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):
October
1, 2008
KAL
ENERGY, INC.
(Exact
name of registrant as specified in its charter)
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Delaware
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333-97201
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98-0360062
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(State
or other jurisdiction of
incorporation)
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(Commission
File Number)
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(IRS
Employer Identification
No.)
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World
Trade Center 14th Floor, Jl. Jenderal Sudirman Kav. 29-31
Jakarta,
Indonesia
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12920
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(Address
of principal executive offices)
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(Zip
Code)
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Registrant’s
telephone number, including area code: (62) 21 5211110
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:
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¨
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Written
communications pursuant to Rule 425 under the Securities Act (17
CFR
230.425).
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¨
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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¨
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act
(17 CFR
240.14d-2(b))
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¨
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act
17
CFR 240.13e-4(c))
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Item
1.01 Entry into a Material Definitive Agreement.
On
October 1, 2008, KAL Energy, Inc. (the “Company”) entered into an Amendment No.
1 to Royalty Agreement (the “Amendment”) with Concord International, Inc.
(“Concord”) and Thatcher Mining Pte. Ltd. (“Thatcher”), which amends the Royalty
Agreement by and between the Company, Concord, Thatcher, Essendon Capital
Ltd.
(“Essendon”) and Carlton Corp. (“Carlton”) (the “Royalty Agreement”). Pursuant
to the terms and conditions of the Royalty Agreement, the Company agreed
to make
certain royalty payments to Concord, Carlton and Essendon in connection with
the
production of thermal coal by the Company pursuant to certain mining concessions
held by the Company. Essendon and Carlton assigned the distribution of all
royalties under the Royalty Agreement to Concord on January 11, 2007.
The
Amendment amends Sections 2.1 and 2.2 of the Royalty Agreement to modify
the
Company’s royalty payment obligations to Concord as follows:
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·
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for
all coal sales under $40.00 per metric ton, the Amendment reduces
the
royalty payment rate from $0.40 per metric ton, indexed annually
with
inflation, to $0.20 per metric ton fixed and
flat;
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·
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for
all coal sales over $40.00 per metric ton, the Amendment changes
the
royalty payment rate from $0.40 per metric ton, indexed annually
with
inflation, to the higher of $0.40 per metric ton or 0.65% of the
price of
coal per metric ton; and
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·
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the
Company will make a one time payment to Concord of $15,000 at the
time of
the first sale of coal by the Company, Thatcher or their affiliates
in
exchange for Concord’s agreement to waive all royalty payments by the
Company for the first three years
thereafter.
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The
foregoing description of the Amendment does not purport to be complete and
is
qualified in its entirety by reference to the full text of the Amendment,
a copy
of which is attached hereto as Exhibit 10.1 and is incorporated herein by
reference.
The
disclosure set forth below under Item 5.02 is hereby incorporated by reference
into this Item 1.01.
Item
5.02 Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain
Officers.
On
October 1, 2008, the Company entered into an Employment Agreement with Jorge
Nigaglioni, the Company’s Chief Financial Officer (the “Nigaglioni Employment
Agreement”), effective as of June 1, 2008. Under the terms of the Nigaglioni
Employment Agreement, Mr. Nigaglioni is entitled to an annual base salary
of
$180,000. The Agreement also provides for equity incentive compensation to
be
awarded to Mr. Nigaglioni under the Company’s equity incentive plans, as
determined from time to time by the Company’s Board of Directors, and entitles
Mr. Nigaglioni to participate in any performance-based cash compensation
plans
that may be implemented by the Company’s Board of Directors. The Nigaglioni
Employment Agreement further provides for severance compensation equal to
six
months of base salary upon Mr. Nigaglioni terminating his employment with
the
Company for Good Reason.
The
foregoing description of the Nigaglioni Employment Agreement does not purport
to
be complete and is qualified in its entirety by reference to the full text
of
the Nigaglioni Employment Agreement, a copy of which is attached hereto as
Exhibit 10.2 and is incorporated herein by reference.
On
October 1, 2008, the Company entered into an Employment Agreement with Andrew
Caminschi, the Company’s Senior Vice President of Business Development (the
“Caminschi Employment Agreement”), effective as of June 1, 2008. Under the terms
of the Caminschi Employment Agreement, Mr. Caminschi is entitled to an annual
base salary of $180,000. The Agreement also provides for equity incentive
compensation to be awarded to Mr. Caminschi under the Company’s equity incentive
plans, as determined from time to time by the Company’s Board of Directors, and
entitles Mr. Caminschi to participate in any performance-based cash compensation
plans that may be implemented by the Company’s Board of Directors. The Caminschi
Employment Agreement further provides for severance compensation equal to
six
months of base salary upon Mr. Caminschi terminating his employment with
the
Company for Good Reason.
The
foregoing description of the Caminschi Employment Agreement does not purport
to
be complete and is qualified in its entirety by reference to the full text
of
the Caminschi Employment Agreement, a copy of which is attached hereto as
Exhibit 10.3 and is incorporated herein by reference.
Item
7.01 Regulation FD Disclosure.
On
October 6, 2008, the Company issued a press release announcing the Company’s
entry into the Amendment No. 1 to the Royalty Agreement by and between KAL
Energy, Inc., Concord International, Inc., and Thatcher Mining Pte. Ltd,
a copy
of which is attached hereto as Exhibit 99.1 and is incorporated herein by
reference.
In
accordance with General Instruction B.2 of Form 8-K, the information set
forth
under this Item 7.01, including Exhibit 99.1 referenced herein, is being
furnished and shall not be deemed "filed" for purposes of Section 18 of the
Securities Exchange Act of 1934, as amended, or otherwise subject to the
liabilities of that Section, nor shall such information be deemed incorporated
by reference in any filing under the Securities Act of 1933, as
amended.
Item
9.01 Financial Statements and Exhibits.
(d)
Exhibits.
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Exhibit
Number
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Description
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10.1
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Amendment
No. 1 to Royalty Agreement, dated as of October 1, 2008, by and
between
KAL Energy, Inc., Concord International, Inc. and Thatcher Mining
Pte.
Ltd.
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10.2
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Employment
Agreement, dated as of October 1, 2008, by and between KAL Energy,
Inc.
and Jorge Nigaglioni.†
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10.3
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Employment
Agreement, dated as of October 1, 2008, by and between KAL Energy,
Inc.
and Andrew Caminschi.†
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99.1
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Press
release of KAL Energy, Inc. issued October 6, 2008 announcing its
entry
into Amendment No. 1 to Royalty
Agreement.
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†
Indicates
management contract or compensatory plan or arrangement
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.
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KAL
ENERGY, INC.
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October
6, 2008
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By:
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/s/
Jorge Nigaglioni
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Jorge
Nigaglioni
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Chief
Financial Officer
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EXHIBIT
INDEX
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Exhibit
Number
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Description
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10.1
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Amendment
No. 1 to Royalty Agreement, dated as of October 1, 2008, by and
between
KAL Energy, Inc., Concord International, Inc. and Thatcher Mining
Pte.
Ltd.
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10.2
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Employment
Agreement, dated as of October 1, 2008, by and between KAL Energy,
Inc.
and Jorge Nigaglioni.†
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10.3
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Employment
Agreement, dated as of October 1, 2008, by and between KAL Energy,
Inc.
and Andrew Caminschi.†
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99.1
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Press
release of KAL Energy, Inc. issued October 6, 2008 announcing its
entry
into Amendment No. 1 to Royalty
Agreement.
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†
Indicates
management contract or compensatory plan or arrangement