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): January 6, 2006 (January 1, 2006)
THE HOUSTON EXPLORATION COMPANY
(Exact name of registrant as specified in its charter)
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Delaware
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001-11899
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22-2674487 |
(State or other jurisdiction of
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(Commission File No.)
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(IRS Employer Identification No.) |
incorporation) |
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1100 Louisiana Street, Suite 2000 |
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Houston, Texas
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77002-5215 |
(Address of principal executive offices)
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(Zip Code) |
(713) 830-6800
(Registrants telephone number, including area code)
Not Applicable
(Former names 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:
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
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TABLE OF CONTENTS
Item 1.01. Entry into a Material Definitive Agreement.
A. Adoption of Supplemental Executive Retirement Plan
The Houston Exploration Company (the Company) adopted a Supplemental Executive Retirement
Plan (the SERP) effective January 1, 2006 to provide retirement benefits to selected employees of
the Company. The SERP is an unfunded, non-tax qualified defined benefit pension plan for certain
management level or other highly compensated employees of the Company, as identified by the Plan
Administrator. Eligible employees will be entitled to a monthly retirement benefit for life in the
form of an annuity, the amount of which will vary based on the employees Final Average Salary (as
defined in the SERP).
Once vested, each participant in the SERP will be entitled to the accrued benefit, or a
portion thereof, as determined by the participants retirement date. A participant who terminates
his or her employment with the Company on or after his or her normal retirement date (as defined in
the SERP) will receive full accrued benefits, beginning not later than six months after separation.
If a participant terminates his or her employment prior to his or her normal retirement date, his
or her benefits will be reduced in accordance with the provisions of the SERP.
The amount of benefits payable to a participant will be determined in accordance with the
formula set forth in the SERP. Generally, the annual benefits will be determined by multiplying
2.5% of the participants Final Average Salary (calculated by averaging the highest consecutive
three years of a participants annual base salary and bonuses during the five years immediately
prior to the termination of employment, by the number of years of service, not to exceed 20 years),
subject to reduction for certain amounts.
A participant becomes fully vested upon the earlier of completing five years of participation
in the SERP, or attaining the age of 65 prior to termination of employment. In the event a
participant is terminated for cause, all benefits under the SERP will be forfeited. All benefits
become fully vested upon a change of control (as defined in the SERP) and may become payable in a
lump-sum if a participants employment is terminated by the Company without cause or the
participant resigns for good reason within two years following a change of control.
The foregoing description of the SERP is qualified in its entirety by reference to the
provisions of the SERP, which is attached to this Report as Exhibit 99.1 and incorporated by
reference herein.
B. Increase in Director Compensation
Also effective January 1, 2006, the Board of Directors approved an increase to the annual
retainer payable to non-employee directors to $40,000. Following consultation with the Companys
compensation consultants, compensation for certain positions on the Board also has been adjusted as
follows: (i) the meeting fee for committee service has been increased to $1,500 per meeting; (ii)
the annual retainer for committee chairpersons (other than the Audit
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Committee) has been increased to $5,000; and (iii) the annual retainer for the chairperson of the
Audit Committee has been increased to $10,000.
A summary of the changes to the non-employee director compensation arrangements is attached as
Exhibit 99.2 to this Report.
Item 8.01. Other Events.
The information included under Item 1.01 above of this Current Report is incorporated by
reference herein.
Item 9.01. Financial Statements and Exhibits.
(d) |
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Exhibits |
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99.1 |
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The Houston Exploration Company Supplemental Executive Retirement Plan dated January 1, 2006 |
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99.2 |
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Summary of Changes to Non-Employee Director Compensation Arrangements |
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