WASHINGTON,
DC 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): March 7,
2008
Petroleum Development
Corporation
(Exact
Name of Registrant as Specified in Charter)
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Nevada
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0-7246
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95-2636730
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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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120 Genesis Boulevard,
Bridgeport, WV 26330
(Address
of Principal Executive Offices)
Registrant's
telephone number, including area code 304-842-3597
no
change
(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 (see General
Instruction A.2. below):
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[ ]
Written communications pursuant to Rule 425 under 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 CFR 240.13e-4(c))
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Item
5.02. Entry into a Material Definitive Agreement.
On March
7, 2008, the Compensation Committee ("Committee") of the Board of Directors of
Petroleum Development Corporation ("Company") finalized the Long-Term Incentive
Plan grants for 2008 for the Company's current executive officers after a review
of performance and competitive market data. Additionally, on March 8,
2008 the Board of Directors set the compensation for non-employee members of the
Board of Directors for the Board year commencing on July 1, 2008.
`The
following table sets forth the previous and new annual compensation levels of
the non-employee directors:
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Board
Compensation
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Year
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Compensation
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Annual
retainer as director
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2008
2007
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$55,000
$55,000
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Stock
Compensation
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2008
2007
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2000
shares
2000
shares
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Committee
Fees
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Lead
director
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2008
2007
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$27,500
$27,500
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Executive
committee
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2008
2007
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$5,000
$5,000
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Audit
chair
Other
audit
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2008
2007
2008
2007
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$22,500
$22,500
$10,000
$10,000
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Compensation
chair
Other
compensation
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2008
2007
2008
2007
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$10,000
$7,000
$5,000
$2,500
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Nominating
chair
Other
nominating
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2008
2007
2008
2007
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$7,500
$7,500
$2,500
$2,500
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Planning
& finance
Other
planning & finance
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2008
2007
2008
2007
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$7,500
$7,500
$2,500
$2,500
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New stock
compensation for the Board year 2008-2007 is intended to vest July 1,
2009. In addition, all restricted shares previously granted to Board members
would vest on the earlier of the 2008 annual shareholder meeting or on July 1,
2008. To accommodate such time-based vesting, an amendment to the 2005
Non-Employee Director Restricted Stock Plan will be proposed to the Company’s
shareholders in the proxy for the 2008 annual shareholders meeting.
The
Committee also determined executive officer awards of restricted stock and
performance shares under the Company's 2004 Long-Term Equity Compensation Plan
("2004 Equity Plan"). Awards under the 2008 Long-Term Incentive
Program include time vesting shares of restricted stock and performance shares,
that may be earned if established performance criteria are
satisfied. The time-based grants of restricted stock were established
with two types of vesting: five year ratable vesting on January 1 of each year
with first vesting on January 1, 2009, and four year ratable vesting on March 7
of each year with first vesting on March 7, 2009. The five year grant was a
special transition grant provided for retention during the new CEO transition,
expected in 2008 as previously announced.
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Executive
Officer
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Restricted
Stock vesting Ratably over five years
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Restricted
Stock vesting Ratably over four years
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Performance
Shares
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Steven
R. Williams
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-------
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-------
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22,757
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Richard
W. McCullough
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13,878
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5,056
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8,290
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Eric
R. Stearns
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8,921
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4,384
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7,189
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Daniel
W. Amidon
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4,956
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2,255
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3,698
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Darwin
L. Stump
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-------
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1,691
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2,773
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The
performance shares may be earned in whole or in part on December 31 of 2010,
2011, and 2012 if the average closing price of the Company's common stock during
the preceding December exceeds a specified price established by the
Committee.
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Performance
Target for the Performance Period Ending on December 31
of:
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Percentage
of Award Vested
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2010
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2011
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2012
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$80.50
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$90.00
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$101.00
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50%
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$89.50
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$103.50
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$120.00
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75%
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$99.00
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$118.50
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$142.50
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100%
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DM3\676642.1
Other
restrictions and conditions of the awards include:
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·
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Awards
may be not sold, transferred, pledged, assigned or otherwise alienated or
hypothecated, other than by will or by the laws of descent and
distribution. Further, awards granted to an executive officer
will be exercisable during his lifetime only by such executive or the
executive's legal representative.
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·
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Performance
shares not earned at December 31, 2012 will be
forfeited.
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·
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Executives
will not have voting rights for non-vested restricted stock or for
unearned performance shares.
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·
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Executives
will not be entitled to receive dividends for restricted stock that has
not vested or for performance shares that have not been
earned.
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·
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Vesting
of any unvested restricted stock will be accelerated in the event of
termination of employment resulting from the death or disability of the
executive; performance shares will be accelerated in accordance with the
terms of the program.
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·
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Termination
of employment for any reason other than death, disability, by the Company
for a reason other than cause or by the executive for good reason will
result in termination of the right of the executive to any remaining
rights to unvested shares of restricted stock or unearned performance
shares.
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·
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In
the event of a "Change in Control" as defined in the
plan:
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o
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In
the event of a change in control of the Company triggered by the sale of
shares, the sales price of a share in the subject change in control will
be the share price for purposes of this section;
and
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o
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In
the event of a change of control triggered by an event other than the sale
of shares, the share price for purposes of this section will be determined
in good faith by the Committee, in its sole
discretion.
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Lastly,
the Committee determined the 2008 compensation of Darwin Stump, Chief Accounting
Officer, as base salary of $227,500 (effective January 1, 2008), with a maximum
annual bonus of 100% of base salary. The entire bonus amount will be
discretionary to the Committee and not based on specific metrics. In addition
Mr. Stump received the long term restricted stock awards noted
above.
Item
9.01. Financial Statements and Exhibits.
(d) Exhibits.
10.1 Petroleum
Development Corporation 2008 Long-Term Incentive Program
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.
Petroleum
Development Corporation
Date March 13,
2008
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By
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/s/ Steven R. Williams
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Steven
R. Williams
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Chief
Executive Officer
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