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
November 7, 2008
Date of Report (Date of earliest event reported)
Wentworth Energy, Inc.
(Exact name of registrant as specified in its charter)
Oklahoma
(State or other jurisdiction)
0-32593
(Commission File Number)
73-1599600
(IRS Employer Identification No.)
112 E. Oak Street, Suite 200, Palestine, Texas, 75801
(Address of principal executive offices)
(903) 723-0395
Registrant’s telephone number, including area code
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:
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[ ] | | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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[ ] | | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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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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[ ] | | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 FR 240.13e-4(c)) |
Item 4.02
Non-Reliance on Previously Issued Financial Statements or a Related Audit Report or Completed Interim Review
On November 5, 2008, the officers of Wentworth Energy, Inc. (the “Company”) concluded that the financial statements included in the Form 10-KSB/A for the Company’s fiscal year ended December 31, 2007, and Form 10-Q for the Company’s three months ended March 31, 2008 and six months ended June 30, 2008 should no longer be relied upon because of an error in such financial statements.
On November 14, 2007, the Company amended several of its stock option agreements (the “Amendments”) to remove all service conditions, effectively accelerating the remaining unrecognized compensation. In accordance with Statement of Financial Accounting Standards No. 123(R), the fair value of a stock-based award is measured on the grant date and the compensation cost is recognized over the requisite service period. However, the amount of compensation cost recognized at any date must at least equal the portion of the value of the award that is not contingent upon either a service condition or a performance condition at that date. On November 14, 2007, the Company had approximately $2.1 million in unrecognized compensation expense related to non-vested stock-based compensation arrangements. Upon execution of the Amendments, the full amount of unrecognized compensation expense was accelerated and should have b een recorded in the fourth quarter of 2007, resulting in an increase in general and administrative expenses of $2.1 million.
The Company, together with its independent accountants, Malone & Bailey, PC, and its former independent accountants, Hein & Associates LLP, has undertaken a review of the Company’s financial statements, and has concluded that the Company’s accounting treatment of the Amendments should be revised. The Company will file amendments to each of the Form 10-KSB/A for the Company’s fiscal year ended December 31, 2007, Form 10-Q for the Company’s three months ended March 31, 2008 and Form 10-Q for the Company’s six months ended June 30, 2008, as soon as reasonably possible.
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.
Dated: November 7, 2008
WENTWORTH ENERGY, INC.
/s/ Francis K. Ling
Francis K. Ling, Chief Financial Officer
