Regarding the shelf registration

[Palm]

Well said. This is as CV said, "prudent" planning for the coming events. This way they can focus on development and the project without looking over their shoulder. Move ahead.

[sltibbs]

I did some DD and made some inquiries about the shelf and here is what I learned.

Existing Shelf registrations firms are allowed to either file a new shelf registration or they can file a post-effective amendment to the existing shelf registration to expand their available capacity. Also, let me be clear that I am not an expert on shelf registrations, but under Rule 462 firms can expand their shelf registrations by 20% of the remaining capacity (which wouldn’t have really helped with the Nov. 2010 shelf, however, under Rule 429 there is no 20% restriction the firm could file a new registration statement and combine it with the existing shelf registration statement, then the new combined shelf registration statement would act as a post-effective amendment to the existing shelf registration, which would then be subject to potential SEC staff review, in contrast to post-effective amendments filed under Rule 462 under the Securities Act would not be subject to an SEC staff review. So I learned something new, shelf registrations can be expanded.

Concerning the new, when the shelf was filed in Nov. 2010 IOC was under Canadian GAAP. To file shelf they had to have audited financials in the last 9 (not 6) months. So Nov. 2 was less than 9 months away since filing date (March 1st I think). An additional requirement for that shelf was also to have one of the quarterly statements reconciled with US GAAP (Annual statement was already reconciled with US GAAP).

Now they are under IFRS, so no reconciliation required and since right after filing no issue with same 9 month restriction. They could have expanded the last shelf, except that there was an inquiry from Alberta about the categorization of seismic costs, which was addressed in the financials. (If there are any inquiries, then a shelf is not allowed.) Another issue that limited a shelf is that they likely had management had material non-public information during that time (before the other shelf expired), and I guess the only way they got around the material non-public info this time is that the shelf was filed right before bids were received. If bids were received, based on my understanding, they wouldn’t have been able to issue a shelf until the winner/partner was selected.

This is correct to the best of my knowledge, but please do your own DD.

Best,
Sam

[warrenkj]

Thank you for the info, sltibbs.
For reference, IFRS is International Financial Reporting Standards and it's sometimes called IAS, International Accounting Standards.