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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 11)*
(Name of Issuer)
Common Stock, $0.001 par value
(Title of Class of Securities)
(CUSIP Number)
David Kelly, Esq.
UBS AG
677 Washington Blvd
Stamford CT 06901
203-719-3000
(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)
(Date of Event Which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. o
Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7 for other parties to whom copies are to be sent.
* The remainder of this cover page shall be filled out for a reporting persons initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed to be filed for the purpose of Section 18 of the Securities Exchange Act of 1934 (Act) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).
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NAMES OF REPORTING PERSONS
UBS AG directly and on behalf of certain subsidiaries |
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
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(a) o |
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(b) o |
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SEC USE ONLY |
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SOURCE OF FUNDS (SEE INSTRUCTIONS) |
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WC |
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CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) |
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þ |
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CITIZENSHIP OR PLACE OF ORGANIZATION |
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Switzerland
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SOLE VOTING POWER |
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NUMBER OF |
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12,376,3401 |
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SHARES |
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SHARED VOTING POWER |
BENEFICIALLY |
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OWNED BY |
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EACH |
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SOLE DISPOSITIVE POWER |
REPORTING |
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PERSON |
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12,376,3401 |
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WITH |
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SHARED DISPOSITIVE POWER |
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11 |
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AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON |
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12,376,340 |
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12 |
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CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS) |
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13 |
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PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) |
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20.48%2 |
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14 |
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TYPE OF REPORTING PERSON (SEE INSTRUCTIONS) |
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BK |
1 The number of Common Shares beneficially owned is reported as of August
16, 2011, and consists of 11,617,370 Common Shares underlying 10% Senior Redeemable Convertible Preferred Stock (the Preferred Stock) and
758,970 Common Shares. As of August 16, 2011, each share of Preferred Stock converts into 114.29 Common. This amendment is being filed because of
an increase in UBS AGs beneficial ownership due solely to a Preferred Stock dividend.
2. This percentage is calculated as of August 16, 2011
pursuant to rule 13(d)(1)(i) and is based upon 48,821,142 Common Shares outstanding as of August 4, 2011 (as reported in Issuers 10-Q filed August 12, 2011).
Item 1. Security and Issuer
The class of equity securities to which this statement relates is the common stock, $0.001 par
value per share (the Common Shares), of Dune Energy, Inc., a Delaware corporation (the Issuer).
The principal executive offices of the Issuer are located at Two Shell Plaza, 777 Walker Street,
Suite 2300, Houston, Texas 77002.
Item 2. Identity and Background
(a) (c) This Schedule 13D is being filed on behalf of UBS AG (the Reporting Person). UBS AGs
principal business offices are located at:
Bahnhofstrasse 45
CH-8001
Zurich, Switzerland
and
Aeschenvorstadt 1
CH-4051
Basel, Switzerland
UBS AG is a major international banking and financial firm. UBS AG, a Swiss banking corporation,
is publicly owned, and its shares are listed on the Zurich and New York exchanges. UBS Securities
LLC is a wholly owned subsidiary of UBS AG. Like most securities firms, UBS Securities LLC is, and
has been, a defendant in numerous legal actions brought by private plaintiffs relating to its
securities business that allege various violations of federal and state securities laws. UBS AG
files annual reports on Form 20-F with the SEC, and also files quarterly reports and certain other
material information with the SEC under cover of Form 6-K. These reports are publicly available.
These reports include material information about UBS Securities LLC matters, including information
about any material litigation or administrative proceedings.
Further, UBS AG, UBS Securities LLC and other affiliated entities, like most large, full service
investment banks and broker-dealers, receive inquiries and are sometimes involved in investigations
by the Federal Reserve Bank, SEC, NYSE and various other regulatory organizations and government
agencies. UBS AG and its affiliates and subsidiaries fully cooperate with the authorities in all
such requests. UBS Securities LLC regularly reports to the Financial Industry Regulatory
Authority, Inc on form B-D and to the SEC on the Schedule E to Form ADV investigations that result
in orders. These reports are publicly available.
(d) (e) During the last five years, the Reporting Person, nor to the best of the Reporting
Persons knowledge, any of the executive officers has not (1) been convicted in a criminal
proceeding (excluding traffic violations or similar misdemeanors) or (2) has been a party to a
civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of
such proceeding was or is subject to a judgment, decree or final order enjoining future violations
of, or prohibiting or mandating activities subject, to federal or state securities laws or finding
any violation with respect to such laws, except as follows:
Municipal Bonds: In November 2006, UBS and others received subpoenas from the Antitrust Division of
the US Department of Justice (DOJ) and the US Securities and Exchange Commission (SEC) seeking
information relating to the investment of proceeds of municipal bond issuances and associated
derivative transactions. In addition, various state Attorneys General have issued subpoenas seeking
similar information. The investigations are ongoing, and UBS is cooperating. Several putative class
actions also have been filed in Federal District Courts against UBS AG and numerous other firms. In
the SEC investigation, on 4 February 2008, UBS received a Wells notice advising that the SEC
staff is considering recommending that the SEC bring a civil action against UBS in connection with
the bidding of various financial instruments associated with municipal securities. In December
2010, three former UBS employees were indicted in connection with the Federal criminal antitrust
investigation. Discussions with the SEC, DOJ and a number of state Attorneys General are ongoing.
Auction Rate Securities: UBS was the subject of an SEC investigation and state regulatory actions
relating to the marketing and sale of auction rate securities (ARS) to clients, and to UBSs role
and participation in ARS auctions and underwriting of ARS. UBS was also named in several putative
class actions and individual civil suits and arbitrations. The regulatory actions and
investigations and the civil proceedings followed the disruption in the markets for these
securities and related auction failures since mid-February 2008. At the end of 2008 UBS entered
into settlements with the SEC, the New York Attorney General (NYAG) and the Massachusetts
Securities Division whereby UBS agreed to offer to buy back ARS from eligible customers within
certain time periods, the last of which began on 30 June 2010, and to pay penalties of USD 150
million (USD 75 million to the NYAG, USD 75 million to the other states). UBSs settlement is
largely in line with similar industry regulatory settlements. UBS has settled with the majority of
states and is continuing to finalize settlements with the rest. The SEC continues to investigate
individuals affiliated with UBS regarding the trading in ARS and disclosures. During the third
quarter of 2010, a claimant alleging consequential damages from the illiquidity of ARS was awarded
approximately USD 80 million by an arbitration panel and UBS has booked a provision of CHF 78
million relating to the case. UBS moved in state court to vacate the award and oral argument was
heard on that motion in December 2010.
Inquiries Regarding Cross-Border Wealth Management Businesses: Following the disclosure and the
settlement of the US cross-border matter tax and regulatory authorities in a number of countries
have made inquiries and served requests for information located in their respective jurisdictions
relating to the cross-border wealth management services provided by UBS and other financial
institutions. UBS is cooperating with these requests within the limits of financial privacy
obligations under Swiss and other applicable laws.
Matters Related to the Credit Crisis: UBS is responding to a number of governmental inquiries and
investigations and is involved in a number of litigations, arbitrations and disputes related to the
credit crisis and in particular mortgage-related securities and other structured transactions and
derivatives. These matters concern, among other things, UBSs valuations, accounting
classifications, disclosures, writedowns, contractual obligations and interactions with rating
agencies, as well as its role as underwriter in securities offerings for other issuers. In
particular, UBS has communicated with and has responded to inquiries by various governmental and
regulatory authorities, including the Swiss Financial Market Supervisory Authority (FINMA), the UK
Financial Services Authority (FSA), the SEC, the US Financial Industry Regulatory Authority
(FINRA), the Financial Crisis Inquiry Commission (FCIC), the New York Attorney General, and the US
Department of Justice, regarding some of these issues and others, including: the role of internal
control units; the risk control, valuation, structuring and marketing of mortgage-related
instruments; and compliance with public disclosure rules.
Lehman Principal Protection Notes: From March 2007 through September 2008, UBS sold approximately
USD 1 billion face amount of structured notes issued by Lehman Brothers Holdings Inc. (Lehman), a
majority of which were referred to as principal protection notes, reflecting the fact that while
the notes return was in some manner linked to market indices or other measures, some or all of the
investors principal was an unconditional obligation of Lehman as issuer of the note. UBS has been
named along with other defendants in a putative class action alleging materially misleading
statements and omissions in the prospectuses relating to these notes and asserting claims under
US securities laws. UBS has also been named in numerous individual civil suits and customer
arbitrations (some of which have resulted in settlements or adverse judgments), was named in a
proceeding brought by the New Hampshire Bureau of Securities, and is responding to investigations
by other state regulators and FINRA relating to the sale of these notes to UBS customers. The
customer litigations and regulatory investigations relate to whether UBS adequately disclosed the
risks of these notes to its customers.
Claims Related to Sales of RMBS and Mortgages: From 2002 through about 2007, UBS was a substantial
underwriter and issuer of US residential mortgage-backed securities (RMBS). UBS has been named as a
defendant relating to its role as underwriter and issuer of RMBS in more than 20 lawsuits relating
to at least USD 39 billion in original face amount of RMBS underwritten or issued by UBS. Most of
the lawsuits are in their early stages. Many have not advanced beyond the motion to dismiss phase;
some are in the early stages of discovery. In connection with certain of the lawsuits, UBS expects
to be indemnified against any loss or liability by third-party issuers. UBS is also named as a
defendant in litigation by insurers of RMBS seeking recovery of insurance paid to RMBS investors.
These insurers allege that UBS and other RMBS underwriters aided and abetted misrepresentations and
fraud by RMBS issuers, and claim equitable and contractual subrogation rights. UBS has also been
contacted by certain government-sponsored enterprises requesting that UBS repurchase securities
issued in UBS-sponsored RMBS offerings.
As described under Note 15 Other contingent liabilities, UBS also has contractual
obligations to repurchase US residential mortgage loans as to which its representations made at the
time of transfer prove to have been materially inaccurate. Contested loan repurchase demands
relating to loans with an initial principal balance of USD 30 million are the subject of
litigation.
Claims Related to UBS Disclosure: A putative consolidated class action has been filed in the United
States District Court for the Southern District of New York against UBS, a number of current and
former directors and senior officers and certain banks that underwrote UBSs May 2008 Rights
Offering (including UBS Securities LLC) alleging violation of the US securities laws in connection
with the firms disclosures relating to its positions and losses in mortgage-related securities,
its positions and losses in auction rate securities, and its US cross-border business. Defendants
have moved to dismiss the complaint for failure to state a claim. UBS, a number of senior officers
and employees and various UBS committees have also been sued in a putative consolidated class
action brought on behalf of current and former participants in two UBS Employee Retirement Income
Security Act (ERISA) retirement plans in which there were purchases of UBS stock. Defendants have
moved to dismiss the ERISA complaint for failure to state a claim.
Madoff: In relation to the Bernard L. Madoff Investment Securities LLC (BMIS) investment fraud, UBS
AG, UBS (Luxembourg) SA and certain other UBS subsidiaries have been subject to inquiries by a
number of regulators, including FINMA and the Luxembourg Commission de Surveillance du Secteur
Financier (CSSF). Those inquiries concerned two third-party funds established under Luxembourg law
substantially all assets of which were with BMIS, as well as certain funds established under
offshore jurisdictions with either direct or indirect exposure to BMIS. These funds now face severe
losses, and the Luxembourg funds are in liquidation. The last reported net asset value of the two
Luxembourg funds before revelation of the Madoff scheme was approximately USD 1.7 billion in the
aggregate, although that figure likely includes fictitious profit reported by BMIS. The
documentation establishing both funds identifies UBS entities in various roles including custodian,
administrator, manager, distributor and promoter, and indicates that UBS employees serve as board
members. Between February and May 2009 UBS (Luxembourg) SA responded to criticisms made by the CSSF
in relation to its responsibilities as custodian bank and demonstrated to the satisfaction of the
CSSF that it has the infrastructure and internal organization in place in accordance with
professional standards applicable to custodian banks in Luxembourg. In December 2009 and March 2010
the liquidators of the two Luxembourg funds filed claims on behalf of the funds against UBS
entities, non-UBS entities and certain individuals including current and former UBS employees. The
amounts claimed are approximately EUR 890 million and EUR 305 million respectively. In addition, a
large number of alleged beneficiaries have filed claims against UBS entities (and non-UBS entities)
for purported losses relating to the Madoff scheme. The majority of these cases are pending in
Luxembourg, where appeals have been filed against the March 2010 decisions of the court in which
the claims in a number of test cases were held to be inadmissible. In the US, the BMIS Trustee has
filed claims against UBS entities, amongst others, in relation to the two Luxembourg funds and one
of the offshore funds. A claim was filed in November 2010 against 23 defendants including UBS
entities, the Luxembourg and offshore funds concerned and various individuals, including current
and former UBS employees. The total amount claimed against all defendants is no less than USD 2
billion. A second claim was filed in December 2010 against 16 defendants including UBS entities and
the Luxembourg fund concerned. The total amount claimed against all defendants is not less than USD
555 million. In Germany, certain clients of UBS are exposed to Madoff-managed positions through
third-party funds and funds administered by UBS entities in Germany. To date one claim has been
filed.
HSH Nordbank AG (HSH): HSH has filed an action against UBS in New York State court relating to USD
500 million of notes acquired by HSH in a synthetic collateralized debt obligation (CDO)
transaction known as North Street Referenced Linked Notes, 2002-4 Limited (NS4). The notes were
linked through a credit default swap between the NS4 issuer and UBS to a reference pool of
corporate bonds and asset-backed securities. HSH alleges that UBS
knowingly misrepresented the risk in the transaction, sold HSH notes with embedded losses, and
improperly profited at HSHs expense by mis-using its right to substitute assets in the reference
pool within specified parameters. HSH is seeking USD 500 million in compensatory damages plus
pre-judgment interest. The case was initially filed in 2008. Following orders issued in 2008 and
2009, in which the court dismissed most of HSHs claims and its punitive damages demand and later
partially denied a motion to dismiss certain repleaded claims, the claims remaining in the case are
for fraud, breach of contract and breach of the implied covenant of good faith and fair dealing.
Both sides have appealed the courts most recent partial dismissal order, and a decision on the
appeal is pending.
Puerto Rico Matter: The SEC has been investigating UBSs secondary market trading and associated
disclosures involving shares of closed-end funds managed by UBS Asset Managers of Puerto Rico,
principally in 2008 and 2009. In November 2010, the SEC issued a Wells notice to two UBS
subsidiaries, advising them that the SEC staff is considering whether to recommend that the SEC
bring a civil action against them relating to these matters. We believe that the negative financial
results, if any, to shareholders of the Funds who traded their shares through UBS during the
relevant periods were less than USD 5 million in the aggregate.
In January 2009, the City of Milan filed civil proceedings against UBS Limited, UBS Italia SIM Spa and three
other international banks in relation to a 2005 bond issue and associated derivatives transactions entered into with the City of Milan between 2005 and 2007. The claim
is to recover alleged damages in an amount which will compensate for terms of the related derivatives which the City claims to be objectionable. In the alternative, the
City seeks to recover alleged hidden profits asserted to have been made by the banks in an amount of approximately EUR 88 million (of which UBS Limited is alleged to have
received approximately EUR 16 million) together with further damages of not less than EUR 150 million. The claims are made against all of the banks on a joint and several
basis. In addition, two current UBS employees and one former employee, together with employees from other banks, a former City officer and a former adviser to the City,
are facing a criminal trial for alleged "aggravated fraud" in relation to the City's 2005 bond issue and the execution, and subsequent restructuring, of certain related
derivative transactions. The primary allegation is that UBS Limited and the other international banks fraudulently obtained hidden and / or illegal profits by entering
into the derivative contracts with the City of Milan. The banks also face an administrative charge of failing to have in place a business organizational model to avoid
the alleged misconduct by employees, the sanctions for which could include a limitation on activities in Italy. The City has separately asserted claims for damages
against UBS Limited and UBS individuals in relation to this alleged failure. A number of transactions with other public entity counterparties in Italy have also been
called into question or become the subject of legal proceedings and claims for damages and other awards. These include derivative transactions with the Regions of Calabria,
Tuscany, Lombardy and Lazio and the City of Florence. UBS has itself issued proceedings before English courts in connection with a number of derivative transactions with
Italian public entities, including some of those mentioned above, aimed at obtaining declaratory judgments as to the legitimacy of UBS's behavior.
In 2006 and 2007, KWL entered into a series of managed Credit Default Swap transactions with bank
swap counterparties, including UBS. Under the CDS contracts between KWL and UBS, the last of which were terminated by UBS on 18 October 2010, a net sum of approximately USD 138
million has fallen due from KWL but not been paid. In January 2010, UBS issued proceedings in the English High Court against KWL seeking various declarations from the English court,
in order to establish that the swap transaction between KWL and UBS is valid, binding and enforceable as against KWL. On 15 October 2010, the English court dismissed an application
by KWL contesting its jurisdiction, and ruled that it has jurisdiction and will hear the proceedings. On 18 October 2010, UBS issued a further claim against KWL in the English court
seeking declarations concerning the validity of UBS's early termination on that date of the remaining CDS with KWL. On 11 November 2010, the English Supreme Court ruled in a case
concerning similar jurisdictional issues, but not involving UBS, that certain questions should be referred to the European Court of Justice. Thereafter, KWL was granted permission
to appeal certain jurisdictional aspects of its claim, and the court ordered a temporary stay of the proceedings related to UBS's claim for a declaration as to validity. In March 2010,
KWL issued proceedings in Leipzig, Germany, against UBS and other banks involved in these contracts, claiming that the swap transactions are void and not binding on the basis of KWL's
allegation that KWL did not have the capacity or the necessary internal authorization to enter into the transactions and that the banks knew this. UBS is contesting the claims and has
also contested the jurisdiction of the Leipzig court. The Leipzig court indicated in August 2010 that it did not have jurisdiction over KWL's claim. Subsequently, KWL made a further
submission in October 2010 making additional allegations including fraudulent collusion by UBS employees. On 15 February 2011, the Leipzig court proposed that the proceedings in Leipzig
be stayed against UBS and the other banks pending the outcome of the appeal on the jurisdiction aspects in England.
The other two banks that entered into CDS transactions with KWL entered
into back-to-back CDS transactions with UBS. In April 2010, UBS issued separate proceedings in the English High Court against those bank swap counterparties seeking declarations as to
the parties' obligations under those transactions. The aggregate amount that UBS contends is outstanding under those transactions is approximately USD 189 million. These English proceedings are also currently stayed.
It is reported that in January 2011, the former managing director of KWL and two financial advisers were convicted on criminal charges related to certain KWL transactions, including swap transactions with UBS and other banks.
UBS has received subpoenas from the SEC, the US Commodity Futures Trading Commission and the US Department of Justice in
connection with investigations regarding submissions to the British Bankers' Association, which sets LIBOR rates. UBS understands that the investigations focus on whether there were improper attempts
by UBS, either acting on its own or together with others, to manipulate LIBOR rates at certain times. In addition, UBS has received an order to provide information to the Japan Financial Supervisory
Agency concerning similar matters. UBS is conducting an internal review and is cooperating with the investigations.
Item 3. Source and Amount of Funds or Other Consideration
The source of funds for the purchases of the Preferred Stock (as defined above in Item 1) was
internal funds of UBS AG (UBS) and the affiliates that purchased the subject securities.
Item 4. Purpose of Transaction
The Preferred Stock was acquired for investment and proprietary trading purposes. UBS intends
to review continuously its position with the Issuer. Depending on future evaluations of the
business prospects of the Issuer and upon other development, including, but not limited to, general
and economic business conditions and stock market conditions, UBS may retain or dispose from time
to time of all or a portion of their holdings, subject to any applicable legal and contractual
restrictions on their ability to do so.
UBS has converted a portion of the Preferred Stock into Common Shares available for sale.
Except as set forth in this Item 4, the reporting person does not have any present plans or
proposals that relate to or that would result in any of the actions described in subparagraphs (a)
through (j) of Item 4 of Schedule 13D.
Item 5. Interest in Securities of the Issuer
(a) This statement on Schedule 13D is being filed by UBS on behalf of itself and its
subsidiaries. The securities being reported on by UBS representing the Common Shares are held
directly by UBS Securities LLC and UBS Financial Services.
For purposes of Rule 13d-3, as of August 16, 2011 UBS may be deemed to beneficially own 12,376,340
Common Shares, consisting of 11,617,370 Common Shares underlying Preferred Stock and 758,970 Common
Shares, or approximately 20.48% of the outstanding Common Shares.
(b) The Reporting Person has sole voting and dispositive power over all of the Common Shares
reported above.
(c) Inapplicable.
(d) Inapplicable.
(e) Inapplicable.
Item 6. Contracts, Arrangements, Understandings or Relationships with Respect to Securities of
the Issuer
To the best knowledge of UBS, except as described under Item 4 above, no contracts,
arrangements, understandings or relationship (legal or otherwise) exist between UBS and any other
person with respect to the securities of the Issuer
Item 7. Material to be Filed as Exhibits
None.
SIGNATURE
After reasonable 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.
Date: August 18, 2011
By:
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By: |
/s/ Anthony DeFilippis
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Name: |
Anthony DeFilippis |
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Title: |
Executive Director |
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By: |
/s/ Gordon Kiesling
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Name: |
Gordon Kiesling |
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Title: |
Executive Director |
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