SEC Form 4 · accession 0001580695-16-000222
HYDROCARB ENERGY CORP · HECC
Statement of changes in beneficial ownership, as filed. Original on EDGAR ↗
Reporting owner
Kwongyip Andrew Lai
Officer — CFO
Period of report
Jan 31, 2016
Accepted (ET)
Feb 4, 2016 · 7:10 pm EST
Rule 10b5-1 plan
unknown — predates the checkbox
Issuer CIK
0001425808
Table I — non-derivative securities
| Security | Date | Code | Shares | Price | A/D | Owned after | D/I | Nature of ownership |
|---|---|---|---|---|---|---|---|---|
| Common StockF1,F2,F3,F6 | Jan 31, 2016 | A | 3,030 | $1.10 | A | 3,030 | D |
Table II — derivative securities
| Security | Conv. / exercise price | Date | Code | Shares | A/D | Exercisable | Expires | Underlying | Underlying shares | Owned after | D/I |
|---|---|---|---|---|---|---|---|---|---|---|---|
| Options to Purchase Common StockF1,F3,F4,F6,F5 | $1.10 | Jan 31, 2016 | A | 30,000 | A | — | Jan 31, 2021 | Common Stock | 30,000 | 40,000 | D |
Explanation of responses
- F1Effective January 4, 2016, the Registrant entered into an employment agreement with Mr. Lai pursuant to which Mr. Lai agreed to serve as Chief Financial Officer of the Registrant. During the term of the agreement (2 years, subject to automatic renewals), Mr. Lai is due an annual salary of (a) $200,000 in cash; (b) $40,000 in shares of the Registrant's common stock; and (c) options to purchase 120,000 shares of the Registrant's common stock.
- F2The shares due to Mr. Lai are priced at market at the time of issuance (i.e., the average of the high and low sales prices of the Registrant's common stock on the grant date, the "FMV") and payable in quarterly installments at the end of each fiscal quarter starting on January 31, 2016, provided that only $3,333 of shares of common stock were due on January 1, 2016 ($3,333 divided by $1.10 (the FMV on the closest trading day to the grant date) = 3,030 shares).
- F3Issued and granted under the Registrant's 2015 Stock Incentive Plan and exempt from Section 16(b) pursuant to Rule 16b-3(d).
- F4The options due to Mr. Lai have an exercise price equal to the FMV and are payable in equal quarterly installments at the beginning of each fiscal quarter starting on February 1, 2016. The options to purchase 30,000 shares in the table represent one quarter of the options to purchase 120,000 shares of common stock due for the year.
- F5The options granted pursuant to the employment agreement have a term of five years and vest at the rate of 1/3rd of each option grant on the date of grant, 1/3rd of such option grant on the one year anniversary of the option grant and 1/3rd of such option grant on the two year anniversary of the option grant.
- F6Issued and granted in consideration for services rendered and to be rendered as the Chief Financial Officer of the Registrant.