There are accusations in the market place which suggest that members of the board and management of InterOil Corporation
(InterOil, IOC, or the Company) acted improperly related to transactions in shares of the Company and related entities. We assume
our clients are familiar with these accusations.
• We have done some additional research of the public filings from the nonprofit mentioned, interviewed management and reviewed
the early InterOil filings related to ownership interest.
• We do not believe there were improper actions by IOC management or board members and maintain our BUY
recommendation and $115 Price Target.   
o We understand the Fuller Foundation (Foundation) ownership in IOC was from its original investment as part of a group
to purchase the refinery in Alaska, which was refurbished and moved to Papua New Guinea to form the original core of
InterOil.  This led to the Fuller Foundation receiving a significant position in IOC that was held in a US entity, which was
necessary to secure the debt financing from the Overseas Private Investment Corp (OPIC).   
o We understand from multiple independent sources that the Foundation did not purchase interests in IOC from any of the
Company officers or directors. We understand that the Foundation did not purchase any IOC shares or related instruments
in its client accounts or investment funds.  The Foundation was audited by Deloitte and Touche during the years that we
reviewed, and we believe this firm would have reviewed for conflicts of interests and ensured appropriate policies were in place.  
o The budgetary issues at Calvin College are similar to issues at many other college endowments: (NY Times, Moody’s).
o Mr. Samuel Delcamp is a recent addition to the InterOil Board and was previously the Executive Director of the Fuller
Foundation.  His average total compensation for 2001-2011 of ~$536,000/yr is inline with our expectations for somebody
heading a foundation managing ~$450MM and living in a high cost area such as southern California. For reference, media
reports put the compensation of the ~$2 billion University of North Carolina endowment CEO at ~$665,000 in 2006 (link).
o The recently published summary report from Calvin College indicates that the primary issues related to building new
infrastructure in anticipation of additional gifts and investment returns (link). Both gifts and investment returns
underperformed expectations during the recent recession.  Given Calvin College’s location in Michigan, we suspect industries
supporting its alumni were particularly hard hit.

• We believe this story has been an overhang on the stock for some time.  We originally saw a similar story on March 22
.  We began reviewing the public filings and were able to engage with management on March 25 about the potential issues.  Management has
been diligent in responding to our questions with written correspondence that clarifies many of the issues.   
• We are working to communicate directly with Calvin College, but they seem overwhelmed by the recent influx of calls.  
• Please refer to our initiation piece on March 13, 2013 for more discussion of the Company, our investment thesis, and risks.

Also says that Calvin basically acquired their shares of IOC for equivalent $0.50.  Pretty sure that investment didn't cause any financial distress!

'Palm' pid='19691' datel Wrote:Great post/find STP. I reviewed a lot of this info and provided it to EnergyInvest85 who used it in his post on SA. There is such an overwhelming amount of info out there that points to nothing wrong being done by Byker/Fuller. There are public docs and reports available which show that accredidation processes, Calvin strategic planning sessions, etc looked at all that was going on as far as the building program, the investments, the plan for paying the debt, etc., and yet the accusers didn't bother to take the time and look at all that is available. AG instead calls the SEC, and my guess is they have already tossed it aside. A lot of people owe Byker and Delcamp a public apology, but let's see if they do it. Instead they likely will find minor things to barb about in the Westlake information.

They've been barbing for as long as I can remember, in fact, my last SA article was about just that. They'll always find something new to barb about, that really isn't a surprise either. But the diminishing returns of all that barbing have long ago set in..