemic’s impact on demand for oil and natural gas and the resulting decline in oil prices that led to a significant reduction in our customer’s activity. Product sales revenues decreased $19.0 million, as we continued to close out remaining backlog and prepared to shut down our Midland manufacturing facility and exit the new equipment sales business. Service revenues decreased $15.6 million due to returned compressors, compressors placed on standby rates, and some pricing concessions.

Compression Division gross profit decreased during the current year quarter compared to the prior year due to the lower revenues discussed above.

The Compression Division recorded an increased pretax loss during the current year quarter compared to the prior year quarter due to the decreased gross profit discussed above. General and administrative expense levels decreased compared to the prior year quarter, primarily due to decreased bad debt expense of $1.5 million and decreased employee expenses of $0.7 million. Other income, net, reflected gains in the current year period primarily from the sale of the Midland facility

Corporate Overhead

	Three Months Ended September 30,				Period to Period Change
	2020		2019		2020 vs 2019		% Change
	(In Thousands, Except Percentages)
Depreciation and amortization	$	270	$	167	$	103	(61.7)	%
General and administrative expense	8,959		12,573		(3,614)		(28.7)	%
Interest expense, net	4,706		5,495		(789)		(14.4)	%
Warrants fair value adjustment (income) expense			78		(78)		100.0	%
Other income, net	(463)		(382)		(81)		21.2	%
Loss before taxes	$	(13,472)	$	(17,931)	$	4,459	24.9	%

Corporate Overhead pretax loss decreased during the current year quarter compared to the prior year quarter, primarily due to decreased general and administrative expense and decreased interest expense. Corporate general and administrative expense decreased primarily due to decreased salary and employee expenses of $2.6 million, decreased professional fees of $0.5 million and decreased general expenses of $0.5 million. Interest expense decreased resulting from decreased borrowing under the ABL Credit Agreement.

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Results of Operations

Nine months ended September 30, 2020 compared with nine months ended September 30, 2019.

Consolidated Comparisons

	Nine Months Ended September 30,						Period to Period Change
	2020			2019			2020 vs 2019		% Change
	(In Thousands, Except Percentages)
Revenues	$	567,984		$	778,471		$	(210,487)	(27.0)	%
Gross profit	79,708			129,536			(49,828)		(38.5)	%
Gross profit as a percentage of revenue	14.0		%	16.6		%
General and administrative expense	89,807			105,498			(15,691)		(14.9)	%
General and administrative expense as a percentage of revenue	15.8		%	13.6		%
Interest expense, net	53,073			55,054			(1,981)		(3.6)	%
Warrants fair value adjustment income	(327)			(1,035)			708		(68.4)	%
CCLP Series A Preferred Units fair value adjustment expense	—			1,309			(1,309)		(100.0)	%
Other (income) expense, net	2,141			(1,014)			3,155		(311.1)	%
Loss before taxes and discontinued operations	(64,986)			(30,276)			(34,710)		114.6	%
Loss before taxes and discontinued operations as a percentage of revenue	(11.4)		%	(3.9)		%
Provision for income taxes	3,800			5,678			(1,878)		(33.1)	%
Loss before discontinued operations	(68,786)			(35,954)			(32,832)		91.3	%
Discontinued operations:
Loss from discontinued operations, net of taxes	(155)			(9,901)			9,746		(98.4)	%
Net loss	(68,941)			(45,855)			(23,086)		50.3	%
Loss attributable to noncontrolling interest	32,833			12,273			20,560		167.5	%
Net loss attributable to TETRA stockholders	$	(36,108)		$	(33,582)		$	(2,526)	7.5	%

Consolidated revenues for the current year period decreased compared to the prior year period primarily due to decreased revenues in our Water & Flowback Services and Compression Divisions, which decreased by $120.9 million and $87.4 million, respectively, primarily due to the ongoing COVID-19 pandemic and associated decline in oil prices. The decrease in revenues for the Water & Flowback Services Division was primarily due to decreased water management services activity. The decreased revenues of the Compression Division were primarily due to lower new unit sales as we progress the shut down of our Midland manufacturing facility. See Divisional Comparisons section below for additional discussion.

Consolidated gross profit decreased during the current year period compared to the prior year period primarily due to the decreased profitability of our Water & Flowback Services and Compression Divisions. This decreased gross profit was partially offset by increased gross profit of our Completion Fluids & Products Division. While offshore activity levels for our Completion Fluids & Products Division increased from the prior year period, onshore activity levels decreased, particularly during the second and third quarters. The impact of pricing pressures in addition to reduced levels of onshore activity continues to challenge profitability in the current markets. Operating expenses reflect the decrease in consolidated revenues, as well as aggressive management of operating costs and headcount.

Consolidated general and administrative expenses decreased during the current year period compared to the prior year period primarily due to decreased salary related expenses of $15.2 million, decreased general expenses of $1.6 million and decreased professional services fees of $1.3 million. These decreases were partly offset by increased bad debt expense of $2.8 million. Decreased general and administrative expenses were driven primarily by our Corporate Division. Most of the decrease of our general and administrative expenses stemmed from our restructuring efforts and headcount reductions in response to the decline in activity levels, particularly in our U.S. onshore operations. General and administrative expense as a percentage of revenues increased compared to the prior year period.

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Consolidated interest expense, net, decreased in the current year period primarily due to a decrease in Corporate and Compression Division interest expense. Corporate interest expense decreased due to lower borrowings under the ABL Credit Agreement. Compression Division interest expense decreased due to interest associated with the expense of CCLP Series A Preferred units that was incurred in the prior year period. Interest expense during the current year period and the prior year period includes $3.1 million and $1.9 million, respectively, of finance cost amortization.

The Warrants are accounted for as a derivative liability in accordance with ASC 815 and therefore they are classified as a long-term liability on our consolidated balance sheet at their fair value. Increases (or decreases) in the fair value of the Warrants are generally associated with increases (or decreases) in the trading price of our common stock, resulting in adjustments to earnings for the associated valuation losses (gains), and resulting in future volatility of our earnings during the period the Warrants are outstanding.

The CCLP Preferred Units were eligible to be settled using a variable number of CCLP common units, and therefore the fair value of the CCLP Preferred Units was classified as a long-term liability on our consolidated balance sheets in accordance with ASC 480. Because the CCLP Preferred Units were convertible into CCLP common units at the option of the holder, the fair value of the CCLP Preferred Units generally increased or decreased with the trading price of the CCLP common units, and this increase (decrease) in CCLP Preferred Unit fair value was charged (credited) to earnings, as appropriate. The last remaining outstanding CCLP Preferred Units were redeemed for cash on August 8, 2019.

Consolidated other (income) expense, net, was $2.1 million of expense during the current year period compared to $1.0 million of income during the prior year period. The increase in expense is primarily due to $4.8 million of fees associated with the CCLP unsecured debt exchange transaction and $3.0 million of increased foreign currency losses due to the devaluation of the Mexican peso. These increases in expense were partially offset by gains associated with the sale of the Midland facility and lower expenses related to the redemption of CCLP Preferred Units for cash in the prior year quarter.

Our consolidated provision for income taxes for the current year period is primarily attributable to taxes in certain foreign jurisdictions and Texas gross margin taxes. Our consolidated effective tax rate for the nine month period ended September 30, 2020 of negative 5.8% was primarily the result of losses generated in entities for which no related tax benefit has been recorded. The losses generated by these entities do not result in tax benefits due to offsetting valuation allowances being recorded against the related net deferred tax assets. We establish a valuation allowance to reduce the deferred tax assets when it is more likely than not that some portion or all of the deferred tax assets will not be realized. Included in our deferred tax assets are net operating loss carryforwards and tax credits that are available to offset future income tax liabilities in the U.S. as well as in certain foreign jurisdictions.

Divisional Comparisons

Completion Fluids & Products Division

	Nine Months Ended September 30,						Period to Period Change
	2020			2019			2020 vs 2019		% Change
	(In Thousands, Except Percentages)
Revenues	$	198,533		$	200,688		$	(2,155)	(1.1)	%
Gross profit	62,979			46,653			16,326		35.0	%
Gross profit as a percentage of revenue	31.7		%	23.2		%
General and administrative expense	18,995			14,792			4,203		28.4	%
General and administrative expense as a percentage of revenue	9.6		%	7.4		%
Interest income, net	(588)			(553)			(35)		6.3	%
Other expense, net	218			296			(78)		(26.4)	%
Income before taxes	$	44,354		$	32,118		$	12,236	38.1	%
Income before taxes as a percentage of revenue	22.3		%	16.0		%

The decrease in Completion Fluids & Products Division revenues during the current year period compared to the prior year period was primarily due to decline in oil and gas prices and the COVID-19 pandemic.

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Completion Fluids & Products Division gross profit during the current year period increased compared to the prior year period primarily due to profitability associated with increased manufactured products and international CBF sales revenues. Completion Fluids & Products Division profitability in future periods will be affected by the mix of its products and services, including the timing of TETRA CS Neptune completion fluid projects.

The Completion Fluids & Products Division reported an increase in pretax earnings during the current year period compared to the prior year period due to the increase in gross profit discussed above. Completion Fluids & Products Division general and administrative expenses increased compared to the prior year period primarily due to increased bad debt expense of $2.9 million and increased salary and employee-related expenses of $1.8 million.

Water & Flowback Services Division

	Nine Months Ended September 30,						Period to Period Change
	2020			2019			2020 vs 2019		% Change
	(In Thousands, Except Percentages)
Revenues	$	103,724		$	224,643		$	(120,919)	(53.8)	%
Gross profit (loss)	(7,283)			24,577			(31,860)		(129.6)	%
Gross profit as a percentage of revenue	(7.0)		%	10.9		%
General and administrative expense	12,688			18,528			(5,840)		(31.5)	%
General and administrative expense as a percentage of revenue	12.2		%	8.2		%
Interest income, net	(88)			(6)			(82)		1,366.7	%
Other income, net	(1,475)			(1,214)			(261)		21.5	%
Income (loss) before taxes	$	(18,408)		$	7,269		$	(25,677)	353.2	%
Income (loss) before taxes as a percentage of revenue	(17.7)		%	3.2		%

    Water & Flowback Services Division service and product revenues decreased $120.9 million during the current year period compared to the prior year period due to decreased water management services activity associated with significantly lower customer drilling and completion activity.

The Water & Flowback Services Division reflected a gross loss during the current year period compared to a gross profit during the prior year period partly due to lower revenues and partly due to certain high-margin projects performed during the prior year.

The Water & Flowback Services Division reported a pretax loss compared to a pretax income in the prior year period, primarily due to the gross loss described above. General and administrative expenses decreased primarily due to decreased wage and benefit related expenses of $5.8 million and decreased general expenses of $1.1 million, partially offset by increased bad debt expense of $1.0 million.

Compression Division

	Nine Months Ended September 30,						Period to Period Change
	2020			2019			2020 vs 2019		% Change
	(In Thousands, Except Percentages)
Revenues	$	265,727		$	353,140		$	(87,413)	(24.8)	%
Gross profit	24,645			58,804			(34,159)		(58.1)	%
Gross profit as a percentage of revenue	9.3		%	16.7		%
General and administrative expense	29,474			33,166			(3,692)		(11.1)	%
General and administrative expense as a percentage of revenue	11.1		%	9.4		%
Interest expense, net	38,839			39,079			(240)		(0.6)	%
CCLP Series A Preferred fair value adjustment (income) expense	—			1,309			(1,309)		(100.0)	%
Other (income) expense, net	3,449			(2)			3,451		(172,550.0)	%
Loss before taxes	$	(47,117)		$	(14,748)		$	(32,369)	219.5	%
Loss before taxes as a percentage of revenue	(17.7)		%	(4.2)		%

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    Compression Division revenues decreased during the current year period compared to the prior year period primarily due to the COVID-19 pandemic’s impact on demand for oil and natural gas and the resulting decline in oil prices that led to a significant decrease in customer activity. Product sales revenues decreased $69.6 million due to a decrease in deliveries of new compressors compared to the prior year due to the shut down of our Midland manufacturing facility and exit of the new equipment sales business. Service revenues decreased $17.9 million from compression and aftermarket services operations. The decrease in service revenues was primarily due to reduction in customer activity resulting in a decrease in demand for compression services. In addition, returned compressors, compressors placed on standby rates, and pricing concessions also resulted in decreased revenues.

Compression Division gross profit decreased during the current year period compared to the prior year due to decreased revenues discussed above and the impairments and other charges of $14.3 million primarily on our Midland manufacturing facility and related assets, non-core used compressor equipment that we have held for sale, the low-horsepower class of our compression fleet, and field inventory for compression and related services.

The Compression Division recorded increased pretax loss in the current year period compared to the prior year period due to the decreased gross profit discussed above. General and administrative expense levels decreased compared to the prior year period due to decreased salary and employee-related expenses, including the impact of decreased headcount, incentives and equity compensation of $2.2 million and decreased bad debt expense of $1.1 million. Other (income) expense, net increased to $3.4 million expense in the current year period compared to the prior year period. The increase in expense is primarily due to $4.7 million of fees associated with the exchange of debt and $1.5 million of increased foreign currency losses due to the devaluation of the Mexican peso. These increases in expense were offset by decreased expense of $1.6 million primarily associated with the redemption premium incurred during the prior year period in connection with the redemption of Preferred Units for cash and an increase of $1.2 million in gains in the current year period primarily from the sale of the Midland facility and the remaining inventory and equipment related to the fabrication of new compressors. The last remaining outstanding CCLP Preferred Units were redeemed for cash on August 8, 2019.

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Corporate Overhead

	Nine Months Ended September 30,				Period to Period Change
	2020		2019		2020 vs 2019		% Change
	(In Thousands, Except Percentages)
Depreciation and amortization	$	643	$	507	$	136	26.8	%
General and administrative expense	28,650		39,012		(10,362)		(26.6)	%
Interest expense, net	14,909		16,533		(1,624)		(9.8)	%
Warrants fair value adjustment income	(327)		(1,035)		708		(68.4)	%
Other income, net	(50)		(96)		46		(47.9)	%
Loss before taxes	$	(43,825)	$	(54,921)	$	11,096	(20.2)	%

Corporate Overhead pretax loss decreased during the current year period compared to the prior year period primarily due to decreased general and administrative expenses. Corporate general and administrative expense decreased primarily due to decreased salary related expense of $8.9 million, $0.9 million of decreased general expenses and $0.5 million of decreased professional fees. Interest expense decreased due to lower borrowings under the ABL Credit Agreement. The fair value of the outstanding Warrants liability resulted in a $0.3 million credit to earnings in the current year period compared to a $1.0 million credit to earnings during the prior year period.

Liquidity and Capital Resources

    We believe that our and CCLP’s separate capital structures allow us to meet our respective financial obligations, despite current uncertain operating conditions and financial markets. As of September 30, 2020, we and CCLP are in compliance with all covenants of our respective debt agreements. Information about the terms and covenants of our debt agreements can be found in our 2019 Annual Report and in Note 6 Long Term Debt and Other Borrowings.

We believe it is important to consider our capital structure and that of CCLP separately because there are no cross default provisions or cross guarantees between CCLP’s debt and TETRA’s debt. Our consolidated debt outstanding has a carrying value of approximately $843.2 million as of September 30, 2020. However, approximately $636.9 million of this consolidated debt balance is owed by CCLP and is serviced from the cash balances and cash flows of CCLP, and $557.1 million of which is secured by certain of CCLP’s assets. Through our common unit ownership interest in CCLP, which was approximately 34% as of September 30, 2020, and ownership of an approximate 1.4% general partner interest, we receive our share of the distributable cash flows of CCLP through its quarterly cash distributions. Approximately $16.7 million of the $75.2 million of the cash balance reflected on our consolidated balance sheet is owned by CCLP and is not accessible by us. The following table provides condensed consolidating balance sheet information reflecting TETRA’s net assets and CCLP’s net assets that service and secure TETRA’s and CCLP’s respective capital structures.

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	September 30, 2020
Condensed Consolidating Balance Sheet	TETRA		CCLP		Eliminations		Consolidated
	(In Thousands)
Cash, excluding restricted cash	$	58,466	$	16,699	$	—	$	75,165
Affiliate receivables	9,428		—		(9,428)		—
Other current assets	145,672		96,805		—		242,477
Property, plant and equipment, net	102,068		572,500		—		674,568
Long-term affiliate receivables	11,858		—		(11,858)		—
Other assets, including investment in CCLP	6,617		64,801		97,912		169,330
Total assets	$	334,109	$	750,805	$	76,626	$	1,161,540
Affiliate payables	$	—	$	9,428	$	(9,428)	$	—
Other current liabilities	64,601		67,467		—		132,068
Long-term debt, net	206,273		636,943		—		843,216
Warrants liability	123		—		—		123
Long-term affiliate payable	—		11,858		(11,858)		—
Other non-current liabilities	63,425		27,533		—		90,958
Total equity	(313)		(2,424)		97,912		95,175
Total liabilities and equity	$	334,109	$	750,805	$	76,626	$	1,161,540

As of September 30, 2020, subject to compliance with the covenants, borrowing base requirements, and other provisions of the agreement that may limit borrowings, we had $25.8 million of availability under the ABL Credit Agreement. The amounts we may borrow under the ABL Credit Agreement are derived from our accounts receivable and certain inventory. Decreases in the amount of our accounts receivable and the value of our inventory would result in reduced borrowing availability under the ABL Credit Agreement. As of September 30, 2020, and subject to compliance with the covenants, borrowing base requirements, and other provisions of the agreement that may limit borrowings under the CCLP Credit Agreement, CCLP had availability of $14.5 million. See CCLP Financing Activities below for further discussion.

    Our consolidated sources (uses) of cash during the nine months ended September 30, 2020 and 2019 are as follows:

	Nine months ended September 30,
	2020		2019
	(In Thousands)
Operating activities	$	64,827	$	83,590
Investing activities	2,760		(98,562)
Financing activities	(9,776)		11,455

Operating Activities

Consolidated cash flows provided by operating activities decreased by $18.8 million compared to the first nine months of 2019. CCLP generated $13.7 million of our consolidated cash flows provided by operating activities during the nine months ended September 30, 2020 compared to $67.5 million during the corresponding prior year period. Operating cash flows decreased primarily due a decrease in revenue and the effect of working capital movements, particularly related to collections of accounts receivable, management of inventory levels and timing of payments of accounts payable. During the period, TETRA increased cash generation which offset CCLP’s decreased cash generation. We continue to monitor customer credit risk in the current environment and focus on serving larger capitalized oil and gas operators and national oil companies.

Investing Activities

Total cash capital expenditures during the first nine months of 2020 were $22.0 million, which is net of $7.2 million cost of compressors sold, as we adjusted to current market conditions. Our Completion Fluids & Products Division spent $2.7 million on capital expenditures, the majority of which related to plant and facility additions. Our Water & Flowback Services Division spent $7.8 million on capital expenditures, primarily to maintain, automate and

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upgrade its water management and flowback equipment fleet. Our Compression Division spent $10.8 million primarily to maintain its compression fleet.

Historically, a significant majority of our planned capital expenditures has been related to identified opportunities to grow and expand our existing businesses. However, such expenditures have recently been, and may continue to be, postponed or canceled as we are reviewing all capital expenditure plans carefully in an effort to conserve cash. We currently have no long-term capital expenditure commitments. The deferral of capital projects could affect our ability to expand our operations in the future. Excluding our Compression Division, we expect to spend approximately $12.0 million to $15.0 million during 2020 on capital expenditures, primarily to expand and maintain our Water & Flowback Services Division equipment fleet.

Our Compression Division has adjusted its expected capital spend downward to approximately $31.0 million to $34.0 million during 2020 primarily to maintain its compression fleet.

If the forecasted demand for our products and services increases or decreases, the amount of planned expenditures on growth and expansion may be adjusted.

Financing Activities 

During the first nine months of 2020, the total amount of consolidated cash used in financing activities was $9.8 million primarily due to repayments under our ABL Credit Agreement and cash fees paid for the exchange of debt. We and CCLP may supplement our existing cash balances and cash flow from operating activities with short-term borrowings, long-term borrowings, issuances of equity and debt securities, and other sources of capital. We and CCLP are aggressively managing our working capital and capital expenditure needs in order to maximize our liquidity in the current environment.

TETRA Long-Term Debt

Asset-Based Credit Agreement. The ABL Credit Agreement provides for a senior secured revolving credit facility of up to $100 million, subject to a borrowing base to be determined by reference to the value of inventory and accounts receivable, and includes a sublimit of $20.0 million for letters of credit and a swingline loan sublimit of $10.0 million. The amounts we may borrow under the ABL Credit Agreement are derived from our accounts receivable and certain inventory. Changes in demand for our products and services have an impact on our eligible accounts receivable, which could result in significant changes to our borrowing base and therefore our availability under our ABL Credit Agreement. With the current depressed oil and gas market conditions, we believe our availability under our ABL Credit facility will be adversely impacted by the expected decline in our customers’ activity levels. The ABL Credit Agreement is scheduled to mature on September 10, 2023. As of November 2, 2020, we have $0.1 million outstanding under our ABL Credit Agreement and $6.6 million letters of credit, resulting in $22.8 million of availability.

    Term Credit Agreement.    The Term Credit Agreement is scheduled to mature on September 10, 2025. As of November 2, 2020, $220.5 million in aggregate principal amount of our Term Credit Agreement is outstanding.

CCLP Financing Activities

CCLP Series A Preferred Units. In January 2019, CCLP began redeeming its Series A Preferred Units for cash, resulting in 2,660,569 Series A Preferred Units being redeemed during the nine months ended September 30, 2019 for an aggregate of $31.9 million, which includes approximately $1.5 million of redemption premiums that were paid. The last redemption of the remaining Series A Preferred Units, along with a final cash payment made in lieu of paid-in-kind units, occurred on August 8, 2019.

    CCLP Bank Credit Facility. CCLP’s revolving credit facility ( the “CCLP Credit Agreement”) provides for a maximum credit commitment of $35,000,000 and includes a $5,000,000 reserve with respect to the borrowing base which would result in reduced borrowing availability. During the nine month period ended September 30, 2020 CCLP charged $0.2 million of financing fees to other (income) expense, net in our consolidated statement of operations. As of September 30, 2020, subject to compliance with the covenants, borrowing base, and other provisions of the agreements that may limit borrowings under the Credit Agreement, CCLP had no outstanding balance, $2.5 million in letters of credit against the CCLP Credit Agreement and $14.5 million available to borrow. As

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of October 30, 2020, CCLP has $0.0 million balance outstanding under the CCLP Credit Agreement and $3.4 million in letters of credit, resulting in $16.4 million of availability.

    CCLP 7.25% Senior Notes due 2022. As of September 30, 2020, CCLP’s 7.25% Senior Notes due 2022 had $79.9 million outstanding net of unamortized discounts and unamortized deferred financing costs. Interest on these notes is payable on February 15 and August 15 of each year. The 2022 Senior Notes are unsecured obligations, and are guaranteed on a unsecured basis by the Partnership’s subsidiaries that guarantee the CCLP Credit Agreement.

    CCLP 7.50% Senior Secured Notes due 2025. As of September 30, 2020, CCLP’s 7.50% Senior Secured Notes due 2025 (the “First Lien Notes”) had $399.6 million outstanding net of unamortized discounts and unamortized deferred financing costs. Interest on these notes is payable on April 1 and October 1 of each year. The First Lien Notes are secured by a first-priority security interest in substantially all of CCLP’s and its subsidiaries assets, subject to certain permitted encumbrances and exceptions, and are guaranteed on a senior secured basis by each of CCLP’s domestic restricted subsidiaries, with limited exceptions.

CCLP 10.00%/10.75% Second Lien Notes due 2026. As of September 30, 2020, CCLP’s 10.00%/10.75% Second Lien Notes due 2026 (the “Second Lien Notes”) had $157.4 million outstanding, net of unamortized discounts and unamortized deferred financing costs. Interest on the Second Lien Notes is payable on April 1 and October 1 of each year. The Second Lien Notes are secured by a second-priority security interest in substantially all of CCLP’s and its subsidiaries assets, subject to certain permitted encumbrances and exceptions, and are guaranteed on a senior secured basis by each of CCLP’s domestic restricted subsidiaries, with limited exceptions. In connection with the payment of PIK Interest (as defined below), if any, in respect of the Second Lien Notes, CCLP will be entitled, to increase the outstanding aggregate principal amount of the Second Lien Notes or issue additional notes (“PIK notes”) under the Second Lien Notes indenture on the same terms and conditions as the already outstanding Second Lien Notes. Interest will accrue at (1) the annual rate of 7.250% payable in cash, plus (2) at the election of the Issuers (made by delivering a notice to the Second Lien Trustee not less than five business days prior to the record date), the annual rate of (i) 2.750% payable in cash (together with the annual rate set forth in clause (1), the “Cash Interest Rate”) or (ii) 3.500% payable by increasing the principal amount of the outstanding 10.00%/10.75% Second Lien Notes or by issuing additional PIK notes, in each case rounding up to the nearest $1.00 (such increased principal amount or additional PIK notes, the “PIK Interest”).

    Other Sources and Uses

    In addition to the aforementioned credit facilities, we and CCLP fund our respective short-term liquidity requirements from cash generated by our respective operations and from short-term vendor financing. Should additional capital be required, the ability to raise such capital through the issuance of additional debt or equity securities may currently be limited. Instability or volatility in the capital markets at the times we need to access capital may affect the cost of capital and the ability to raise capital for an indeterminable length of time. If it is necessary to issue additional equity to fund our capital needs, additional dilution of our common stockholders will occur. We periodically evaluate engaging in strategic transactions and may consider divesting non-core assets where our evaluation suggests such transaction is in the best interest of our business. In challenging economic environments, we may experience increased delays and failures by customers to pay our invoices. Given the nature and significance of the pandemic and disruption in the oil and gas industry, we could experience delayed customer payments and payment defaults associated with customer liquidity issues and bankruptcies. If our customers delay paying or fail to pay us a significant amount of our outstanding receivables, it could have an adverse effect on our liquidity. An increase of unpaid receivable would also negatively affect our borrowing availability under the ABL Credit Agreement.

The Second Amended and Restated Partnership Agreement of CCLP requires that within 45 days after the end of each quarter, CCLP distribute all of its available cash, as defined in the Second Amended and Restated Partnership Agreement, to its common unitholders of record on the applicable record date. During the nine months ended September 30, 2020, CCLP distributed $1.4 million in cash, including $0.9 million to its public unitholders. The amount of quarterly distributions is determined based on a variety of factors, including estimates of CCLP’s cash needs to fund its future operating, investing, and debt service requirements. There can be no assurance that quarterly distributions from CCLP will increase from this amount per unit going forward.

Off Balance Sheet Arrangements

As of September 30, 2020, we had no “off balance sheet arrangements” that may have a current or future material effect on our consolidated financial condition or results of operations. 

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Commitments and Contingencies

Litigation

We are named defendants in several lawsuits and respondents in certain governmental proceedings arising in the ordinary course of business. While the outcome of lawsuits or other proceedings against us cannot be predicted with certainty, management does not consider it reasonably possible that a loss resulting from such lawsuits or other proceedings in excess of any amounts accrued has been incurred that is expected to have a material adverse impact on our financial condition, results of operations, or liquidity.

Contingencies of Discontinued Operations

    In early 2018, we closed the Maritech Asset Purchase and Sale Agreement with Orinoco Natural Resources, LLC (“Orinoco”) that provided for the purchase by Orinoco of Maritech’s remaining oil and gas properties and related assets. Shortly thereafter, we closed the Maritech Membership Interest Purchase and Sale Agreement with Orinoco that provided for the purchase by Orinoco of all of the outstanding membership interests in Maritech. As a result of these transactions, we have effectively exited the business of our former Maritech segment.

    Under the Maritech Asset Purchase and Sale Agreement, Orinoco assumed all of Maritech’s decommissioning liabilities related to the leases sold to Orinoco (the “Orinoco Lease Liabilities”) and, under the Maritech Membership Interest Purchase and Sale Agreement, Orinoco assumed all other liabilities of Maritech, including the decommissioning liabilities associated with the oil and gas properties previously sold by Maritech (the “Legacy Liabilities”), subject to certain limited exceptions unrelated to the decommissioning liabilities. To the extent that Maritech or Orinoco fails to satisfy decommissioning liabilities associated with any of the Orinoco Lease Liabilities or the Legacy Liabilities, we may be required to satisfy such liabilities under third party indemnity agreements and corporate guarantees that we previously provided to the US Department of the Interior and other parties, respectively.

    Pursuant to a Bonding Agreement entered into as part of these transactions (the “Bonding Agreement”), Orinoco provided non-revocable performance bonds in an aggregate amount of $46.8 million to cover the performance by Orinoco and Maritech of the asset retirement obligations of Maritech (the “Initial Bonds”) and agreed to replace, within 90 days following the closing, the Initial Bonds with other non-revocable performance bonds, meeting certain requirements, in the aggregate sum of $47.0 million (collectively, the “Interim Replacement Bonds”). Orinoco further agreed to replace, within 180 days following the closing, the Interim Replacement Bonds with a maximum of three non-revocable performance bonds in the aggregate sum of $47.0 million, meeting certain requirements (the “Final Bonds”). Among the other requirements of the Final Bonds was that they must provide coverage for all of the asset retirement obligations of Maritech instead of only relating to specific properties. In the event Orinoco did not provide the Interim Replacement Bonds or the Final Bonds, Orinoco was required to make certain cash escrow payments to us.

    The payment obligations of Orinoco under the Bonding Agreement were guaranteed by Thomas M. Clarke and Ana M. Clarke pursuant to a separate guaranty agreement (the “Clarke Bonding Guaranty Agreement”). Orinoco has not delivered such replacement bonds and neither it nor the Clarkes has made any of the agreed upon cash escrow payments and we filed a lawsuit against Orinoco and the Clarkes to enforce the terms of the Bonding Agreement and the Clarke Bonding Guaranty Agreement. A summary judgment was initially granted in favor of Orinoco and the Clarkes which dismissed our claims against Orinoco under the Bonding Agreement and against the Clarkes under the Clarke Bonding Guaranty Agreement. We filed an appeal and also asked the trial court to grant a new trial on the summary judgment or to modify the judgment because we believe this judgment should not have been granted. On November 5, 2019, the trial court signed an order granting our motion for new trial and vacating the prior order granting summary judgment for Orinoco and the Clarkes. The parties are awaiting direction from the court on a new scheduling order and/or trial setting. The Initial Bonds, which are non-revocable, remain in effect.

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    If we become liable in the future for any decommissioning liability associated with any property covered by either an Initial Bond or an Interim Replacement Bond while such bonds are outstanding and the payment made to us under such bond is not sufficient to satisfy such liability, the Bonding Agreement provides that Orinoco will pay us an amount equal to such deficiency and if Orinoco fails to pay any such amount, such amount must be paid by the Clarkes under the Clarke Bonding Guaranty Agreement. However, if the Final Bonds or the full amount of the escrowed cash have been provided, neither Orinoco nor the Clarkes would be liable to pay us for any such deficiency. Our financial condition and results of operations may be negatively affected if Orinoco is unable to cover any such deficiency or if we become liable for a significant portion of the decommissioning liabilities.

     In early 2018, we also closed the sale of our Offshore Division to Epic Companies, LLC (“Epic Companies,” formerly known as Epic Offshore Specialty, LLC). Part of the consideration we received was a promissory note of Epic Companies in the original principal amount of $7.5 million (the “Epic Promissory Note”) payable to us in full, together with interest at a rate of 1.52% per annum, on December 31, 2019, along with a personal guaranty agreement from Thomas M. Clarke and Ana M. Clarke guaranteeing the payment obligations of Epic Companies pursuant to the Epic Promissory Note (the “Clarke Promissory Note Guaranty Agreement”). Additionally, pursuant to the Equity Interest Purchase Agreement (the “Offshore Services Purchase Agreement”) and other agreements with Epic Companies, certain other amounts relating to the Offshore Division totaling approximately $1.5 million were payable to us. At the end of August 2019, Epic Companies filed for bankruptcy. We recorded a reserve of $7.5 million for the full amount of the promissory note, including accrued interest, and the certain other receivables in the amount of $1.5 million during the quarter ended September 30, 2019. The Epic Promissory Note became due on December 31, 2019 but neither Epic nor the Clarkes made the required payment. Upon the default by Epic and the Clarkes, we filed a lawsuit against the Clarkes on January 15, 2020 in Montgomery County, Texas for breach of the Clarke Promissory Note Guaranty Agreement, seeking the amounts due under the Epic Promissory Note and related interest, as well as attorneys’ fees and expenses. The Clarkes each filed an answer and counterclaims for fraud and negligent misrepresentation and seek monetary damages in excess of $1 million, punitive damages, and attorneys’ fees. After taking discovery from the Clarkes, on August 21, 2020, we filed a Motion for Summary Judgment to recover the principal amount of the note plus interest from the Clarkes and to dismiss their counterclaims. The Court granted the Motion for Summary Judgment and entered Final Judgment in our favor, thereby dismissing the Clarkes’ counterclaims and awarding TETRA the full amount requested pursuant to an Order dated September 23, 2020. The Court awarded TETRA the full amount of $7,887,454, plus post-judgment interest at the rate of 3.52% per annum. On October 21, 2020, the Clarkes filed a Notice of Appeal. We will defend the Clarkes’ appeal and consider the options available to enforce the Court’s Order.

Contractual Obligations

    Our contractual obligations and commitments principally include obligations associated with our outstanding

indebtedness and obligations under operating leases. The table below summarizes our consolidated contractual cash obligations as of September 30, 2020:

	Payments Due
	Total		2020		2021		2022		2023		2024		Thereafter
	(In Thousands)
Long-term debt - TETRA	$	220,500	$	—	$	—	$	—	$	—	$	—	$	220,500
Long-term debt - CCLP	636,249		—		—		80,720		—		—		555,529
Interest on debt - TETRA	79,931		3,997		15,986		15,986		15,986		15,986		11,990
Interest on debt - CCLP	241,409		22,503		51,405		49,454		45,553		45,553		26,941
Purchase obligations	87,806		2,381		9,525		9,525		9,525		9,525		47,325
Asset retirement obligations(1)	12,973		—		—		—		—		—		12,973
Operating leases	107,508		5,809		22,322		18,896		15,803		12,067		32,611
Total contractual cash obligations(2)	$	1,386,376	$	34,690	$	99,238	$	174,581	$	86,867	$	83,131	$	907,869

(1)We have estimated the timing of these payments for asset retirement obligation liabilities based upon our plans. The amounts shown represent the discounted obligation as of September 30, 2020.

(2)Amounts exclude other long-term liabilities reflected in our Consolidated Balance Sheet that do not have known payment streams. These excluded amounts include approximately $0.4 million of liabilities under FASB Codification Topic 740, “Accounting for Uncertainty in Income Taxes,” as we are unable to reasonably estimate the ultimate amount or timing of settlements.

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For additional information about our contractual obligations as of December 31, 2019, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our 2019 Annual Report on Form 10-K.

Cautionary Statement for Purposes of Forward-Looking Statements

This Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements in this Quarterly Report are identifiable by the use of the following words, the negative of such words, and other similar words: “anticipates”, “assumes”, “believes,” “budgets”, “could,” “estimates,” “expects”, “forecasts”, “goal”, “intends”, “may”, “might”, “plans”, “predicts”, “projects”, “schedules”, “seeks”, “should”, “targets”, “will”, and “would”.

    Management believes that these forward-looking statements are reasonable as and when made. However, caution should be taken not to place undue reliance on any such forward-looking statements because such statements speak only as of the date when made. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. In addition, forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from our historical experience and our present expectations or projections. These risks and uncertainties include, but are not limited to, those described in Part II, “Item 1A. Risk Factors” and elsewhere in this report and in our Annual Report on Form 10-K for the year ended December 31, 2019, and those described from time to time in our future reports filed with the SEC.

Item 3. Quantitative and Qualitative Disclosures about Market Risk.

Not Applicable.

Item 4. Controls and Procedures.

Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended. Based on this evaluation, the Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of September 30, 2020, the end of the period covered by this quarterly report.

There were no changes in our internal control over financial reporting that occurred during the quarter ended September 30, 2020, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II

OTHER INFORMATION

Item 1. Legal Proceedings.

We are named defendants in several lawsuits and respondents in certain governmental proceedings arising in the ordinary course of business. While the outcome of lawsuits or other proceedings against us cannot be predicted with certainty, management does not consider it reasonably possible that a loss resulting from such lawsuits or other proceedings in excess of amounts accrued has been incurred that is expected to have a material adverse impact on our financial condition, results of operations, or liquidity.

Item 1A. Risk Factors.

The statements in this section describe the known material risks to our business and should be considered carefully. We have described in the 2019 Annual Report significant risk factors and periodically update those risks for material developments. Provided below is an update to our risk factors as previously disclosed in the 2019 Annual Report.

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    The COVID-19 pandemic has had, or may in the future have, certain negative impacts on our business, and such impacts have had, or may in the future have, an adverse effect on our business, our financial condition, results of operations, or liquidity.

    The COVID-19 pandemic and the resulting economic impact have had a significant negative impact on the oil and gas industry. The deterioration in demand for oil caused by the pandemic, coupled with oil oversupply, has had, and is reasonably likely to continue to have, an adverse impact on the demand for our products and services. The public health crisis caused by the COVID-19 pandemic,  and the measures that have been taken or that may be taken in the future by governments, various regulatory agencies, our customers and our suppliers, have had, or may in the future have, certain negative impacts on our financial condition, results of operations, and  liquidity, including, without limitation, the following:

•demand for our products and services is declining as our customers continue to adjust their operations in response to lower oil and gas prices;

•actions undertaken by national, state and local governments and health officials to contain COVID-19 or treat its effects. In response to various governmental directives, at points we have required most office-based employees, including most employees based at our headquarters in The Woodlands, Texas, to work remotely. We may experience reductions in productivity and disruptions to our business routines while work-from-home arrangements remain in place;

•We could encounter logistical complications and increased costs adapting our disclosure controls and procedures and our internal control over financial reporting in a changing environment that includes work-from-home arrangements and furloughs. In the future we may encounter operational challenges or disruptions stemming from the pandemic that require us to implement new or enhanced internal controls to mitigate the risks of operating in a remote environment or increased risks of material misstatements resulting from changes to the business and other uncertainties;

•restrictions on importing and exporting products;

•impacts related to late customer payments and contractual defaults associated with customer and supplier bankruptcies;

•potentially higher borrowing costs in the future;

•cybersecurity issues, as our network may become more vulnerable to cyberattacks due to increased remote access associated with work-from-home arrangements;

•our ability to use our net operating loss carryforwards may be limited;

•increased costs associated with possible facility closures to meet expected customer activity levels; and

•we may be required to record significant impairment charges with respect to assets, whose fair values may be negatively affected by the effects of the COVID-19 pandemic on our operations. Also, we may be required to write off obsolete inventory, and such charges may be significant.

    The resumption of our normal business operations after the disruptions caused by the COVID-19 pandemic may be delayed or constrained by its lingering effects on the oil and gas industry. Any of the negative impacts of the COVID-19 pandemic, including those described above, alone or in combination with others, may have a significant adverse effect on our financial condition, results of operations, or liquidity. Any of these negative impacts, alone or in combination with others, could exacerbate many of the risk factors discussed in Part I, “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2019. The full extent to which the COVID-19 pandemic will negatively affect our financial condition, results of operations, or liquidity will depend on future developments that are highly uncertain and cannot be predicted, including the scope and duration of the pandemic and the resulting impact on the oil and gas industry. Given the dynamic nature of these events, we cannot reasonably estimate the period of time that the COVID-19 pandemic and related market conditions will persist, the full extent of the impact they will have on our financial condition, results of operations, or liquidity or the pace or extent of any subsequent recovery. For more information, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”    

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

(a) None.

(b) None.

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(c) Purchases of Equity Securities by the Issuer and Affiliated Purchasers.

Period	Total Number of Shares Purchased		Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs(1)	Maximum Number (or Approximate Dollar Value) of Shares that May Yet be Purchased Under the Publicly Announced Plans or Programs(1)
July 1 – July 31, 2020	27,403	(2)	$	0.40	—	$	14,327,000
August 1 – August 31, 2020	18,356	(2)	0.61		—	14,327,000
September 1 – September 30, 2020	—		—		—	14,327,000
Total	45,759				—	$	14,327,000

(1)In January 2004, our Board of Directors authorized the repurchase of up to $20 million of our common stock. Purchases will be made from time to time in open market transactions at prevailing market prices. The repurchase program may continue until the authorized limit is reached, at which time the Board of Directors may review the option of increasing the authorized limit.

(2)Shares we received in connection with the exercise of certain employee stock options or the vesting of certain shares of employee restricted stock. These shares were not acquired pursuant to the stock repurchase program.

Item 3. Defaults Upon Senior Securities.

None.

Item 4. Mine Safety Disclosures.

None.

Item 5. Other Information.

None.

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Item 6. Exhibits.

Exhibits:

10.1*	Transition Agreement dates July 27, 2020 between TETRA Technologies, Inc. and Bass C. Wallace, Jr.
10.2*	Form of Cash Retention Award Agreement under the TETRA Technologies, Inc. 2018 Equity Incentive Plan.
31.1*	Certification Pursuant to Rule 13a-14(a) or 15d-14(a) of the Exchange Act, As Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*	Certification Pursuant to Rule 13a-14(a) or 15d-14(a) of the Exchange Act, As Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1**	Certification Furnished Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2**	Certification Furnished Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.SCH+	XBRL Taxonomy Extension Schema Document.
101.CAL+	XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF+	XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB+	XBRL Taxonomy Extension Label Linkbase Document.
101.PRE+	XBRL Taxonomy Extension Presentation Linkbase Document.
104*	Cover Page Interactive Data File - the cover page interactive data file does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL documents

*    Filed with this report.

**    Furnished with this report.

+    Attached as Exhibit 101 to this report are the following documents formatted in XBRL (Extensible Business Reporting Language): (i) Consolidated Statements of Operations for the three and nine month periods ended September 30, 2020 and 2019; (ii) Consolidated Statements of Comprehensive Income for the three and nine month periods ended September 30, 2020 and 2019; (iii) Consolidated Balance Sheets as of September 30, 2020 and December 31, 2019; (iv) Consolidated Statements of Equity for the nine month periods ended September 30, 2020 and 2019 ; (v) Consolidated Statements of Cash Flows for the nine month periods ended September 30, 2020 and 2019; and (vi) Notes to Consolidated Financial Statements for the nine months ended September 30, 2020.

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Table of Contents

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 thereunto duly authorized.

		TETRA Technologies, Inc.
Date:	November 3, 2020	By:	/s/Brady M. Murphy
			Brady M. Murphy
			President
			Chief Executive Officer
Date:	November 3, 2020	By:	/s/Elijio V. Serrano
			Elijio V. Serrano
			Senior Vice President
			Chief Financial Officer
Date:	November 3, 2020	By:	/s/Richard D. O’Brien
			Richard D. O’Brien
			Vice President – Finance and Global Controller
			Principal Accounting Officer

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EX-10.1

                    Exhibit 10.1

TRANSITION AGREEMENT

THIS TRANSITION AGREEMENT (this “Agreement”) is entered into as of the 27th day of July, 2020 (the “Execution Date”), by and between TETRA TECHNOLOGIES, INC., a Delaware corporation (the “Company”), and Bass C. Wallace, Jr. (the “Employee”) and shall be effective as of the Effective Date (defined below in Section 12). (Certain capitalized terms used in this Agreement have the meanings ascribed to them in Section 15 of this Agreement.)

W I T N E S S E T H :

WHEREAS, the Employee has been employed by the Company as its Senior Vice President and General Counsel and held various officer positions with the Company and its Affiliates;

WHEREAS, the Employee has as of the Execution Date resigned from the positions of Senior Vice President and General Counsel and the parties have mutually agreed to continue the Employee’s employment by the Company as herein provided; and

WHEREAS, the Employee and the Company desire to enter into this Agreement to set forth the terms and conditions of the Employee’s continued employment by, and the Employee’s separation of service from, the Company.

NOW, THEREFORE, in consideration of the mutual covenants and promises herein contained, and intending to be legally bound hereby, the Company and the Employee hereby agree as follows:

1.Employment.

1.1 Contingent upon the Employee executing this Agreement and not revoking the First ADEA Release (defined below in Section 11), the Company hereby agrees to continue to employ the Employee, and the Employee hereby agrees to accept continued employment with the Company, in a non-executive capacity upon the terms and for the period set forth in this Agreement. If the Employee revokes the First ADEA Release, this Agreement shall not go into effect and shall be null and void.

1.2 Unless sooner terminated in accordance with the terms of this Agreement, the Employee’s term of employment hereunder shall mean the period commencing on the Execution Date and ending two (2) years thereafter, on July 26, 2022 (the “Transition Period”). The Employee acknowledges and agrees, subject to the terms and provisions of this Agreement, that the Employee’s employment with the Company during the Transition Period shall continue to be on an at-will basis and this Agreement shall not establish any term of employment for a fixed term.

2.    Duties.

2.1 During the Transition Period, the Employee shall provide, on the terms set forth herein, such services as may be reasonably requested by the Company’s Chief Executive Officer,

1

which will be generally consistent with the services previously provided by the Employee and relate to the Company’s business operations and other matters about which the Employee has knowledge because of the Employee’s previous employment position with the Company and its Affiliates. The Employee shall have no regular office hours and it is anticipated that such services will be performed remotely by the Employee, although the Employee agrees to attend in person meetings at reasonable locations if requested. The Company shall provide the Employee with a laptop computer, cell phone, and other equipment reasonably necessary to perform his duties. The Employee may be requested to provide up to sixteen (16) hours of services per week; provided, the Employee shall not be required to provide such services during any three (3) consecutive month period during the Transition Period for an average number of hours per week greater than eight (8). Such services may include, without limitation, (i) the transition of internal legal duties and responsibilities, (ii) assistance with any litigation or other disputes involving the Company and/or its Affiliates including providing affidavits and testimony at depositions, hearings and trials with regard, in all cases, to matters within his knowledge and subject to all obligations applicable to the Employee under the Texas Disciplinary Rules of Professional Conduct, as reasonably requested by the Company, (iii) assistance with transactions and financings involving the Company and/or its Affiliates, and (iv) answering questions regarding the Employee’s former job duties, all as requested by the Company’s Chief Executive Officer. The Company acknowledges that the Employee may be providing legal or other consulting services to third parties in the future or he may have other commitments or plans. The Chief Executive Office will give the Employee written notice of any requested services, which may be by email, and the Employee agrees to use his reasonable best efforts to provide such services subject to the terms herein.

3.    Compensation and Related Matters.

3.1 Base Salary. During the Transition Period, the Employee shall receive an annualized base salary equal to $192,500, less applicable withholdings (the “Base Salary”), which shall be paid in accordance with the Company’s standard payroll practice.

3.2 Bonus Opportunities. During the Transition Period, the Employee shall no longer be entitled to receive any new annual or long-term bonus awards or opportunities. The Company has previously awarded to the Employee the annual cash incentive compensation opportunity (the “Annual Cash Incentive Award”) and the long-term cash incentive compensation opportunities (the “LT Cash Incentive Awards”) set forth on Schedule A that remain outstanding as of the Execution Date.

(a) Annual Cash Incentive Award. Subject to the terms of this Agreement, the Employee is eligible to receive the full amount of any earned award payment for the Annual Cash Incentive Award for 2020, paid at the same time that payments under similar annual cash incentive awards are made by the Company, which will generally be no later than two and one-half (2½) months after the end of the calendar year in which the Annual Cash Incentive Award was earned by the Employee, assuming the Employee is still employed by the Company at that time. The Annual Cash Incentive Award will be paid only to the extent the applicable performance period objectives are met, as

2

determined in accordance with the Cash Incentive Compensation Plan (the “CICP”) (i.e., a payout is not guaranteed); provided that the Company shall not exercise negative discretion to reduce the amount of the Annual Cash Incentive Award payable to the Employee below the amount that was earned based upon the applicable performance period objectives; and provided further that to the extent the Compensation Committee of the Company’s Board of Directors approves the payment of any portion of the 2020 annual cash incentive compensation awards based upon the individual performance objectives of any executives of the Company, then the applicable individual performance objectives for the Employee shall be deemed to have been 100% satisfied.

(b) LT Cash Incentive Awards. Subject to the terms of this Agreement, the Employee is eligible to receive the full amount of any earned award payment for each of the performance periods covered by the respective LT Cash Incentive Awards listed on Schedule A, paid at the same time that payments under similar long-term cash incentive awards are made by the Company, which will generally be no later than two and one-half (2½) months after the end of the respective performance period in which the LT Cash Incentive Award was earned by the Employee, assuming the Employee is still employed by the Company at that time. Each LT Cash Incentive Award will be paid only to the extent the applicable performance period objectives are met, as determined in accordance with the CICP (i.e., a payout is not guaranteed); provided that the Company shall not exercise negative discretion to reduce the amount of the LT Cash Incentive Award payable to the Employee below the amount that was earned based upon the applicable performance period objectives.

3.3 Equity-Based Awards. During the Transition Period, the Employee shall no longer be entitled to receive any new equity awards. The Company and CSI Compressco LP (“CSI Compressco LP”) have each previously granted to the Employee the respective equity awards (the “Outstanding Equity Awards”) as set forth on Schedule B that remain outstanding as of the Execution Date. Unvested stock options included within the Outstanding Equity Awards will continue to vest during the Transition Period pursuant to the vesting schedule set forth in the applicable award agreement and thereafter subject to the terms and conditions in Section 5. Unvested time-based restricted stock, restricted stock units and phantom units included within the Outstanding Equity Awards will continue to vest, and the restrictions on such restricted stock awards, restricted stock units and phantom units will continue to lapse, during the Transition Period pursuant to the vesting schedule set forth in the applicable award agreement and thereafter subject to the terms and conditions in Section 5.

3.4 Employee Benefits. During the Transition Period and thereafter subject to the terms and conditions in Section 5, and subject to the provisions of and eligibility under any applicable plan (including any insurance plan or program), the Employee and/or the Employee’s eligible dependents, as the case may be, shall, except as provided below, be eligible to participate in and shall receive all coverage under welfare benefit plans practices, policies and programs provided by the Company (including, without limitation, medical, prescription and dental plans and programs and the Company’s 401(k) plan, including Company-matching contributions, and the Company’s deferred compensation plan), to the extent generally available to the executive

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officers of the Company. The Employee acknowledges that, beginning with the commencement of the Transition Period, neither the Employee nor any of his dependents will be eligible to participate in and receive coverage under the Company’s disability, employee life, group life, accidental death and dismemberment plans and programs. If the Company amends any welfare benefit plan after the Effective Date and the amendment has the effect of denying the Employee and his eligible dependents benefits and coverage substantially the same as the benefits and coverage for which they are eligible as of the Effective Date, the Company shall use its best efforts to enter into, at the Company’s sole cost, alternative arrangements to provide such denied benefits and coverage during the period required under this Agreement. The foregoing sentence shall not require any such action by the Company if the amendment or change in benefits and coverage results from any amendment or change in benefits or coverage required (i) by applicable law or regulation, or (ii) by general market conditions in the insurance industry and such amendment or change affects all employees at the Company who participate in such welfare benefit plan.

4.    Termination of Employment.

4.1 Death. The Employee’s employment shall terminate automatically upon the Employee’s death during the Transition Period.

4.2 Disability. If the Company determines that a Disability (as defined below) of the Employee has occurred during the Transition Period, the Company may give to the Employee a Notice of Termination (as defined below) giving notice of the Company’s intention to terminate the Employee’s employment. In such event, the Employee’s employment with the Company shall terminate effective thirty (30) days after receipt of such Notice of Termination by the Employee (the “Disability Effective Date”). For purposes of this Agreement only, “Disability” shall mean and be deemed to have occurred if (i) the Employee is receiving income replacement benefits under the Company’s long-term disability plan, or (ii) in the absence of the Employee’s receipt of such benefits, the Employee has been unable to perform the essential functions of his position, despite any reasonable accommodation required by law, by reason of illness or injury for a total of ninety (90) consecutive days or an aggregate of one hundred eighty (180) days within any given period of three hundred sixty (360) consecutive days.

4.3 Termination by Employee.

(a) The Employee may terminate his employment during the Transition Period for (i) Good Reason (as defined below), or (ii) any reason upon ten (10) days’ advance written notice to the Company (a “Voluntary Resignation”). The Employee’s employment will be deemed to be automatically terminated upon (x) the Employee’s commencement of employment with any third party (which for clarification does not include any Successor Entity), or (y) unless otherwise agreed in writing by the Chief Executive Officer of the Company, the Employee’s commencement of providing services to any one or more third parties under circumstances in which it is reasonably anticipated that the Employee will receive compensation (whether in any combination of cash, equity, property or other consideration) in excess of $200,000 in any consecutive twelve (12) month period (both (x) and (y) being referred to herein as a “Reemployment

4

Termination”). The Employee shall provide prior written notice to the Company of any proposed employment or the provision of services, including the name of the counterparty and, in the event of a proposed services arrangement, the anticipated amount of compensation payable to the Employee. For clarification, a Reemployment Termination shall not occur as a result of the Employee serving on the board or committee of any charitable organization or other third party.

(b) For purposes of this Agreement, “Good Reason” shall mean, without the Employee’s consent, any failure by the Company to comply with any of the provisions of Section 3 hereof that is not remedied by the Company within ten (10) days after the Company’s receipt of written notice thereof by the Employee.

4.4 Termination by the Company. The Company may terminate the Employee’s employment during the Transition Period for Cause or without Cause. For purposes of this Agreement, “Cause” shall mean:

(a) the continued failure of the Employee to perform, in accordance with the terms and conditions herein, the Employee’s duties and obligations hereunder (other than any such failure resulting from bodily injury or disease or any other incapacity due to physical or mental illness), after a written demand for performance is delivered to the Employee by the Chief Executive Officer (which specifically identifies the manner in which the Chief Executive Officer believes that the Employee has not performed the Employee’s duties), and the Employee has not cured such failure within ten (10) days following receipt of the written demand for performance;

(b) the Employee’s conviction of, or entry of a plea of guilty or nolo contendere of, a felony or any crime involving dishonesty or moral turpitude;

(c) the failure of the Employee to comply in any material respect with any previously announced and disclosed written policy or procedure of the Company including, without limitation, the Company’s Code of Business Conduct, which, if curable, is not cured within ten (10) days after the Employee’s receipt of written notice thereof; or

(d) the Employee’s breach or violation of the covenants and obligations contained in any one of Sections 6, 7 and 8 or the Employee’s engagement in any Competitive Activities (as defined in Section 9.2).

4.5 Notice of Termination. Any termination of the Employee’s employment hereunder by the Company or the Employee (other than a termination pursuant to Section 4.1 or Reemployment Termination) shall be communicated by a Notice of Termination to the other party hereto. For purposes of this Agreement, a “Notice of Termination” shall mean a written notice which (i) indicates the specific termination provision in this Agreement relied upon, (ii) in the case of a termination for Disability, Cause or Good Reason, sets forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Employee’s employment under the provision so indicated, and (iii) specifies the Effective Termination Date

5

(as herein defined); provided, however, that a Notice of Termination in connection with a termination for Good Reason shall be given by the Employee within a reasonable period of time, not to exceed forty-five (45) days, following the occurrence of the event giving rise to such right of termination.

4.6 Effective Termination Date. For purposes of this Agreement, the “Effective Termination Date” shall mean the effective date of the termination of the Employee’s employment hereunder, which date shall be:

(a) if the Employee’s employment is terminated as a result of the Employee’s death, the date of the Employee’s death;

(b) if the Employee’s employment is terminated as a result of the Employee’s Disability, the Disability Effective Date;

(c)if the Employee’s employment is terminated by the Company either for Cause or without Cause, or by the Employee for Good Reason, the date on which the Notice of Termination is given, or any later date specified therein, as the case may be;

(d) if the Employee’s employment is terminated as a result of the expiration of the Transition Period pursuant to Section 1.2, the date on which the Transition Period ends;

(e) if the Employee’s employment is terminated by the Employee for a Voluntary Resignation, the date that is ten (10) days after the date on which the Notice of Termination is given; and

(f) if the Employee’s employment is terminated as a result of a Reemployment Termination, the date the Employee commences employment with any third party or commences providing services to any third party.

4.7 Resignation from Officer Positions. In connection with the execution of this Agreement, the Employee has delivered to the Company an executed resignation pursuant to which the Employee has resigned from all officer positions with the Company and its Affiliates.

5.    Obligations of the Company upon Termination of Employment.

5.1 Good Reason; Death; Disability; Other Than For Cause.

(a) Subject to the provisions of Section 5.1(b), Section 5.6 and Section 9 below, if, during the Transition Period, the Employee’s employment hereunder is terminated (1) by reason of the Employee’s termination of the Employee’s employment hereunder for Good Reason, (2) by reason of the Employee’s death, or (3) by reason of the Company’s termination of the Employee’s employment hereunder as a result of (x) the Employee’s Disability or (y) other than for Cause:

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(i)    the Employee or his estate or heirs, as applicable, shall be entitled to receive all accrued and unpaid Base Salary through the Effective Termination Date;

(ii)    the Company shall continue to pay to the Employee or his estate or heirs, as applicable, when due in accordance with the Company’s normal payroll practices the Employee’s Base Salary through July 26, 2022;

(iii)    the Company shall pay to the Employee or his estate or heirs, as applicable, the full amounts of any outstanding Annual Cash Incentive Award and any outstanding LT Cash Incentive Awards that are earned, consistent with the provisions of Section 3.2 above, and that would have been or would be payable to the Employee if the Employee’s employment hereunder had not been terminated;

(iv)    to the extent not already vested, the restricted stock awards included in the time-based Outstanding Equity Awards will become fully vested and no longer subject to forfeiture, and all other unvested time-based Outstanding Equity Awards shall continue to vest, and the risk of forfeiture shall lapse, pursuant to the vesting schedule set forth in the applicable award agreement; provided that in the event the Employee’s employment hereunder is terminated by reason of the Employee’s death, or the Employee should die following any other termination of employment covered by this Section 5.1, the vesting of all such other unvested time-based Outstanding Equity Awards shall be accelerated and such awards will become fully vested and no longer subject to forfeiture;

(v)    the Employee’s vested stock options, including those that became vested pursuant to Section 5.1(a)(iv), will continue to be exercisable by the Employee or his estate or heirs, as applicable, until the first to occur of (A) the original expiration date of the applicable stock option, and (B) any accelerated expiration date applicable to that stock option, other than solely as a result of the Employee’s termination of employment (such as accelerated expiration in connection with a change in control of the Company); and

(vi)    the Employee and his eligible dependents shall continue to be eligible to participate in any welfare benefit plans contemplated by Section 3.4 above pursuant to the terms and conditions thereof or pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”), and if the Employee or the Employee’s eligible dependents elect continuation coverage pursuant to COBRA, the Company will waive, pay or reimburse the Employee for any premium or contribution required of the Employee to continue COBRA coverage (at coverage levels in effect immediately prior to the Employee’s termination of employment but without regard to any tax consequences to the Employee) until the earlier of (A) the expiration of the availability of COBRA coverage, and (B) the date upon which the Employee or the Employee’s eligible dependents become eligible for coverage under another employer’s plan(s).

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The payments and benefits described in Section 5.1(a)(ii) – (vi) are collectively referred to as the “Section 5.1 Severance Benefits.”

(b) Notwithstanding any provision herein to the contrary, the payment or provision of any of the Section 5.1 Severance Benefits shall be conditioned upon (i) the Employee’s (or the Employee’s legal representative’s) execution and delivery to the Company, within sixty (60) days after the Effective Termination Date, of a release agreement substantially in the form attached hereto as Exhibit A (the “Release”) and (ii) the expiration of any period during which the ADEA Release (as defined in the Release) is subject to revocation without the Employee (or the Employee’s legal representative) having revoked such ADEA Release. If the Employee (or the Employee’s legal representative) satisfies the foregoing conditions, then except as otherwise provided in Section 5.6 and Section 9, the Section 5.1 Severance Benefits shall commence and become effective, within sixty (60) days following the Effective Termination Date as it relates to any termination of employment covered by this Section 5.1. To the extent any payment under Section 5.1(a) would be payable before the conditions in this Section 5.1(b) are satisfied, such payment shall be withheld and upon satisfaction of the conditions in this Section 5.1(b), such withheld payment shall be made on the Company’s next regularly scheduled payroll date following the satisfaction of such conditions. If the Employee (or the Employee’s legal representative) does not satisfy the conditions set forth herein regarding the execution and delivery of the Release and non-revocation of the ADEA Release in the Release, neither the Employee nor his estate or heirs, as applicable, shall be entitled to any of the Section 5.1 Severance Benefits. If the ADEA Release review and revocation period spans two calendar years, the payment or provision of the Section 5.1 Severance Benefits in accordance with the terms herein will commence in the later year.

5.2 Voluntary Resignation; Reemployment Termination.

(a) Subject to the provisions of Section 5.2(b), Section 5.6 and Section 9 below, if, during the Transition Period, the Employee’s employment hereunder is terminated (1) by reason of a Voluntary Resignation, or (2) by reason of a Reemployment Termination which does not involve the Employee engaging in Competitive Activities:

(i)    the Employee shall be entitled to receive all accrued and unpaid Base Salary through the Effective Termination Date;

(ii)    the Company shall pay to the Employee the prorated amount of any outstanding Annual Cash Incentive Award and the prorated amount of any outstanding LT Cash Incentive Awards that are earned, consistent with the provisions of Section 3.2 above, and that would have been or would be payable to the Employee if the Employee’s employment hereunder had not been terminated. Proration will be based on the number of full months of service during the applicable performance period prior to the Effective Termination Date divided by the number of months in the applicable performance period;

(iii)    to the extent not already vested, the restricted stock awards included in the time-based Outstanding Equity Awards will become fully vested and no longer subject to forfeiture, and all other time-based Outstanding Equity Awards shall continue

8

to vest, and the risk of forfeiture shall lapse, pursuant to the vesting schedule set forth in the applicable award agreement; provided that in the event of the Employee’s death following any termination of employment covered by this Section 5.2, the vesting of any such other unvested time-based Outstanding Equity Awards will be accelerated and such awards will become fully vested and no longer subject to forfeiture; and

(iv)    the Employee’s vested stock options, including those that became vested pursuant to Section 5.2(a)(iii), will continue to be exercisable by the Employee or his estate or heirs, as applicable, until the first to occur of (A) the original expiration date of the applicable stock option, and (B) any accelerated expiration date applicable to that stock option, other than solely as a result of the Employee’s termination of employment (such as accelerated expiration in connection with a change in control of the Company).

The payments and benefits described in Section 5.2(a)(ii) – (iv) are collectively referred to as the “Section 5.2 Severance Benefits.”

(b) Notwithstanding any provision herein to the contrary, the payment or provision of any of the Section 5.2 Severance Benefits shall be conditioned upon (i) the Employee’s (or the Employee’s legal representative’s) execution and delivery to the Company, within sixty (60) days after the Effective Termination Date, of the Release and (ii) the expiration of any period during which the ADEA Release is subject to revocation without the Employee (or the Employee’s legal representative) having revoked such ADEA Release. If the Employee (or the Employee’s legal representative) satisfies the foregoing conditions, then except as otherwise provided in Section 5.6 and Section 9, the Section 5.2 Severance Benefits shall commence and become effective within sixty (60) days following the Effective Termination Date as it relates to any termination of employment covered by this Section 5.2. To the extent any payment under Section 5.2(a) would be payable before the conditions in this Section 5.2(b) are satisfied, such payment shall be withheld and upon satisfaction of the conditions in this Section 5.2(b), such withheld payment shall be made on the Company’s next regularly scheduled payroll date following the satisfaction of such conditions. If the Employee (or the Employee’s legal representative) does not satisfy the conditions set forth herein regarding the execution and delivery of the Release and non-revocation of the ADEA Release in the Release, neither the Employee nor his estate or heirs, as applicable, shall be entitled to any of the Section 5.2 Severance Benefits. If the ADEA Release review and revocation period spans two calendar years, the payment or provision of the Section 5.2 Severance Benefits in accordance with the terms herein will commence in the later year.

5.3 Expiration of Transition Period

(a) Subject to the provisions of Section 5.3(b), Section 5.6 and Section 9 below, if the Employee’s employment hereunder is terminated as a result of the expiration of the Transition Period:

(i)    the Employee shall be entitled to receive all accrued and unpaid Base Salary through the Effective Termination Date;

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(ii)    the Company shall pay to the Employee the prorated amount of any outstanding LT Cash Incentive Awards that are earned, consistent with the provisions of Section 3.2 above, and that would have been or would be payable to the Employee if the Employee’s employment hereunder had not been terminated. Proration will be based on the number of full months of service during the applicable performance period prior to the Effective Termination Date divided by the number of months in the applicable performance period;

(iii)    to the extent not already vested, the restricted stock awards included in the time-based Outstanding Equity Awards will become fully vested and no longer subject to forfeiture, and all other time-based Outstanding Equity Awards shall continue to vest, and the risk of forfeiture shall lapse, pursuant to the vesting schedule set forth in the applicable award agreement; provided that in the event of the Employee’s death following any termination of employment covered by this Section 5.3, the vesting of any such other unvested time-based Outstanding Equity Awards will be accelerated and such awards will become fully vested and no longer subject to forfeiture; and

(iv)    the Employee’s vested stock options, including those that became vested pursuant to Section 5.3(a)(iii), will continue to be exercisable by the Employee or his estate or heirs, as applicable, until the first to occur of (A) the original expiration date of the applicable stock option, and (B) any accelerated expiration date applicable to that stock option, other than solely as a result of the Employee’s termination of employment (such as accelerated expiration in connection with a change in control of the Company).

The payments and benefits described in Section 5.3(a)(ii) - (iv)) are collectively referred to as the “Section 5.3 Severance Benefits.” The Section 5.1 Severance Benefits, Section 5.2 Severance Benefits and Section 5.3 Severance Benefits are collectively referred to as the “Severance Benefits.”

(b) Notwithstanding any provision herein to the contrary, the payment or provision of any of the Section 5.3 Severance Benefits shall be conditioned upon (i) the Employee’s (or the Employee’s legal representative’s) execution and delivery to the Company, within sixty (60) days after the Effective Termination Date, of the Release and (ii) the expiration of any period during which the ADEA Release is subject to revocation without the Employee (or the Employee’s legal representative) having revoked such ADEA Release. If the Employee (or the Employee’s legal representative) satisfies the foregoing conditions, then except as otherwise provided in Section 5.6 and Section 9, the Section 5.3 Severance Benefits shall commence and become effective within sixty (60) days following the Effective Termination Date as it relates to any termination of employment covered by this Section 5.3. To the extent any payment under Section 5.3(a) would be payable before the conditions in this Section 5.3(b) are satisfied, such payment shall be withheld and upon satisfaction of the conditions in this Section 5.3(b), such withheld payment shall be made on the Company’s next regularly scheduled payroll date

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following the satisfaction of such conditions. If the Employee (or the Employee’s legal representative) does not satisfy the conditions set forth herein regarding the execution and delivery of the Release and non-revocation of the ADEA Release in the Release, neither the Employee nor his estate or heirs, as applicable, shall be entitled to any of the Section 5.3 Severance Benefits. If the ADEA Release review and revocation period spans two calendar years, the payment or provision of the Section 5.3 Severance Benefits in accordance with the terms herein will commence in the later year.

5.4 Cause. If the Employee’s employment hereunder is terminated by the Company for Cause, (i) the Employee shall be entitled to receive all accrued and unpaid Base Salary through the Effective Termination Date, (ii) except as provided in clause (i), the Employee shall not be entitled to receive following the Effective Termination Date any of the compensation or benefits provided in Section 3 including, without limitation, any continued payment of the Base Salary, the payment of the Annual Cash Incentive Award and any LT Cash Incentive Awards that are unpaid at such time and the continued vesting of the Outstanding Equity Awards, (iii) the Employee shall not be entitled to any of the Severance Benefits, Change of Control Benefits (as defined in Section 5.5(c)), or any of the payments provided for in Section 5.5(d) or Section 5.5(e), and (iv) the exercise period of the Employee’s vested options shall not be extended and shall remain exercisable only for the applicable period following the Effective Termination Date as set forth in the respective plan and option agreement.

5.5 Change of Control In the event of a Change of Control during the periods specified in this Section 5.5, the provisions of this Section 5.5 shall apply.

(a) Effective upon a Change of Control during the Transition Period while the Employee is employed by the Company hereunder:

(i)    if the Employee was not offered the position as Bona Fide General Counsel, (A) the Employee’s employment under the Transition Agreement shall terminate (which termination shall constitute a Qualifying Termination), (B) the provisions of Section 1, Section 2, Section 3, Section 5.1, Section 5.2, Section 5.3 and Section 5.4 shall terminate and no longer be effective, and (C) the payments and benefits provided by this Section 5.5 shall be the sole and exclusive payments and benefits payable or to be provided to the Employee;

(ii)    if the Employee was offered the position as Bona Fide General Counsel and accepts such employment, (A) the Employee’s employment under the Transition Agreement shall terminate (which termination shall not constitute a Qualifying Termination), (B) the provisions of Section 1, Section 2, Section 3, Section 5.1, Section 5.2, Section 5.3 and Section 5.4 shall terminate and no longer be effective, and (C) the payments and benefits provided by this Section 5.5 shall be the sole and exclusive payments and benefits payable or to be provided to the Employee upon a Qualifying Termination during the Protected Period; and

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(iii)    if Employee was offered the position as Bona Fide General Counsel and does not accept such employment, (A) the Employee’s employment under this Transition Agreement shall terminate (which termination shall not constitute a Qualifying Termination), (B) the provisions of Section 1, Section 2, Section 3, Section 5.1, Section 5.2, Section 5.3 and Section 5.4 shall terminate and no longer be effective, and (C) the Employee will not be entitled to receive any of the Severance Benefits, the Change of Control Benefits or any payments provided for in Section 5.5(d) and Section 5.5(e).

(b) Subject to the provisions of Section 5.5(f), Section 5.6 and Section 9 below, if a Qualifying Termination occurs with respect to the Employee during the Protected Period, the Company (or the Successor Entity, if it assumes the obligations of this Section 5.5), shall pay and provide to the Employee or his estate or heirs, as applicable, the following amounts and benefits:

(i)    A lump sum amount equal to all accrued and unpaid salary through the Date of Qualifying Termination; and

(ii)    (A) if the Date of Qualifying Termination occurs in 2020, (1) a lump sum amount equal to the Employee’s target Annual Cash Incentive Award for 2020, prorated from January 1, 2020 to the Date of Qualifying Termination, plus (2) a lump sum amount equal to the Employee’s target LT Cash Incentive Award for each outstanding LT Cash Incentive Award listed on Schedule A;

(B) if the Date of Qualifying Termination occurs in 2021, (1) a lump sum amount equal to any unpaid Annual Cash Incentive Award for 2020 only to the extent the performance objectives are met, as determined in accordance with the CICP; provided that the Company shall not exercise negative discretion to reduce the amount of such award payable to the Employee below the amount that was earned based upon the applicable performance period objectives; provided further that to the extent the Compensation Committee of the Company’s Board of Directors approves the payment of any portion of the 2020 annual cash incentive compensation awards based upon the individual performance objectives of any executives of the Company, then the applicable individual performance objectives for the Employee shall be deemed to have been 100% satisfied, plus (2) a lump sum amount equal to any unpaid LT Cash Incentive Award attributable to the performance period ending as of December 31, 2020 only to the extent the performance objectives are met, as determined in accordance with the CICP; provided that the Company shall not exercise negative discretion to reduce the amount of such award payable to the Employee below the amount that was earned based upon the applicable performance period objectives, plus (3) without duplication of clause (2), a lump sum amount equal to the Employee’s target LT Cash Incentive Award for each outstanding LT Cash Incentive Award listed on Schedule A; and

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(C) if the Date of Qualifying Termination occurs in 2022, (1) a lump sum amount equal to any unpaid LT Cash Incentive Award attributable to a performance period ending as of December 31, 2021 only to the extent the performance objectives are met, as determined in accordance with the CICP; provided that the Company shall not exercise negative discretion to reduce the amount of such award payable to the Employee below the amount that was earned based upon the applicable performance period objectives, plus (2) without duplication of clause (1), a lump sum amount equal to the Employee’s target LT Cash Incentive Award for each outstanding LT Cash Incentive Award listed on Schedule A.

(iii)    A lump sum amount equal to the product of two (2) multiplied by the sum of the greater of (x) Employee’s Qualifying Base Salary or (y) $250,000 plus an amount equal to the Employee’s target Annual Cash Incentive Award, if any, for the year in which the Qualifying Termination occurs; plus

(iv)    A lump sum amount equal to the aggregate premiums and any administrative fees applicable to the Employee due to election of continuation coverage that the Employee would be required to pay if the Employee elected to continue medical and dental benefits under the Company’s or the Successor Entity’s group health plans for the Employee and the Employee’s eligible dependents for a period of two (2) years following the Date of Qualifying Termination and the Employee was required to pay the full cost of such continuation coverage without subsidy from the Company or the Successor Entity. The amount of the payment to the Employee pursuant to this Section 5.5(b)(iv) shall be determined using the premiums the Employee would be required to pay for continuation coverage without subsidy from the Company of the Successor Entity if the Employee elected continuation coverage as of the Date of Qualifying Termination, based on the Employee’s coverage elections in effect on the day immediately preceding the Date of Qualifying Termination under the Company’s or the Successor Entity’s group health plan.

(c) Subject to the provisions of Section 5.5(f), Section 5.6, and Section 9 below, if a Qualifying Termination occurs with respect to the Employee, then (i) all Outstanding Equity Awards shall become immediately 100% vested and no longer subject to forfeiture as of the Date of Qualifying Termination and (ii) the Employee’s vested stock options, including those that became vested pursuant to this Section 5.5(c), will continue to be exercisable by the Employee or his estate or heirs, as applicable, until the first to occur of (A) the original expiration date of the applicable stock option, and (B) any accelerated expiration date applicable to that stock option, other than solely as a result of the Employee’s termination of employment (such as accelerated expiration in connection with the Change of Control of the Company).

The payments and benefits described in Section 5.5(b)(ii) – (iv) and Section 5.5(c) are collectively referred to as the “Change of Control Benefits.”

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(d) Subject to the provisions of Section 5.5(f), Section 5.6, and Section 9 below, if after a termination of Employee’s employment hereunder by the Employee for Good Reason or by the Company without Cause (i) there is a Change of Control within two years after the Execution Date or (ii) the Company has entered into a definitive agreement within two years after the Execution Date that subsequently results in a consummated Change of Control, the Company (or the Successor Entity if it assumes the obligations of this Section 5.5) shall pay to the Employee, his estate or heirs, as applicable, a lump sum amount of (A) $770,000 if the later Change of Control occurs after the Execution Date and before October 12, 2020, (B) $616,000 if the later Change of Control occurs on or after October 12, 2020 and within 6 months after the Execution Date, or (C) $385,000 if the later Change of Control occurs after 6 months after the Execution Date but still within the two-year period after the Execution Date or such later date as provided in clause (ii) of this sentence.

(e) Subject to the provisions of Section 5.5(f), Section 5.6, and Section 9 below, if Employee’s employment hereunder is terminated as a result of the expiration of the Transition Period and on such Effective Termination Date the Company has entered into a definitive agreement that subsequently results in a consummated Change of Control, the Company (or the Successor Entity, if it assumes the obligations of this Section 5.5) shall pay to the Employee, his estate or heirs, as applicable, a lump sum amount of $385,000.

(f) Notwithstanding any provision herein to the contrary, the payment or provision of any of the Change of Control Benefits and the payment of any amounts pursuant to Section 5.5(d) or Section 5.5(e) shall be conditioned upon (i) the Employee’s (or the Employee’s legal representative’s) execution and delivery to the Company or the Successor Entity, as applicable, within sixty (60) days after the (A) Date of Qualifying Termination, or (B) the effective date of the Change of Control as it relates to any payment pursuant to Section 5.5(d) or Section 5.5(e), the Release and (ii) the expiration of any period during which the ADEA Release (as defined in the Release) is subject to revocation without the Employee (or the Employee’s legal representative) having revoked such ADEA Release. If the Employee (or the Employee’s legal representative) satisfies the foregoing conditions, then except as otherwise provided in Section 5.6 and Section 9, (x) Change of Control Benefits shall commence and become effective and amounts payable pursuant to Section 5.5(b) shall be payable within sixty (60) days following the Date of Qualifying Termination or (y) the amounts payable pursuant to Section 5.5(d) or Section 5.5(e) shall be payable within sixty (60) days following the effective date of the Change of Control. If the Employee (or the Employee’s legal representative) does not satisfy the conditions set forth herein regarding the execution and delivery of the Release and non-revocation of the ADEA Release in the Release, neither the Employee nor his estate or heirs, as applicable, shall be entitled to any of the Change of Control Benefits or the payment of any amounts pursuant to Section 5.5(d) or Section 5.5(e). If the ADEA Release review and revocation period spans two calendar years, the payment or provision of the Change of Control Benefits or the payment of any amounts

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pursuant to Section 5.5(d) or Section 5.5(e) in accordance with the terms herein will commence in the later year.

5.6 Payment Delay for Specified Employee. Any provision of this Agreement to the contrary notwithstanding, if the Employee is a Specified Employee (as herein defined) on the Effective Termination Date or Date of Qualifying Termination, as applicable, then any payment or benefit to be paid, transferred or provided to the Employee pursuant to the provisions of this Agreement that would be subject to the tax imposed by Section 409A of the Internal Revenue Code of 1986, as amended, and the regulations thereunder (the “Code”), if paid, transferred or provided at the time otherwise specified in this Agreement shall be delayed and thereafter paid, transferred or provided on the first business day that is six (6) months after the Employee’s Effective Termination Date or Date of Qualifying Termination (or if earlier, within thirty (30) days after the date of the Employee’s death following the Employee’s Termination) to the extent necessary for such payment or benefit to avoid being subject to the tax imposed by Section 409A of the Code. For purposes of this Agreement, “Specified Employee” shall mean a specified employee within the meaning of Section 409A(a)(2) of the Code and the regulations and other guidance promulgated thereunder.

5.7 Separate Payments. For purposes of Section 409A of the Code, the Employee’s right to receive any payment, benefit or amounts that might otherwise constitute installment payments shall be treated for purposes of Section 409A of the Code as a right to receive a series of separate and distinct payments. Whenever a payment under this Agreement specifies a payment period with reference to a number of days (for example, “payment shall be made within thirty (30) days following the Effective Termination Date”), the actual date of payment within the specified period shall be within the sole discretion of the Company. In no event may the Employee, directly or indirectly, designate the calendar year of any payment to be made under this Agreement, to the extent such payment is subject to Section 409A of the Code.

6.    Confidential Information and Nondisclosure.

6.1 The Employee acknowledges that during the course of his employment with the Company and in his service to the Company and its Affiliates, the Employee has been involved, and he will continue to be involved, in the development of the Confidential Information (as herein defined) of the Company and its Affiliates, and he has had access, and will continue to have access, to Confidential Information relating to the business and affairs of the Company and its Affiliates. “Confidential Information” means and includes all confidential and/or proprietary information, trade secrets and “know-how” and compilations of information of any kind, type or nature (tangible and intangible, written or oral, and including information contained, stored or transmitted through any electronic medium), whether owned by the Company or its Affiliates, disclosed to the Company or its Affiliates in confidence by third parties or licensed from any third parties, which, at any time during the Employee’s employment by the Company or in his service to the Company and its Affiliates, is developed, designed or discovered or otherwise acquired or learned by the Employee and which relates to the Company or its Affiliates, partners, business, services, products, processes, properties or assets, customers, clients, suppliers, vendors or markets or such third parties. Confidential Information includes, by way of example and

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without limitation, the following: all patents, trade secrets, inventions, processes and formulae including any proprietary information regarding existing and proposed products and services; information regarding existing and potential customers, employees, contractors, and the industry; strategies, books, records, and documents; the names of and other information concerning customers, investors and business affiliates such as contact name, service or product provided, pricing for that customer, type and amount of products and services used, credit and financial data, and/or other information relating to the relationship with that customer; plans and strategies for expansions, acquisitions or divestitures; budgets, financial and sales data, and pricing and costing data; sources of supply; contracts benefiting or obligating the Company or its Affiliates; bids or proposals submitted to or by any third parties; organizational structure; personnel information, including salaries and responsibilities of personnel; payment amounts or rates paid to consultants or other service providers; and other confidential or proprietary information.

6.2 The Employee acknowledges and agrees that such Confidential Information constitutes a valuable, special and unique asset used by the Company and its Affiliates in their businesses to obtain a competitive advantage over their competitors and was and is developed or acquired by the Company and its Affiliates at considerable time and expense and is intended to be used solely for the benefit of the Company and its Affiliates. The Employee further acknowledges and agrees that the Company and its Affiliates have put in place certain policies and practices to safeguard such Confidential Information, and that as a condition of his employment with the Company, the Employee executed an Employment Agreement dated February 17, 1994 (the “Employment Agreement”) with the Company pursuant to which the Employee agreed, both during and after his employment, not to disclose or use for his benefit or the benefit of others any Confidential Information and to comply with the Company’s policies regarding Confidential Information. While the Employee agrees that he continues to be subject to the terms and provisions of such Employment Agreement, including the confidentiality provisions contained therein, as well as the Company’s policies and limitations on disclosure of Confidential Information, the Employee further agrees that both during and after the Employee’s employment with the Company, the Employee will (i) hold all Confidential Information, in strict confidence and will not, directly or indirectly, disclose, make available, discuss, transmit, publish or use such Confidential Information other than for the Company’s benefit and/or the benefit of its Affiliates and (ii) not, directly or indirectly, disclose, use, cause, facilitate or allow any third party to use such Confidential Information in any way, except as may be (A) authorized by the Company’s Chief Executive Officer in writing, or (B) required by law or applicable legal process. In the event the Employee becomes legally compelled to disclose any Confidential Information, the Employee will provide the Company with prompt written notice so that the Company may seek a protective order or other appropriate remedy with respect to such disclosure.

6.3 Notwithstanding any other provision of this Agreement, the Employee may disclose Confidential Information when required to do so by a court of competent jurisdiction, by any governmental agency having authority over the Employee or the business of the Company or any of its Affiliates or by any administrative body or legislative body (including a committee thereof) with jurisdiction to order the Employee to divulge, disclose or make accessible such information. The Employee and the Company agree that nothing in this Agreement is intended to interfere

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with the Employee’s right to (i) report possible violations of federal, state or local law or regulation to any governmental agency or entity charged with the enforcement of any laws; (ii) make other disclosures that are protected under the whistleblower provisions of federal, state or local law or regulation; (iii) file a claim or charge with any federal, state or local government agency or entity; or (iv) testify, assist, or participate in an investigation, hearing, or proceeding conducted by any federal, state or local government or law enforcement agency, entity or court. In making or initiating any such reports or disclosures, the Employee need not seek the Company’s prior authorization and is not required to notify the Company of any such reports or disclosures.

7.    Nondisparagement and Nonsolicitation.

7.1 During and after the Employee’s employment with the Company, the Employee agrees not to make or publish, to any person or entity or in any public forum any defamatory or disparaging remarks, comments or statements concerning the Company or its Affiliates. However, nothing in this Section 7.1 shall prohibit the Employee from participating in any governmental proceeding. During and after the Employee’s employment with the Company, the Company agrees that its elected officers and directors, while any such individual holds such position, will not directly or indirectly communicate or publish any defamatory or disparaging remarks, comments or statements or any knowingly false information (written or oral) concerning the Employee or cause any other person to communicate or publish such information. Notwithstanding the foregoing, nothing in this Agreement shall prohibit any elected officer or director of the Company from participating in any truthful internal communications, governmental proceeding, giving truthful testimony or providing any truthful information to any regulatory agency.

7.2 The Employee further agrees that for the period following the Effective Termination Date during which any Severance Benefits are being provided hereunder or, if applicable, one (1) year following the Date of Qualifying Termination, the Employee will not, directly or indirectly on the Employee’s own behalf or on behalf of any other person or entity, solicit, recruit, hire, engage or seek to hire or engage any person who is employed by the Company, the Successor Entity, or their respective Affiliates. Nothing in this Section 7.2 shall prohibit the Employee from (i) soliciting or hiring any individual whose employment or engagement with the Company, the Successor Entity or any Affiliate has been terminated for a period of at least six (6) months or (ii) engaging in general solicitations to the public or general advertising not targeted to employees of the Company, the Successor Entity or any Affiliate and hiring persons responding thereto, provided such individuals are not otherwise solicited by the Employee prior to such general solicitation.

8.    Continuing Obligations. Nothing contained in this Agreement shall be deemed to affect or relieve the Employee from any continuing obligations contained in the Employment Agreement or other policies of the Company to which the Employee is subject during and, as

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applicable, following his employment with the Company and the Employee agrees to comply with such ongoing obligations in accordance with their terms.

9.    Termination of Agreement and Severance Benefits.

9.1    In addition to any rights or remedies set forth in Section 14.6 hereof for any breach by the Employee of any of the covenants or agreements set forth in Sections 6, 7 and 8, (i) the Employee’s employment hereunder and the Company’s payment and provision of the compensation and benefits provided in Section 3, (ii) the Company’s payment and provision of the Severance Benefits, and (iii) the payment and provision of the Change of Control Benefits or any payments pursuant to Section 5.5(d) or Section 5.5(e) are each conditioned upon the Employee’s compliance with the terms and provisions of Sections 6, 7 and 8, and the Employee not engaging in any Competitive Activity (as defined in Section 9.2). If at any time during the term of the Employee’s employment the Employee shall breach any of the provisions of Sections 6, 7 or 8, or engage in any Competitive Activities, the Company may terminate the Employee’s employment for Cause in accordance with Section 4.4. If at any time after the Effective Termination Date during which any Severance Benefits are being provided the Employee shall breach any of the provisions of Sections 6,7, or 8, or engage in any Competitive Activities, the Company shall no longer be required to pay or provide the Severance Benefits and any vested stock options shall be exercisable only for the applicable period following the Effective Termination Date in accordance with the respective stock option agreement and plan. If at any time after a Change of Control and prior to the payment of the Change of Control Benefits the Employee shall breach any of the provisions of Sections 6, 7 or 8, or engage in Competitive Activities, neither the Company nor any Successor Entity shall be required to pay or provide any such Change of Control Benefits. If at any time after the Effective Termination Date and prior to the payment of any amounts pursuant to Section 5.5(d) or Section 5.5(e) the Employee shall breach any of the provisions of Sections 6, 7 or 8, or engage in Competitive Activities, neither the Company nor any Successor Entity shall be required to make any such payments.

9.2 The Employee shall be deemed to have engaged in “Competitive Activities” if the Employee, during the term of his employment and for the period following the Effective Termination Date during which any Severance Benefits are being provided hereunder, directly or indirectly, becomes the owner of, becomes employed by, or otherwise provides services as a director, attorney, consultant or independent contractor to, any Competing Business in any state in which the Company or any of its Affiliates is then conducting business. The foregoing shall not prohibit the Employee owning less than 1% of the total outstanding equity securities of any publicly-traded entity. For purposes of this Agreement, “Competing Business” means any business that competes in any manner with (i) the business conducted by the Company and its Affiliates as of the Execution Date, and (ii) any new business activity (including any business acquisition) entered into during the term of the Employee’s employment hereunder to the extent the Employee provides any services, on behalf of the Company or its Affiliates with respect to such new business activity (or acquisition). Notwithstanding the foregoing, a Competing Business shall not include any line of business or business segment that is divested by the

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Company or any of its Affiliates so long as the definitive agreements for any such disposition do not otherwise restrict the Employee from engaging in the divested business.

10.    Release of Claims. In consideration of the benefits set forth herein, the Employee, on his own behalf and on behalf of any of the Employee’s estate, heirs, family members, executors, administrators, representatives, agents, successors and assigns, hereby and forever releases the Company, its Affiliates, and any of their respective current and former officers, directors, managers, partners, employees, agents, attorneys, benefit plans, plan administrators, successors and assigns (the “Releasees”), from, and agrees not to sue concerning, or in any manner to institute, prosecute, or pursue, any claim, demand, action, complaint, charge, cause of action, cost, expense, attorneys’ fees, damages or liabilities relating to any matters of any kind, whether presently known or unknown, suspected or unsuspected, liquidated or unliquidated, that the Employee may possess against any of the Releasees arising from any omissions, acts, facts, or damages that have occurred up until and including the date that the Employee signs this Agreement (collectively, the “Claims”), including, without limitation:

(a)    any and all Claims relating to or arising from the Employee’s employment or service relationship with the Company or any of its Affiliates and any termination of that relationship;

(b)    any and all Claims relating to, or arising from, the Employee’s right to purchase, or actual purchase of any shares of stock or other equity interests of the Company or any of its Affiliates, including, without limitation, any claims for fraud, misrepresentation, breach of fiduciary duty, breach of duty under applicable state corporate law, and securities fraud under any state or federal law;

(c)    any and all Claims for wrongful discharge of employment; termination in violation of public policy; discrimination; harassment; retaliation; breach of contract, both express and implied; breach of covenant of good faith and fair dealing, both express and implied; promissory estoppel; negligent or intentional infliction of emotional distress; fraud; negligent or intentional misrepresentation; negligent or intentional interference with contract or prospective economic advantage; unfair business practices; defamation; libel; slander; negligence; personal injury; assault; battery; invasion of privacy; false imprisonment; conversion; and disability benefits;

(d) any and all Claims arising under any federal, state, or local laws of any jurisdiction that prohibit discrimination based on age, sex, race, national origin, color, ancestry, disability, religion, veteran or military status, sexual orientation, or any other form of discrimination, harassment, hostile work environment, or retaliation (including, without limitation, the Age Discrimination in Employment Act, the Older Workers Benefit Protection Act, the Americans with Disabilities Act, the Americans with Disabilities Act Amendments Act of 2008, Title VII of the Civil Rights Act of 1964, the Civil Rights Act of 1991, the Civil Rights Acts of 1866 and/or 1871, 42 U.S.C. Section 1981, the Rehabilitation Act, the Pregnancy Discrimination Act, the Family and Medical Leave Act, the Genetic Information and Nondiscrimination Act, the Sarbanes-Oxley Act, the Employee Polygraph Protection Act, the Worker Adjustment and Retraining Notification Act, the Equal Pay Act of 1963, the Lilly

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Ledbetter Fair Pay Act, the Uniformed Services Employment and Reemployment Rights Act of 1994, Section 1558 of the Patient Protection and Affordable Care Act of 2010, the Consolidated Omnibus Budget Reconciliation Act of 1985, the National Labor Relations Act, the Fair Credit Reporting Act, the Labor Management Relations Act, Chapter 21 of the Texas Labor Code, or any other federal, state, or local laws or ordinances of any jurisdiction);

(e)    Claims under any other federal, state, local, municipal, or common law whistleblower protection, discrimination, wrongful discharge, anti-harassment, or anti-retaliation statute or ordinance;

(f)    Claims arising under the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), except such rights as may be vested or such claims that vest in the future under any retirement plan sponsored by the Company;

(g)    any and all Claims for violation of the federal or any state constitution;

(h)    any and all Claims arising out of any other laws and regulations relating to employment or employment discrimination; and

(i)    any and all Claims for attorneys’ fees and costs.

The release set forth in this Section 10 is a full and final general release by the Employee of all Claims (other than the Claims specifically excluded below) that arise wholly or in part from any act or omission occurring before this Agreement is signed by the Employee. The Employee confirms that the release set forth in this Section 10 was neither procured by fraud nor signed under duress or coercion. Further, the Employee waives and releases the Company and each of the other Releasees from any Claims that this Agreement was procured by fraud or signed under duress or coercion so as to make this Agreement and the release set forth in this Section 10 not binding. The Employee understands and agrees that (except as otherwise specified in this Agreement) by signing this Agreement, the Employee is giving up the right to pursue any legal Claims released herein that the Employee may currently have against the Company or any of the other Releasees, whether or not the Employee is aware of such Claims, and specifically agrees and covenants not to bring any legal action for any Claims released herein.

Notwithstanding any other provision of this Agreement, this release is not intended to interfere with the Employee’s right to file a charge with the Equal Employment Opportunity Commission (the “EEOC”) or any state or local human rights commission in connection with any claim the Employee believes the Employee may have against any of the Releasees. However, by executing this Agreement, the Employee hereby waives the right to recover in any proceeding the Employee may bring before the EEOC or any state or local human rights commission or in any proceeding brought by the EEOC or any state or local human rights commission on the Employee’s behalf.

The only Claims that are excluded from the release set forth in this Section 10 are (i) Claims arising after the time the Employee signs this Agreement, if any, including any future

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Claims relating to the Company’s or any Successor Entity’s performance of its obligations hereunder, (ii) any claim for unemployment compensation, (iii) any claim for workers’ compensation benefits, (iv) any future benefits which the Employee is entitled to receive under any Company “employee benefit plan,” within the meaning of Section 3(3) of ERISA, and the regulations promulgated thereunder; (v) indemnification or payment under any applicable directors and officers liability insurance policy, applicable state and federal law, and the Company’s by-laws, certificate of incorporation, or other agreement, (vi) any vested interest the Employee may have in the Company’s 401(k) plan and deferred compensation plan by virtue of the Employee’s employment with the Company; and (vii) any rights the Employee may have under the equity award agreements listed on Schedule B attached hereto with respect to any vested equity awards thereunder.

11.    Release of Claims under ADEA. The Employee understands and acknowledges that the Employee is waiving and releasing any rights the Employee may have under the Age Discrimination in Employment Act of 1967, as amended, and the Older Workers’ Benefit Protection Act, as amended (collectively, “ADEA”), and that this waiver and release (the “First ADEA Release”) is knowing and voluntary. The Employee understands and agrees that this First ADEA Release does not apply to any rights or claims that may arise under the ADEA after the date this Agreement is executed by the Employee. The Employee understands and acknowledges that the consideration given for this First ADEA Release is in addition to anything of value to which the Employee was already entitled. The Employee further understands and acknowledges that the Employee has been advised by this writing that: (i) the Employee should consult with an attorney prior to executing this Agreement, including this First ADEA Release; (ii) the Employee has twenty-one (21) days after June 19, 2020 (the “First Review Period”) within which to consider the First ADEA Release; (iii) the Employee has seven (7) days following the Employee’s execution of this Agreement (the “First Revocation Period”) to revoke this First ADEA Release pursuant to written notice to the Chief Executive Officer of the Company on or before the seventh day after the Employee signs this Agreement; (iv) provided the Employee does not revoke the First ADEA Release as herein provided, this First ADEA Release shall not be effective until after the First Revocation Period has expired; and (v) nothing in this Agreement prevents or precludes Employee from challenging or seeking a determination in good faith of the validity of this First ADEA Release, nor does it impose any condition precedent, penalties, or costs for doing so, unless specifically authorized by federal law. The Company and the Employee agree that any changes to this Agreement, whether material or immaterial, will not restart the running of the First Review Period. In the event the Employee signs this Agreement and returns it to the Company before the First Review Period has concluded, the Employee hereby acknowledges that the Employee has freely and voluntarily chosen to waive the time period allotted for considering this Agreement and the First ADEA Release contained herein. The Parties acknowledge and agree that this Agreement was negotiated at arm’s length and that this Agreement is worded in a manner that the Employee fully understands. The Employee further acknowledges that the Employee has read this Agreement, as signified by the Employee’s signature hereto, and is voluntarily executing the

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same. The Employee acknowledges that he has been provided with a period of at least twenty-one (21) days within which to consider, review and reflect upon the terms of this Agreement.

12.    Effective Date. As provided in Section 11, Employee has (i) the First Review Period to consider and review this Agreement, including the First ADEA Release, and (ii) the First Revocation Period to revoke the First ADEA Release. If the Employee does not revoke the First ADEA Release during the First Revocation Period, then this Agreement shall become effective on the eighth day following the date upon which the Employee executes this Agreement (such eighth date, the “Effective Date”).

13.    Successors.

13.1    This Agreement is personal to the Employee and shall not be assignable by the Employee. This Agreement shall inure to the benefit of and be enforceable by the Employee and Employee’s estate, heirs and legal representatives.

13.2     This Agreement shall inure to the benefit of and be binding upon the Company and its successors and assigns.

13.3    In the event of a Change of Control during the Transition Period, the Company shall, except in the case of a merger involving the Company with respect to which under applicable law the surviving entity of such merger will be obligated under this Agreement in the same manner and to the same extent as the Company would have been bound if no such merger had taken place, require any Successor Entity, by purchase or otherwise, to all or substantially all of the business and/or assets of the Company, to execute an agreement whereby such Successor Entity expressly assumes and agrees to perform the obligations under Section 5.5 of this Agreement in the same manner and to the same extent as the Company would have been required if no such succession had taken place and expressly agree that the Employee may enforce the obligations under Section 5.5 of this Agreement against such Successor Entity.

14.    Miscellaneous.

14.1    Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS, WITHOUT REFERENCE TO PRINCIPLES OF CONFLICT OF LAWS. WITH RESPECT TO ANY SUIT, ACTION, OR OTHER PROCEEDING ARISING FROM OR RELATING TO THIS AGREEMENT, THE COMPANY AND THE EMPLOYEE HEREBY IRREVOCABLY AGREE TO THE EXCLUSIVE PERSONAL JURISDICTION AND VENUE OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF TEXAS AND ANY TEXAS STATE COURT WITHIN MONTGOMERY COUNTY, TEXAS.

14.2    Amendment. This Agreement may not be amended or modified other than by a written agreement executed by the parties hereto or their respective successors or legal representatives.

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14.3    Waiver. Any term or condition of this Agreement may be waived at any time by the party hereto which is entitled to have the benefit thereof, but such waiver shall only be effective if evidenced by a writing signed by such party, and a waiver on one occasion shall not be deemed to be a waiver of the same or any other type of breach on a future occasion. No failure or delay by a party hereto in exercising any right or power hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right or power.

14.4    Notices. All notices required hereunder shall be in writing and shall be given by hand delivery to the other party or by registered or certified mail, return receipt requested, postage prepaid, addressed to the Employee, at the address maintained in the Company’s records, and to the Company as follows:

If to the Company:    TETRA Technologies, Inc.

24955 Interstate 45 North

The Woodlands, TX 77380

Attention: Chief Executive Officer

or to such other address as either party shall have furnished to the other in writing in accordance herewith. Notices and communications shall be effective when actually received by the addressee.

14.5    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 as if such invalid, illegal or unenforceable provision had never been contained herein.

14.6    Injunctive Relief. In recognition of the fact that a breach by the Employee of any of the provisions of Sections 6 or 7 or the continuing obligations as provided in Section 8 will cause irreparable damage to the Company and/or its Affiliates, for which monetary damages alone will not constitute an adequate remedy, the Company shall be entitled as a matter of right (without being required to prove damages or furnish any bond or other security) to obtain a restraining order, an injunction, an order of specific performance, or other equitable or extraordinary relief from any court of competent jurisdiction restraining any further violation of such provisions by the Employee or requiring the Employee to perform the Employee’s obligations hereunder. Such right to equitable or extraordinary relief shall not be exclusive but shall be in addition to all other rights and remedies to which the Company or any of its Affiliates may be entitled at law or in equity, including without limitation the right to recover monetary damages for the breach of any such provisions of this Agreement. In recognition of the fact that a breach by the Company of any of the provisions of Section 7.1 will cause irreparable damage to the Employee and/or his heirs, for which monetary damages alone will not constitute an adequate remedy, the Employee shall be entitled as a matter of right (without being required to provide damages or furnish any bond or other security) to obtain a restraining order, an

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injunction, an order of specific performance, or other equitable or extraordinary relief from any court of competent jurisdiction restraining any further violation of such provisions by the Company. Such right to equitable or extraordinary relief shall not be exclusive but shall be in addition to all other rights and remedies to which the Employee or his heirs may be entitled at law or in equity, including without limitation, the right to recover monetary damages for any such breach of this Agreement.

14.7    Taxes. The Company or any Affiliate, as applicable, may withhold from any amounts payable under this Agreement such Federal, state, local or foreign taxes as shall be required to be withheld pursuant to any applicable law or regulation. Notwithstanding any other provision of this Agreement, each party hereto agrees to be responsible for and to pay the taxes imposed on it by applicable law without any contribution from the other.

14.8    No Guarantee of Tax Consequences. Notwithstanding anything in this Agreement to the contrary, the Company makes no representation, commitment or guarantee that any federal, state, local or other tax treatment will (or will not) apply or be available with respect to the payments and benefits provided under this Agreement (including whether or not the same are exempt from, or compliant with, Section 409A of the Code) and does not assume any responsibility or liability for all or any portion of any taxes, penalties, interest or other costs or expenses that may be incurred by the Employee (or any person claiming through or on behalf of the Employee) with respect thereto.

14.9    Section 409A. The intent of the parties is that the payments and benefits under this Agreement comply with or be exempt from Section 409A of the Code and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith. If any provision of this Agreement does not satisfy the requirements of Section 409A of the Code, then such provision shall nevertheless be applied in a manner consistent with those requirements to the extent any payments hereunder are subject to Section 409A of the Code. The services to be provided hereunder will be provided on an on-call basis subject to the terms of this Agreement. The parties do not anticipate that the number of hours to be worked by Employee will exceed eight (8) hours in any given week, which is less than 20% of the hours the Employee has worked on average over the prior three (3) years; provided that if currently unanticipated business circumstances occur that require Employee to work in excess of eight (8) hours per week, such work will not exceed sixteen (16) hours in any such week. Further, the parties intend, as of the Execution Date, that entering into this Agreement and the arrangement contemplated hereby will constitute a “separation of service” for purposes of Section 409A of the Code and, subject to the provisions of Section 5.6, the Employee may receive from the Company any deferred compensation in accordance with the terms of such deferred compensation.

14.10    Entire Agreement; Change of Control Agreement.

(a) This Agreement constitutes the entire agreement between the parties hereto concerning the subject matter hereof and, except for the existing covenants of the Employee, including those in the Employment Agreement, which are intended to be carried forward pursuant to Section 8 of this Agreement, this Agreement shall supersede

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any other prior agreement or understanding, both written and oral, between the parties with respect to such subject matter.

(b) The Change of Control Agreement dated May 31, 2013, by and between the Company and the Employee shall be terminated effective as of the Execution Date.

14.11    Captions. The captions herein are inserted for convenience of reference only, do not constitute a part of this Agreement, and shall not affect in any manner the meaning or interpretation of this Agreement.

14.12    Multiple Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Facsimile or e-mail transmission of any signed original of this Agreement will be deemed the same as delivery of an original.

14.13    Voluntary Agreement. The Employee hereby represents and warrants that, prior to signing below, he has had the opportunity to consult with independent legal counsel of his choice, has read this document in its entirety and fully or satisfactorily understands its content and effect, is completely satisfied with the terms reflected in this Agreement, and, accordingly, knowingly makes this Agreement and agrees to be bound as described in this Agreement.

15.    Definitions.

15.1    Affiliate. “Affiliate” means (i) any entity in which the Company, directly or indirectly, owns 10% or more of the combined voting power, as determined by the Board, (ii) any “parent corporation” of the Company (as defined in Section 424(e) of the Code), (iii) any “subsidiary corporation” of any such parent corporation (as defined in Section 424(f) of the Code) of the Company and (iv) any trades or businesses, whether or not incorporated which are members of a controlled group or are under common control (as defined in Sections 414(b) or (c) of the Code) with the Company. For purposes of this Agreement, each of CSI Compressco LP and its subsidiaries and affiliates shall be considered an Affiliate of the Company.

15.2    Board. “Board” shall mean the Board of Directors of the Company.

15.3    Bona Fide General Counsel. “Bona Fide General Counsel” shall mean the chief legal officer of the Successor Entity with compensation and benefits, in the aggregate, no less than the compensation received and benefits enjoyed by the Employee from the Company in 2019, and no requirement to office in any location that is more than 50 miles from Houston, Texas.

15.4    Change of Control. A “Change of Control” of the Company shall be deemed to have occurred upon any of the following events:

(i)    any “person” (as defined in Section 3(a)(9) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and as modified in Section 13(d) and 14(d) of the Exchange Act) other than (A) the Company or any

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of its subsidiaries, (B) any employee benefit plan of the Company or any of its subsidiaries, (C) or any Affiliate, (D) a company owned, directly or indirectly, by stockholders of the Company in substantially the same proportions as their ownership of the Company, or (E) an underwriter temporarily holding securities pursuant to an offering of such securities, becomes the “beneficial owner” (as defined in Rule 13d-3 of the Exchange Act), directly or indirectly, of securities of the Company representing more than 50% of the shares of voting stock of the Company then outstanding;

(ii)    the consummation of any merger, reorganization, business combination or consolidation of the Company or one of its subsidiaries with or into any other company, other than a merger, reorganization, business combination or consolidation which would result in the holders of the voting securities of the Company outstanding immediately prior thereto holding securities which represent immediately after such merger, reorganization, business combination or consolidation more than 50% of the combined voting power of the voting securities of the Company or the surviving company or the parent of such surviving company;

(iii)    the consummation of a sale or disposition by the Company of all or substantially all of the Company’s assets, other than a sale or disposition if the holders of the voting securities of the Company outstanding immediately prior thereto hold securities immediately thereafter which represent more than 50% of the combined voting power of the voting securities of the acquiror, or parent of the acquiror, of such assets;

(iv)    the stockholders of the Company approve a plan of complete liquidation or dissolution of the Company; or

(v)    individuals who, as of the date of this Agreement, constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the date of this Agreement whose election, or nomination for election by the Company’s stockholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board, shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an election contest with respect to the election or removal of directors or other solicitation of proxies or consents by or on behalf of a person other than the Board.

Notwithstanding the foregoing, however, in any circumstance or transaction in which compensation would be subject to the income tax under the Section 409A Rules if the foregoing definition of “Change of Control” were to apply, but would not be so subject if the term “Change of Control” were defined herein to mean a “change in control event” within the meaning of Treasury Regulation Section 1.409A-3(i)(5), then “Change of Control” means, but only to the

26

extent necessary to prevent such compensation from becoming subject to the income tax under the Section 409A Rules, a transaction or circumstance that satisfies the requirements of both (1) a Change of Control under the applicable clauses (i) through (v) above, as applicable, and (2) a “change in control event” within the meaning of Treasury Regulation Section 1.409A-3(i)(5).

15.5    COC Good Reason. “COC Good Reason” shall mean the occurrence of any of the following during the Protected Period after the Employee has been appointed as the Bona Fide General Counsel, without the Employee’s express written consent:

(a)    The Employee no longer acting as the Bona Fide General Counsel of the Successor Entity;

(b)    The Employee being required to office in any location that is more than 50 miles from Houston, Texas.

(c)     A material reduction in the Employee’s compensation from the Successor Entity; or

(d)    A material reduction in the Employee’s employee benefits (without regard to bonus compensation, if any) if such reduction results in the Employee receiving benefits which are, in the aggregate, materially less than the benefits received by other comparable officers of the Successor Entity generally.

The Employee must give the Successor Entity a Notice of Termination within 90 days of the date of initial existence of the condition constituting Good Reason. If the Employee fails to give such Notice of Termination timely, the Employee shall be deemed to have waived all rights the Employee may have under Section 5.5 with respect to such condition. The Successor Entity shall have 30 days from the date of such Notice of Termination to cure the condition. If the Successor Entity cures the condition, such Notice of Termination shall be deemed rescinded. If the Successor Entity fails to cure the condition timely, the Employee shall be deemed to have terminated employment at the end of such 30-day period.

15.6    Date of Qualifying Termination. “Date of Qualifying Termination shall mean the date the Employee experiences a Qualifying Termination.

15.7    Notice of Termination. “Notice of Termination” shall mean a written notice that sets forth in reasonable detail the facts and circumstances for termination for a COC Good Reason. Such Notice of Termination shall be subject to the Successor Entity’s 30-day cure period.

15.8    Person. “Person” shall mean any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act).

15.9    Protected Period. The “Protected Period” shall mean the period of time beginning with the Change of Control if the Employee has accepted the Bona Fide General Counsel position and ending on the two-year anniversary of such Change of Control or the Employee’s

27

death, if earlier; provided, however, if the Employee’s employment with the Company is terminated by the Company other than for Cause during the Transition Period and within six months prior to the date on which a Change of Control occurs (e.g., not during the Protected Period), and it is reasonably demonstrated by the Employee that such termination was at the request of a third party who has taken steps reasonably calculated to effect the Change of Control, or otherwise arose in connection with or anticipation of the Change of Control, then for purposes of determining whether a Qualifying Termination has occurred and only for such purposes, the Change of Control shall be deemed to have occurred on the date immediately prior to the date of such termination of employment and the Employee shall be deemed to have experienced a Qualifying Termination by the Company other than for Cause.

15.10    Qualifying Base Salary. “Qualifying Base Salary” shall mean the Employee’s highest annual rate of base salary in effect at any time during the period beginning six (6) months preceding the Change of Control and throughout the Protected Period, without reduction by payroll deductions and withholdings, including but not limited to, elective contributions made on the Employee’s behalf pursuant to a plan maintained under Code Sections 125 or 401, and any other reductions of the Employee’s remuneration, but excluding bonuses, severance pay and other amounts in lieu of base salary and any other amounts not considered base salary under the Company’s or Successor Entity’s normal payroll practices.

15.11    Qualifying Termination. A “Qualifying Termination” shall be deemed to have occurred if in connection with the consummation of a Change of Control, (i) the Employee does not receive an offer to act as the Bona Fide General Counsel, or (ii) the Employee does receive and accept an offer to act as the Bona Fide General Counsel and the Employee’s employment with the Successor Entity during the Protected Period is terminated as a result of either (a) a unilateral and involuntary termination by the Successor Entity other than for Cause which, unless the Employee and Successor Entity otherwise agree in writing to a definition of “Cause,” shall have the meaning in Section 4.4 except that the duties and obligations referred to in Section 4.4(a) shall refer to such duties and obligations as agreed upon between the Employee and Successor Entity, or (b) resignation by the Employee for COC Good Reason. Termination of the Employee’s employment during the Protected Period for any other reason, including the Employee’s death or Disability, a termination by the Successor Entity for Cause or a termination by the Employee other than for COC Good Reason shall not constitute a Qualifying Termination.

15.12    Section 409A Rules. “Section 409A Rules” shall mean Section 409A of the Code and the Treasury Regulations and administrative guidance promulgated thereunder.

15.13    Successor Entity. “Successor Entity” means the surviving entity in a Change of Control involving a merger or acquisition of the Company’s equity interests and any successor, by purchase or otherwise, to all or substantially all of the assets of the Company.

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[SIGNATURE PAGE TO FOLLOW]

IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first above written.

THE COMPANY:

TETRA TECHNOLOGIES, INC.

By:    /s/Brady M. Murphy

Name:    Brady M. Murphy

Title:    President and Chief Executive Officer

Date:    July 27, 2020

EMPLOYEE:

/s/Bass C. Wallace, Jr.

Bass C. Wallace, Jr.

Date: July 27, 2020

Time of Execution: 3:07 p.m.

SCHEDULE A

Outstanding Awards Under the

Cash Incentive Compensation Plan

Annual Cash Incentive Award	Values at Target
	Weighted Average Division EBITDA	Corporate G&A	Individual Performance Objectives	Total
1/1/2020 – 12/31/2020 Performance Period	$138,600	$46,200	$46,200	$231,000

LTI Cash Incentive Awards	Values at Target
	RTSR	RONCE (EBIT)	Total
1/1/2020-12/31/2022 Performance Period	$131,250	$131,250	$262,500
	RTSR	CFO/Share	Total
1/1/2019-12/31/2021 Performance Period	$125,000	$125,000	$250,000
	RTSR	3-Year CFO	Total
1/1/2018-12/31/2020 Performance Period	$100,000	$100,000	$200,000

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SCHEDULE B

Outstanding Equity Awards

Award Type	Unvested	Vested and Unexercised
Restricted Stock Awards
Granted 2/22/2017	0	0
Granted 2/22/2018	17,498	0
Total:	17,498
Restricted Stock Units
Granted 2/21/2019	71,747	0
Granted 5/2/2019	40,742	0
Granted 2/20/2020	106,419	0
Total	218,908	0
Incentive Stock Options
Granted 5/20/2011	0	2,066
Granted 5/20/2012	0	10,089
Granted 5/20/2013	0	11,679
Granted 5/20/2014	0	10,009
Granted 5/4/2015	0	15,207
Granted 5/2/2016	0	21,783
Granted 2/22/2017	0	17,949
Granted 2/22/2018	12,144	9,108
Total:	12,144	97,890
Nonqualified Stock Options
Granted 5/20/2011	0	12,806
Granted 5/20/2012	0	11,276
Granted 5/20/2013	0	7,985
Granted 5/20/2014	0	8,857
Granted 5/4/2015	0	21,347
Granted 5/2/2016	0	14,656
Granted 2/22/2017	0	50,213
Granted 2/22/2018	0	33,393
Total:	0	160,533
Phantom Units
Granted 2/22/2020	50,873	0
Total:	50,873	0

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EXHIBIT A

TO

TRANSITION AGREEMENT

Form Of Release Agreement

[To be signed after the Effective Termination Date / Date of Qualifying Termination]

This Release Agreement (“Release Agreement”) is made by and between Bass C. Wallace, Jr. (the “Employee”)1 and TETRA Technologies, Inc. (the “Company”)2 (collectively, referred to as the “Parties” or individually referred to as a “Party”). Capitalized terms used but not defined in this Release Agreement shall have the meanings set forth in the Transition Agreement (as defined below).

WHEREAS, the Parties have previously entered into that certain Transition Agreement, dated as of July ____, 2020 (the “Transition Agreement”); and

WHEREAS, the Transition Agreement, among other things, contemplates that, subject to certain conditions in the Transition Agreement, the Company will provide the Employee specified [Severance Benefits/Change of Control] if, among other requirements, the Employee executes and delivers to the Company this Release Agreement upon termination of the Employee’s employment with the Company under certain circumstances and the Employee does not exercise the Employees’ right to revoke the ADEA Release as contained in Section 3 of this Release Agreement; and

WHEREAS, the Employee and the Company desire to execute this Release Agreement to resolve all issues relating to the employment of the Employee by the Company.

NOW, THEREFORE, in consideration of the [Section 5.1 Severance Benefits/ Section 5.2 Severance Benefits/Section 5.3 Severance Benefits/Change of Control Benefits] described in the Transition Agreement, which, pursuant to the Transition Agreement, are conditioned on the Employee’s execution of this Release Agreement and non-revocation of the ADEA Release, and in consideration of the mutual promises made herein, the Company and the Employee hereby agree as follows:

1 The form of Release Agreement will be modified, as applicable, if it is being executed by the Employee’s legal representative.

2 The Successor Entity will be a party to the Release Agreement in the event appropriate following a Change of Control.

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1.    Severance Benefits; Salary and Benefits.

    (a)    The Employee and the Company acknowledge and agree that the [Effective Termination Date/Date of Qualifying Termination] is __________, ______.

    (b)    The Company agrees to provide the Employee with the [Section 5.1Severance Benefits/ Section 5.2 Severance Benefits/Section 5.3 Severance Benefits/Change of Control Benefits] payable at the times set forth in, and subject to the terms and conditions of, the Transition Agreement.

    (c)    The Employee must sign and return this Release Agreement to the Company on or before [twenty-two (22)/ forty-six (46)] days after the Employee receives this Release Agreement. The Parties agree that this Release Agreement was provided to the Employee on or before [_____________].

2.    Release of Claims. In consideration of the benefits set forth herein and in the Transition Agreement, the Employee, on his own behalf and on behalf of any of the Employee’s heirs, family members, executors, administrators, representatives, agents, successors and assigns, hereby and forever releases the Company, its Affiliates, and any of their respective current and former officers, directors, managers, partners, employees, agents, attorneys, benefit plans, plan administrators, successors and assigns (the “Releasees”), from, and agrees not to sue concerning, or in any manner to institute, prosecute, or pursue, any claim, demand, action, complaint, charge, cause of action, cost, expense, attorneys’ fees, damages or liabilities relating to any matters of any kind, whether presently known or unknown, suspected or unsuspected, liquidated or unliquidated, that the Employee may possess against any of the Releasees arising from any omissions, acts, facts, or damages that have occurred up until and including the Effective Date (as defined in Section 6 below) of this Release Agreement (collectively, the “Claims”), including, without limitation:

(a)    any and all Claims relating to or arising from the Employee’s employment or service relationship with the Company or any of its Affiliates and the termination of that relationship;

(b)    any and all Claims relating to, or arising from, the Employee’s right to purchase, or actual purchase of any shares of stock or other equity interests of Company or any of its Affiliates, including, without limitation, any claims for fraud, misrepresentation, breach of fiduciary duty, breach of duty under applicable state corporate law, and securities fraud under any state or federal law;

(c)    any and all Claims for wrongful discharge of employment; termination in violation of public policy; discrimination; harassment; retaliation; breach of contract, both express and implied; breach of covenant of good faith and fair dealing, both express and

32

implied; promissory estoppel; negligent or intentional infliction of emotional distress; fraud; negligent or intentional misrepresentation; negligent or intentional interference with contract or prospective economic advantage; unfair business practices; defamation; libel; slander; negligence; personal injury; assault; battery; invasion of privacy; false imprisonment; conversion; and disability benefits;

(d)    any and all Claims arising under any federal, state, or local laws of any jurisdiction that prohibit discrimination based on age, sex, race, national origin, color, ancestry, disability, religion, veteran or military status, sexual orientation, or any other form of discrimination, harassment, hostile work environment, or retaliation (including, without limitation, the Age Discrimination in Employment Act, the Older Workers Benefit Protection Act, the Americans with Disabilities Act, the Americans with Disabilities Act Amendments Act of 2008, Title VII of the Civil Rights Act of 1964, the Civil Rights Act of 1991, the Civil Rights Acts of 1866 and/or 1871, 42 U.S.C. Section 1981, the Rehabilitation Act, the Pregnancy Discrimination Act, the Family and Medical Leave Act, the Genetic Information and Nondiscrimination Act, the Sarbanes-Oxley Act, the Employee Polygraph Protection Act, the Worker Adjustment and Retraining Notification Act, the Equal Pay Act of 1963, the Lilly Ledbetter Fair Pay Act, the Uniformed Services Employment and Reemployment Rights Act of 1994, Section 1558 of the Patient Protection and Affordable Care Act of 2010, the Consolidated Omnibus Budget Reconciliation Act of 1985, the National Labor Relations Act, the Fair Credit Reporting Act, the Labor Management Relations Act, Chapter 21 of the Texas Labor Code, or any other federal, state, or local laws or ordinances of any jurisdiction);

(e)    Claims under any other federal, state, local, municipal, or common law whistleblower protection, discrimination, wrongful discharge, anti-harassment, or anti-retaliation statute or ordinance;

(f)    Claims arising under the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), except such rights as may be vested or such Claims that vest in the future under any retirement plan sponsored by the Company;

(g)    any and all Claims for violation of the federal or any state constitution;

(h)    any and all Claims arising out of any other laws and regulations relating to employment or employment discrimination; and

(j)    any and all Claims for attorneys’ fees and costs.

The release set forth in this Section 2 is a full and final general release by the Employee of all Claims (other than the Claims specifically excluded below) that arise wholly or in part from any act or omission occurring before this Release Agreement is signed by the Employee. The Employee confirms that this Release Agreement was neither procured by fraud nor signed under duress or coercion. Further, the Employee waives and releases the Company and each of the other Releasees from any Claims that this Release Agreement was procured by fraud or signed under duress or coercion so as to make this Release Agreement not binding. The Employee understands and agrees that (except as otherwise specified in this Release Agreement) by signing this Release Agreement, the Employee is giving up the right to pursue any legal

33

Claims released herein that the Employee may currently have against the Company or any of the other Releasees, whether or not the Employee is aware of such Claims, and specifically agrees and covenants not to bring any legal action for any Claims released herein.

Notwithstanding any other provision of this Release Agreement, this release is not intended to interfere with the Employee’s right to file a charge with the Equal Employment Opportunity Commission (the “EEOC”) or any state or local human rights commission in connection with any claim the Employee believes the Employee may have against any of the Releasees. However, by executing this Release Agreement, the Employee hereby waives the right to recover in any proceeding the Employee may bring before the EEOC or any state or local human rights commission or in any proceeding brought by the EEOC or any state or local human rights commission on the Employee’s behalf.

The only Claims that are excluded from this Release Agreement are (i) Claims arising after the time the Employee signs this Release Agreement, if any, including any future Claims relating to the Company’s or Successor Entity’s performance of its obligations hereunder and under Section 5.5 and Section 7.1 of the Transition Agreement, (ii) any claim for unemployment compensation, (iii) any claim for workers’ compensation benefits, (iv) any future benefits which the Employee is entitled to receive under any Company “employee benefit plan,” within the meaning of Section 3(3) of ERISA, and the regulations promulgated thereunder; (v) indemnification or payment under any applicable directors and officers liability insurance policy, applicable state and federal law, and the Company’s by-laws, certificate of incorporation, or other agreement, (vi) any vested interest the Employee may have in the Company’s 401(k) plan and deferred compensation plan by virtue of the Employee’s employment with the Company; and (vii) any rights the Employee may have under the equity award agreements listed on Schedule B to the Transition Agreement with respect to any vested equity awards thereunder.

3.    Release of Claims under ADEA. The Employee understands and acknowledges that the Employee is waiving and releasing any rights the Employee may have under the Age Discrimination in Employment Act of 1967, as amended, and the Older Workers’ Benefit Protection Act, as amended (collectively, “ADEA”), and that this waiver and release (the “ADEA Release”) is knowing and voluntary. The Employee understands and agrees that this ADEA Release does not apply to any rights or claims that may arise under the ADEA after the date this Release Agreement is executed by the Employee. The Employee understands and acknowledges that the consideration given for this ADEA Release is in addition to anything of value to which the Employee was already entitled. The Employee further understands and acknowledges that the Employee has been advised by this writing that: (a) the Employee should consult with an attorney prior to executing this Release Agreement, including this ADEA Release; (b) the Employee has [twenty-one (21)/forty-five (45)] days (the “Review Period”)within which to consider the ADEA Release contained in this Release Agreement; (c) the Employee has seven (7) days following the Employee’s execution of this Release Agreement (the “Revocation Period”)to revoke this ADEA Release pursuant to written notice to the Chief Executive Officer of the Company on or before the seventh day after the Employee signs this Release Agreement; (d) this ADEA Release shall not be effective until after the Revocation Period has expired; and (e) nothing in this Release Agreement prevents or precludes Employee from challenging or seeking a determination in good faith of the validity

34

of this ADEA Release, nor does it impose any condition precedent, penalties, or costs for doing so, unless specifically authorized by federal law. The Company and the Employee agree that any changes to this Release Agreement, whether material or immaterial, will not restart the running of the Review Period. In the event the Employee signs this Release Agreement and returns it to the Company before the Review Period has concluded, the Employee hereby acknowledges that the Employee has freely and voluntarily chosen to waive the time period allotted for considering this Release Agreement and the ADEA Release contained herein. The Parties acknowledge and agree that this Release Agreement and the Transition Agreement were negotiated at arm’s length and that this Release Agreement and the Transition Agreement are worded in a manner that the Employee fully understands. The Employee further acknowledges that the Employee has read this Release Agreement, as signified by the Employee’s signature hereto, and is voluntarily executing the same. The Employee acknowledges that he has been provided with a period of at least [twenty-one (21)/five-five (45)] days within which to consider, review and reflect upon the terms of this Release Agreement.

4.    Reaffirmation of Continuing Obligations. Nothing in this Release Agreement shall be deemed to affect or relieve the Employee from any continuing obligation contained in any other agreement with the Company, including, but not limited to, the Transition Agreement and the Employment Agreement. The Employee acknowledges that this reaffirmation is material to this Release Agreement, and the Employee further acknowledges and agrees that his continuing obligations under each such agreement are reasonable and enforceable and that he will not challenge or violate these covenants.

5.    Return of Company Property. The Employee represents and warrants that the Employee has returned all Company information (confidential, proprietary or otherwise), including all related documents, reports, emails, files, memoranda and records, computer disks or other storage media and all physical or personal property, including credit cards, card key passes, door and file keys, computers, or cell phones, which the Employee was provided or obtained during the Employee’s employment. Employee will, at the election of the Company, return or delete all Company emails. To the extent the Employee discovers after the Effective Termination Date that the Employee failed to return any Company information or property, the Employee shall promptly return to the Company any such information or property and delete any electronic versions of the Company information in a manner such that the Employee cannot retrieve such information.

6.    Effective Date. This Release Agreement will become effective on the eighth (8th) day after the Employee has signed this Release Agreement, so long as it has been signed by the Parties and has not been revoked by the Employee before that date (the “Effective Date”).

7.    Severability. In the event that any provision or any portion of any provision hereof or any surviving agreement made a part hereof becomes or is declared by a court of competent jurisdiction or arbitrator to be illegal, unenforceable, or void, this Release Agreement shall continue in full force and effect without said provision or portion of provision.

8.    Entire Agreement; Modification. This Release Agreement, combined with the Transition Agreement, sets forth the entire agreement between the Parties, and fully supersedes

35

any and all prior agreements, understandings or representations between the Parties, whether oral or written, pertaining to the Employee’s employment with the Company, the subject matter of this Release Agreement, or any other term or condition of the relationship between Company and the Employee, except as otherwise stated herein. No oral statements or other prior written material not specifically incorporated into this Release Agreement shall be of any force and effect, and no changes in or additions to this Release Agreement shall be recognized, unless incorporated into this Release Agreement by written amendment, such amendment to become effective on the date stipulated in it. Any amendment to this Release Agreement must be signed by all Parties to this Release Agreement. This Release Agreement supersedes any prior oral or written agreements, understandings, promises, or inducements between the Employee and the Company concerning the subject matter in this Release Agreement, with the exception of the Transition Agreement, the Employment Agreement, and the Company Retirement Guidelines adopted January 1, 2019, or any other obligation of the Employee which, by its terms or by operation of law, survives the termination of the Employee’s employment. The Parties agree that the language of this Release Agreement shall, in all cases, be construed as a whole, according to its fair meaning, and not strictly for, or against, any of the Parties.

9.    Governing Law. This Release Agreement shall be subject to the provisions of Section 14.1 of the Transition Agreement.

10.    Voluntary Execution of Release Agreement. The Employee understands and agrees that the Employee executed this Release Agreement voluntarily, without any duress or undue influence on the part or behalf of the Company or any third party, with the full intent of releasing all of the Employee’s claims against the Company and any of the other Releasees. The Employee acknowledges that: (a) the Employee has read this Release Agreement; (b) the Employee has not relied upon any representations or statements made by the Company that are not specifically set forth in this Release Agreement or the Transition Agreement; (c) the Employee has been represented in the preparation, negotiation, and execution of this Release Agreement by legal counsel of his own choice or has elected not to retain legal counsel; (d) the Employee understands the terms and consequences of this Release Agreement and of the releases it contains; and (e) the Employee is fully aware of the legal and binding effect of Release this Release Agreement.

[Signature Page Follows]

36

    IN WITNESS WHEREOF, the Parties have executed this Release Agreement on the respective dates set forth below.

Dated:
Time of Execution:	Bass C. Wallace, Jr.
	COMPANY
	TETRA TECHNOLOGIES, INC.
Dated:	By:
	Name:
	Title:

37

EX-10.2

Exhibit 10.2

[Date]

By Email

[employee name]

[employee email address]

Dear [employee]:

We consider your continued service and dedication essential to our business. In recognition of your contributions to TETRA Technologies, Inc. (the “Company” and together with any of its subsidiaries and affiliates, each a “Company Entity”) and in order to create a further incentive for you (“you” or “Employee”) to remain employed by the Company, you are being offered the opportunity to receive a cash retention award as set forth below (“Cash Retention Award”). Capitalized terms not otherwise defined shall have the meanings set forth in the “Definitions” below.

The Cash Retention Award is comprised of two separate components. Component 1 offers a minimum payment based upon your continued employment with the opportunity to earn more based upon the Company’s Liquidity as of [Date] and [____] quarter Adjusted EBITDA. Component 2 also offers a minimum payment based upon your continued employment with the opportunity to earn more based on the Company’s Average Stock Price as of a specified date. This letter (the “Letter”) sets forth the amount and the terms and conditions upon which you will be eligible to receive the Cash Retention Award.

Component 1:

•Component 1 Maximum:    $________

•Component 1 Minimum:    $________

Applicable Conditions:

You will be deemed to have earned the full amount of the Component 1 Minimum if you simply comply with this Letter by (i) signing and returning this Letter to the Company within 14 days and (ii) remaining continuously employed with the Company or one of its affiliates through the earlier of (i) [Date], and (ii) the date of a Change of Control.

If the Company’s Liquidity as of [Date] is at least $[__] million and its Adjusted EBITDA for the [___] quarter of [Year] is at least $[__] million, the total amount of Component 1 of the Cash Retention Award you will be deemed to have earned will be calculated based on the greater of the amounts in (i) and (ii) below:

(i)    the amount above the Component 1 Minimum will increase proportionate to the increase in the Company’s Liquidity from $[__] million to $[__] million, but not to exceed the Component 1 Maximum; or

(ii)     the amount above the Component 1 Minimum will increase proportionate to the increase in the Company’s Adjusted EBITDA for the [___] quarter of [Year] from $[__] million to $[__] million, but not to exceed the Component 1 Maximum.

Example: If the Company’s Liquidity is $[__] million and its Adjusted EBITDA is $[__] million, the incremental increase in Liquidity would be [__]% (equal to $[__] million out of the $[__] million spread). Likewise, the incremental increase in Adjusted EBITDA would be [__]% (equal to $[__] million out of

1

the $[__] million spread). The Company would use the greater of the two percentages (or [__]% in this example) to calculate the total amount of Component 1 of the Cash Retention Award as follows:

•the Component 1 Minimum, plus

•an amount equal to the Component 1 Minimum multiplied by [__]%.

Assuming a Component 1 Minimum of $[___], the Component 1 award using the [__]% increase in Adjusted EBITDA would be $[___].

Any adjustments to Adjusted EBITDA or Liquidity, as determined above, will be at the sole discretion of the Compensation Committee of the Board of Directors.

Component 2:

•Component 2 Maximum:    $________

•Component 2 Minimum:    $________

Applicable Conditions:

You will be deemed to have earned the full amount of the Component 2 Minimum, regardless of the Average Stock Price on the Determination Date, if you simply comply with this Letter by (i) signing and returning this Letter to the Company within 14 days and (ii) remaining continuously employed with the Company or one of its affiliates through the earlier of (A) [Date], and (B) the date of a Change of Control.

The total amount of Component 2 of the Cash Retention Award you will be deemed to have earned will be calculated based on the percentage of your Base Pay in the table below corresponding to the Average Stock Price of the Company’s common stock (“Common Stock”) on the Determination Date.

Component 2 Award	Average Stock Price as of the Determination Date	Payout as a Percentage of Base Pay as of the Determination Date
Minimum	$[__] or less	[__]%
Base Value	$[__]	[__]%
	$[__]	[__]%
Maximum	$[__]	[__]%

The Average Stock Price in the table above will be equitably adjusted for any stock split, reverse stock split, recapitalization or other similar event affecting the Common Stock. If the Average Stock Price is between two of the levels set forth in the table above, the percentage payout shall be determined by using linear interpolation.

Definitions

1.“Adjusted EBITDA” for the [___] quarter of [Year] will be as reported in the Company’s earnings press release reporting the [___] quarter, [Year] financial results which may be further adjusted for items solely at the discretion of the Compensation Committee of the Board of Directors.

2.“Average Stock Price” means, with respect to the Determination Date, (i) in the absence of a Change of Control, the average closing price of a share of the Company’s Common Stock for ten (10) consecutive trading days preceding [Date] on the principal national securities exchange on which the Common Stock is listed or admitted for trading or, if not listed or admitted for trading on any national

2

securities exchange, the average of the closing bid and asked prices as furnished by the OTC Markets, or similar reporting organization, or if shares of the Common Stock are not publicly traded, the price as determined in good faith by the Company’s Board of Directors, or (ii) in the event of a Change of Control, the price per share of Common Stock offered to a holder thereof in conjunction with any transaction resulting in a Change of Control (as determined in good faith by the Company’s Board of Directors if any part of the offered price is payable other than in cash).

3.“Base Pay” means your base salary in effect as of the Determination Date but exclusive of bonuses, severance pay and other amounts not considered base salary under the Company’s normal payroll practices.

4.“Change in Control” will mean a Change of Control as defined in the Plan.

5.“Determination Date” means the earlier of (i) [Date], and (ii) the date of a Change of Control.

6.“Liquidity” will be defined as set forth below and capitalized terms used in the calculation will have the meanings assigned to such terms in the Asset-Based Credit Agreement entered into on September 10, 2018, as amended. “Liquidity” will be calculated based on the Borrowing Base as reported to the Company’s lenders at [Date], less any Borrowings outstanding at [Date], less outstanding Letters of Credit, plus the Company’s cash as reflected on the general ledger/balance sheet as of [Date], less any additional restrictions from the Company’s lenders.

7.“Plan” means the TETRA Technologies, Inc. 2018 Equity Incentive Plan, as may be amended.

Terms. Each of Component 1 and Component 2 of the Cash Retention Award will be deemed to be earned only to the extent the applicable performance conditions and the other conditions set forth in this Letter are satisfied. If and to the extent earned, the Cash Retention Award will be paid in one lump sum, less applicable taxes, deductions and withholdings, by (i) [Date], or (ii) in the event of a Change of Control, within ten (10) days following the consummation of such Change of Control. This Cash Retention Award constitutes a Cash-Based Award under the Plan.

Restrictive Covenants. By signing below, you acknowledge and agree that the grant of the Cash Retention Award further aligns your interests with the Company’s business interests, and as a condition to the Company’s willingness to enter into this Letter, you agree to abide by the terms set forth in Exhibit A, which Exhibit A is deemed to be part of this Letter as if fully set forth herein.

Miscellaneous. Neither you nor your beneficiaries will be permitted to anticipate, encumber or dispose of any right, title, interest or benefit with respect to the Cash Retention Award hereunder in any manner or any time until such Cash Retention Award has been paid to you. Nothing in this Letter changes the “at will” nature of your employment (meaning either you or the applicable Company Entity may terminate your employment at any time and for any reason, including, without limitation, prior to the Determination Date, or for no reason at all) or confers upon you the right to continue to be employed by any Company Entity for any particular period of time. The Cash Retention Award will not be taken into account to increase any benefits or compensation provided, or to continue coverage, under any other plan, program, policy or arrangement of the Company or any of its affiliates, except as otherwise expressly provided in such other plan, program, policy or arrangement.

This Letter shall be construed and interpreted in accordance with the laws of the State of Texas (without regard to the conflicts of laws principles of any jurisdiction) and applicable federal law. All references to “$” in this Letter refer to United States dollars. Further, this Letter may be executed in multiple counterparts and may be amended only by a written instrument executed by you and the Company.

3

Please review this Letter carefully, and, if you agree with all the terms and conditions as specified above, please sign and date the Letter in the space below.

TETRA TECHNOLOGIES, INC.            ACKNOWLEDGED AND AGREED:

By:     __________________________________

Name: _________________________________     [Employee name]            

Title:    Date:______________________________

4

Exhibit A

Confidentiality and Non-Solicitation Covenants

1.Confidentiality. In the course of Employee’s employment or continued employment with the Company or any Company Entity and the performance of Employee’s duties on behalf of the Company or any Company Entity (collectively, the “Company Group”), Employee will be provided with, and will have access to, Confidential Information (as defined below). In consideration of Employee’s receipt and access to such Confidential Information, and as a condition of Employee’s employment, or continued employment, Employee shall comply with this Section 1 of Exhibit A.

(a)Both during the term of Employee’s employment with any Company Group member (the “Employment Period”) and thereafter, except as expressly permitted by this Letter or by directive of the Chief Executive Officer of the Company, Employee shall not disclose any Confidential Information to any person or entity and shall not use any Confidential Information except for the benefit of the Company Group. Employee shall follow all Company Group policies and protocols regarding the security of all documents and other materials containing Confidential Information (regardless of the medium on which Confidential Information is stored). The covenants of this Section 1(a) of Exhibit A shall apply to all Confidential Information, whether now known or later to become known to Employee during the period that Employee is employed or engaged by any Company Group member.

(b)Notwithstanding any provisions of Section 1(a) of this Exhibit A to the contrary, Employee may make the following disclosures and uses of Confidential Information:

(i)disclosures to other employees of a member of the Company Group who have a need to know the information in connection with the businesses of the Company Group;

(ii)disclosures to customers and suppliers when, in the reasonable and good faith belief of Employee, such disclosure is in connection with Employee’s performance of Employee’s duties and is in the best interests of the Company Group.

(iii)disclosures to a person or entity that has (x) been retained by a member of the Company Group to provide services to one or more members of the Company Group and (y) agreed in writing to abide by the terms of a confidentiality agreement.

(c)All trade secrets, non-public information, designs, ideas, concepts, improvements, product developments, discoveries and inventions, whether patentable or not, that are conceived, made, developed or acquired by or disclosed to Employee, individually or in conjunction with others, during the period that Employee is employed by any Company Group member (whether during business hours or otherwise and whether on the Company’s premises or otherwise) that relate to any Company Group member’s businesses or properties, products or services (including, without limitation, all such information relating to corporate opportunities, operations, future plans, methods of doing business, business plans, strategies for developing business and market share, research, financial and sales data, pricing terms, evaluations, opinions, interpretations, acquisition prospects, the identity of customers or acquisition targets or their requirements, the identity of key contacts within the organizations of customers or acquisition prospects, or marketing and merchandising techniques, prospective names and marks) is defined as “Confidential Information.” Moreover, all documents, videotapes, drawings, notes, files, recordings, models, specifications, computer programs, e-mail, voice mail, text messages, electronic databases, maps, and all other writings or materials of any type including or embodying any of such information, ideas, concepts, improvements, discoveries, inventions and other similar forms of expression

5

are and shall be the sole and exclusive property of the Company or the other applicable Company Group member and be subject to the same restrictions on disclosure applicable to all Confidential Information pursuant to this Letter. For purposes of this Letter, Confidential Information shall not include any information that (i) is or becomes generally available to the public other than as a result of a violation of a confidentiality obligation; (ii) was available to Employee not as part of Employee’s employment or engagement with any Company Group member and before its disclosure by a Company Group member; or (iii) becomes available to Employee on a non-confidential basis from a source other than a Company Group member that is not bound by a confidentiality obligation to any Company Group member.

(d)Notwithstanding the foregoing, nothing in this Letter shall prohibit or restrict Employee from lawfully: (i) initiating communications directly with, cooperating with, providing information to, causing information to be provided to, or otherwise assisting in an investigation by, any governmental authority regarding a possible violation of any law; (ii) responding to any inquiry or legal process directed to Employee from any governmental authority; (iii) testifying, participating or otherwise assisting in any action or proceeding by any governmental authority relating to a possible violation of law; or (iv) making any other disclosures that are protected under the whistleblower provisions of any applicable law. Nothing in this Letter requires Employee to obtain prior authorization before engaging in any conduct described in this paragraph, or to notify the Company or any Company Group member of any such conduct.

(e)Upon the expiration of the Employment Period, and at any other time upon request of the Company, Employee shall promptly surrender and deliver to the Company all Confidential Information (including, without limitation, electronically stored information) and all copies thereof and all other Company Group property (including any Company Group-issued computer, mobile device or other equipment or property) in Employee’s possession, custody or control.

6

2.Non-Solicitation. During the Employment Period and continuing for a period of 12 months following the date that Employee is no longer employed by any Company Entity, Employee shall not, without the prior written approval of the Chief Executive Officer of the Company, directly or indirectly, for Employee or on behalf of or in conjunction with any other person or entity, directly or indirectly, solicit, encourage, or induce (i) any employee or contractor of any Company Group member to terminate his, her or its employment or engagement with any Company Group member or hire or engage any employee or contractor of any Company Group member or former employee or contractor of any Company Group member unless such employee’s or contractor’s employment or engagement with each Company Group member has been terminated for at least 12 months as of such hiring or engagement; and (ii) any customer or supplier of any member of the Company Group to cease or lessen such customer’s or supplier’s business with any member of the Company Group. Because of the difficulty of measuring economic losses to the Company Group as a result of a breach or threatened breach of the covenants set forth in Section 1 and Section 2 of this Exhibit A, and because of the immediate and irreparable damage that would be caused to the members of the Company Group for which they would have no other adequate remedy, the Company and each other member of the Company Group shall be entitled to enforce the foregoing covenants, in the event of a breach or threatened breach, by injunctions and restraining orders from any court of competent jurisdiction, without the necessity of showing any actual damages or that money damages would not afford an adequate remedy, and without the necessity of posting any bond or other security. The aforementioned equitable relief shall not be the Company’s or any other member of the Company Group’s exclusive remedy for a breach but instead shall be in addition to all other rights and remedies available to the Company and each other member of the Company Group at law and equity.

3.Third-Party Beneficiaries; Assignment; Survival. Each Company Group member (and any successor or permitted assignee of any Company Group member) that is not a signatory hereto shall be a third-party beneficiary of Employee’s covenants and obligations set forth in this Exhibit A and shall be entitled to enforce such covenants and obligations as if a party hereto. Any Company Group member may assign this Letter (including this Exhibit A) without Employee’s consent, including to any Company Group member and to any successor to or acquirer of (whether by merger, purchase or otherwise) all or substantially all of the equity, assets or businesses of any Company Group member. In the event of any such assignment, such successor or acquirer shall assume all of such Company Group member’s rights and obligations in this Letter and the “Date of Termination” as used herein shall be interpreted to mean the last date upon which Employee was no longer employed or engaged by such successor or acquirer or any of its affiliates. Employee’s obligations under this Exhibit A shall survive the date that Employee is no longer employed or engaged by any Company Group member or any successor or permitted assignee, regardless of the reason that such relationship ends.

7

EX-31.1

Exhibit 31.1

Certification Pursuant to

Rule 13a-14(a) or 15d-14(a) of the Exchange Act

As Adopted Pursuant to

Section 302 of the Sarbanes-Oxley Act of 2002

I, Brady M. Murphy, certify that:

1.I have reviewed this report on Form 10-Q for the fiscalquarter ended September 30, 2020, of TETRA Technologies, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)evaluated the effectiveness of the registrant’s disclosure controls and procedures and presentedin this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;

d)disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function):

a)all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.

Date:	November 3, 2020	/s/Brady M. Murphy
		Brady M. Murphy
		President and
		Chief Executive Officer

EX-31.2

Exhibit 31.2

Certification Pursuant to

Rule 13a-14(a) or 15d-14(a) of the Exchange Act

As Adopted Pursuant to

Section 302 of the Sarbanes-Oxley Act of 2002

I, Elijio V. Serrano, certify that:

1.I have reviewed this report on Form 10-Q for the fiscalquarter ended September 30, 2020, of TETRA Technologies, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)evaluated the effectiveness of the registrant’s disclosure controls and procedures and presentedin this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;

d)disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function):

a)all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.

Date:	November 3, 2020	/s/Elijio V. Serrano
		Elijio V. Serrano
		SeniorVice President and
		Chief Financial Officer and Principal Accounting Officer

EX-32.1

Exhibit 32.1

Certification Pursuant to

18 U.S.C. Section 1350

As Adopted Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report of TETRA Technologies, Inc. (the “Company”) on Form 10-Q for the period ending September 30, 2020 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Brady M. Murphy, President and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects,the financial condition and results of operations of the Company.

Dated:	November 3, 2020	/s/Brady M. Murphy
		Brady M. Murphy
		President and
		Chief Executive Officer
		TETRA Technologies, Inc.

A signed original of this written statementrequired by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.2

Exhibit 32.2

Certification Pursuant to

18 U.S.C. Section 1350

As Adopted Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report of TETRA Technologies, Inc. (the “Company”) on Form 10-Q for the period ending September 30, 2020 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Elijio V. Serrano, Senior Vice President and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all materialrespects, the financial condition and results of operations of the Company.

Dated:	November 3, 2020	/s/Elijio V. Serrano
		Elijio V. Serrano
		Senior Vice President and
		Chief Financial Officer
		TETRA Technologies, Inc.

A signed original ofthis written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Cover Page - shares	9 Months Ended
	Sep. 30, 2020	Nov. 02, 2020
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2020
Document Transition Report	false
Entity File Number	1-13455
Entity Registrant Name	TETRA Technologies, Inc.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	74-2148293
Entity Address, Address Line One	24955 Interstate 45 North
Entity Address, City or Town	The Woodlands,
Entity Address, Postal Zip Code	77380
Entity Address, State or Province	TX
City Area Code	281
Local Phone Number	367-1983
Title of 12(b) Security	Common Stock
Trading Symbol	TTI
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Shell Company	false
Entity Common Stock Shares Outstanding		125,976,728
Entity Central Index Key	0000844965
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q3
Amendment Flag	false

XML

Commitments and Contingencies

9 Months Ended

Sep. 30, 2020

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

COMMITMENTS AND CONTINGENCIES

Litigation

We are named defendants in several lawsuits and respondents in certain governmental proceedings arising in the ordinary course of business. While the outcome of lawsuits or other proceedings against us cannot be predicted with certainty, management does not consider it reasonably possible that a loss resulting from such lawsuits or other proceedings in excess of any amounts accrued has been incurred that is expected to have a material adverse impact on our financial condition, results of operations, or liquidity.

Contingencies of Discontinued Operations

    In early 2018, we closed the Maritech Asset Purchase and Sale Agreement with Orinoco Natural Resources, LLC (“Orinoco”) that provided for the purchase by Orinoco of Maritech’s remaining oil and gas properties and related assets. Shortly thereafter, we closed the Maritech Membership Interest Purchase and Sale Agreement with Orinoco that provided for the purchase by Orinoco of all of the outstanding membership interests in Maritech. As a result of these transactions, we have effectively exited the business of our former Maritech segment.

    Under the Maritech Asset Purchase and Sale Agreement, Orinoco assumed all of Maritech’s decommissioning liabilities related to the leases sold to Orinoco (the “Orinoco Lease Liabilities”) and, under the Maritech Membership Interest Purchase and Sale Agreement, Orinoco assumed all other liabilities of Maritech, including the decommissioning liabilities associated with the oil and gas properties previously sold by Maritech (the “Legacy Liabilities”), subject to certain limited exceptions unrelated to the decommissioning liabilities. To the extent that Maritech or Orinoco fails to satisfy decommissioning liabilities associated with any of the Orinoco Lease Liabilities or the Legacy Liabilities, we may be required to satisfy such liabilities under third party indemnity agreements and corporate guarantees that we previously provided to the US Department of the Interior and other parties, respectively.

    Pursuant to a Bonding Agreement entered into as part of these transactions (the “Bonding Agreement”), Orinoco provided non-revocable performance bonds in an aggregate amount of $46.8 million to cover the performance by Orinoco and Maritech of the asset retirement obligations of Maritech (the “Initial Bonds”) and agreed to replace, within 90 days following the closing, the Initial Bonds with other non-revocable performance bonds, meeting certain requirements, in the aggregate sum of $47.0 million (collectively, the “Interim Replacement Bonds”). Orinoco further agreed to replace, within 180 days following the closing, the Interim Replacement Bonds with a maximum of three non-revocable performance bonds in the aggregate sum of $47.0 million, meeting certain requirements (the “Final Bonds”). Among the other requirements of the Final Bonds was that they must provide coverage for all of the asset retirement obligations of Maritech instead of only relating to specific properties. In the event Orinoco did not provide the Interim Replacement Bonds or the Final Bonds, Orinoco was required to make certain cash escrow payments to us.

    The payment obligations of Orinoco under the Bonding Agreement were guaranteed by Thomas M. Clarke and Ana M. Clarke pursuant to a separate guaranty agreement (the “Clarke Bonding Guaranty Agreement”). Orinoco has not delivered such replacement bonds and neither it nor the Clarkes has made any of the agreed upon cash escrow payments and we filed a lawsuit against Orinoco and the Clarkes to enforce the terms of the Bonding Agreement and the Clarke Bonding Guaranty Agreement. A summary judgment was initially granted in favor of Orinoco and the Clarkes which dismissed our claims against Orinoco under the Bonding Agreement and against the Clarkes under the Clarke Bonding Guaranty Agreement. We filed an appeal and also asked the trial court to grant a new trial on the summary judgment or to modify the judgment because we believe this judgment should not have been granted. On November 5, 2019, the trial court signed an order granting our motion for new trial and vacating the prior order granting summary judgment for Orinoco and the Clarkes. The parties are awaiting direction from the court on a new scheduling order and/or trial setting. The Initial Bonds, which are non-revocable, remain in effect.

    If we become liable in the future for any decommissioning liability associated with any property covered by either an Initial Bond or an Interim Replacement Bond while such bonds are outstanding and the payment made to us under such bond is not sufficient to satisfy such liability, the Bonding Agreement provides that Orinoco will pay us an amount equal to such deficiency and if Orinoco fails to pay any such amount, such amount must be paid by the Clarkes under the Clarke Bonding Guaranty Agreement. However, if the Final Bonds or the full amount of the escrowed cash have been provided, neither Orinoco nor the Clarkes would be liable to pay us for any such deficiency. Our financial condition and results of operations may be negatively affected if Orinoco is unable to cover any such deficiency or if we become liable for a significant portion of the decommissioning liabilities.

     In early 2018, we also closed the sale of our Offshore Division to Epic Companies, LLC (“Epic Companies,” formerly known as Epic Offshore Specialty, LLC). Part of the consideration we received was a promissory note of Epic Companies in the original principal amount of $7.5 million (the “Epic Promissory Note”) payable to us in full, together with interest at a rate of 1.52% per annum, on December 31, 2019, along with a personal guaranty agreement from Thomas M. Clarke and Ana M. Clarke guaranteeing the payment obligations of Epic Companies pursuant to the Epic Promissory Note (the “Clarke Promissory Note Guaranty Agreement”). Additionally, pursuant to the Equity Interest Purchase Agreement (the “Offshore Services Purchase Agreement”) and other agreements with Epic Companies, certain other amounts relating to the Offshore Division totaling approximately $1.5 million were payable to us. At the end of August 2019, Epic Companies filed for bankruptcy. We recorded a reserve of $7.5 million for the full amount of the promissory note, including accrued interest, and the certain other receivables in the amount of $1.5 million

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Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Revenues	$ 152,601	$ 245,947	$ 567,984	$ 778,471
Cost of Goods and Services Sold [Abstract]
Depreciation, amortization, and accretion	29,604	30,867	88,906	93,312
Impairment and other charges	97	849	14,445	3,306
Insurance recoveries associated with damaged equipment	52	1,042	643	1,392
Total cost of revenues	132,631	200,987	488,276	648,935
Gross profit	19,970	44,960	79,708	129,536
General and administrative expense	25,256	34,926	89,807	105,498
Interest expense, net	17,631	18,146	53,073	55,054
Fair Value Adjustment Of Warrants, Income Statement	0	78	(327)	(1,035)
Preferred, Fair Value Adjustment	0	0	0	1,309
Other (income) expense, net	(2,137)	(690)	2,141	(1,014)
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest	(20,780)	(7,500)	(64,986)	(30,276)
Provision for income taxes	645	1,579	3,800	5,678
Income (loss) before taxes	(21,425)	(9,079)	(68,786)	(35,954)
Income (Loss) from Discontinued Operations, Net of Tax, Including Portion Attributable to Noncontrolling Interest	(173)	(9,130)	(155)	(9,901)
Net income (loss)	(21,598)	(18,209)	(68,941)	(45,855)
(Income) loss attributable to noncontrolling interest	8,296	2,378	32,833	12,273
Net income (loss) attributable to TETRA stockholders	$ (13,302)	$ (15,831)	$ (36,108)	$ (33,582)
Basic net income per common share:
Income (Loss) from Continuing Operations, Per Basic and Diluted Share	$ (0.10)	$ (0.06)	$ (0.29)	$ (0.19)
Income (Loss) from Discontinued Operations and Disposal of Discontinued Operations, Net of Tax, Per Basic Share	0	(0.07)	0	(0.08)
Net income (loss) attributable to TETRA stockholders	$ (0.10)	$ (0.13)	$ (0.29)	$ (0.27)
Weighted Average Number of Shares Outstanding, Basic	125,893	125,568	125,789	125,620
Diluted net income per common share:
Income (Loss) from Continuing Operations, Per Diluted Share	$ (0.10)	$ (0.06)	$ (0.29)	$ (0.19)
Income (Loss) from Discontinued Operations and Disposal of Discontinued Operations, Net of Tax, Per Diluted Share	0	(0.07)	0	(0.08)
Net income (loss) attributable to TETRA stockholders	$ (0.10)	$ (0.13)	$ (0.29)	$ (0.27)
Weighted Average Number of Shares Outstanding, Diluted	125,893	125,568	125,789	125,620
Product sales
Revenues	$ 68,810	$ 93,377	$ 252,016	$ 320,508
Cost of Goods and Services Sold [Abstract]
Cost of product sales	50,541	71,957	184,512	254,798
Services
Revenues	83,791	152,570	315,968	457,963
Cost of Goods and Services Sold [Abstract]
Cost of product sales	$ 52,441	$ 98,356	$ 201,056	$ 298,911

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Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Statement of Comprehensive Income [Abstract]
Net income (loss)	$ (21,598)	$ (18,209)	$ (68,941)	$ (45,855)
Foreign currency translation adjustment, net of taxes of $0 in 2020 and 2019	2,874	(3,742)	(2,498)	(3,300)
Comprehensive income	(18,724)	(21,951)	(71,439)	(49,155)
Comprehensive (income) loss attributable to noncontrolling interest	8,229	2,358	32,880	11,994
Comprehensive income (loss) attributable to TETRA stockholders	(10,495)	(19,593)	(38,559)	(37,161)
Foreign currency translation adjustment, tax	$ 0	$ 0	$ 0	$ 0

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Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Current assets:
Cash and cash equivalents	$ 75,165	$ 17,704
Restricted cash	59	64
Trade accounts receivable, net of allowances	108,222	175,918
Inventories	113,020	136,510
Disposal Group, Including Discontinued Operation, Assets, Current	0	0
Prepaid expenses and other current assets	21,176	21,158
Total current assets	317,642	351,354
Property, plant, and equipment:
Land and building	39,534	60,586
Machinery and equipment	1,341,905	1,335,157
Automobiles and trucks	26,581	31,681
Chemical plants	60,195	57,692
Construction in progress	10,819	34,393
Total property, plant, and equipment	1,479,034	1,519,509
Less accumulated depreciation	(804,466)	(760,872)
Net property, plant, and equipment	674,568	758,637
Other assets:
Patents, trademarks and other intangible assets, net of accumulated amortization	68,350	74,199
Deferred tax assets, net	24	24
Operating lease right-of-use assets	78,867	68,131
Other assets	22,089	19,577
Total other assets	169,330	161,931
Total assets	1,161,540	1,271,922
Current liabilities:
Trade accounts payable	42,406	88,917
Unearned income	7,310	9,831
Accrued liabilities	80,500	87,877
Disposal Group, Including Discontinued Operation, Liabilities, Current	1,852	2,098
Total current liabilities	132,068	188,723
Long-term debt, net	843,216	842,871
Deferred income taxes	3,421	2,988
Decommissioning and other asset retirement obligations, net	12,973	12,762
Warranty Liability	123	449
Operating lease liabilities	64,200	53,919
Other liabilities	10,364	7,384
Total long-term liabilities	934,297	920,373
Equity:
Common stock, par value $0.01 per share	1,289	1,283
Additional paid-in capital	471,146	466,959
Treasury stock, at cost	(19,484)	(19,164)
Accumulated other comprehensive income (loss)	(54,634)	(52,183)
Retained earnings	(398,630)	(362,522)
Total TETRA stockholders' equity	(313)	34,373
Noncontrolling interests	95,488	128,453
Total equity	95,175	162,826
Total liabilities and equity	1,161,540	1,271,922
Trade accounts receivable, allowances for doubtful accounts	7,742	5,262
Patents, trademarks, and other intangible assets, accumulated amortization	$ 93,976	$ 88,422
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	250,000,000	250,000,000
Common stock, shares issued	128,930,704	128,304,354
Treasury stock, shares held	2,953,976	2,823,191

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Consolidated Statements of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019
Operating activities:
Net income (loss)	$ (68,941)	$ (45,855)
Reconciliation of net income (loss) to cash provided by (used in) operating activities:
Depreciation, amortization, and accretion	88,906	93,364
Impairment and other charges	14,445	3,306
Benefit for deferred income taxes	550	545
Equity-based compensation expense	4,847	6,260
Provision for doubtful accounts	5,907	3,351
Loss on disposition of business	0	7,500
Amortization of deferred financing costs	3,698	4,614
Insurance recoveries associated with damaged equipment	643	1,392
Equipment received in lieu of cash	725	0
Debt exchange expenses	4,777	0
Liabilities, Fair Value Adjustment	0	3,574
Warrants fair value adjustment	(326)	(1,035)
Contingent consideration liability fair value adjustment	0	(800)
Gain on sale of assets	(4,340)	(1,583)
Changes in operating assets and liabilities, net of assets acquired:
Accounts receivable	61,314	13,309
Inventories	11,780	(6,847)
Prepaid expenses and other current assets	(916)	(1,831)
Trade accounts payable and accrued expenses	(57,844)	10,344
Other	888	(3,234)
Net cash provided by (used in) operating activities	64,827	83,590
Investing activities:
Purchases of property, plant, and equipment, net	22,011	89,192
Proceeds on sale of property, plant, and equipment	24,704	2,152
Proceeds from Insurance Settlement, Investing Activities	643	1,392
Other investing activities	(576)	(890)
Net cash provided by (used in) investing activities	2,760	(98,562)
Financing activities:
Proceeds from long-term debt	404,060	246,090
Principal payments on long-term debt	(408,666)	(204,718)
CCLP distributions	(932)	(924)
Redemptions of CCLP Series A Preferred	0	(28,049)
Tax remittances on equity based compensation	(341)	(571)
Debt issuance costs and other financing activities	(3,897)	(373)
Net cash provided by (used in) financing activities	(9,776)	11,455
Effect of exchange rate changes on cash	(355)	(606)
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Period Increase (Decrease), Including Exchange Rate Effect	57,456	(4,123)
Cash, cash equivalents, and restricted cash	75,224	35,979
Supplemental cash flow information:
Interest paid	42,199	49,073
Income taxes paid	4,692	6,226
Payments to Acquire Businesses, Net of Cash Acquired	$ 0	$ 12,024

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Consolidated Statement of Equity Statement - USD ($) $ in Thousands	Total	Common Stock Par Value	Additional Paid-In Capital	Treasury Stock	Accumulated Other  Comprehensive Income (Loss)	Retained Deficit	Noncontrolling Interest	Cumulative Effect, Period of Adoption, Adjustment [Member]	Cumulative Effect, Period of Adoption, Adjustment [Member] Retained Deficit
Cumulative effect adjustment	$ 312,749	$ 1,285	$ 460,680	$ (18,950)	$ (51,663)	$ (217,952)	$ 139,349	$ 2,843	$ 2,843
Balance at beginning of period at Dec. 31, 2018	312,749	1,285	460,680	(18,950)	(51,663)	(217,952)	139,349	2,843	2,843
Net Income (Loss) Attributable to Parent						(10,838)
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest	(19,100)						(8,262)
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Gain (Loss), before Reclassification and Tax	(406)				(582)		176
Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Noncontrolling Interest	(19,506)
Distributions to public unitholders	(307)						307
Equity award activity	(1)	(1)
Treasury stock activity, net	(155)			(155)
Equity compensation expense	1,939		1,628				311
Conversions of CCLP Series A Preferred	2,539						2,539
Cumulative effect adjustment	300,110	1,284	462,241	(19,105)	(52,245)	(225,947)	133,882	2,843	2,843
Other	9		(67)				76
Balance at end of period at Mar. 31, 2019	300,110	1,284	462,241	(19,105)	(52,245)	(225,947)	133,882
Translation adjustment, tax	0
Balance at beginning of period at Dec. 31, 2018	312,749	1,285	460,680	(18,950)	(51,663)	(217,952)	139,349	2,843	2,843
Net Income (Loss) Attributable to Parent	(33,582)
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest	(45,855)
Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Noncontrolling Interest	(49,155)
Cumulative effect adjustment	273,528	1,284	465,615	(19,164)	(55,242)	(248,691)	129,726	$ 2,843	$ 2,843
Balance at end of period at Sep. 30, 2019	273,528	1,284	465,615	(19,164)	(55,242)	(248,691)	129,726
Cumulative effect adjustment	300,110	1,284	462,241	(19,105)	(52,245)	(225,947)	133,882
Balance at beginning of period at Mar. 31, 2019	300,110	1,284	462,241	(19,105)	(52,245)	(225,947)	133,882
Net Income (Loss) Attributable to Parent						(6,913)
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest	(8,546)						(1,633)
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Gain (Loss), before Reclassification and Tax	848				765		83
Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Noncontrolling Interest	(7,698)
Distributions to public unitholders	(308)						308
Treasury stock activity, net	(11)			(11)
Equity compensation expense	2,667		2,100				567
Cumulative effect adjustment	294,691	1,284	464,305	(19,116)	(51,480)	(232,860)	132,558
Other	(69)		(36)				(33)
Balance at end of period at Jun. 30, 2019	294,691	1,284	464,305	(19,116)	(51,480)	(232,860)	132,558
Translation adjustment, tax	0
Cumulative effect adjustment	294,691	1,284	464,305	(19,116)	(51,480)	(232,860)	132,558
Net Income (Loss) Attributable to Parent	(15,831)					(15,831)
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest	(18,209)						(2,378)
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Gain (Loss), before Reclassification and Tax	(3,742)				(3,762)		20
Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Noncontrolling Interest	(21,951)
Distributions to public unitholders	(309)						309
Equity award activity	0	0
Treasury stock activity, net	(48)			(48)
Equity compensation expense	1,105		1,316				(211)
Cumulative effect adjustment	273,528	1,284	465,615	(19,164)	(55,242)	(248,691)	129,726
Other	40		(6)				46
Balance at end of period at Sep. 30, 2019	273,528	1,284	465,615	(19,164)	(55,242)	(248,691)	129,726
Translation adjustment, tax	0
Cumulative effect adjustment	273,528	1,284	465,615	(19,164)	(55,242)	(248,691)	129,726
Cumulative effect adjustment	162,826	1,283	466,959	(19,164)	(52,183)	(362,522)	128,453
Balance at beginning of period at Dec. 31, 2019	162,826	1,283	466,959	(19,164)	(52,183)	(362,522)	128,453
Net Income (Loss) Attributable to Parent						(1,551)
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest	(10,376)						(8,825)
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Gain (Loss), before Reclassification and Tax	(6,467)				(6,238)		(229)
Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Noncontrolling Interest	(16,843)
Distributions to public unitholders	(309)						(309)
Equity award activity	4	4	0
Treasury stock activity, net	(89)			(89)
Equity compensation expense	1,373		1,145				228
Cumulative effect adjustment	146,931	1,287	468,088	(19,253)	(58,421)	(364,073)	119,303
Other	(31)		(16)				(15)
Balance at end of period at Mar. 31, 2020	146,931	1,287	468,088	(19,253)	(58,421)	(364,073)	119,303
Translation adjustment, tax	0
Balance at beginning of period at Dec. 31, 2019	162,826	1,283	466,959	(19,164)	(52,183)	(362,522)	128,453
Net Income (Loss) Attributable to Parent	(36,108)
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest	(68,941)
Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Noncontrolling Interest	(71,439)
Cumulative effect adjustment	162,826	1,289	471,146	(19,484)	(54,634)	(398,630)	95,488
Balance at end of period at Sep. 30, 2020	95,175	1,289	471,146	(19,484)	(54,634)	(398,630)	95,488
Cumulative effect adjustment	146,931	1,287	468,088	(19,253)	(58,421)	(364,073)	119,303
Balance at beginning of period at Mar. 31, 2020	146,931	1,287	468,088	(19,253)	(58,421)	(364,073)	119,303
Net Income (Loss) Attributable to Parent						(21,255)
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest	(36,967)						(15,712)
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Gain (Loss), before Reclassification and Tax	1,095				980		115
Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Noncontrolling Interest	(35,872)
Distributions to public unitholders	(311)						(311)
Equity award activity	1	1	0
Treasury stock activity, net	(181)			(181)
Equity compensation expense	2,134		1,685				449
Cumulative effect adjustment	112,686	1,288	469,777	(19,434)	(57,441)	(385,328)	103,824
Other	(16)		4				(20)
Balance at end of period at Jun. 30, 2020	112,686	1,288	469,777	(19,434)	(57,441)	(385,328)	103,824
Translation adjustment, tax	0
Cumulative effect adjustment	112,686	1,288	469,777	(19,434)	(57,441)	(385,328)	103,824
Net Income (Loss) Attributable to Parent	(13,302)					(13,302)
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest	(21,598)						(8,296)
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Gain (Loss), before Reclassification and Tax	2,874				2,807		67
Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Noncontrolling Interest	(18,724)
Distributions to public unitholders	(312)						(312)
Equity award activity	1	1	0
Treasury stock activity, net	(50)			(50)
Equity compensation expense	1,595		1,363				232
Cumulative effect adjustment	112,686	1,289	471,146	(19,484)	(54,634)	(398,630)	95,488
Other	(21)		6				(27)
Balance at end of period at Sep. 30, 2020	95,175	1,289	471,146	(19,484)	(54,634)	(398,630)	95,488
Translation adjustment, tax	0
Cumulative effect adjustment	$ 95,175	$ 1,289	$ 471,146	$ (19,484)	$ (54,634)	$ (398,630)	$ 95,488

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Organization, Basis of Presentation, and Significant Accounting Policies (Notes)

9 Months Ended

Sep. 30, 2020

Accounting Policies [Abstract]

Organization, Basis of Presentation, and Significant Accounting Policies

ORGANIZATION, BASIS OF PRESENTATION, AND SIGNIFICANT ACCOUNTING POLICIES

Organization 

We are a geographically diversified oil and gas services company, focused on completion fluids and associated products and services, water management, frac flowback, production well testing and offshore rig cooling services, and compression services and equipment. We were incorporated in Delaware in 1981. We are composed of three divisions – Completion Fluids & Products, Water & Flowback Services, and Compression. Unless the context requires otherwise, when we refer to “we,” “us,” and “our,” we are describing TETRA Technologies, Inc. and its consolidated subsidiaries on a consolidated basis.

Presentation  

Our unaudited consolidated financial statements include the accounts of our wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The information furnished reflects all normal recurring adjustments, which are, in the opinion of management, necessary to provide a fair statement of the results for the interim periods. Operating results for the period ended September 30, 2020 are not necessarily indicative of results that may be expected for the twelve months ended December 31, 2020.

We consolidate the financial statements of our CSI Compressco LP subsidiary (“CCLP”) as part of our Compression Division, as we determined that CCLP is a variable interest entity and we are the primary beneficiary. We control the financial interests of CCLP and have the ability to direct the activities of CCLP that most significantly impact its economic performance through our ownership of its general partner. The share of CCLP net assets and earnings that is not owned by us is presented as noncontrolling interest in our consolidated financial statements. Our cash flows from our investment in CCLP are limited to the quarterly distributions we receive on our CCLP common units and general partner interest (including incentive distribution rights) and the amounts collected for services we perform on behalf of CCLP, as TETRA’s capital structure and CCLP’s capital structure are separate, and do not include cross default provisions or cross guarantees.

The accompanying unaudited consolidated financial statements have been prepared in accordance with Rule 10-01 of Regulation S-X for interim financial statements required to be filed with the U.S. Securities and Exchange Commission (“SEC”) and do not include all information and footnotes required by U.S. generally accepted accounting principles (“U.S. GAAP”) for complete financial statements. These financial statements should be read in conjunction with the financial statements for the year ended December 31, 2019 and notes thereto included in our Annual Report on Form 10-K, which we filed with the SEC on March 16, 2020.

Significant Accounting Policies

    Our significant accounting policies are described in the notes to our consolidated financial statements for the year ended December 31, 2019 included in our Annual Report on Form 10-K. There have been no significant changes in our accounting policies or the application thereof during the third quarter of 2020.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclose contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues, expenses, and impairments during the reporting period. Actual results could differ from those estimates, and such differences could be material.

Reclassifications

    Certain previously reported financial information has been reclassified to conform to the current year's presentation. The impact of such reclassifications was not significant to the prior year’s overall presentation.

Impairments and Other Charges

Impairments of long-lived assets, including identified intangible assets, are determined periodically when indicators of impairment are present. If such indicators are present, the determination of the amount of impairment is based on our judgment as to the future undiscounted operating cash flows to be generated from the relevant assets throughout their remaining estimated useful lives. If these undiscounted cash flows are less than the carrying amount of the related assets, an impairment is recognized for the excess of the carrying value over fair value. Fair value of intangible assets is generally determined using the discounted present value of future cash flows using discount rates commensurate with the risks inherent with the specific assets. Assets held for disposal are recorded at the lower of carrying value or estimated fair value less estimated selling costs. See Note 3 - “Impairments and Other Charges” for additional discussion of recorded impairments.

Revenue Recognition

    Performance Obligations. Revenue is generally recognized when we transfer control of our products or services to our customers. Revenue is measured as the amount of consideration we expect to receive in exchange for transferring products or providing services to our customers. We receive cash equal to the invoice price for most sales of product and services and payment terms typically range from 30 to 60 days from the date we invoice our customer. Since the period between when we deliver products or services and when the customer pays for such products or services is not expected to exceed one year, we have elected not to calculate or disclose a financing component for our customer contracts.

    Depending on the terms of the arrangement, we may also defer the recognition of revenue for a portion of the consideration received because we have to satisfy a future performance obligation. For example, consideration received from customers during the fabrication of new compressor packages is typically deferred until control of the compressor package is transferred to our customer.

    For any arrangements with multiple performance obligations, we use management’s estimated selling price to determine the stand-alone selling price for separate performance obligations. For revenue associated with mobilization of service equipment as part of a service contract arrangement, such revenue, if significant, is deferred and amortized over the estimated service period.

    Product Sales. Product sales revenues are generally recognized when we ship products from our facility to our customer. The product sales for our Completion Fluids & Products Division consist primarily of clear brine fluids (“CBFs”), additives, and associated manufactured products. Product sales for our Water & Flowback Services Division are typically attributed to specific performance obligations within certain production testing service arrangements. Parts and equipment sales comprise the product sales for the Compression Division.

    Services. Service revenues represent revenue recognized over time, as our customer arrangements typically provide agreed upon day-rates (monthly service rates for compression services) and we recognize service revenue based upon the number of days services have been performed. Service revenue recognized over time is associated with a majority of our Water & Flowback Services Division arrangements, compression service and aftermarket service contracts within our Compression Division, and a small portion of Completion Fluids & Products Division revenue that is associated with completion fluid service arrangements. With the exception of the initial terms of the compression services contracts for medium- and high-horsepower compressor packages of our Compression Division, our customer contracts are generally for terms of one year or less. The majority of the service arrangements in the Water & Flowback Services Division are for a period of 90 days or less.

    Sales taxes, value added taxes, and other taxes we collect concurrent with revenue-producing activities are excluded from revenue. We have elected to recognize the cost for freight and shipping costs as part of cost of product sales when control over our products (i.e. delivery) has transferred to the customer.

    Use of Estimates. In recognizing revenue for variable consideration arrangements, the amount of variable consideration recognized is limited so that it is probable that significant amounts of revenues will not be reversed in future periods when the uncertainty is resolved. For products returned by the customer, we estimate the expected returns based on an analysis of historical experience. For volume discounts earned by the customer, we estimate the discount (if any) based on our estimate of the total expected volume of products sold or services to be provided to the customer during the discount period. In certain contracts for the sale of CBFs, we may agree to issue credits

for the repurchase of reclaimable used fluids from certain customers at an agreed price that is based on the condition of the fluids.

    Contract Assets and Liabilities. We consider contract assets to be trade accounts receivable when we have an unconditional right to consideration and only the passage of time is required before payment is due. In certain instances, particularly those requiring customer specific documentation prior to invoicing, our invoicing of the customer is delayed until certain documentation requirements are met. In those cases, we recognize a contract asset rather than a billed trade accounts receivable until we are able to invoice the customer. Contract assets, along with billed trade accounts receivable, are included in trade accounts receivable in our consolidated balance sheets.

    We classify contract liabilities as unearned income in our consolidated balance sheets. Such deferred revenue typically results from advance payments received on orders for new compressor equipment prior to the time such equipment is completed and transferred to the customer in accordance with the customer contract. New equipment sales orders generally take less than twelve months to build and deliver.

    Bill-and-Hold Arrangements. We design and fabricate compressor packages based on our customer’s specifications. In some cases, the customer will request us to hold the equipment, upon completion of the unit, until the job site is ready to receive the equipment. When this occurs, we along with the customer sign a bill-and-hold agreement, which outlines that the customer has title to the equipment, the equipment is ready for delivery, we cannot use the equipment or direct it to another customer, and we have a present right to payment. When those criteria have been met and the agreement is executed, we recognize the revenue on the equipment because control of the equipment has passed to our customer and our performance obligations are complete. Entering into these arrangements is something we have done as a courtesy for certain customers for many years. The equipment subject to the bill-and-hold agreements has generally been invoiced and paid for through progressive billings such that at the time the bill-and-hold agreement is executed, the majority of the contractual cash obligation of the customer has been received by us.

Operating Costs

Cost of product sales includes direct and indirect costs of manufacturing and producing our products, including raw materials, fuel, utilities, labor, overhead, repairs and maintenance, materials, services, transportation, warehousing, equipment rentals, insurance, and certain taxes. Cost of services includes operating expenses we incur in delivering our services, including labor, equipment rental, fuel, repair and maintenance, transportation, overhead, insurance, and certain taxes. We include in product sales revenues the reimbursements we receive from customers for shipping and handling costs. Shipping and handling costs are included in cost of product sales. Amounts we incur for “out-of-pocket” expenses in the delivery of our services are recorded as cost of services. Reimbursements for “out-of-pocket” expenses we incur in the delivery of our services are recorded as service revenues. Depreciation, amortization, and accretion includes depreciation expense for all of our facilities, equipment and vehicles, amortization expense on our intangible assets, and accretion expense related to our decommissioning and other asset retirement obligations.

We include in general and administrative expense all costs not identifiable to our specific product or service operations, including divisional and general corporate overhead, professional services, corporate office costs, sales and marketing expenses, insurance, and certain taxes. 

Foreign Currency Translation

    We have designated the Euro, the British pound, the Norwegian krone, the Canadian dollar, the Brazilian real, and the Mexican peso as the functional currencies for our operations in Finland and Sweden, the United Kingdom, Norway, Canada, Brazil, and certain of our operations in Mexico, respectively. The U.S. dollar is the designated functional currency for all of our other foreign operations. The cumulative translation effects of translating the applicable accounts from the functional currencies into the U.S. dollar at current exchange rates are included as a separate component of equity. Foreign currency exchange (gains) and losses are included in other (income) expense, net and totaled $(0.8) million and $(3.2) million during the three and nine months ended September 30, 2020, respectively, and $(1.7) million and $(2.2) million during the three and nine months ended September 30, 2019, respectively.

Fair Value Measurements

We utilize fair value measurements to account for certain items and account balances within our consolidated financial statements. Fair value measurements are utilized on a recurring basis in the determination of the carrying values of certain liabilities, including the liabilities for the warrants to purchase 11.2 million shares of our common stock (the “Warrants”) and our foreign currency derivative contracts. See Note 9 - “Fair Value Measurements” for further discussion.

Fair value measurements are also utilized on a nonrecurring basis in certain circumstances, such as in the allocation of purchase consideration for acquisition transactions to the assets and liabilities acquired, including intangible assets and goodwill (a Level 3 fair value measurement), the initial recording of our asset retirement obligations, and for the impairment of long-lived assets, including goodwill (a Level 3 fair value measurement).

New Accounting Pronouncements

Standards adopted in 2020

    In August 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2018-15, “Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract.” ASU 2018-15 clarifies the accounting for implementation costs in cloud computing arrangements. ASU 2018-15 is effective for interim and annual reporting periods beginning after December 15, 2019, and early adoption is permitted. The adoption of this standard did not have a material impact on our consolidated financial statements.

Standards not yet adopted

    In June 2016, the FASB issued ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” ASU 2016-13 amends the impairment model to utilize an expected loss methodology in place of the currently used incurred loss methodology, which will result in the more timely recognition of losses on financial instruments not accounted for at fair value through net income. The provisions require credit impairments to be measured over the contractual life of an asset and developed with consideration for past events, current conditions, and forecasts of future economic information. Credit impairment will be accounted for as an allowance for credit losses deducted from the amortized cost basis at each reporting date. We are continuing to work through our implementation plan which includes evaluating the impact on our allowance for doubtful accounts methodology, identifying new reporting requirements, and implementing changes to business processes, systems, and controls to support adoption of the standard. Upon adoption, the allowance for doubtful accounts is expected to increase with an offsetting adjustment to retained earnings. Updates at each reporting date after initial adoption will be recorded through selling, general, and administrative expense. ASU 2016-13 has an effective date of the first quarter of fiscal 2023. We continue to assess the potential effects of these changes to our consolidated financial statements.

    In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes.” ASU 2019-12 simplifies the accounting for income taxes by eliminating certain exceptions related to intraperiod tax allocation, interim period income tax calculation methodology, and the recognition of deferred tax liabilities for outside basis differences. It also simplifies certain aspects of accounting for franchise taxes and clarifies the accounting for transactions that results in a step-up in the tax basis of goodwill. ASU 2019-12 is effective for us the first quarter of fiscal 2021. We continue to assess the potential effects of these changes to our consolidated financial statements.

    In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848)”, which provides optional expedients and exceptions for applying U.S. GAAP to contracts, hedging relationships, and other transactions affected by the discontinuation of the London Interbank Offered Rate (“LIBOR”) or by another reference rate expected to be discontinued. The amendments are effective for all entities as of March 12, 2020 through December 31, 2022. Entities may elect to apply the amendments for contract modifications as of any date from the beginning of an interim period that includes or is subsequent to March 12, 2020, or prospectively from a date within an interim period that includes or is subsequent to March 12, 2020. We are currently evaluating the impacts of the provisions of ASU 2020-04 on our consolidated financial statements.

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Revenue from Contracts with Customers (Notes)

9 Months Ended

Sep. 30, 2020

Revenue from Contract with Customer [Abstract]

Revenue from Contract with Customer [Text Block]

REVENUE FROM CONTRACTS WITH CUSTOMERS

    As of September 30, 2020, we had $47.1 million of remaining contractual performance obligations for compression services. As a practical expedient, this amount does not reflect revenue for compression service contracts whose original expected duration is less than twelve months and does not consider the effects of the time value of money. Expected revenue to be recognized in the future as of September 30, 2020 for completion of performance obligations of compression service contracts are as follows:

	2020		2021		2022		2023		2024		Total
	(In Thousands)
Compression service contracts remaining performance obligations	$	13,939	$	26,608	$	5,785	$	703	$	56	$	47,091

    For sales of CBFs where we have agreed to issue credits for the repurchase of reclaimable used fluids at an agreed price based on the condition of the fluid upon return, we adjust the revenue recognized in the period of shipment by an estimated amount, based on historical experience, of the credit expected to be issued. As of September 30, 2020, the amount of remaining credits expected to be issued for the repurchase of reclaimable used fluids was $1.1 million recorded in inventory (right of return asset) and either accounts payable or as a reduction to accounts receivable. There were no material differences between amounts recognized during the three and nine month period ended September 30, 2020, compared to estimates made in a prior period from these variable consideration arrangements.

    Our contract asset balances, primarily associated with customer documentation requirements, were $17.2 million and $34.9 million as of September 30, 2020 and December 31, 2019, respectively. Contract assets, along with billed trade accounts receivable, are included in trade accounts receivable in our consolidated balance sheets.

    Collections primarily associated with progressive billings to customers for the construction of compression equipment is included in unearned income in the consolidated balance sheets. The following table reflects the changes in unearned income in our consolidated balance sheets for the periods indicated:

	Nine Months Ended September 30,
	2020		2019
	(In Thousands)
Unearned Income, beginning of period	$	9,678	$	25,333
Additional unearned income	38,979		106,744
Revenue recognized	(41,624)		(105,486)
Unearned income, end of period	$	7,033	$	26,591

    During the nine month period ended September 30, 2020, we recognized product sales revenue of $9.4 million from unearned income that was deferred as of December 31, 2019. During the nine months ended September 30, 2019, we recognized product sales revenue of $22.2 million from unearned income that was deferred as of December 31, 2018.

    As of September 30, 2020, contract costs were immaterial.

    We disaggregate revenue from contracts with customers into Product Sales and Services within each segment, as noted in our three reportable segments in Note 12. In addition, we disaggregate revenue from contracts with customers by geography based on the following table below.

	Three months ended September 30,		Nine months ended September 30,
	2020	2019	2020		2019
	(In Thousands)
Completion Fluids & Products
U.S.	15,013	31,480	$	85,073	$	100,622
International	36,937	27,860	113,460		100,066
	51,950	59,340	198,533		200,688
Water & Flowback Services
U.S.	19,767	68,052	97,016		209,663
International	1,767	4,789	6,708		14,980
	21,534	72,841	103,724		224,643
Compression
U.S.	71,478	105,153	240,661		324,792
International	7,639	8,613	25,066		28,348
	79,117	113,766	265,727		353,140
Total Revenue
U.S.	106,258	204,685	422,750		635,077
International	46,343	41,262	145,234		143,394
	152,601	245,947	$	567,984	$	778,471

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Impairments and Other Charges (Notes)

9 Months Ended

Sep. 30, 2020

Asset Impairment Charges [Abstract]

Impairments and Other Charges

IMPAIRMENTS AND OTHER CHARGES

Impairments of Long-Lived Assets

    During the first nine months of 2020, the COVID-19 pandemic and decline in oil and gas prices had a significant impact on our customers and industry. These events led to a significant reduction in the operations of our customers resulting in a decrease in demand in certain of our service lines.

    During the first quarter of 2020, we started to see our customers revise their capital budgets downwards and adjust their operations accordingly, which led to a decline in orders for new compression equipment to be fabricated and sold to third parties. We concluded that these events were indicators of impairment for all our asset groups within our Compression Division and certain asset groups within our Completion Fluids & Products Division. We performed recoverability analyses on the relevant asset groups within these divisions. Based upon these recoverability analyses, we determined that the carrying values of our Midland manufacturing facility and related new unit sales inventory in our Compression Division exceeded their respective fair values. Therefore, we recorded impairments of approximately $5.4 million related to these assets. Fair value was estimated based on a market approach.

    During the second quarter of 2020, primarily as a result of continued negative impacts on our compression fleet associated with the COVID-19 pandemic and declines in oil and gas prices, our Compression Division recorded impairments and other charges of approximately $9.0 million associated with non-core used compressor equipment that we have held for sale, the low-horsepower class of our compression fleet, and field inventory for compression and related services. During the third quarter of 2020, no further impairments were recorded. Impairment charges are reflected in impairment and other charges in our consolidated statements of operations. Fair value used to determine impairments was estimated based on a market approach. Given the dynamic nature of the events, we are not able to reasonably estimate how long our operations will be adversely impacted and the full impact these events will have on our operations. As a result, we could have indicators of impairment again in future periods resulting in additional asset impairments.

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Inventories

9 Months Ended

Sep. 30, 2020

Inventory Disclosure [Abstract]

Inventories

INVENTORIES

Components of inventories as of September 30, 2020 and December 31, 2019 are as follows: 

	September 30, 2020		December 31, 2019
	(In Thousands)
Finished goods	$	70,452	$	70,135
Raw materials	3,744		4,125
Parts and supplies	32,340		47,793
Work in progress	6,484		14,457
Total inventories	$	113,020	$	136,510

Finished goods inventories include newly manufactured clear brine fluids as well as used brines that are repurchased from certain customers for recycling

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Leases

9 Months Ended

Sep. 30, 2020

Leases [Abstract]

Leases

LEASES

    We have operating leases for some of our transportation equipment, office space, warehouse space, operating locations, and machinery and equipment. We have finance leases for certain storage tanks and equipment rentals. These finance leases are not material to our financial statements. Our leases have remaining lease terms ranging from 1 to 16 years. Some of our leases have options to extend for various periods, while some have termination options with prior notice of generally 30 days or six months. The office space, warehouse space, operating location leases, and machinery and equipment leases generally require us to pay all maintenance and insurance costs. During the fourth quarter of 2019, CCLP entered into a lease agreement commitment for 14 compressor packages. The leases are for an initial term of seven years and commenced upon the completion of the equipment fabrication. During the first quarter, CCLP took delivery of eight compressor packages. During the second quarter, CCLP took delivery of the remaining six compressor packages. We have no other lease commitments that have not yet commenced that create significant rights and obligations. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. Variable rent expense was not material.

    Our corporate headquarters facility located in The Woodlands, Texas, was sold on December 31, 2012, pursuant to a sale and leaseback transaction. As a condition to the completion of the purchase and sale of the facility, the parties entered into a lease agreement for the facility having an initial lease term of 15 years, which is classified as an operating lease. Under the terms of the lease agreement, we have the ability to extend the lease for five successive five-year periods at base rental rates to be determined at the time of each extension.

    Components of lease expense, included in either cost of revenues or general and administrative expense based on the use of the underlying asset, are as follows (inclusive of lease expense for leases not included on our consolidated balance sheet based on our accounting policy election to exclude leases with a term of 12 months or less):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
	(In Thousands)
Operating lease expense	$	5,822	$	5,075	$	17,839	$	15,106
Short-term lease expense	3,758		9,556		17,061		30,269
Total lease expense	$	9,580	$	14,631	$	34,900	$	45,375

Supplemental cash flow information:

	Nine Months Ended September 30,
	2020		2019
	(In Thousands)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows - operating leases	$	17,861	$	14,868
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	24,201	$	7,631

Supplemental balance sheet information:

	September 30, 2020		December 31, 2019
	(In Thousands)
Operating leases:
Operating lease right-of-use assets	$	78,867	$	68,131
Accrued liabilities and other	$	16,362	$	15,850
Operating lease liabilities	64,200		53,919
Total operating lease liabilities	$	80,562	$	69,769

Additional operating lease information:

	September 30, 2020		December 31, 2019
Weighted average remaining lease term:
Operating leases	6.09 years		6.43 years
Weighted average discount rate:
Operating leases	9.33	%	9.46	%

    Future minimum lease payments by year and in the aggregate, under non-cancellable operating leases with terms in excess of one year consist of the following at September 30, 2020:

		Operating Leases
	(In Thousands)
Remainder of 2020		$	5,809
2021		22,322
2022		18,896
2023		15,803
2024		12,067
Thereafter		32,611
Total lease payments		107,508
Less imputed interest		(26,946)
Total lease liabilities		$	80,562

    At September 30, 2020, future minimum rental receipts under a non-cancellable sublease for office space in one of our locations totaled $5.0 million. For the three and nine months ended September 30, 2020, we recognized sublease income of $0.3 million and $0.9 million.

Leases

LEASES

    We have operating leases for some of our transportation equipment, office space, warehouse space, operating locations, and machinery and equipment. We have finance leases for certain storage tanks and equipment rentals. These finance leases are not material to our financial statements. Our leases have remaining lease terms ranging from 1 to 16 years. Some of our leases have options to extend for various periods, while some have termination options with prior notice of generally 30 days or six months. The office space, warehouse space, operating location leases, and machinery and equipment leases generally require us to pay all maintenance and insurance costs. During the fourth quarter of 2019, CCLP entered into a lease agreement commitment for 14 compressor packages. The leases are for an initial term of seven years and commenced upon the completion of the equipment fabrication. During the first quarter, CCLP took delivery of eight compressor packages. During the second quarter, CCLP took delivery of the remaining six compressor packages. We have no other lease commitments that have not yet commenced that create significant rights and obligations. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. Variable rent expense was not material.

    Our corporate headquarters facility located in The Woodlands, Texas, was sold on December 31, 2012, pursuant to a sale and leaseback transaction. As a condition to the completion of the purchase and sale of the facility, the parties entered into a lease agreement for the facility having an initial lease term of 15 years, which is classified as an operating lease. Under the terms of the lease agreement, we have the ability to extend the lease for five successive five-year periods at base rental rates to be determined at the time of each extension.

    Components of lease expense, included in either cost of revenues or general and administrative expense based on the use of the underlying asset, are as follows (inclusive of lease expense for leases not included on our consolidated balance sheet based on our accounting policy election to exclude leases with a term of 12 months or less):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
	(In Thousands)
Operating lease expense	$	5,822	$	5,075	$	17,839	$	15,106
Short-term lease expense	3,758		9,556		17,061		30,269
Total lease expense	$	9,580	$	14,631	$	34,900	$	45,375

Supplemental cash flow information:

	Nine Months Ended September 30,
	2020		2019
	(In Thousands)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows - operating leases	$	17,861	$	14,868
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	24,201	$	7,631

Supplemental balance sheet information:

	September 30, 2020		December 31, 2019
	(In Thousands)
Operating leases:
Operating lease right-of-use assets	$	78,867	$	68,131
Accrued liabilities and other	$	16,362	$	15,850
Operating lease liabilities	64,200		53,919
Total operating lease liabilities	$	80,562	$	69,769

Additional operating lease information:

	September 30, 2020		December 31, 2019
Weighted average remaining lease term:
Operating leases	6.09 years		6.43 years
Weighted average discount rate:
Operating leases	9.33	%	9.46	%

    Future minimum lease payments by year and in the aggregate, under non-cancellable operating leases with terms in excess of one year consist of the following at September 30, 2020:

		Operating Leases
	(In Thousands)
Remainder of 2020		$	5,809
2021		22,322
2022		18,896
2023		15,803
2024		12,067
Thereafter		32,611
Total lease payments		107,508
Less imputed interest		(26,946)
Total lease liabilities		$	80,562

    At September 30, 2020, future minimum rental receipts under a non-cancellable sublease for office space in one of our locations totaled $5.0 million. For the three and nine months ended September 30, 2020, we recognized sublease income of $0.3 million and $0.9 million.

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Long-Term Debt and Other Borrowings

9 Months Ended

Sep. 30, 2020

Debt Disclosure [Abstract]

Long-Term Debt and Other Borrowings

LONG-TERM DEBT AND OTHER BORROWINGS

We believe our capital structure, excluding CCLP, (“TETRA”) and CCLP’s capital structure should be considered separately, as there are no cross default provisions or cross guarantees between CCLP’s debt and TETRA’s debt.

Consolidated long-term debt as of September 30, 2020 and December 31, 2019, consists of the following:

		September 30, 2020		December 31, 2019
		(In Thousands)
TETRA	Scheduled Maturity
Asset-based credit agreement (presented net of unamortized deferred financing costs of $0 million as of September 30, 2020 and $1.0 million as of December 31, 2019)	September 10, 2023	$	—	$	—
Term credit agreement (presented net of the unamortized discount of $5.7 million as of September 30, 2020 and $6.4 million as of December 31, 2019 and net of unamortized deferred financing costs of $8.5 million as of September 30, 2020 and $9.5 million as of December 31, 2019)	September 10, 2025	206,273		204,633
TETRA total long-term debt		$	206,273	$	204,633
CCLP
CCLP asset-based credit agreement (presented net of unamortized deferred financing costs of $0 million as of September 30, 2020 and $0.9 million of December 31, 2019)	June 29, 2023	—		2,622
CCLP 7.25% Senior Notes (presented net of the unamortized discount of $0.3 million as of September 30, 2020 and $1.7 million as of December 31, 2019 and net of unamortized deferred financing costs of $0.5 million as of September 30, 2020 and $2.8 million as of December 31, 2019)	August 15, 2022	79,893		291,444
CCLP 7.50% First Lien Notes (presented net of unamortized deferred financing costs of $5.4 million as of September 30, 2020 and $5.8 million as of December 31, 2019, net of the unamortized discount of $0.2 million as of September 30, 2020, and net of deferred restructuring gain of $5.3 million as of September 30, 2020)	April 1, 2025	399,640		344,172
CCLP 10.00%/10.75% Second Lien Notes (presented net of the unamortized discount of $0.8 million as of September 30, 2020, net of unamortized deferred financing costs of $1.2 million as of September 30, 2020, and net of deferred restructuring gain of $3.9 million as of September 30, 2020)	April 1, 2026	157,410		—
CCLP total long-term debt		$	636,943	$	638,238
Consolidated total long-term debt		$	843,216	$	842,871

    As of September 30, 2020, TETRA had no outstanding balance and $6.4 million in letters of credit against its asset-based credit agreement (“ABL Credit Agreement”). Because there was no outstanding balance on this Credit Agreement, associated deferred financing costs of $1.1 million as of September 30, 2020, were classified as other long-term assets on the accompanying consolidated balance sheet. As of September 30, 2020, subject to compliance with the covenants, borrowing base, and other provisions of the ABL Credit Agreement that may limit borrowings, TETRA had an availability of $25.8 million under this agreement.

As of September 30, 2020, CCLP had no balance outstanding and $2.5 million in letters of credit against its asset-based credit agreement (“CCLP Credit Agreement”). Because there was no outstanding balance under the CCLP Credit Agreement, associated deferred financing costs of $0.7 million were classified as other long-term assets on the accompanying consolidated balance sheet. As of September 30, 2020, and subject to compliance with the covenants, borrowing base, and other provisions of the CCLP Credit Agreement that may limit borrowings, CCLP had availability of $14.5 million.

    TETRA and CCLP credit and senior note agreements contain certain affirmative and negative covenants, including covenants that restrict the ability to pay dividends or other restricted payments. TETRA and CCLP are both in compliance with all covenants of their respective credit and senior note agreements as of September 30, 2020.

Second Amendment to Credit Agreement

    On June 11, 2020, CSI Compressco, LP and CSI Compressco Sub Inc (the “Borrowers”) entered into the Second Amendment to Loan and Security Agreement (the “Amendment”) amending the Loan and Security Agreement dated June 29, 2018 (as amended, restated, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”) with Bank of America, N.A., in its capacity as administrative agent, issuing bank and swing line issuer (“Administrative Agent”), and the other lenders and loan parties party thereto. The Amendment provided for changes and modifications to the Credit Agreement which include, among other things, changes to certain terms of the Credit Agreement as follows: (i) resizing of the maximum credit commitment under the Credit Agreement from $50,000,000 to $35,000,000; (ii) the inclusion of a $5,000,000 reserve with respect to the Borrowing Base (as defined in the Credit Agreement) thereunder, which would result in reduced borrowing availability; (iii) the removal of the financial covenant compliance test with respect to the Consolidated Fixed Charge Coverage Ratio (as defined in the Credit Agreement); (iv) an increase in the applicable margin related to (x) LIBOR Rate Loans (as defined in the Credit Agreement) to a range between 3.00% and 3.50% and (y) Base Rate Loans (as defined in the Credit Agreement) to a range between 2.00% and 2.50%, in each case, which shall be determined according to average daily excess availability under the Credit Agreement; and (v) an increase in the rate used to calculate the commitment fee in respect of the unutilized commitments under the Credit Agreement to 0.50%. In connection to this amendment, $0.2 million of financing costs were incurred by CCLP and deferred against the carrying value of the amount outstanding, if any. Additionally, $0.2 million of financing fees were charged to other (income) expense, net during the nine month period ended September 30, 2020.

First Supplemental Indenture for the Old Notes

    On June 11, 2020, CSI Compressco, LP and CSI Compressco Finance Inc. (the “Issuers”) announced that they had accepted for exchange $215,208,000, or approximately 72.7%, of their outstanding 7.25% Senior Notes due 2022 (the “Old Notes”) that were validly tendered (and not validly withdrawn) by 11:59 p.m., New York City time, on June 10, 2020, for (i) $50,000,000 of the Issuers’ 7.50% Senior Secured First Lien Notes due 2025 (the “7.50% First Lien Notes”) and (ii) $155,529,000 aggregate principal amount of new 10.00%/10.75% Senior Secured Second Lien Notes due 2026 (the “10.00%/10.75% Second Lien Notes” and, together with the 7.50% First Lien Notes, the “New Notes”), pursuant to its previously announced exchange offer and consent solicitation (the “Exchange Offer”), which commenced on April 17, 2020. In connection with the exchange offer, CCLP incurred financing fees of $4.6 million which were charged to other (income) expense, net during the nine month period ended September 30, 2020.

    On June 12, 2020, following receipt of the requisite consents of the holders of the Old Notes, the Issuers entered into the First Supplemental Indenture (the “First Supplemental Indenture”), by and among the Issuers, the subsidiary guarantors named therein and U.S. Bank National Association, as trustee, to the Indenture, dated as of August 4, 2014 (the “Unsecured Indenture”), by and among the Issuers, the subsidiary guarantors named therein and U.S. Bank National Association, as trustee.

    The First Supplemental Indenture eliminated substantially all of the restrictive covenants and certain of the default provisions in the Unsecured Indenture and became operative upon the consummation by the Issuers of the Exchange Offer.

    On June 12, 2020, the Issuers issued $50,000,000 in aggregate principal amount of New First Lien Notes to certain holders of the Old Notes pursuant to the terms of the Exchange Offer. In March 2018, the Issuers had issued $350,000,000 in aggregate principal amount of 7.50% Senior Secured Notes due 2025 (the “Existing First Lien Notes” and, together with the New First Lien Notes, the “7.50% First Lien Notes”) pursuant to the First Lien Base Indenture. The New First Lien Notes were issued as “additional notes” under the First Lien Base Indenture and will be treated as a single class with such notes but will not trade fungibly with the Existing First Lien Notes.

Second Lien Notes Indenture

    On June 12, 2020, the Issuers issued $155,529,000 in aggregate principal amount of the 10.00%/10.75% Second Lien Notes to certain holders of the Old Notes pursuant to the terms of the Exchange Offer. The Issuers

issued the 10.00%/10.75% Second Lien Notes pursuant to an indenture, dated June 12, 2020 (the “Second Lien Notes Indenture”),by and among the Issuers, the subsidiary guarantors named therein and U.S. Bank National Association, as trustee (the “Second Lien Trustee”). In connection with the payment of PIK Interest (as defined below), if any, in respect of the 10.00%/10.75% Second Lien Notes, the Issuers will be entitled, without the consent of the Holders, to increase the outstanding aggregate principal amount of the 10.00%/10.75% Second Lien Notes or issue additional notes (“PIK notes”) under the Second Lien Notes Indenture on the same terms and conditions as the 10.00%/10.75% Second Lien Notes offered hereby (each such increase or issuance, a “PIK Payment”). The Issuers may issue additional 10.00%/10.75% Second Lien Notes under the Second Lien Notes Indenture from time to time. Any issuance of additional 10.00%/10.75% Second Lien Notes (including PIK notes) is subject to all of the covenants in the Second Lien Notes Indenture. The 10.00%/10.75% Second Lien Notes and any additional 10.00%/10.75% Second Lien Notes subsequently issued under the indenture, will be treated as a single class for all purposes under the indenture, including, without limitation, waivers, amendments, redemptions and offers to purchase. Subject to the making of PIK Payments, the Issuers will issue 10.00%/10.75% Second Lien Notes in denominations of $2,000 and integral multiples of $1,000 in excess of $2,000; provided that PIK Payments may result in 10.00%/10.75% Second Lien Notes being issued in denominations of $1.00 and integral multiples of $1.00. The 10.00%/10.75% Second Lien Notes will mature on April 1, 2026. Interest on the 10.00%/10.75% Second Lien Notes will be payable semi-annually in arrears on April 1 and October 1, commencing on October 1, 2020. The Issuers will make each interest payment to the holders of record on March 15 and September 15 immediately preceding each interest payment date. Interest will accrue at (1) the annual rate of 7.250% payable in cash, plus (2) at the election of the Issuers (made by delivering a notice to the Second Lien Trustee not less than five business days prior to the record date), the annual rate of (i) 2.750% payable in cash (together with the annual rate set forth in clause (1), the “Cash Interest Rate”) or (ii) 3.500% payable by increasing the principal amount of the outstanding 10.00%/10.75% Second Lien Notes or by issuing additional PIK notes, in each case rounding up to the nearest $1.00 (such increased principal amount or additional PIK notes, the “PIK Interest”). In the absence of an interest payment election made by the Issuers as set forth above, interest on the notes will be payable as if the Issuers had elected to pay PIK Interest with respect to the portion of interest payable pursuant to clause (2) above.

    The 10.00%/10.75% Second Lien Notes are jointly and severally, and fully and unconditionally, guaranteed (the “Guarantees”) on a senior secured basis initially by each of the Partnership’s domestic restricted subsidiaries (other than Finance Corp, certain immaterial subsidiaries and certain other excluded domestic subsidiaries, the “Guarantors”) and will be secured by a second-priority security interest in substantially all of the Issuers’ and the Guarantors’ assets (other than certain excluded assets) (the “Collateral”) as collateral security for their obligations under the 10.00%/10.75% Second Lien Notes, subject to certain permitted encumbrances and exceptions. At any time prior to April 1, 2023, the Issuers may on any one or more occasions redeem up to 35% of the aggregate principal amount of the 10.00%/10.75% Second Lien Notes issued under the Second Lien Notes Indenture at a redemption price of 110.000% of the principal amount of the 10.00%/10.75% Second Lien Notes, plus accrued and unpaid interest to the redemption date, with an amount of cash equal to the net cash proceeds of certain equity offerings. On or after April 1, 2023, the Issuers may redeem all or part of the 10.00%/10.75% Second Lien Notes at redemption prices (expressed as percentages of the principal amount) equal to (i) 107.500% for the twelve month period beginning on April 1, 2023; (ii) 105.000% for the twelve-month period beginning on April 1, 2024 and (iii) 100.000% at any time thereafter, plus accrued and unpaid interest up to, but not including, the redemption date. In addition, at any time prior to April 1, 2023, the Company may redeem all or a part of the 10.00%/10.75% Second Lien Notes at a redemption price equal to 100% of the principal amount of the 10.00%/10.75% Second Lien Notes to be redeemed plus a make-whole premium, plus accrued and unpaid interest up to, but not including, the redemption date.

    The Second Lien Notes Indenture contains customary covenants restricting the Partnership’s ability and the ability of its restricted subsidiaries to: (i) pay distributions on, purchase or redeem its common units or purchase or redeem its subordinated debt; (ii) incur or guarantee additional indebtedness or issue certain kinds of preferred equity securities; (iii) create or incur certain liens securing indebtedness; (iv) sell assets, including dispositions of the Collateral; (v) consolidate, merge or transfer all or substantially all of its assets; (vi) enter into transactions with affiliates; and (vii) enter into agreements that restrict distributions or other payments from its restricted subsidiaries to the Partnership. These covenants are subject to a number of important limitations and exceptions, including certain provisions permitting the Partnership, subject to the satisfaction of certain conditions, to transfer assets to certain of its unrestricted subsidiaries. Moreover, if the 10.00%/10.75% Second Lien Notes receive an investment grade rating from at least two rating agencies and no default has occurred and is continuing under the 10.00%/10.75% Second Lien Notes Indenture, many of the restrictive covenants in the Second Lien Notes Indenture will be terminated. The Second Lien Notes Indenture also contains customary events of default and acceleration provisions relating to such events of default, which provide that upon an event of default under the

Second Lien Notes Indenture, the Second Lien Trustee or the holders of at least 25% in aggregate principal amount of the then outstanding 10.00%/10.75% Second Lien Notes may declare all of the 10.00%/10.75% Second Lien Notes to be due and payable immediately.

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Discontinued Operations (Notes)

9 Months Ended

Sep. 30, 2020

Discontinued Operations and Disposal Groups [Abstract]

Disposal Groups, Including Discontinued Operations, Disclosure [Text Block]

DISCONTINUED OPERATIONS

    On March 1, 2018, we closed a series of related transactions that resulted in the disposition of our Offshore Division. As a result, we have accounted for our Offshore Division, consisting of our Offshore Services and Maritech segments, as discontinued operations. See Note 8 - “Commitments and Contingencies” for further discussion. A summary of financial information related to our discontinued operations is as follows:

Reconciliation of the Line Items Constituting Pretax Loss from Discontinued Operations to the After-Tax Loss from Discontinued Operations

(in thousands)

	Three Months Ended September 30, 2020						Three Months Ended September 30, 2019
	Offshore Services		Maritech		Total		Offshore Services		Maritech		Total
Major classes of line items constituting pretax loss from discontinued operations
Revenue	$	—	$	—	$	—	$	—	$	—	$	—
Cost of revenues	2		—		2		(273)		—		(273)
Depreciation, amortization, and accretion	—		—		—		52		—		52
General and administrative expense	171		—		171		1,734		—		1,734
Other expense, net	—		—		—		117		—		117
Pretax income (loss) from discontinued operations	(173)		—		(173)		(1,630)		—		(1,630)
Pretax (loss) on disposal of discontinued operations					—						(7,500)
Total pretax (loss) from discontinued operations					(173)						(9,130)
Income tax provision (benefit)					—						—
Total (loss) from discontinued operations					$	(173)					$	(9,130)

	Nine Months Ended September 30, 2020						Nine Months Ended September 30, 2019
	Offshore Services		Maritech		Total		Offshore Services		Maritech		Total
Major classes of line items constituting pretax loss from discontinued operations
Revenue	$	—	$	—	$	—	$	—	$	—	$	—
Cost of revenues	(332)		—		(332)		(251)		—		(251)
Depreciation, amortization, and accretion	—		—		—		52		—		52
General and administrative expense	487		—		487		2,483		—		2,483
Other expense, net	—		—		—		117		—		117
Pretax (loss) from discontinued operations	(155)		—		(155)		(2,401)		—		(2,401)
Pretax (loss) on disposal of discontinued operations					—						(7,500)
Total pretax (loss) from discontinued operations					(155)						(9,901)
Income tax provision (benefit)					—						—
Total (loss) from discontinued operations					$	(155)					$	(9,901)

Reconciliation of Major Classes of Assets and Liabilities of the Discontinued Operations to Amounts Presented Separately in the Statement of Financial Position

(in thousands)

	September 30, 2020						December 31, 2019
	Offshore Services		Maritech		Total		Offshore Services		Maritech		Total
Carrying amounts of major classes of assets included as part of discontinued operations
Trade receivables	$	—	$	—	$	—	$	—	$	—	$	—
Other current assets	—		—		—		—		—		—
Assets of discontinued operations	$	—	$	—	$	—	$	—	$	—	$	—
Carrying amounts of major classes of liabilities included as part of discontinued operations
Trade payables	$	1,223	$	—	$	1,223	$	1,233	$	—	$	1,233
Accrued liabilities	401		228		629		745		120		865
Liabilities of discontinued operations	$	1,624	$	228	$	1,852	$	1,978	$	120	$	2,098

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Fair Value Measurements

9 Months Ended

Sep. 30, 2020

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Fair Value Measurements

FAIR VALUE MEASUREMENTS

Financial Instruments

Warrants

The Warrants are valued using a Black Scholes option valuation model that includes implied volatility of the trading price (a Level 3 fair value measurement).

Derivative Contracts

    We and CCLP each enter into short term foreign currency forward derivative contracts with third parties as part of a program designed to mitigate the currency exchange rate risk exposure on selected transactions of certain foreign subsidiaries. As of September 30, 2020, we and CCLP had the following foreign currency derivative contracts outstanding relating to portions of our foreign operations:

Derivative contracts	US Dollar Notional Amount	Traded Exchange Rate	Settlement Date
	(In Thousands)
Forward sale Mexican peso	5,464	21.87	October 1, 2020

Under this program, we and CCLP may enter into similar derivative contracts from time to time. Although contracts pursuant to this program will serve as an economic hedge of the cash flow of our currency exchange risk exposure, they are not formally designated as hedge contracts or qualify for hedge accounting treatment. Accordingly, any change in the fair value of these derivative contracts during a period will be included in the determination of earnings for that period.

The fair values of foreign currency derivative contracts are based on quoted market values (a Level 2 fair value measurement). The fair values of our and CCLP’s foreign currency derivative contracts as of September 30, 2020 and December 31, 2019, are as follows:

Foreign currency derivative contracts	Balance Sheet Location	Fair Value at September 30, 2020		Fair Value at December 31, 2019
		(In Thousands)
Forward purchase contracts	Current assets	$	59	$	86
Forward sale contracts	Current liabilities	—		(53)
Forward purchase contracts	Current liabilities	—		(3)
Net asset		$	59	$	30

None of our foreign currency derivative contracts contain credit risk related contingent features that would require us to post assets or collateral for contracts that are classified as liabilities. During the three and nine months ended September 30, 2020, we recognized $0.2 million and $(0.7) million, respectively, of net (gains) losses associated with our foreign currency derivative program. During the three and nine months ended September 30, 2019, we recognized $1.0 million and $1.8 million, respectively, of net (gains) losses associated with our foreign currency derivative program. These amounts are reflected in other (income) expense, net, in the accompanying consolidated statement of operations.

During the nine months ended September 30, 2020, we recorded impairments of approximately $9.0 million, reflecting the decreased fair value for certain assets. The fair values used in these impairment calculations were estimated based on a market approach, which is based on significant unobservable inputs (Level 3) in accordance with the fair value hierarchy. See Note 3 - “Impairments and Other Charges” for further discussion.

Recurring and nonrecurring fair value measurements by valuation hierarchy as of September 30, 2020 and December 31, 2019, are as follows:

			Fair Value Measurements Using
	Total as of		Quoted Prices in Active Markets for Identical Assets or Liabilities		Significant Other Observable Inputs		Significant Unobservable Inputs
Description	September 30, 2020		(Level 1)		(Level 2)		(Level 3)
	(In Thousands)
Warrants liability	$	(123)	$	—	$	—	$	(123)
Asset for foreign currency derivative contracts	59		—		59		—
Net asset	$	(64)

			Fair Value Measurements Using
	Total as of		Quoted Prices in Active Markets for Identical Assets or Liabilities		Significant Other Observable Inputs		Significant Unobservable Inputs
Description	December 31, 2019		(Level 1)		(Level 2)		(Level 3)
	(In Thousands)
Warrants liability	$	(449)	$	—	$	—	$	(449)
Asset for foreign currency derivative contracts	86		—		86		—
Liability for foreign currency derivative contracts	(56)		—		(56)		—
Net liability	$	(419)

The fair values of cash, restricted cash, accounts receivable, accounts payable, accrued liabilities, short-term borrowings and long-term debt pursuant to TETRA’s ABL Credit Agreement and Term Credit Agreement, and the CCLP Credit Agreement approximate their carrying amounts. The fair values of the publicly traded CCLP 7.25% Senior Notes at September 30, 2020 and December 31, 2019, were approximately $59.7 million and $266.0 million, respectively. Those fair values compare to the face amount of $80.7 million and $295.9 million at September 30, 2020 and December 31, 2019, respectively. The fair values of the CCLP 7.50% Senior Secured Notes at September 30, 2020 and December 31, 2019 were approximately $360.0 million and $344.8 million, respectively. These fair values compare to aggregate principal amount of such notes at September 30, 2020 and December 31, 2019, of $400.0 million and $350.0 million, respectively. The fair value of the CCLP 10.00%/10.75% Second Lien Notes at September 30, 2020 was approximately $115.5 million. This fair value compares to aggregate principal amount of such notes at September 30, 2020 of $155.5 million. We based the fair values of the CCLP 7.25% Senior Notes, the CCLP 7.50% Senior Secured Notes, and the CCLP 10.00%/10.75% Second Lien Notes as of September 30, 2020 on recent trades for these notes. See Note 6 - “Long-Term Debt and Other Borrowings” for further discussion.

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Net Income (Loss) per Share (Notes)

9 Months Ended

Sep. 30, 2020

Earnings Per Share [Abstract]

Net Income (Loss) per Share

NET INCOME (LOSS) PER SHARE

The following is a reconciliation of the weighted average number of common shares outstanding with the number of shares used in the computations of net income (loss) per common and common equivalent share:

	Three Months Ended September 30,		Nine Months Ended September 30,
	2020	2019	2020	2019
	(In Thousands)
Number of weighted average common shares outstanding	125,893	125,568	125,789	125,620
Assumed exercise of equity awards and warrants	—	—	—	—
Average diluted shares outstanding	125,893	125,568	125,789	125,620

For the three and nine month periods ended September 30, 2020 and September 30, 2019, the average diluted shares outstanding excludes the impact of all outstanding equity awards and warrants, as the inclusion of these shares would have been anti-dilutive due to the net losses recorded during the periods. In addition, for the three and nine month period ended September 30, 2019, the calculation of diluted earnings per common share excludes the impact of the CSI Compressco LP Series A Convertible Preferred Units (the “CCLP Preferred Units”), as the inclusion of the impact from conversion of the CCLP Preferred Units into CCLP common units would have been anti-dilutive.

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Industry Segments

9 Months Ended

Sep. 30, 2020

Segment Reporting [Abstract]

Industry Segments

INDUSTRY SEGMENTS

We manage our operations through three Divisions: Completion Fluids & Products, Water & Flowback Services, and Compression.

 Summarized financial information concerning the business segments is as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
	(In Thousands)
Revenues from external customers
Product sales
Completion Fluids & Products Division	$	49,986	$	55,444	$	187,419	$	185,578
Water & Flowback Services Division	23		100		56		831
Compression Division	18,801		37,833		64,541		134,099
Consolidated	$	68,810	$	93,377	$	252,016	$	320,508
Services
Completion Fluids & Products Division	$	1,964	$	3,896	$	11,114	$	15,110
Water & Flowback Services Division	21,511		72,741		103,668		223,812
Compression Division	60,316		75,933		201,186		219,041
Consolidated	$	83,791	$	152,570	$	315,968	$	457,963
Total revenues
Completion Fluids & Products Division	$	51,950	$	59,340	$	198,533	$	200,688
Water & Flowback Services Division	21,534		72,841		103,724		224,643
Compression Division	79,117		113,766		265,727		353,140
Interdivision eliminations	—		—		—		—
Consolidated	$	152,601	$	245,947	$	567,984	$	778,471
Income (loss) before taxes
Completion Fluids & Products Division	$	11,756	$	11,318	$	44,354	$	32,118
Water & Flowback Services Division	(7,746)		2,578		(18,408)		7,269
Compression Division	(11,321)		(3,464)		(47,117)		(14,748)
Interdivision eliminations	3		(1)		10		6
Corporate Overhead(1)	(13,472)		(17,931)		(43,825)		(54,921)
Consolidated	$	(20,780)	$	(7,500)	$	(64,986)	$	(30,276)

(1)Amounts reflected include the following general corporate expenses:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
	(In Thousands)
General and administrative expense	$	8,959	$	12,573	$	28,650	$	39,012
Depreciation and amortization	270		167		643		507
Interest expense	4,706		5,495		14,909		16,533
Warrants fair value adjustment (income) expense	—		78		(327)		(1,035)
Other general corporate income, net	(463)		(382)		(50)		(96)
Total	$	13,472	$	17,931	$	43,825	$	54,921

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Subsequent Events (Notes)	9 Months Ended
	Sep. 30, 2020
Subsequent Events [Abstract]
Subsequent Events	SUBSEQUENT EVENTSIn connection with the Midland manufacturing facility sale discussed in Note 10, we entered into an agreement with the buyer to continue to operate a portion of the facility, which allowed us to close out remaining backlog for the New Unit Sale business and operate our aftermarket services business for an interim period. Following the shipment of the last unit in October, we are no longer fabricating new compressor packages for sales to third parties or for our own service fleet. The operations associated with fabricating new compressor packages will be reported as a discontinued operation in the fourth quarter of 2020.In July 2020, we received a purchase order to sell $6.7 million of idle large horsepower compressor units to one of our significant customers. During the third quarter of 2020, we received proceeds and recognized $1.7 million relating to this order. In October 2020, we received the remaining $5.0 million of proceeds and started to deliver the compressor units to the customer. We have and will continue to evaluate the sale of other non-core assets, including our low-horsepower compression fleet. We can provide no assurance that we will consummate a future sale of our low-horsepower compression fleet or any other non-core asset.

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Sale of Assets

9 Months Ended

Sep. 30, 2020

Discontinued Operations and Disposal Groups [Abstract]

Sale of Assets

SALE OF ASSETS

In April 2020, we entered into a purchase and sale agreement for the sale of the Midland manufacturing facility within our Compression Division. During the nine months ended September 30, 2020, we recorded an impairment of $3.1 million to reduce this asset to its approximate fair market value based on a market approach and expected net proceeds. The impairment charges are reflected in impairment and other charges in our statement of operations.

On July 2, 2020, we completed the previously announced sale of our Midland manufacturing facility for a total sale price of $17.0 million. The Midland facility was used to design, fabricate and assemble new standard and customized compressor packages. The sale of the Midland facility resulted in a gain of $0.3 million during the three and nine months ended September 30, 2020, which is reflected in other (income) expense, net in our statement of operations.

Additionally, in the third quarter of 2020, we sold the remaining inventory and equipment related to the fabrication of new compressors within our Compression Division for a gain of $0.5 million, which is reflected in other (income) expense, net in our statement of operations for the three and nine months ended September 30, 2020. During the nine months ended September 30, 2020, we recorded an impairment of $2.3 million to reduce the carrying value of the new unit sales inventory to its approximate fair market value based on a market approach. The impairment charges are reflected in impairment and other charges in our statement of operations.

During the third quarter ended September 30, 2020, we completed the sale of 58 low-horsepower units to one of our customers for $2.6 million. During the nine months ended September 30, 2020, we recorded an impairment of $3.7 million to reduce these assets to their approximate fair market value based on a market approach and expected net proceeds. The impairment charges are reflected in impairment and other charges in our statement of operations.

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Organization, Basis of Presentation, and Significant Accounting Policies (Policies)

9 Months Ended

Sep. 30, 2020

Accounting Policies [Abstract]

Principles of consolidation policy

Presentation  

Our unaudited consolidated financial statements include the accounts of our wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The information furnished reflects all normal recurring adjustments, which are, in the opinion of management, necessary to provide a fair statement of the results for the interim periods. Operating results for the period ended September 30, 2020 are not necessarily indicative of results that may be expected for the twelve months ended December 31, 2020.

We consolidate the financial statements of our CSI Compressco LP subsidiary (“CCLP”) as part of our Compression Division, as we determined that CCLP is a variable interest entity and we are the primary beneficiary. We control the financial interests of CCLP and have the ability to direct the activities of CCLP that most significantly impact its economic performance through our ownership of its general partner. The share of CCLP net assets and earnings that is not owned by us is presented as noncontrolling interest in our consolidated financial statements. Our cash flows from our investment in CCLP are limited to the quarterly distributions we receive on our CCLP common units and general partner interest (including incentive distribution rights) and the amounts collected for services we perform on behalf of CCLP, as TETRA’s capital structure and CCLP’s capital structure are separate, and do not include cross default provisions or cross guarantees.

The accompanying unaudited consolidated financial statements have been prepared in accordance with Rule 10-01 of Regulation S-X for interim financial statements required to be filed with the U.S. Securities and Exchange Commission (“SEC”) and do not include all information and footnotes required by U.S. generally accepted accounting principles (“U.S. GAAP”) for complete financial statements. These financial statements should be read in conjunction with the financial statements for the year ended December 31, 2019 and notes thereto included in our Annual Report on Form 10-K, which we filed with the SEC on March 16, 2020.

Use of estimates policy

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclose contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues, expenses, and impairments during the reporting period. Actual results could differ from those estimates, and such differences could be material.

Reclassifications [Text Block]

Reclassifications

    Certain previously reported financial information has been reclassified to conform to the current year's presentation. The impact of such reclassifications was not significant to the prior year’s overall presentation.

Foreign currency translation policy

Foreign Currency Translation

    We have designated the Euro, the British pound, the Norwegian krone, the Canadian dollar, the Brazilian real, and the Mexican peso as the functional currencies for our operations in Finland and Sweden, the United Kingdom, Norway, Canada, Brazil, and certain of our operations in Mexico, respectively. The U.S. dollar is the designated functional currency for all of our other foreign operations. The cumulative translation effects of translating the applicable accounts from the functional currencies into the U.S. dollar at current exchange rates are included as a separate component of equity. Foreign currency exchange (gains) and losses are included in other (income) expense, net and totaled $(0.8) million and $(3.2) million during the three and nine months ended September 30, 2020, respectively, and $(1.7) million and $(2.2) million during the three and nine months ended September 30, 2019, respectively.

New Accounting Pronouncements policy

New Accounting Pronouncements

Standards adopted in 2020

    In August 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2018-15, “Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract.” ASU 2018-15 clarifies the accounting for implementation costs in cloud computing arrangements. ASU 2018-15 is effective for interim and annual reporting periods beginning after December 15, 2019, and early adoption is permitted. The adoption of this standard did not have a material impact on our consolidated financial statements.

Standards not yet adopted

    In June 2016, the FASB issued ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” ASU 2016-13 amends the impairment model to utilize an expected loss methodology in place of the currently used incurred loss methodology, which will result in the more timely recognition of losses on financial instruments not accounted for at fair value through net income. The provisions require credit impairments to be measured over the contractual life of an asset and developed with consideration for past events, current conditions, and forecasts of future economic information. Credit impairment will be accounted for as an allowance for credit losses deducted from the amortized cost basis at each reporting date. We are continuing to work through our implementation plan which includes evaluating the impact on our allowance for doubtful accounts methodology, identifying new reporting requirements, and implementing changes to business processes, systems, and controls to support adoption of the standard. Upon adoption, the allowance for doubtful accounts is expected to increase with an offsetting adjustment to retained earnings. Updates at each reporting date after initial adoption will be recorded through selling, general, and administrative expense. ASU 2016-13 has an effective date of the first quarter of fiscal 2023. We continue to assess the potential effects of these changes to our consolidated financial statements.

    In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes.” ASU 2019-12 simplifies the accounting for income taxes by eliminating certain exceptions related to intraperiod tax allocation, interim period income tax calculation methodology, and the recognition of deferred tax liabilities for outside basis differences. It also simplifies certain aspects of accounting for franchise taxes and clarifies the accounting for transactions that results in a step-up in the tax basis of goodwill. ASU 2019-12 is effective for us the first quarter of fiscal 2021. We continue to assess the potential effects of these changes to our consolidated financial statements.

    In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848)”, which provides optional expedients and exceptions for applying U.S. GAAP to contracts, hedging relationships, and other transactions affected by the discontinuation of the London Interbank Offered Rate (“LIBOR”) or by another reference rate expected to be discontinued. The amendments are effective for all entities as of March 12, 2020 through December 31, 2022. Entities may elect to apply the amendments for contract modifications as of any date from the beginning of an interim period that includes or is subsequent to March 12, 2020, or prospectively from a date within an interim period that includes or is subsequent to March 12, 2020. We are currently evaluating the impacts of the provisions of ASU 2020-04 on our consolidated financial statements.

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Revenue from Contracts with Customers (Tables)

9 Months Ended

Sep. 30, 2020

Revenue from Contract with Customer [Abstract]

Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Table Text Block]

as follows:

	2020		2021		2022		2023		2024		Total
	(In Thousands)
Compression service contracts remaining performance obligations	$	13,939	$	26,608	$	5,785	$	703	$	56	$	47,091

Summary of Changes in Contract Liabilities

The following table reflects the changes in unearned income in our consolidated balance sheets for the periods indicated:

	Nine Months Ended September 30,
	2020		2019
	(In Thousands)
Unearned Income, beginning of period	$	9,678	$	25,333
Additional unearned income	38,979		106,744
Revenue recognized	(41,624)		(105,486)
Unearned income, end of period	$	7,033	$	26,591

Disaggregation of Revenue [Table Text Block]

In addition, we disaggregate revenue from contracts with customers by geography based on the following table below.

	Three months ended September 30,		Nine months ended September 30,
	2020	2019	2020		2019
	(In Thousands)
Completion Fluids & Products
U.S.	15,013	31,480	$	85,073	$	100,622
International	36,937	27,860	113,460		100,066
	51,950	59,340	198,533		200,688
Water & Flowback Services
U.S.	19,767	68,052	97,016		209,663
International	1,767	4,789	6,708		14,980
	21,534	72,841	103,724		224,643
Compression
U.S.	71,478	105,153	240,661		324,792
International	7,639	8,613	25,066		28,348
	79,117	113,766	265,727		353,140
Total Revenue
U.S.	106,258	204,685	422,750		635,077
International	46,343	41,262	145,234		143,394
	152,601	245,947	$	567,984	$	778,471

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Inventories (Tables)

9 Months Ended

Sep. 30, 2020

Inventory Disclosure [Abstract]

Schedule of Inventory, Current [Table Text Block]

Components of inventories as of September 30, 2020 and December 31, 2019 are as follows: 

	September 30, 2020		December 31, 2019
	(In Thousands)
Finished goods	$	70,452	$	70,135
Raw materials	3,744		4,125
Parts and supplies	32,340		47,793
Work in progress	6,484		14,457
Total inventories	$	113,020	$	136,510

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Leases (Tables)

9 Months Ended

Sep. 30, 2020

Leases [Abstract]

Lease, Cost

Components of lease expense, included in either cost of revenues or general and administrative expense based on the use of the underlying asset, are as follows (inclusive of lease expense for leases not included on our consolidated balance sheet based on our accounting policy election to exclude leases with a term of 12 months or less):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
	(In Thousands)
Operating lease expense	$	5,822	$	5,075	$	17,839	$	15,106
Short-term lease expense	3,758		9,556		17,061		30,269
Total lease expense	$	9,580	$	14,631	$	34,900	$	45,375

Supplemental cash flow information:

	Nine Months Ended September 30,
	2020		2019
	(In Thousands)
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows - operating leases	$	17,861	$	14,868
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$	24,201	$	7,631

Assets and Liabilities, Lessee

upplemental balance sheet information:

	September 30, 2020		December 31, 2019
	(In Thousands)
Operating leases:
Operating lease right-of-use assets	$	78,867	$	68,131
Accrued liabilities and other	$	16,362	$	15,850
Operating lease liabilities	64,200		53,919
Total operating lease liabilities	$	80,562	$	69,769

Additional operating lease information:

	September 30, 2020		December 31, 2019
Weighted average remaining lease term:
Operating leases	6.09 years		6.43 years
Weighted average discount rate:
Operating leases	9.33	%	9.46	%

Lessee, Operating Lease, Liability, Maturity

Future minimum lease payments by year and in the aggregate, under non-cancellable operating leases with terms in excess of one year consist of the following at September 30, 2020:

		Operating Leases
	(In Thousands)
Remainder of 2020		$	5,809
2021		22,322
2022		18,896
2023		15,803
2024		12,067
Thereafter		32,611
Total lease payments		107,508
Less imputed interest		(26,946)
Total lease liabilities		$	80,562

Finance Lease, Liability, Maturity

Future minimum lease payments by year and in the aggregate, under non-cancellable operating leases with terms in excess of one year consist of the following at September 30, 2020:

		Operating Leases
	(In Thousands)
Remainder of 2020		$	5,809
2021		22,322
2022		18,896
2023		15,803
2024		12,067
Thereafter		32,611
Total lease payments		107,508
Less imputed interest		(26,946)
Total lease liabilities		$	80,562

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Long-Term Debt and Other Borrowings Long-Term Debt and Other Borrowings (Table)

9 Months Ended

Sep. 30, 2020

Debt Disclosure [Abstract]

Long-Term Debt Table

		September 30, 2020		December 31, 2019
		(In Thousands)
TETRA	Scheduled Maturity
Asset-based credit agreement (presented net of unamortized deferred financing costs of $0 million as of September 30, 2020 and $1.0 million as of December 31, 2019)	September 10, 2023	$	—	$	—
Term credit agreement (presented net of the unamortized discount of $5.7 million as of September 30, 2020 and $6.4 million as of December 31, 2019 and net of unamortized deferred financing costs of $8.5 million as of September 30, 2020 and $9.5 million as of December 31, 2019)	September 10, 2025	206,273		204,633
TETRA total long-term debt		$	206,273	$	204,633
CCLP
CCLP asset-based credit agreement (presented net of unamortized deferred financing costs of $0 million as of September 30, 2020 and $0.9 million of December 31, 2019)	June 29, 2023	—		2,622
CCLP 7.25% Senior Notes (presented net of the unamortized discount of $0.3 million as of September 30, 2020 and $1.7 million as of December 31, 2019 and net of unamortized deferred financing costs of $0.5 million as of September 30, 2020 and $2.8 million as of December 31, 2019)	August 15, 2022	79,893		291,444
CCLP 7.50% First Lien Notes (presented net of unamortized deferred financing costs of $5.4 million as of September 30, 2020 and $5.8 million as of December 31, 2019, net of the unamortized discount of $0.2 million as of September 30, 2020, and net of deferred restructuring gain of $5.3 million as of September 30, 2020)	April 1, 2025	399,640		344,172
CCLP 10.00%/10.75% Second Lien Notes (presented net of the unamortized discount of $0.8 million as of September 30, 2020, net of unamortized deferred financing costs of $1.2 million as of September 30, 2020, and net of deferred restructuring gain of $3.9 million as of September 30, 2020)	April 1, 2026	157,410		—
CCLP total long-term debt		$	636,943	$	638,238
Consolidated total long-term debt		$	843,216	$	842,871

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Fair Value Measurements Market Risks and Derivative Hedge Contracts (Tables)

9 Months Ended

Sep. 30, 2020

Derivative [Line Items]

Schedule of Notional Amounts of Outstanding Derivative Positions Table

Derivative contracts	US Dollar Notional Amount	Traded Exchange Rate	Settlement Date
	(In Thousands)
Forward sale Mexican peso	5,464	21.87	October 1, 2020

Derivatives Designated as Hedging Instruments Table

Foreign currency derivative contracts	Balance Sheet Location	Fair Value at September 30, 2020		Fair Value at December 31, 2019
		(In Thousands)
Forward purchase contracts	Current assets	$	59	$	86
Forward sale contracts	Current liabilities	—		(53)
Forward purchase contracts	Current liabilities	—		(3)
Net asset		$	59	$	30

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Net Income (Loss) per Share (Tables)

9 Months Ended

Sep. 30, 2020

Earnings Per Share [Abstract]

Schedule of Weighted Average Number of Shares [Table Text Block]

The following is a reconciliation of the weighted average number of common shares outstanding with the number of shares used in the computations of net income (loss) per common and common equivalent share:

	Three Months Ended September 30,		Nine Months Ended September 30,
	2020	2019	2020	2019
	(In Thousands)
Number of weighted average common shares outstanding	125,893	125,568	125,789	125,620
Assumed exercise of equity awards and warrants	—	—	—	—
Average diluted shares outstanding	125,893	125,568	125,789	125,620

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Industry Segments (Tables)

9 Months Ended

Sep. 30, 2020

Segment Reporting [Abstract]

Segment Reporting Table

	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
	(In Thousands)
Revenues from external customers
Product sales
Completion Fluids & Products Division	$	49,986	$	55,444	$	187,419	$	185,578
Water & Flowback Services Division	23		100		56		831
Compression Division	18,801		37,833		64,541		134,099
Consolidated	$	68,810	$	93,377	$	252,016	$	320,508
Services
Completion Fluids & Products Division	$	1,964	$	3,896	$	11,114	$	15,110
Water & Flowback Services Division	21,511		72,741		103,668		223,812
Compression Division	60,316		75,933		201,186		219,041
Consolidated	$	83,791	$	152,570	$	315,968	$	457,963
Total revenues
Completion Fluids & Products Division	$	51,950	$	59,340	$	198,533	$	200,688
Water & Flowback Services Division	21,534		72,841		103,724		224,643
Compression Division	79,117		113,766		265,727		353,140
Interdivision eliminations	—		—		—		—
Consolidated	$	152,601	$	245,947	$	567,984	$	778,471
Income (loss) before taxes
Completion Fluids & Products Division	$	11,756	$	11,318	$	44,354	$	32,118
Water & Flowback Services Division	(7,746)		2,578		(18,408)		7,269
Compression Division	(11,321)		(3,464)		(47,117)		(14,748)
Interdivision eliminations	3		(1)		10		6
Corporate Overhead(1)	(13,472)		(17,931)		(43,825)		(54,921)
Consolidated	$	(20,780)	$	(7,500)	$	(64,986)	$	(30,276)

(1)Amounts reflected include the following general corporate expenses:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
	(In Thousands)
General and administrative expense	$	8,959	$	12,573	$	28,650	$	39,012
Depreciation and amortization	270		167		643		507
Interest expense	4,706		5,495		14,909		16,533
Warrants fair value adjustment (income) expense	—		78		(327)		(1,035)
Other general corporate income, net	(463)		(382)		(50)		(96)
Total	$	13,472	$	17,931	$	43,825	$	54,921

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Organization, Basis of Presentation, and Significant Accounting Policies - Additional Information (Details) shares in Millions, $ in Millions	3 Months Ended		9 Months Ended
	Sep. 30, 2020 USD ($) shares	Sep. 30, 2019 USD ($)	Sep. 30, 2020 USD ($) shares	Sep. 30, 2019 USD ($)
Accounting Policies [Abstract]
Number of Operating Segments			3
Foreign Currency Transaction Gain (Loss), Realized | $	$ (0.8)	$ (1.7)	$ (3.2)	$ (2.2)
Class of Warrant or Right, Outstanding | shares	11.2		11.2

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Organization, Basis of Presentation, and Significant Accounting Policies (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Accounting Policies [Abstract]
Operating lease right-of-use assets	$ 78,867	$ 68,131
Accrued liabilities and other	16,362	15,850
Operating lease liabilities	$ 64,200	$ 53,919

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Revenue from Contracts with Customers Services (Details) $ in Millions	Sep. 30, 2020 USD ($)
Revenue from Contract with Customer [Abstract]
Remaining credits expected to be issued	$ 1.1

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Revenue from Contracts with Customers Revenue Performance Obligation (Details) $ in Thousands	Sep. 30, 2020 USD ($)
Revenue from Contract with Customer [Abstract]
Revenue, Remaining Performance Obligation, Amount	$ 47,091
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-10-01
Revenue from Contract with Customer [Abstract]
Revenue, Remaining Performance Obligation, Amount	$ 13,939
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	3 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-01-01
Revenue from Contract with Customer [Abstract]
Revenue, Remaining Performance Obligation, Amount	$ 26,608
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-01-01
Revenue from Contract with Customer [Abstract]
Revenue, Remaining Performance Obligation, Amount	$ 5,785
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01
Revenue from Contract with Customer [Abstract]
Revenue, Remaining Performance Obligation, Amount	$ 703
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-01-01
Revenue from Contract with Customer [Abstract]
Revenue, Remaining Performance Obligation, Amount	$ 56
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Period	1 year

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Revenue from Contracts with Customers Disaggregation of Revenue (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Disaggregation of Revenue [Line Items]
Revenues	$ 152,601	$ 245,947	$ 567,984	$ 778,471
Remaining credits expected to be issued	1,100		1,100
UNITED STATES
Disaggregation of Revenue [Line Items]
Revenues	106,258	204,685	422,750	635,077
Non-US [Member]
Disaggregation of Revenue [Line Items]
Revenues	46,343	41,262	145,234	143,394
Completion Fluids & Products Division [Member]
Disaggregation of Revenue [Line Items]
Revenues	51,950	59,340	198,533	200,688
Completion Fluids & Products Division [Member] | UNITED STATES
Disaggregation of Revenue [Line Items]
Revenues	15,013	31,480	85,073	100,622
Completion Fluids & Products Division [Member] | Non-US [Member]
Disaggregation of Revenue [Line Items]
Revenues	36,937	27,860	113,460	100,066
Water & Flowback Services [Member]
Disaggregation of Revenue [Line Items]
Revenues	21,534	72,841	103,724	224,643
Water & Flowback Services [Member] | UNITED STATES
Disaggregation of Revenue [Line Items]
Revenues	19,767	68,052	97,016	209,663
Water & Flowback Services [Member] | Non-US [Member]
Disaggregation of Revenue [Line Items]
Revenues	1,767	4,789	6,708	14,980
Compression Division [Member]
Disaggregation of Revenue [Line Items]
Revenues	79,117	113,766	265,727	353,140
Compression Division [Member] | UNITED STATES
Disaggregation of Revenue [Line Items]
Revenues	71,478	105,153	240,661	324,792
Compression Division [Member] | Non-US [Member]
Disaggregation of Revenue [Line Items]
Revenues	7,639	8,613	25,066	28,348
Interdivision Eliminations [Member]
Disaggregation of Revenue [Line Items]
Revenues	$ 0	$ 0	$ 0	$ 0

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Revenue from Contracts with Customers Contract Assets and Liabilities (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Dec. 31, 2019	Dec. 31, 2018
Revenue from Contract with Customer [Abstract]
Contract with customer, asset balances	$ 17,200		$ 34,900
Unearned income	9,400	$ 22,200
Deferred Revenue	7,033	26,591	$ 9,678	$ 25,333
Deferred Revenue, Additions	38,979	106,744
Contract with Customer, Liability, Revenue Recognized	$ (41,624)	$ (105,486)

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Impairments and Other Charges (Details) - USD ($) $ in Thousands	3 Months Ended			9 Months Ended
	Sep. 30, 2020	Jun. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Acquired Indefinite-lived Intangible Assets [Line Items]
Impairment and other charges	$ 97	$ 5,400	$ 849	$ 14,445	$ 3,306
Compression Division [Member]
Acquired Indefinite-lived Intangible Assets [Line Items]
Impairment and other charges	$ 9,000

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Inventories (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Inventory Disclosure [Abstract]
Inventory, Finished Goods, Gross	$ 70,452	$ 70,135
Inventory, Raw Materials, Gross	3,744	4,125
Other Inventory, Supplies, Gross	32,340	47,793
Inventory, Work in Process, Gross	6,484	14,457
Inventories	$ 113,020	$ 136,510

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Leases - Narrative (Details) $ in Millions	3 Months Ended	9 Months Ended
	Sep. 30, 2020 USD ($)	Sep. 30, 2020 USD ($)
Lessee, Lease, Description [Line Items]
Operating lease, initial lease term	15 years	15 years
Lessee, operating lease, liability, payments, net of sublease income, due	$ 5.0	$ 5.0
Sublease Income	$ 0.3	$ 0.9
Minimum
Lessee, Lease, Description [Line Items]
Operating lease, remaining lease term		1 year
Operating lease, termination option period		30 days
Maximum
Lessee, Lease, Description [Line Items]
Operating lease, remaining lease term		16 years
Operating lease, termination option period		6 months

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Leases - Components of Lease Expense (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Leases [Abstract]
Operating lease expense	$ 5,822	$ 5,075	$ 17,839	$ 15,106
Short-term lease expense	3,758	9,556	17,061	30,269
Total lease expense	$ 9,580	$ 14,631	$ 34,900	$ 45,375

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Leases - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows - operating leases	$ 17,861	$ 14,868
Right-of-use assets obtained in exchange for lease obligations:
Operating leases	$ 24,201	$ 7,631

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Leases - Supplemental Balance Sheet Information (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Operating leases:
Operating lease right-of-use assets	$ 78,867	$ 68,131
Accrued liabilities and other	16,362	15,850
Operating lease liabilities	64,200	53,919
Total operating lease liabilities	$ 80,562	$ 69,769

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Leases - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended	9 Months Ended
	Sep. 30, 2020	Sep. 30, 2020	Dec. 31, 2019
Leases [Abstract]
Sublease Income	$ 0.3	$ 0.9
Weighted average remaining lease term:
Operating leases	6 years 1 month 2 days	6 years 1 month 2 days	6 years 5 months 4 days
Weighted average discount rate:
Operating leases	9.33%	9.33%	9.46%

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Leases - Future Minimum Lease Payments (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Operating Leases
Remainder of 2020	$ 5,809
2021	22,322
2022	18,896
2023	15,803
2024	12,067
Thereafter	32,611
Total lease payments	107,508
Less imputed interest	(26,946)
Total lease liabilities	$ 80,562	$ 69,769

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Long-Term Debt and Other Borrowings Schedule of Long Term Debt (Details) - USD ($) $ in Thousands	Sep. 30, 2020	Dec. 31, 2019
Debt Instrument [Line Items]
Long-term Debt, Excluding Current Maturities	$ 843,216	$ 842,871
Credit Agreement [Member]
Debt Instrument [Line Items]
Long-term Debt	0	2,622
Unamortized deferred finance costs	0	900
Compressco Partners Senior Notes [Member]
Debt Instrument [Line Items]
Long-term Debt	79,893	291,444
Compressco Partners Senior Notes 7.50% [Member]
Debt Instrument [Line Items]
Long-term Debt	399,640	344,172
Compressco Partners Second Lien Notes 10.00%/10.75% [Member]
Debt Instrument [Line Items]
Long-term Debt	157,410	0
Parent Company [Member]
Debt Instrument [Line Items]
Long-term Debt, Excluding Current Maturities	206,273	204,633
Unamortized deferred finance costs	1,100
CSI Compressco [Member]
Debt Instrument [Line Items]
Long-term Debt	$ 636,943	638,238
CSI Compressco [Member] | Compressco Partners Senior Notes [Member]
Debt Instrument [Line Items]
Interest rate, stated percentage	7.25%
Unamortized deferred finance costs	$ 500	2,800
Debt Instrument, Unamortized Discount (Premium), Net	$ 300	1,700
CSI Compressco [Member] | Compressco Partners Senior Notes 7.50% [Member]
Debt Instrument [Line Items]
Interest rate, stated percentage	7.50%
Unamortized deferred finance costs	$ 5,400	5,800
Debt Instrument, Unamortized Gain	5,300
CSI Compressco [Member] | Compressco Partners Second Lien Notes 10.00%/10.75% [Member]
Debt Instrument [Line Items]
Unamortized deferred finance costs	1,200
Debt Instrument, Unamortized Discount (Premium), Net	800
Debt Instrument, Unamortized Gain	3,900
Revolving Credit Facility [Member] | Secured Debt [Member]
Debt Instrument [Line Items]
Long-term Debt	0	0
Unamortized deferred finance costs	0	1,000
Term Loan [Member] | Secured Debt [Member]
Debt Instrument [Line Items]
Long-term Debt	206,273	204,633
Unamortized deferred finance costs	8,500	9,500
Debt Instrument, Unamortized Discount (Premium), Net	$ 5,700	$ 6,400

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Long-Term Debt and Other Borrowings (Details) - USD ($)			3 Months Ended
	Jun. 12, 2020	Jun. 11, 2020	Sep. 30, 2020	Jun. 10, 2020	Dec. 31, 2019	Mar. 22, 2018
Debt Instrument [Line Items]
Bank line of credit, net availability			$ 14,500,000
Parent Company [Member]
Debt Instrument [Line Items]
Unamortized deferred finance costs			1,100,000
Line of Credit [Member] | Parent Company [Member]
Debt Instrument [Line Items]
Value of amount outstanding			0
Bank line of credit, letters of credit and guarantees			6,400,000
Bank line of credit, net availability			25,800,000
Credit Agreement [Member]
Debt Instrument [Line Items]
Value of amount outstanding			0
Bank line of credit, letters of credit and guarantees			2,500,000
Unamortized deferred finance costs			0		$ 900,000
Credit Agreement [Member] | Other Assets [Member]
Debt Instrument [Line Items]
Unamortized deferred finance costs			700,000
Compressco Partners Senior Notes [Member] | CSI Compressco [Member]
Debt Instrument [Line Items]
Unamortized deferred finance costs			$ 500,000		2,800,000
Interest rate, stated percentage			7.25%
Compressco Partners Senior Notes 7.50% [Member] | CSI Compressco [Member]
Debt Instrument [Line Items]
Unamortized deferred finance costs			$ 5,400,000		5,800,000
Interest rate, stated percentage			7.50%
Compressco Partners Second Lien Notes 10.00%/10.75% [Member] | CSI Compressco [Member]
Debt Instrument [Line Items]
Unamortized deferred finance costs			$ 1,200,000
Revolving Credit Facility [Member] | Secured Debt [Member]
Debt Instrument [Line Items]
Unamortized deferred finance costs			0		1,000,000.0
Term Loan [Member] | Secured Debt [Member]
Debt Instrument [Line Items]
Unamortized deferred finance costs			8,500,000		$ 9,500,000
Second Amendment to Loan and Security Agreement [Member] | Credit Agreement [Member] | CSI Compressco [Member]
Debt Instrument [Line Items]
Unamortized deferred finance costs			200,000
Maximum borrowing capacity		$ 35,000,000		$ 50,000,000
Reserve amount		$ 5,000,000
Commitment fee percentage		0.50%
Debt related commitment fees issuance costs			200,000
First Supplemental Indenture for the Old Notes [Member] | Compressco Partners Senior Notes [Member] | CSI Compressco [Member]
Debt Instrument [Line Items]
Debt related commitment fees issuance costs			$ 4,600,000
Amount outstanding		$ 215,208,000
Percentage of debt exchanged		72.70%
Interest rate, stated percentage			7.25%
First Supplemental Indenture for the Old Notes [Member] | Compressco Partners Senior Notes 7.50% [Member] | CSI Compressco [Member]
Debt Instrument [Line Items]
Interest rate, stated percentage			7.50%
Long-term debt, gross	$ 50,000,000	$ 50,000,000
First Supplemental Indenture for the Old Notes [Member] | Compressco Partners Second Lien Notes 10.00%/10.75% [Member] | CSI Compressco [Member]
Debt Instrument [Line Items]
Long-term debt, gross		155,529,000
First Supplemental Indenture for the Old Notes [Member] | Senior Secured First Lien Notes Due 2025 [Member] | CSI Compressco [Member]
Debt Instrument [Line Items]
Long-term debt, gross						$ 350,000,000
Second Lien Notes Indenture [Member] | Compressco Partners Second Lien Notes 10.00%/10.75% [Member] | CSI Compressco [Member]
Debt Instrument [Line Items]
Long-term debt, gross		$ 155,529,000
Debt issued denomination amount			$ 2,000
Minimum | First Supplemental Indenture for the Old Notes [Member] | Compressco Partners Second Lien Notes 10.00%/10.75% [Member] | CSI Compressco [Member]
Debt Instrument [Line Items]
Interest rate, stated percentage			10.00%
Minimum | Second Lien Notes Indenture [Member] | Compressco Partners Second Lien Notes 10.00%/10.75% [Member] | CSI Compressco [Member]
Debt Instrument [Line Items]
Debt issued denomination integral multiples amount			$ 1,000
Minimum | London Interbank Offered Rate (LIBOR) [Member] | Second Amendment to Loan and Security Agreement [Member] | Credit Agreement [Member] | CSI Compressco [Member]
Debt Instrument [Line Items]
Basis spread on variable rate (percentage)		3.00%
Minimum | Base Rate [Member] | Second Amendment to Loan and Security Agreement [Member] | Credit Agreement [Member] | CSI Compressco [Member]
Debt Instrument [Line Items]
Basis spread on variable rate (percentage)		2.00%
Maximum | First Supplemental Indenture for the Old Notes [Member] | Compressco Partners Second Lien Notes 10.00%/10.75% [Member] | CSI Compressco [Member]
Debt Instrument [Line Items]
Interest rate, stated percentage			10.75%
Maximum | Second Lien Notes Indenture [Member] | Compressco Partners Second Lien Notes 10.00%/10.75% [Member] | CSI Compressco [Member]
Debt Instrument [Line Items]
Debt issued denomination integral multiples amount			$ 2,000
Maximum | London Interbank Offered Rate (LIBOR) [Member] | Second Amendment to Loan and Security Agreement [Member] | Credit Agreement [Member] | CSI Compressco [Member]
Debt Instrument [Line Items]
Basis spread on variable rate (percentage)		3.50%
Maximum | Base Rate [Member] | Second Amendment to Loan and Security Agreement [Member] | Credit Agreement [Member] | CSI Compressco [Member]
Debt Instrument [Line Items]
Basis spread on variable rate (percentage)		2.50%
PIK Payments [Member] | Second Lien Notes Indenture [Member] | Compressco Partners Second Lien Notes 10.00%/10.75% [Member] | CSI Compressco [Member]
Debt Instrument [Line Items]
Debt issued denomination amount			1.00
Debt issued denomination integral multiples amount			$ 1.00
Rate 1 [Member] | Second Lien Notes Indenture [Member] | Compressco Partners Second Lien Notes 10.00%/10.75% [Member] | CSI Compressco [Member]
Debt Instrument [Line Items]
Interest rate, stated percentage			7.25%
Rate 2 [Member] | Second Lien Notes Indenture [Member] | Compressco Partners Second Lien Notes 10.00%/10.75% [Member] | CSI Compressco [Member]
Debt Instrument [Line Items]
Interest rate, stated percentage			2.75%
Rate 3 [Member] | Second Lien Notes Indenture [Member] | Compressco Partners Second Lien Notes 10.00%/10.75% [Member] | CSI Compressco [Member]
Debt Instrument [Line Items]
Interest rate, stated percentage			3.50%
Debt Instrument, Redemption, Period One [Member] | Second Lien Notes Indenture [Member] | Compressco Partners Second Lien Notes 10.00%/10.75% [Member] | CSI Compressco [Member]
Debt Instrument [Line Items]
Redemption price, percentage	110.00%
Debt Instrument, Redemption, Period Two [Member] | Second Lien Notes Indenture [Member] | Compressco Partners Second Lien Notes 10.00%/10.75% [Member] | CSI Compressco [Member]
Debt Instrument [Line Items]
Redemption price, percentage	107.50%
Debt Instrument, Redemption, Period Three [Member] | Second Lien Notes Indenture [Member] | Compressco Partners Second Lien Notes 10.00%/10.75% [Member] | CSI Compressco [Member]
Debt Instrument [Line Items]
Redemption price, percentage	105.00%
Debt Instrument, Redemption, Period Four [Member] | Second Lien Notes Indenture [Member] | Compressco Partners Second Lien Notes 10.00%/10.75% [Member] | CSI Compressco [Member]
Debt Instrument [Line Items]
Redemption price, percentage	100.00%

XML

Discontinued Operations (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019	Dec. 31, 2019
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Disposal Group Including Discontinued Operation Revenue	$ 0	$ 0	$ 0	$ 0
Disposal Group, Including Discontinued Operation, Cost of Revenue	2	(273)	(332)	(251)
Disposal Group, Including Discontinued Operation, Depreciation and Amortization	0	52	0	52
Disposal Group, Including Discontinued Operation, General and Administrative Expense	171	1,734	487	2,483
Disposal Group, Including Discontinued Operation, Other Expense	0	117	0	117
Discontinued Operation, Income (Loss) from Discontinued Operation During Phase-out Period, before Income Tax	(173)	(1,630)	(155)	(2,401)
Discontinued Operation, Gain (Loss) from Disposal of Discontinued Operation, before Income Tax	0	(7,500)	0	(7,500)
Discontinued Operation, Income (Loss) from Discontinued Operation, before Income Tax	(173)	(9,130)	(155)	(9,901)
Discontinued Operation, Tax Effect of Discontinued Operation	0	0	0	0
Income (Loss) from Discontinued Operations, Net of Tax, Including Portion Attributable to Noncontrolling Interest	(173)	(9,130)	(155)	(9,901)
Disposal Group, Including Discontinued Operation, Accounts, Notes and Loans Receivable, Net	0		0		$ 0
Disposal Group, Including Discontinued Operation, Other Assets, Current	0		0		0
Disposal Group, Including Discontinued Operation, Assets, Current	0		0		0
Disposal Group, Including Discontinued Operation, Accounts Payable, Current	1,223		1,223		1,233
Disposal Group, Including Discontinued Operation, Accrued Liabilities, Current	629		629		865
Disposal Group, Including Discontinued Operation, Liabilities, Current	1,852		1,852		2,098
Maritech [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Disposal Group Including Discontinued Operation Revenue	0	0	0	0
Disposal Group, Including Discontinued Operation, Cost of Revenue	0	0	0	0
Disposal Group, Including Discontinued Operation, Depreciation and Amortization	0	0	0	0
Disposal Group, Including Discontinued Operation, General and Administrative Expense	0	0	0	0
Disposal Group, Including Discontinued Operation, Other Expense	0	0	0	0
Discontinued Operation, Income (Loss) from Discontinued Operation During Phase-out Period, before Income Tax	0	0	0	0
Disposal Group, Including Discontinued Operation, Accounts, Notes and Loans Receivable, Net	0		0		0
Disposal Group, Including Discontinued Operation, Other Assets, Current	0		0		0
Disposal Group, Including Discontinued Operation, Assets, Current	0		0		0
Disposal Group, Including Discontinued Operation, Accounts Payable, Current	0		0		0
Disposal Group, Including Discontinued Operation, Accrued Liabilities, Current	228		228		120
Disposal Group, Including Discontinued Operation, Liabilities, Current	228		228		120
Offshore Services [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Disposal Group Including Discontinued Operation Revenue	0	0	0	0
Disposal Group, Including Discontinued Operation, Cost of Revenue	2	(273)	(332)	(251)
Disposal Group, Including Discontinued Operation, Depreciation and Amortization	0	52	0	52
Disposal Group, Including Discontinued Operation, General and Administrative Expense	171	1,734	487	2,483
Disposal Group, Including Discontinued Operation, Other Expense	0	117	0	117
Discontinued Operation, Income (Loss) from Discontinued Operation During Phase-out Period, before Income Tax	(173)	$ (1,630)	(155)	$ (2,401)
Disposal Group, Including Discontinued Operation, Accounts, Notes and Loans Receivable, Net	0		0		0
Disposal Group, Including Discontinued Operation, Other Assets, Current	0		0		0
Disposal Group, Including Discontinued Operation, Assets, Current	0		0		0
Disposal Group, Including Discontinued Operation, Accounts Payable, Current	1,223		1,223		1,233
Disposal Group, Including Discontinued Operation, Accrued Liabilities, Current	401		401		745
Disposal Group, Including Discontinued Operation, Liabilities, Current	$ 1,624		$ 1,624		$ 1,978

XML

Commitments and Contingencies Commitment and Contingencies (Details) - USD ($)	Jan. 15, 2020	Sep. 30, 2020	Aug. 31, 2019	Mar. 01, 2018
Long-term Purchase Commitment [Line Items]
Discontinued operation, amounts of material contingent liabilities remaining, performance bonds		$ 46,800,000
Damages Awarded	$ 7,887,454
Post-judgement interest	3.52%
The Clarkes [Member]
Long-term Purchase Commitment [Line Items]
Damages sought	$ 1,000,000
Within 90 Days Following Bonding Agreement Closing [Member]
Long-term Purchase Commitment [Line Items]
Discontinued operation, amounts of material contingent liabilities remaining, performance bonds		47,000,000.0
Within 180 Days Following Bonding Agreement Closing [Member]
Long-term Purchase Commitment [Line Items]
Discontinued operation, amounts of material contingent liabilities remaining, performance bonds		$ 47,000,000.0
Offshore Division | Discontinued Operations, Disposed of by Sale
Long-term Purchase Commitment [Line Items]
Disposal Group, Including Discontinued Operation, Consideration, Additional Receivable				$ 7,500,000
Disposal group, including discontinued operation, consideration, promissory note receivable, interest rate				1.52%
Disposal Group, Including Discontinued Operation, Reserve, Other Receivables			$ 1,500,000

XML

Fair Value Measurements Additional Information (Details) - USD ($)	9 Months Ended
	Sep. 30, 2020	Dec. 31, 2019
Compressco Partners Senior Notes 7.50% [Member]
Business Acquisition [Line Items]
Fair value of Senior Notes	$ 360,000,000.0	$ 344,800,000
Debt instrument, face amount	400,000,000.0	$ 350,000,000.0
Compressco Partners Second Lien Notes 10.00%/10.75% [Member]
Business Acquisition [Line Items]
Debt instrument, face amount	155,500,000
Debt instrument, fair value	115,500,000
Compression Division [Member]
Business Acquisition [Line Items]
Impairment charges	$ 9,000,000.0

XML

Market Risks and Derivative Hedge Contracts (Details)	3 Months Ended		9 Months Ended
	Sep. 30, 2020 USD ($)	Sep. 30, 2019 USD ($)	Sep. 30, 2020 USD ($)	Sep. 30, 2019 USD ($)	Dec. 31, 2019 USD ($)
Derivatives, Fair Value [Line Items]
Forward purchase contracts	$ 59,000		$ 59,000		$ 30,000
Net gains associated with foreign currency derivatives	200,000	$ 1,000,000.0	(700,000)	$ 1,800,000
Compressco Partners Senior Notes [Member]
Derivatives, Fair Value [Line Items]
Fair value of Senior Notes	59,700,000		59,700,000		266,000,000.0
Carrying value of Senior Notes	$ 80,700,000		$ 80,700,000		295,900,000
Compressco Partners Senior Notes 7.50% [Member]
Derivatives, Fair Value [Line Items]
Long-term Debt, Percentage Bearing Fixed Interest, Percentage Rate	7.50%		7.50%
Fair value of Senior Notes	$ 360,000,000.0		$ 360,000,000.0		344,800,000
Debt instrument, face amount	400,000,000.0		400,000,000.0		350,000,000.0
Fair Value, Recurring [Member]
Derivatives, Fair Value [Line Items]
Financial and Nonfinancial Liabilities, Fair Value Disclosure	(64,000)		(64,000)		(419,000)
Foreign Currency Contract, Asset, Fair Value Disclosure	59,000		59,000		86,000
Foreign Currency Contracts, Liability, Fair Value Disclosure					56,000
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 1 [Member]
Derivatives, Fair Value [Line Items]
Foreign Currency Contract, Asset, Fair Value Disclosure	0		0		0
Foreign Currency Contracts, Liability, Fair Value Disclosure					0
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member]
Derivatives, Fair Value [Line Items]
Foreign Currency Contract, Asset, Fair Value Disclosure	59,000		59,000		86,000
Foreign Currency Contracts, Liability, Fair Value Disclosure					56,000
Fair Value, Recurring [Member] | Fair Value, Inputs, Level 3 [Member]
Derivatives, Fair Value [Line Items]
Foreign Currency Contract, Asset, Fair Value Disclosure	0		0		0
Foreign Currency Contracts, Liability, Fair Value Disclosure					0
Current Assets [Member]
Derivatives, Fair Value [Line Items]
Forward purchase contracts	59,000		59,000		86,000
Current Liabilities [Member]
Derivatives, Fair Value [Line Items]
Derivative Liability, Fair Value, Gross Liability	0		0		53,000
Forward sale contracts	0		0		(3,000)
Warrants liability | Fair Value, Recurring [Member]
Derivatives, Fair Value [Line Items]
Financial and Nonfinancial Liabilities, Fair Value Disclosure	(123,000)		(123,000)		(449,000)
Warrants liability | Fair Value, Recurring [Member] | Fair Value, Inputs, Level 1 [Member]
Derivatives, Fair Value [Line Items]
Financial and Nonfinancial Liabilities, Fair Value Disclosure	0		0		0
Warrants liability | Fair Value, Recurring [Member] | Fair Value, Inputs, Level 2 [Member]
Derivatives, Fair Value [Line Items]
Financial and Nonfinancial Liabilities, Fair Value Disclosure	0		0		0
Warrants liability | Fair Value, Recurring [Member] | Fair Value, Inputs, Level 3 [Member]
Derivatives, Fair Value [Line Items]
Financial and Nonfinancial Liabilities, Fair Value Disclosure	(123,000)		(123,000)		$ (449,000)
Forward Sale Contract, Mexican Pesos (2) [Member]
Derivative [Line Items]
Derivative notional amount	$ 5,464,000		$ 5,464,000
Traded exchange rate	21.87		21.87
Value date			Oct. 01, 2020

XML

Net Income (Loss) per Share (Details) - shares shares in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Earnings Per Share [Abstract]
Weighted Average Number of Shares Outstanding, Basic	125,893	125,568	125,789	125,620
Weighted Average Number Diluted Shares Outstanding Adjustment	0	0	0	0
Weighted Average Number of Shares Outstanding, Diluted	125,893	125,568	125,789	125,620

XML

Industry Segments - Revenue, Income from Operations, and Assets by Reporting Segment (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Industry Segments Details [Line Items]
Revenues	$ 152,601	$ 245,947	$ 567,984	$ 778,471
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest	(20,780)	(7,500)	(64,986)	(30,276)
Completion Fluids & Products Division [Member]
Industry Segments Details [Line Items]
Revenues	51,950	59,340	198,533	200,688
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest	11,756	11,318	44,354	32,118
Water & Flowback Services [Member]
Industry Segments Details [Line Items]
Revenues	21,534	72,841	103,724	224,643
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest	(7,746)	2,578	(18,408)	7,269
Compression Division [Member]
Industry Segments Details [Line Items]
Revenues	79,117	113,766	265,727	353,140
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest	(11,321)	(3,464)	(47,117)	(14,748)
Interdivision Eliminations [Member]
Industry Segments Details [Line Items]
Revenues	0	0	0	0
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest	3	(1)	10	6
Corporate Overhead [Member]
Industry Segments Details [Line Items]
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest	(13,472)	(17,931)	(43,825)	(54,921)
Product sales
Industry Segments Details [Line Items]
Revenues	68,810	93,377	252,016	320,508
Product sales | Completion Fluids & Products Division [Member]
Industry Segments Details [Line Items]
Revenues	49,986	55,444	187,419	185,578
Product sales | Water & Flowback Services [Member]
Industry Segments Details [Line Items]
Revenues	23	100	56	831
Product sales | Compression Division [Member]
Industry Segments Details [Line Items]
Revenues	18,801	37,833	64,541	134,099
Services
Industry Segments Details [Line Items]
Revenues	83,791	152,570	315,968	457,963
Services | Completion Fluids & Products Division [Member]
Industry Segments Details [Line Items]
Revenues	1,964	3,896	11,114	15,110
Services | Water & Flowback Services [Member]
Industry Segments Details [Line Items]
Revenues	21,511	72,741	103,668	223,812
Services | Compression Division [Member]
Industry Segments Details [Line Items]
Revenues	$ 60,316	$ 75,933	$ 201,186	$ 219,041

XML

Industry Segments - Corporate Expenses (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019
Segment Reporting Information [Line Items]
General and administrative expense	$ 25,256	$ 34,926	$ 89,807	$ 105,498
Depreciation, amortization, and accretion	29,604	30,867	88,906	93,312
Interest expense, net	17,631	18,146	53,073	55,054
Warrants fair value adjustment			(326)	(1,035)
Other (income) expense, net	(2,137)	(690)	2,141	(1,014)
Income (Loss) from Continuing Operations, Net of Tax, Including Portion Attributable to Noncontrolling Interest	21,425	9,079	68,786	35,954
Corporate Overhead [Member]
Segment Reporting Information [Line Items]
General and administrative expense	8,959	12,573	28,650	39,012
Depreciation, amortization, and accretion	270	167	643	507
Interest expense, net	4,706	5,495	14,909	16,533
Warrants fair value adjustment	0	78	(327)	(1,035)
Other (income) expense, net	(463)	(382)	(50)	(96)
Income (Loss) from Continuing Operations, Net of Tax, Including Portion Attributable to Noncontrolling Interest	$ 13,472	$ 17,931	$ 43,825	$ 54,921

XML

Industry Segments Additional Details (Details) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2020 USD ($)	Sep. 30, 2019 USD ($)	Sep. 30, 2020 USD ($)	Sep. 30, 2019 USD ($)
Industry Segments Details [Line Items]
Number of Reportable Segments			3
Revenues	$ 152,601	$ 245,947	$ 567,984	$ 778,471
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest	(20,780)	(7,500)	(64,986)	(30,276)
General and administrative expense	25,256	34,926	89,807	105,498
Depreciation, amortization, and accretion	29,604	30,867	88,906	93,312
Interest expense, net	17,631	18,146	53,073	55,054
Warrants fair value adjustment			(326)	(1,035)
Other Nonoperating Income (Expense)	2,137	690	(2,141)	1,014
Income (Loss) from Continuing Operations, Net of Tax, Including Portion Attributable to Noncontrolling Interest	(21,425)	(9,079)	(68,786)	(35,954)
Completion Fluids & Products Division [Member]
Industry Segments Details [Line Items]
Revenues	51,950	59,340	198,533	200,688
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest	11,756	11,318	44,354	32,118
Water & Flowback Services [Member]
Industry Segments Details [Line Items]
Revenues	21,534	72,841	103,724	224,643
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest	(7,746)	2,578	(18,408)	7,269
Compression Division [Member]
Industry Segments Details [Line Items]
Revenues	79,117	113,766	265,727	353,140
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest	(11,321)	(3,464)	(47,117)	(14,748)
Interdivision Eliminations [Member]
Industry Segments Details [Line Items]
Revenues	0	0	0	0
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest	3	(1)	10	6
Corporate Overhead [Member]
Industry Segments Details [Line Items]
Income (Loss) from Continuing Operations before Income Taxes, Noncontrolling Interest	(13,472)	(17,931)	(43,825)	(54,921)
General and administrative expense	8,959	12,573	28,650	39,012
Depreciation, amortization, and accretion	270	167	643	507
Interest expense, net	4,706	5,495	14,909	16,533
Warrants fair value adjustment	0	78	(327)	(1,035)
Other Nonoperating Income (Expense)	463	382	50	96
Income (Loss) from Continuing Operations, Net of Tax, Including Portion Attributable to Noncontrolling Interest	(13,472)	(17,931)	(43,825)	(54,921)
Product sales
Industry Segments Details [Line Items]
Revenues	68,810	93,377	252,016	320,508
Product sales | Completion Fluids & Products Division [Member]
Industry Segments Details [Line Items]
Revenues	49,986	55,444	187,419	185,578
Product sales | Water & Flowback Services [Member]
Industry Segments Details [Line Items]
Revenues	23	100	56	831
Product sales | Compression Division [Member]
Industry Segments Details [Line Items]
Revenues	18,801	37,833	64,541	134,099
Services
Industry Segments Details [Line Items]
Revenues	83,791	152,570	315,968	457,963
Services | Completion Fluids & Products Division [Member]
Industry Segments Details [Line Items]
Revenues	1,964	3,896	11,114	15,110
Services | Water & Flowback Services [Member]
Industry Segments Details [Line Items]
Revenues	21,511	72,741	103,668	223,812
Services | Compression Division [Member]
Industry Segments Details [Line Items]
Revenues	$ 60,316	$ 75,933	$ 201,186	$ 219,041

XML

Subsequent Events (Details) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended		9 Months Ended
	Oct. 31, 2020	Sep. 30, 2020	Sep. 30, 2019	Sep. 30, 2020	Sep. 30, 2019	Jul. 31, 2020
Subsequent Event [Line Items]
Purchase order						$ 6,700
Revenues		$ 152,601	$ 245,947	$ 567,984	$ 778,471
Horsepower Compressor Units [Member]
Subsequent Event [Line Items]
Revenues		$ 1,700
Subsequent Event [Member] | Horsepower Compressor Units [Member]
Subsequent Event [Line Items]
Revenues	$ 5,000

XML

Sale of Assets (Details) - USD ($) $ in Millions		3 Months Ended	9 Months Ended
	Jul. 02, 2020	Sep. 30, 2020	Sep. 30, 2020
58 Low-Horsepower Units [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Impairment charges			$ 3.7
Sale price of assets		$ 2.6
Midland Manufacturing Facility [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Impairment charges			3.1
Sale price of assets	$ 17.0
Gain (loss) on sale of assets		0.3	0.3
New Unit Sales Inventory [Member] | Compression Division [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Impairment charges			2.3
Gain (loss) on sale of assets		$ 0.5	$ 0.5

XML

Label	Element	Value
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents	us-gaap_CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents	$ 17,768,000
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents	us-gaap_CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents	$ 40,102,000