| FORM 4 | UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934 or Section 30(h) of the Investment Company Act of 1940 |
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| Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b). | |||||||||||||||||
1. Name and Address of Reporting Person*
(Street)
| 2. Issuer Name and Ticker or Trading Symbol HYDROCARB ENERGY CORP [ HECC ] | 5. Relationship of Reporting Person(s) to Issuer (Check all applicable)
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| 3. Date of Earliest Transaction (Month/Day/Year) 01/31/2016 | ||||||||||||||||||||||||||
| 4. If Amendment, Date of Original Filed (Month/Day/Year) | 6. Individual or Joint/Group Filing (Check Applicable Line)
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| Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned | ||||||||||
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| 1. Title of Security (Instr. 3) | 2. Transaction Date (Month/Day/Year) | 2A. Deemed Execution Date, if any (Month/Day/Year) | 3. Transaction Code (Instr. 8) | 4. Securities Acquired (A) or Disposed Of (D) (Instr. 3, 4 and 5) | 5. Amount of Securities Beneficially Owned Following Reported Transaction(s) (Instr. 3 and 4) | 6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4) | 7. Nature of Indirect Beneficial Ownership (Instr. 4) | |||
| Code | V | Amount | (A) or (D) | Price | ||||||
| Common Stock | 01/31/2016 | A | 3,030(1)(2)(3) | A | $1.1(6) | 3,030 | D | |||
| Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned (e.g., puts, calls, warrants, options, convertible securities) | |||||||||||||||
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| 1. Title of Derivative Security (Instr. 3) | 2. Conversion or Exercise Price of Derivative Security | 3. Transaction Date (Month/Day/Year) | 3A. Deemed Execution Date, if any (Month/Day/Year) | 4. Transaction Code (Instr. 8) | 5. Number of Derivative Securities Acquired (A) or Disposed of (D) (Instr. 3, 4 and 5) | 6. Date Exercisable and Expiration Date (Month/Day/Year) | 7. Title and Amount of Securities Underlying Derivative Security (Instr. 3 and 4) | 8. Price of Derivative Security (Instr. 5) | 9. Number of derivative Securities Beneficially Owned Following Reported Transaction(s) (Instr. 4) | 10. Ownership Form: Direct (D) or Indirect (I) (Instr. 4) | 11. Nature of Indirect Beneficial Ownership (Instr. 4) | ||||
| Code | V | (A) | (D) | Date Exercisable | Expiration Date | Title | Amount or Number of Shares | ||||||||
| Options to Purchase Common Stock | $1.1(4) | 01/31/2016 | A | 30,000(1)(3)(4) | (5) | 01/31/2021 | Common Stock | 30,000 | (6) | 40,000 | D | ||||
| Explanation of Responses: |
| 1. Effective 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. |
| 2. The 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). |
| 3. Issued and granted under the Registrant's 2015 Stock Incentive Plan and exempt from Section 16(b) pursuant to Rule 16b-3(d). |
| 4. The 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. |
| 5. The 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. |
| 6. Issued and granted in consideration for services rendered and to be rendered as the Chief Financial Officer of the Registrant. |
| /s/ K. Andrew Lai | 02/04/2016 | |
| ** Signature of Reporting Person | Date | |
| Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly. | ||
| * If the form is filed by more than one reporting person, see Instruction 4 (b)(v). | ||
| ** Intentional misstatements or omissions of facts constitute Federal Criminal Violations See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a). | ||
| Note: File three copies of this Form, one of which must be manually signed. If space is insufficient, see Instruction 6 for procedure. | ||
| Persons who respond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMB Number. | ||
