8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported): July 23, 2018 (July 20, 2018)

TENNECO INC.

(Exact Name of Registrant as Specified in Charter)

Delaware	1-12387	76-0515284
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)
500 NORTH FIELD DRIVE, LAKE FOREST, ILLINOIS		60045
(Address of Principal Executive Offices)		(Zip Code)

Registrant’s telephone number, including area code: (847) 482-5000

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☒ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

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

Emerging growth company  ☐

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

ITEM 5.02 DEPARTURE OF DIRECTORS OR CERTAIN OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF CERTAIN OFFICERS; COMPENSATORY ARRANGEMENTS OF CERTAIN OFFICERS.

On July 20, 2018, the Board of Directors of Tenneco Inc. (the “Company”) selected Brian J. Kesseler and Roger J. Wood, currently a member of the Board of Directors, as the chief executive officers who will lead the two new independent, publicly traded companies, which will be created in the second half of 2019 after the Company completes its acquisition of Federal-Mogul LLC (“Federal-Mogul”). The appointments are subject to consummation of the Federal-Mogul acquisition and the separation of the combined company into two independent companies. Mr. Kesseler, the Company’s current Chief Executive Officer, will become Chairman and Chief Executive Officer of the new aftermarket and ride performance company, while Mr. Wood will become Chairman and Chief Executive Officer of the powertrain technology company.

The Company also announced that, effective upon and subject to consummation of the Federal-Mogul acquisition, the Board of Directors has appointed Messrs. Kesseler and Wood to be Co-Chief Executive Officers of the Company until the separation is completed.

Mr. Wood, age 56, was named Chief Executive Officer and Chairman of Fallbrook Technologies Inc. in February 2018 and became Executive Chairman on June 29, 2018. He previously retired as President and Chief Executive Officer of Dana Holding Corporation (now known as Dana Incorporated) in 2015, having served in those positions since 2011 when he joined Dana. Prior to joining Dana Holding Corporation, Mr. Wood served as Executive Vice President and Group President for the Engine Group at BorgWarner Inc. In his 26-year career at BorgWarner, Mr. Wood served in various leadership roles with global operations responsibilities. Mr. Wood holds a bachelor’s degree in engineering technology from State University College in Buffalo, N.Y., and an M.B.A. from Syracuse University. He is a member of the board of directors of Brunswick Corporation and Fallbrook Technologies. Prior to Mr. Wood’s retirement from Dana, he served as a member of the boards for the Business Leaders of Michigan, the Ohio Business Roundtable, the board of trustees of the Manufacturer’s Alliance/MAPI and the CEO Council for the Original Equipment Suppliers Association (OESA). Mr. Wood is a fellow of the National Association of Corporate Directors.

Mr. Wood has been a director of the Company since 2016 and will continue to serve as a director, but will no longer serve as a member of the Company’s Compensation Committee.

In connection with his appointment, the Company provided Mr. Wood with a letter outlining the terms of his appointment. He will receive a base salary of $1,050,000 per year. His target bonus opportunity under the annual incentive plan for the 2018 calendar year will be 125% of his annual base salary (pro rated to his employment date). He will be eligible to participate in the Company’s long-term incentive plan in a manner consistent with other executives. The Company estimates that his 2019 award will have a value of $5.4 million. He will also receive a long-term incentive award for 2018 with an equivalent value, prorated to his employment date, granted as restricted stock units that vest over three years. He will be eligible to participate in the Company’s 401(k) plan and change in control severance plan. Under the Company’s excess benefit plan, he will receive a company contribution after certain IRS limits are met at the rate of 3 percent of compensation and he will receive a company contribution equal to 3% of the annual incentive bonus paid. Outside of the context of a change of control, if Mr. Wood’s employment is involuntarily terminated by the Company for reasons other than disability or “Cause” or if Mr. Wood terminates employment due to “Constructive Termination”, he will be entitled to severance equal to two times the sum of his annual base salary and target bonus for the year in which termination occurs, payable in a lump sum within 60 days of termination, subject to execution of a general release and such other documents as the Company may reasonably request. For these purposes “Cause” means fraud, embezzlement, or theft in connection with employment, gross negligence in the performance of duties, or conviction, guilty plea, or plea of nolo contendere with respect to a felony, and “Constructive Termination” will generally have the same meaning as under the change in control severance plan.

In connection with Mr. Kesseler’s new role, the Company provided Mr. Kesseler with an addendum to his original offer letter. The addendum entitles him to the same severance benefit as Mr. Wood where, outside of a change of control context, Mr. Kesseler’s employment is involuntarily terminated by the Company for reasons other than disability or “Cause” or if Mr. Kesseler terminates employment due to “Constructive Termination”.

A copy of the Company’s press release, dated July 23, 2018, announcing these changes is filed herewith as Exhibit 99.1 and is incorporated herein by reference.

ITEM 8.01 OTHER EVENTS.

The information set forth in Item 5.02 of this Current Report on Form 8-K is incorporated herein by reference.

Additional Information and Where to Find It

In connection with the proposed transaction between Tenneco Inc. (the “Company”) and Federal-Mogul LLC, the Company intends to file relevant materials with the U.S. Securities and Exchange Commission (the “SEC”), including a preliminary proxy statement on Schedule 14A. Following the filing of the definitive proxy statement with the SEC, the Company will mail the definitive proxy statement and a proxy card to each stockholder entitled to vote at the special meeting relating to the proposed transaction. This communication is not a substitute for the proxy statement or other document(s) that the Company may file with the SEC in connection with the proposed transaction. INVESTORS AND SECURITY HOLDERS OF THE COMPANY ARE URGED TO READ CAREFULLY THE PROXY STATEMENT (INCLUDING ANY AMENDMENTS OR SUPPLEMENTS THERETO) AND OTHER DOCUMENTS FILED WITH THE SEC WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT THE COMPANY, FEDERAL-MOGUL AND THE PROPOSED TRANSACTION. Investors and security holders may obtain free copies of the proxy statement and other relevant materials (when they become available), and any and all documents filed by the Company with the SEC, may be obtained for free at the SEC’s website at www.sec.gov. In addition, stockholders may obtain free copies of the documents filed with the SEC by the Company via the Company’s Investor Relations section of its website at investors.tenneco.com or by contacting Investor Relations by directing a request to the Company, Attention: Investor Relations, 500 North Field Drive in Lake Forest, Illinois, 60045 or by calling (847) 482-5162.

Certain Information Regarding Participants

The Company and its respective directors and executive officers may be deemed participants in the solicitation of proxies in connection with the proposed transaction. Information about the persons who may, under the rules of the SEC, be considered to be participants in the solicitation of the Company’s stockholders in connection with the proposed transaction, and any interest they have in the proposed transaction, will be set forth in the definitive proxy statement when it is filed with the SEC. Additional information regarding these individuals is set forth in the Company’s proxy statement for its 2018 Annual Meeting of Stockholders, which was filed with the SEC on April 4, 2018, and its Annual Report on Form 10-K for the fiscal year ended December 31, 2017, which was filed with the SEC on February 28, 2018. You may obtain these documents (when they become available) free of charge at the SEC’s web site at www.sec.gov and from Investor Relations at the Company.

No Offer or Solicitations

This document shall not constitute an offer to sell or the solicitation of an offer to buy any securities, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the U.S. Securities Act of 1933, as amended.

ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.

(d)    Exhibits.

Exhibit No.	Description
99.1	Press release, dated July 23, 2018

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	TENNECO INC.
Date: July 23, 2018	By:	/s/ Brandon B. Smith
		Brandon B. Smith
		Senior Vice President, General Counsel and Corporate Secretary

EX-99.1

Exhibit 99.1

TENNECO BOARD SELECTS BRIAN KESSELER, ROGER WOOD AS CEOs

OF FUTURE INDEPENDENT COMPANIES

Kesseler to Lead Aftermarket and Ride Performance Company

Wood to Lead Powertrain Technology Company

Lake Forest, Illinois, July 23, 2018 – Tenneco Inc. (NYSE: TEN) announced today that its board of directors has selected Brian J. Kesseler and Roger J. Wood as the chief executive officers of the aftermarket and ride performance company and powertrain technology company, respectively, the two new independent, publicly traded companies, which will be established in the second half of 2019.

Immediately upon closing of the Federal-Mogul acquisition, and prior to separation, Kesseler and Wood will serve as co-CEOs of Tenneco Inc., leading their respective businesses, while preparing each to become a stand-alone entity and helping facilitate a smooth spin-off. During this period, both CEOs will report to the Tenneco Board of Directors. The appointments of Kesseler and Wood are dependent on Tenneco closing the acquisition of Federal-Mogul and separation of the business through a tax-free spin-off, which were announced on April 10, 2018.

“On behalf of the Tenneco board of directors, I am pleased to announce two outstanding executives as CEOs for the future companies, both of whom played integral roles in shaping the strategy for this transaction,” said Gregg Sherrill, Chairman, Tenneco Board of Directors. “They are seasoned global industry leaders with deep knowledge of the businesses, and are passionate about the opportunity to launch purpose-built leading companies in their respective markets.”

Kesseler, Tenneco’s current CEO will become chairman and CEO of the aftermarket and ride performance company, which will be headquartered in Lake Forest, Illinois. Kesseler has been serving as Tenneco CEO since May 2017, having joined the company as chief operating officer in 2015. Prior to Tenneco, he was president of Johnson Controls Power Solutions, a business largely focused on the aftermarket. He joined Johnson Controls in 1994 and served in leadership positions in the company’s automotive experience and building efficiency businesses. Kesseler began his manufacturing career with Ford Motor Company. He also serves on the Tenneco Board of Directors.

“With extensive industry experience in both OE and aftermarket businesses, Brian is uniquely qualified to be CEO of what will be one of the world’s leading multi-line aftermarket and OE suppliers,” said Sherrill. “His global perspective and demonstrated success in driving top-line growth make him the right choice to lead a company that will be well positioned to accelerate aftermarket growth in Asia Pacific and capture opportunities driven by new mobility and autonomous driving trends.”

Wood will become chairman and CEO of the new powertrain technology company, which will be headquartered in the Detroit, Michigan area. He currently serves as executive chairman of Fallbrook Technologies, an industrial innovation company. Wood retired in 2015 as Dana Holding Corporation President and Chief Executive Officer, a position he had held since joining Dana in 2011. Previously, Wood had a distinguished 26-year career with Borg Warner where he served in various leadership roles with global operations, culminating in the role of executive vice president and president for the engine group. Wood serves on the Tenneco Board of Directors and is a member of the Brunswick Corporation Board of Directors.

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“We are excited that Roger Wood will become CEO of what will be one of the largest pure-play powertrain suppliers globally. He is an exceptional leader with more than 30 years in the industry, including extensive powertrain experience with Dana and Borg Warner,” said Sherrill. “Roger is a highly successful executive who understands the trends shaping the industry, including regulatory and hybridization, and has a proven reputation for driving growth through innovation and technology.”

The acquisition is expected to close in the second half of 2018, subject to regulatory and shareholder approvals and other customary closing conditions. The separation is expected to occur in the second half of 2019.

Post-close and until the spin, the Tenneco Ride Performance, Aftermarket and Federal-Mogul Motorparts leadership will report to Kesseler. The Tenneco Clean Air and Federal-Mogul Powertrain leadership will report to Wood. Tenneco’s corporate staff will have a dual reporting relationship to both Kesseler and Wood.

Wood will participate in the Q and A portion of Tenneco’s second quarter 2018 earnings release conference call on July 27, 2018 at 9:00 a.m. ET.

About Tenneco

Tenneco is a $9.3 billion global manufacturing company with headquarters in Lake Forest, Illinois and approximately 32,000 employees worldwide. Tenneco is one of the world’s largest designers, manufacturers and marketers of ride performance and clean air products and systems for automotive and commercial vehicle original equipment markets and the aftermarket. Tenneco’s principal brand names are Monroe^®, Walker^®, XNOx™ and Clevite^®Elastomer.

About the Aftermarket and Ride Performance Company

The aftermarket and ride performance company would have 2017 pro-forma revenues of $6.4 billion, with 57% of those revenues from aftermarket and 43% from original equipment customers. Following the Federal-Mogul acquisition, the aftermarket and ride performance company will be one of the largest global multi-line, multi-brand aftermarket companies, and one of the largest global OE ride performance and braking companies. The aftermarket and ride performance company’s principal product brands will include Monroe^®, Walker^®, Clevite^®Elastomers, MOOG^®, Fel-Pro^®, Wagner^®, and Champion^®.

About the Powertrain Technology Company

The powertrain technology company would have 2017 pro-forma revenues of $10.7 billion, serving light vehicle, commercial truck, off-highway and industrial markets. Following the Federal-Mogul acquisition, the powertrain technology company will be one of the world’s largest pure-play powertrain companies serving OE markets worldwide with engineered solutions addressing fuel economy, power output, and criteria pollution requirements for gasoline, diesel and electrified powertrains.

Safe Harbor

This communication contains forward-looking statements. These forward-looking statements include, but are not limited to, (i) all statements, other than statements of historical fact, included in this communication that address activities, events or developments that we expect or anticipate will or may occur in the future or that depend on future events, or (ii) statements about our future business plans and strategy and other statements that describe the Company’s outlook, objectives, plans, intentions or goals, and any discussion of future operating or financial performance. These forward-looking statements are included in various sections of this communication and the words “may,” “will,” “believe,” “should,” “could,” “plan,” “expect,” “anticipate,” “estimate,” and similar

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expressions (and variations thereof), are intended to identify forward-looking statements. Forward-looking statements included in this communication concern, among other things the proposed acquisition of Federal-Mogul LLC, including the expected timing of completion of the proposed acquisition and related transactions; the benefits of the proposed acquisition; the combined company’s plans, objectives and expectations; future financial and operating results; Tenneco’s intent to separate into two independent publicly traded companies as a result of the proposed spin-off the expectation that the spin-off will be tax-free; statements regarding the resources, potential, priorities, competitive positioning and opportunities for the independent companies following the spin-off; the timing of the proposed spin-off and other statements that are not historical facts. Forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to materially differ from those described in the forward-looking statements, including the risk that the transaction may not be completed in a timely manner or at all due to a failure to satisfy certain closing conditions, including any stockholder or regulatory approvals or the failure to satisfy other conditions to completion of the transaction; the occurrence of any event, change or other circumstance that could give rise to the termination of the Transaction Agreement; the outcome of any legal proceeding that may be instituted against the Company and others following the announcement of the transaction; the combined company may not complete a spin-off of the Motorparts business from the Powertrain business (or achieve some or all of the anticipated benefits of such a spin-off); the proposed transaction may have an adverse impact on existing arrangements with the Company, including those related to transition, manufacturing and supply services and tax matters; the amount of the costs, fees, expenses and charges related to the transaction may be greater than expected; the ability to retain and hire key personnel and maintain relationships with customers, suppliers or other business partners; the risk that the benefits of the transaction, including synergies, may not be fully realized or may take longer to realize than expected; the risk that the transaction may not advance the combined company’s business strategy; the risk that the combined company may experience difficulty integrating all employees or operations; the potential diversion of the Company’s management’s attention resulting from the proposed transaction; as well as the risk factors and cautionary statements included in the Company’s periodic and current reports (Forms 10-K, 10-Q and 8-K) filed from time to time with the SEC. Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements as a prediction of actual results. Unless otherwise indicated in this report, the forward-looking statements in this communication are made as of the date of this communication, and, except as required by law, the Company does not undertake any obligation, and disclaims any obligation, to publicly disclose revisions or updates to any forward-looking statements.

Contacts:
Bill Dawson	Linae Golla
Media inquiries	Investor inquires
847 482-5807	847 482-5162
bdawson@tenneco.com	lgolla@tenneco.com