UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------------------
SCHEDULE TO
Tender Offer Statement
Under Section 14(d)(1) of the Securities Exchange Act of 1934
-----------------------------
American Natural Energy Corporation
(Name of Subject Company (issuer))
Dune Energy, Inc., Offeror
(Names of Filing Persons (identifying status as offeror, issuer or other
person))
-----------------------------
8% Convertible Secured Debentures due September 30, 2006 N/A
(Title of Class of Securities) (CUSIP Number of Class
of Securities)
-----------------------------
Copies to:
Alan Gaines, Chief Executive Officer Matthew S. Cohen, Esq.
Dune Energy, Inc. Eaton & Van Winkle LLP
3050 Post Oak Boulevard, Suite 695 3 Park Avenue, 16th floor
Houston, TX 77056 New York, NY 10016
(212) 779-9910
(Name, address, and telephone numbers of persons authorized
to receive notices and communications on behalf of filing persons)
-----------------------------
Calculation of Filing Fee
- --------------------------------------------------------------------------------
Transaction valuation* Amount of filing fee**
$ 4,303,750 $860.75
- --------------------------------------------------------------------------------
* Calculated solely for purposes of determining the filing fee. The purchase
price, as described herein, is fifty-five percent (55%) of the principal amount
outstanding under the American Natural Energy Corporation 8% Convertible Secured
Debentures due 2006 and is payable in the form of shares of the common stock,
$.001 par value, of the Company, based upon the average closing price as
reported on the American Stock Exchange over the ten trading days preceding the
third trading day immediately preceding the date the tender offer expires. At
December 26, 2006, the aggregate principal amount of the outstanding debentures
that are subject to the tender offer was $7,825,000 and the closing price of the
Company's common stock was $ 1.95 per share.
|_| Check the box if any part of the fee is offset as provided by Rule
0-11(a)(2) and identify the filing with which the offsetting fee was
previously paid. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
Amount Previously Paid:_____________________
Form or Registration No.:___________________
Filing Party:_______________________________
Date Filed:_________________________________
|_| Check the box if the filing relates solely to preliminary communications
made before the commencement of a tender offer.
Check the appropriate boxes below to designate any transactions to which the
statement relates:
|X| third-party tender offer subject to Rule 14d-1.
|_| issuer tender offer subject to Rule 13e-4.
|_| going-private transaction subject to Rule 13e-3.
|_| amendment to Schedule 13D under Rule 13d-2.
Check the following box if the filing is a final amendment reporting the results
of the tender offer: |_|
This Tender Offer Statement on Schedule TO is being filed by Dune Energy,
Inc. (the "Company"), pursuant to Section 14(d) of the Securities Exchange Act
of 1934, as amended, in connection with its offer to purchase for shares of its
common stock the outstanding 8% Convertible Secured Debentures due September 30,
2006 (the "Debentures"), upon the terms and subject to the conditions set forth
in the offer to purchase statement dated December 28, 2006 (the "Offer to
Purchase") and in the related Letter of Transmittal attached as Exhibit a(1) and
a(2), respectively, to this Schedule TO (which, together with any amendments or
supplements thereto, collectively constitute the "Tender Offer').
The Company is offering to purchase all of the outstanding Debentures at a
purchase price equal to $0.55 for each $1.00 of principal outstanding for an
aggregate purchase price of approximately $4,303,750, payable in the form of
shares of the Company's common stock, $.001 par value, as calculated on January
26, 2007 as provided in the Offer to Purchase. As detailed in the Offer to
Purchase, the Company believes that Debentures with a total outstanding
principal balance of $7,825,000 will be subject to the tender offer as of the
date it expires. Any purchase of the Debentures by the Company will be
conditioned upon holders tendering Debentures of an aggregate outstanding
principal balance of at least $6 million.
The information set forth in the Offer to Purchase and the related Letter
of Transmittal is incorporated herein by reference with respect to Items 1-11 of
this Schedule TO.
Item 1. Summary Term Sheet.
The information set forth in the Offer to Purchase under "Summary Term
Sheet" and "Answers to Questions You May Have" is incorporated herein by
reference.
Item 2. Subject Company Information.
(a) Name and Address.
American Natural Energy Corporation, the subject company issuing those
Debentures to which this tender offer relates ("American Natural"), is an
Oklahoma corporation having its principal executive offices at 6100 South Yale,
Suite 300, Tulsa, Oklahoma 74136.
(b) Securities.
8% Convertible Secured Debentures due September 30, 2006 of American
Natural (the "Debentures"), in the aggregate outstanding principal amount of
$7,825,000 (exclusive of the Company Owned Debentures defined in Item 3(a)
below), issued under that Amended and Restated Trust Indenture dated as of June
29, 2005 (the "Indenture") between American Natural and Coumputershare Trust
Company of Canada, as Trustee (the "Trustee"). The Debentures are immediately
convertible into shares of American Natural's common stock (the "Conversion
Shares") at the conversion price of $0.15 per share and became immediately due
and payable on September 30, 2006. Additional information set forth in the Offer
to Purchase in the section entitled "The Tender Offer - Securities being
Tendered" is incorporated herein by reference.
(c) Trading Market and Price.
There is no established trading market for the Debentures.
The Conversion Shares underlying the Debentures are traded on the TSX
Venture Exchange, Inc. in Toronto, Canada under the symbol "ANR.U." None of the
Conversion Shares is currently traded on any United States stock exchange or in
the over-the-counter market in the United States, and, accordingly, there is
currently no public market for the Conversion Shares in the United States.
1
The following table sets forth, for the periods indicated, the reported
high and low sales prices (in U.S. dollars) for the Conversion Stock, as
reported by the TSX Venture Exchange. The prices for the Conversion Stock have
been traded in and reported by the TSX Venture Exchange in United States dollars
since February 12, 2002.
Prices
------------------
Quarterly Period Presented High Low
- -------------------------- ---- ---
2006
First Quarter $0.15 $0.05
Second Quarter $0.20 $0.08
Third Quarter $0.08 $0.03
Fourth Quarter (through December 22, 2006) $0.06 $0.02
2005
First Quarter 0.31 0.12
Second Quarter 0.27 0.09
Third Quarter 0.15 0.10
Fourth Quarter 0.12 0.06
2004
Fourth Quarter 1.15 0.31
Information contained in the above chart is from American Natural's most
recent company reports filed with the Securities and Exchange Commission (the
"Commission") on Form 10-KSB for the year ended December 31, 2005 filed on April
17, 2006 and the Form 10-QSB for the quarterly period ended September 30, 2006
filed on November 20, 2006. The Company has no reason to believe the information
contained therein is not correct.
Item 3. Identity and Background of Filing Person.
(a) Name and Address.
The filing person is Dune Energy, Inc., a Delaware corporation (the
"Company").
Itera Holdings BV, a company organized under the laws of The Netherlands
("Itera"), holds approximately 59.7% of the outstanding capital stock of the
Company. The officers and directors of the Company and of Itera are identified
in the Appendix A to this Schedule TO and are collectively referred to herein,
together with Itera, as "Control Persons" pursuant to General Instruction C of
Schedule TO promulgated by the United States Securities and Exchange Commission,
or the SEC.
As disclosed on the Company's report on Form 8-K and statement on Schedule
13D filed by the Company with the Commission on December 26, 2006 and December
28, 2006, respectively, the Company presently own $3 million in principal amount
of debentures issued under the Indenture but not subject to the tender offer
(the "Company Owned Debentures"), which Company Owned Debentures are immediately
convertible into up to 20,000,000 shares of American Natural's common stock at
the conversion price of $0.15 per share.
The business address of the Company is 3050 Post Oak Blvd., Suite 695,
Houston, Texas 77056. Unless indicated otherwise in Appendix A, the address for
the Company's directors, officers and other Control Persons is c/o 3050 Post Oak
Blvd., Suite 695, Houston, Texas 77056.
(b) Business and Background.
The Company is a company organized under the laws of the State of
Delaware. Its principal business is the exploration, development, and
2
acquisition of natural gas and crude oil properties. The principal businesses of
the Control Persons are set forth in the chart above. Additional information set
forth in the Offer to Purchase in the section entitled "The Tender Offer - The
Offeror" is incorporated herein by reference.
The principal occupation or employment of any Control Person who is a
natural person, together with their respective principal business address, at
the time of this filing and during the past five (5) years are set forth in
Appendix A, as well as the current citizenship of each of the Company's officers
and directors and the officers and directors of the Itera.
(c) No Conviction or Violation of Securities Laws
Neither the Company nor any Control Person has, during the last five
years, been convicted in a criminal proceeding (excluding traffic violations or
similar misdemeanors).
Neither the Company nor any Control Person has, during the last five
years, been a party to any judicial or administrative proceeding and, as a
result of such proceeding, was or is subject to a judgment, decree or final
order enjoining future violations of, or prohibiting activities subject to,
federal or state securities laws, or finding any violation with respect to
federal or state securities laws.
Item 4. Terms of the Transaction.
(a) Material Terms - Tender Offer.
The information set forth in the Offer to Purchase under "The Tender
Offer" and "Purposes, Effects and Plans" is incorporated herein by reference,
including descriptions of the securities to be tendered, the type and amount of
consideration, the expiration date, tendering and withdrawal procedures, and
acceptance procedures and conditions thereto.
Item 5. Past Contacts, Transactions, Negotiations and Agreements.
(a) Transactions
Pursuant to an Exploration and Development Agreement dated effective
August 26, 2005 between the Company and American Natural, American Natural
assigned one-half of its contractual rights under a certain Development
Agreement with a major integrated oil and gas company to the Company. That
Development Agreement created an area of mutual interest ("AMI") in
approximately 11,500 acres in the State of Louisiana. We paid $1 million for the
assignment of such rights. In addition, the Company has spent considerable funds
to drill wells located within the AMI and, subject to ongoing geological and
geophysical investigation, may spend considerable additional capital in the AMI
in the future.
Except as set forth above and other than the acquisition of the Company
Owned Debentures and the other contract rights and assets acquired by the
Company pursuant to that Purchase and Sale Agreement, dated as of November 14,
2006, among the Company and each of TransAtlantic Petroleum (USA) Corp. and
TransAtlantic Petroleum Corp. as described in Item 8(b) below, no transactions
have occurred during the last two years between the Company or any Control
Person and either American Natural or any of its affiliates that are not natural
persons, or any executive officer, director or affiliate of American Natural
that is a natural person where the aggregate value of the transaction or series
of transactions with that person exceeds $60,000.
(b) Not Applicable
Item 6. Purposes of the Transaction and Plans or Proposals.
(a) Purposes.
The information set forth in the Offer to Purchase under "Purposes,
Effects and Plans - Purposes and Plans" is incorporated herein by reference.
Notwithstanding controlling ownership by Itera of the Company, the
decision to commence the tender offer and the terms and conditions thereof was
made by the Company's board of directors in the ordinary course, without any
direction from or other involvement by Itera.
(c) Plans.
(1) - (5)None.
3
(6) - (7) Not Applicable
Item 7. Source and Amount of Funds or Other Consideration.
(a) Source of Funds.
The information set forth in the Offer to Purchase in the section entitled
"The Tender Offer - Purchase Price - Source and Amount of Funds" is incorporated
herein by reference.
(b) Not Applicable.
(c) In connection with this tender offer, the Company expects to incur
expenses of approximately $27,500 as follows: (i) legal - $15,000, (ii)
Depositary charges - $10,000 and (iii) stock transfer agent - $2,500.
Item 8. Interest in Securities of the Subject Company.
(a) Security Ownership.
The Company Owned Debentures owned by the Company consist of American
Natural 8% convertible secured debentures, in the outstanding principal amount
of $3 million, issued under the Indenture but not subject to the tender offer,
or approximately 27.7% of the total issued and outstanding principal amount of
$10,825,000 of Debentures under the Indenture (inclusive of the Debentures and
the Company Owned Debentures). The Company Owned Debentures became immediately
due and payable on September 30, 2006. As of September 30, 2006, there was
unpaid interest on the Company Owned Debentures of $433,994.
The outstanding principal amount of the Company Owned Debentures is
immediately convertible into shares of American Natural's common stock (the
"Conversion Shares") at the conversion price of $0.15 per share. Interest
accrued or accruing thereon is not convertible into Conversion Shares.
Conversion of all of the Company Owned Debentures would result in the issuance
to the Company of up to 20,000,000 Conversion Shares. If the Debentures that are
the subject of the tender offer are not converted, upon the Company's conversion
of the Company Owned Debentures the Company would own approximately 27.4% of the
issued and outstanding shares of common stock of American Natural, and if all of
the Debentures are converted by holders other than the Company, approximately
16% of the issued and outstanding shares of the common stock of American
Natural, in each case based upon 52,997,673 shares of Common Stock issued and
outstanding as of November 15, 2006 (exclusive of Conversion Shares), as
disclosed on American Natural's most recent quarterly filing for the nine months
ended September 30, 2006 filed with the SEC on November 20, 2006 . No Control
Person has any beneficial ownership of any of the Company Owned Debentures, or
any shares of the Conversion Shares, except that Itera may be deemed a
beneficial owner of such debentures and/or Conversion Shares by virtue of its
control of the Company. Inasmuch as the Company's decision to enter into the
tender offer was negotiated solely by the Company's board of directors in the
ordinary course of their business without any involvement of Itera, Itera
disclaims any beneficial ownership in the Debentures and the Conversion Shares.
(b) Securities Transactions
By that certain Purchase and Sale Agreement, dated as of November 14,
2006, among the Company and each of TransAtlantic Petroleum (USA) Corp. ("USA")
and TransAtlantic Petroleum Corp. ("TNP"), the Company purchased certain assets
of, and claims against, American Natural for consideration of $2 million in cash
(subject to adjustments as described therein), including, for purposes hereof,
the Company Owned Debentures from a single holder for cash consideration of
$500,000 (or $0.166 per $1.00 principal face amount outstanding). Reference is
made to our Report on Form 8-K, filed with the SEC on December 26, 2006
4
Other than the above purchase of the Company Owned Debentures, the Company
has not acquired in the past 60 days any of the securities of American Natural.
Item 9. Persons/Assets, Retained, Employed, Compensated or Used.
(a) Not Applicable.
Item 10. Financial Statements.
(a) Financial Statements
The Company is a public reporting company under Section 13(a) of the
Exchange Act that files reports electronically on EDGAR and, incorporated herein
by reference are the following reports of the Company setting forth the
Company's (i) audited balance sheets for the most recent two fiscal years ended
December 31, 2004 and 2005 and (ii) unaudited balance sheet, statements of
income, earnings per share and statements of cash flow for the most recent
quarterly period ended September 30, 2006:
o Annual Report on Form 10-KSB for the year ended December 31,
2005 filed with the Commission on March 31, 2006; and
o Quarterly Report on Form 10-QSB for periods ended September
30, 2006 filed with the Commission on November 14, 2006.
(b) Not material.
Item 11. Additional Information.
(a) Agreements, Regulatory Requirements and Legal Proceedings.
(1) Amended and Restated Trust Indenture dated as of June 29, 2005
between American Natural and Coumputershare Trust Company of
Canada, as Trustee, that governs the Debentures and the
Company Owned Debentures.
(2) The only regulatory requirements that must be met are those
imposed by applicable securities laws and the rules and
regulations promulgated by the American Stock Exchange
(3)-(5) None
(b) Other Material Information.
The information set forth in the Offer to Purchase and Letter of
Transmittal (Exhibits (a)(1) and (a)(2), respectively, to this Schedule TO) is
incorporated herein by reference.
5
Item 12. Exhibits.
(a) Tender Offer Materials
(1) Offer to Purchase
(2) Form of Letter of Transmittal
(3) Form of Letter to Debenture Holders
(4) Press Release dated December 28, 2006
(d) Amended and Restated Indenture (including the form of Debenture),
dated as of June 29, 2005, among American Natural Energy Corporation
and Computershare Trust Company of Canada, as Trustee, incorporated
herein by reference to Exhibit 4.1 to American Natural's report on
Form 8-K filed with the Securities and Exchange Commission on July
6, 2005.
SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify that the
information set forth in this statement is true, complete and correct.
Dated December 28, 2006
/s/ Alan Gaines
--------------------------------
Name: Alan Gaines
Title: Chief Executive Officer
6
APPENDIX A
Officers and Directors of Company and Control Persons:
Name and Position Principal Business Address Citizenship
----------------- ------------------ ------- -----------
OFFICERS AND DIRECTORS OF COMPANY
Alan Gaines, Company 3050 Post Oak Blvd. United States
Chairman and Chief Suite 695
Executive Officer Houston, TX 77056
Amiel David, Company 3050 Post Oak Blvd. United States
President and Chief Suite 695
Operating Officer Houston, TX 77056
Hugh Idstein, Company 3050 Post Oak Blvd. United States
Chief Financial Officer Suite 695
Houston, TX 77056
Richard M. Cohen, Secretary Company 3 Park Avenue United States
New York, NY 10016
Steven Barrenechea, Restaurant Management 3050 Post Oak Blvd. United States
Director Suite 695
Houston, TX 77056
Valery G. Otchertsov, First Deputy Chairman of Sevastopolsky Russian
Director the Board of Itera Group Prospekt 28/1
Moscow, Russia
Raissa S. Frenkel, President & CEO of Itera 9995 Gate Pkwy N. United States
Director International Energy Jacksonville, FL
Corporation 32256
Steven M. Sisselman, Executive Vice-President & 9995 Gate Pkwy N. United States
Director COO of Itera International Jacksonville, FL
Energy Corporation 32256
Marshall Lynn Bass, Financial Advisor Weisser 1221 United States
Director Johnson & Co. McKinney
Suite 3175
Houston, TX 77010
Itera Holdings BV, Investment holding company Keizergracht 442 N/A
controlling shareholder 1016 GD Amsterdam
The Netherlands
OFFICERS AND DIRECTORS OF ITERA
Igor V. Makarov Director Chairman of the Itera Group Sevastopolsky Russian
of Itera Holdings BV Prospekt 28/1
Moscow, Russia
Fruytier & Van Bremen Manager of Itera Keizergracht 442 N/A
Director of Itera Holdings 1016 GD Amsterdam
BV The Netherlands
Five Year Biographies of Company's Officers and Directors and Natural Control
Persons
Alan Gaines is the Chairman and Chief Executive Officer of the Company and
has served as a Director of the Company since May 2001. For the past five years,
Mr. Gaines has served as President and CEO of Proton Capital LLC, a privately
held merchant and investment banking firm. Since April 2005, Mr. Gaines has
served as Vice Chairman of Baseline Oil & Gas Corp., a public company. In 1983,
Mr. Gaines founded Gaines, Berland Inc., a full service brokerage firm and
investment bank specializing in global energy markets, with particular emphasis
given to small to mid-capitalization exploration and production, pipeline,
midstream, and oilfield services companies. Mr. Gaines served as President of
Appendix A-1
Gaines, Berland from 1983 to 1998. Mr. Gaines holds a BBA in Finance from Baruch
College, and an MBA ("With Distinction") from the Zarb School, Hofstra
University School of Management.
Amiel David has served as the President/Chief Operating Officer of the
Company since February 2004 and has over 35 years of engineering and investment
banking experience within the energy sector. From 1993- 2001, he was the Senior
Vice President and Chief Engineer for the First City Bank and later First Union
Securities (Wachovia Bank) where he was responsible for the technical viability
of in excess of $3.5 billion of energy credits. From 2001 through 2003, Dr.
David was the Managing Director, Senior Vice President and Chief Engineer of
Duke Capital Partners. Dr. David holds a PhD in Petroleum Engineering from
Stanford University and an MBA from The University of Pittsburgh.
Hugh Idstein has served as the Chief Financial Officer of the Company
since April 4, 2005. Prior to joining our Company, Mr. Idstein served as CFO of
Houston based Black Stone Minerals Company, L.P., an oil and gas mineral
exploration company. In addition Mr. Idstein has acted as a consultant for
several oil and gas companies regarding international oil and gas opportunities.
He earned an MBA and a BS in Energy Management from Eastern Illinois University.
Richard M. Cohen has served as a Director of the Company since December
2003. Since 1996, Mr. Cohen has been the President of Richard M. Cohen
Consultants, a private financial services consulting company that assists both
public and private companies with their corporate governance and corporate
finance needs. In 1999, Mr. Cohen was the President of National Auto Credit, a
publicly traded sub-prime auto finance company. From 1992-1995, Mr. Cohen was
the President of General Media Inc., a publicly reporting international
diversified publishing and communications company. Mr. Cohen is a Certified
Public Accountant and worked at Arthur Andersen & Co. from 1975 to 1977. He
received a BS ("With Honors") from The University of Pennsylvania (Wharton) and
an MBA from Stanford University.
Steven Barrenechea has served as a Director of the Company since May 2001.
Mr. Barrenechea is in the restaurant management business. From April 2005 to
January 2006, Mr. Barrenechea served as a Director of Baseline Oil & Corp., a
public company. Mr. Barrenechea is a member of the Board of Directors of the
Creative Coalition, The Milford (Connecticut) Red Cross, and The Child Guidance
Center of Fairfield County. Mr. Barrenechea holds a BBA from New York
University.
Valery Otchertsov has served as a Director of our Company since May 2004.
Since 1999, Mr. Otchertsov has held the position of President of Itera Holding
Ltd and since 2003 Chairman of the Management Board of Itera Oil and Gas Company
Ltd. (Itera). Itera's operating entities are engaged in the business of
production, transportation, marketing and sales of natural gas throughout the
Former Soviet Union. From 1997 -1999, Mr. Otchertsov served as First
Vice-President of Itera International Group of Companies. From 1991 -1996, Mr.
Otchertsov served as Minister of Economics and Finance, Deputy Chairman of the
Cabinet of Ministers of Turkmenistan. He graduated with a Bachelors degree from
Izhevsk Mechanical Institute.
Raissa Frenkel has served as a Director of our Company since May 2004. Dr.
Frenkel has been a member of the Board of Directors of the Itera Oil and Gas
Company Ltd (Itera) since 2002. Itera's operating entities are engaged in the
business of production, transportation, marketing and sales of natural gas
throughout the Former Soviet Union. Since 2003, Dr. Frenkel has been Executive
Vice-President of Itera International Energy Corp. an Itera subsidiary operating
in the US gas, real estate and commodity business. From 1994-2002 Dr. Frenkel
was a Vice-President with Itera International Energy Corp. She graduated from
the Kazan Finance and Economics Institute in 1982 and received her PHD from
Kazan State University in 1989.
Steven Sisselman has served as a Director of our Company since May 2004.
From 1995 to the present, Mr. Sisselman has been a Vice-President of Business
Development with Itera International Energy Corp., an Itera subsidiary operating
in the US gas, real estate and commodity business. From 1992-1994, Mr. Sisselman
was Vice-President of Dalon Inc., a petroleum trading company, responsible for
trading crude oil and petroleum products from the former Soviet Union. For the
12 years prior to 1992, Mr. Sisselman was employed by Charter Oil Company, UBS
Appendix A-2
AG, and Astra Oil working in various financial and trading positions both in the
US and London, England. He graduated from University of Florida in 1980 with a
BS in Business Administration with a major in Finance.
Marshall Lynn Bass has served as a Director of our Company and a member of
the Company's audit committee since September 29, 2004. From 1998 to December
2001, he served as an associate, and from 2002 to present, he served as a
principal of Weisser, Johnson & Co., a Houston based energy investment bank. He
is also a principal and co-founder of GasRock Capital, LLC, a finance company
which makes direct investments in energy companies or projects. He graduated
from Purdue University in 1992 with a BS in economics and from Rice University
with a Masters in business administration.
Appendix A-3
Exhibits Index
Exhibit No. Description
- ----------- -----------
99(a)(1) Offer to Purchase
99(a)(2) Form of Letter of Transmittal
99(a)(3) Form of Letter to Debenture Holders
99(a)(4) Press Release dated December 28, 2006
99(d) Amended and Restated Indenture, dated as of June 29, 2005,
among American Natural Energy Corporation and Computershare
Trust Company of Canada, as Trustee, incorporated herein by
reference to Exhibit 4.1 to American Natural's report on
Form 8-K filed with the Securities and Exchange Commission
on July 6, 2005.