UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 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): March 7, 2014
DUNE ENERGY, INC.
(Exact name of registrant as specified in its charter)
| Delaware | 000-27897 | 95-4737507 | ||
| (State or other jurisdiction of incorporation) |
(Commission File Number) |
(I.R.S Employer Identification No.) |
| Two Shell Plaza 777 Walker Street, Suite 2300 Houston, Texas |
77002 | |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code: (713) 229-6300
NOT APPLICABLE
(Former name or former address, if changed since last report)
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 (see General Instruction A.2 below):
| ¨ | 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)) |
| Item 5.02 | Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. |
On March 7, 2014, the Board of Directors (the “Board”) of Dune Energy, Inc. (the “Company”) approved certain compensation arrangements for the Company’s employees, including the Company’s senior executives, as set forth below.
2014 Bonus Program
The Board approved the recommendation of the Compensation Committee of the Board (the “Committee”) to adopt a new cash bonus plan for the Company’s employees, including the Company’s senior executives, for 2014 (the “2014 Bonus Program”). Each participant in the 2014 Bonus Program is assigned a target bonus for 2014. A participant’s bonus will be determined by multiplying the participant’s target bonus by a performance factor determined based upon the Company’s performance and the participant’s individual performance. Actual bonuses may range from 0 percent (no bonus) to 200 percent of the participant’s target bonus. The metrics used to determine each participant’s bonus under the 2014 Bonus Program will be (i) reserve growth, (ii) production growth, (iii) lease operating expense reduction and (iv) individual goals. No minimum bonus is required under the 2014 Bonus Program.
The following table sets forth the target bonus under the 2014 Bonus Program for the Company’s named executive officers:
| Officer and Title |
Target Bonus |
|||
| James A. Watt, President and Chief Executive Officer |
$ | 550,000 | ||
| Frank T. Smith, Jr., Senior Vice President and Chief Financial Officer |
$ | 230,300 | ||
| Hal L. Bettis, Chief Operating Officer |
$ | 197,400 | ||
| Richard H. Mourglia, Senior Vice President, Land and General Counsel |
$ | 174,000 | ||
Granted Restricted Stock Awards
The Board also approved the recommendation of the Committee to issue an aggregate of 1,000,000 restricted shares to employees pursuant to the Dune Energy, Inc. 2012 Stock Incentive Plan, as amended by the First Amendment on June 5, 2013 (the “Plan”), including an aggregate of 560,000 restricted shares to the four executive officers named below.
| Name |
Initial Grant (# shares) |
# Shares Vesting on March 7, 2015 |
# Shares Vesting on March 7, 2016 |
# Shares Vesting on March 7, 2017 |
||||||||||||
| James A. Watt |
230,000 | 76,667 | 76,667 | 76,666 | ||||||||||||
| Frank T. Smith, Jr. |
110,000 | 36,667 | 36,667 | 36,666 | ||||||||||||
| Hal L. Bettis |
110,000 | 36,667 | 36,667 | 36,666 | ||||||||||||
| Richard H. Mourglia |
110,000 | 36,667 | 36,667 | 36,666 | ||||||||||||
Bonus Payout
As previously announced on July 23, 2013, the Board approved the payment of retention bonuses to the Company’s employees, including the Company’s senior executive officers pursuant to a cash bonus plan (the “2013 Bonus Program”). James Watt, our chief executive officer, received one-third of his approved retention cash bonus (the “2013 Bonus”) in October 2013 and received 156,695 restricted shares under the Plan in lieu of his second one-third cash payment of the 2013 Bonus in December 2013. Mr. Watt has voluntarily agreed, with the Board’s approval, to receive 156,695 restricted shares under the Plan in lieu of his third and final one-third cash payment of the 2013 Bonus under the 2013 Bonus Program with the vesting schedule set forth below.
| Name |
Initial Grant (# shares) |
# Shares Vesting on March 7, 2015 |
# Shares Vesting on March 7, 2016 |
# Shares Vesting on March 7, 2017 |
||||||||||||
| James A. Watt |
156,695 | 52,232 | 52,232 | 52,231 | ||||||||||||
The time vesting awards granted to the executive officers were granted pursuant to the Dune Energy, Inc. 2012 Stock Incentive Plan Restricted Stock Agreement (Time Vesting) (the “Form of Award Agreement”), and the description of the grants are qualified in their entirety by reference to the full text of the Form of Award Agreement which is filed as Exhibit 10.3 to the Current Report on Form 8-K on March 6, 2012 (file no. 001-32497).
| Item 9.01 | Financial Statements and Exhibits |
| Exhibit |
Name of Document | |
| 10.1 | Form of Dune Energy, Inc. 2012 Stock Incentive Plan Restricted Stock Agreement (Time Vesting) (incorporated by reference to the Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on March 6, 2012 (file no. 001-32497)). | |
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.
| DUNE ENERGY, INC. | ||||||
| Date: March 12, 2014 | By: | /s/ James A. Watt | ||||
| Name: | James A. Watt | |||||
| Title: | Chief Executive Officer | |||||