Full Compliance of InterOil with Requisition

[katytrader]

I cut and pasted this from an earlier post of mine on April 15, 2016 (Under : IOC Update re: Call for Special Meeting).

"It may also be a good idea to review what exactly PM et.al. are seeking.

They are seeking to have a special shareholders meeting at which all shareholders would be able to vote on the following proposals:

• reduce the size of the BOD from 10 to 6
• change IOC executive compensation policy to 1) reduce the amount of cash paid to $600K/year max, 2) require compensation to be at least 50% equity, 2) impose holding periods for stock compensation (actually to restrict the sale of any IOC stock to no more than 50% of director/officer's holding while employed and for 1 year after) , 3) restrict 'change of control' compensation payments to not allow such unless the IOC share price is over $60 and also over the share price when the office/director was hired or pro-rate the compensation respectively
• amend BOD policy on board member's qualifications to require 1/3 of directors to have competency in exploration/development of onshore O&G assets in the "PNG jungle"
• amend BOD policy of third-party reviews of assets to increase communication to shareholders regarding discoveries and development plans, specifically that the BOD disclose 1) why a discovery location is considered 'commercial' by the BOD, including the BOD views and assumptions on the cost of development, including specifically overall cost breakdowns for wells and development,) 2) likely markets for the production from the discovery, and 3) what update such discovery may imply to the company's annual resource reports
• amend BOD policy to insure that any resource evaluation companies retained have expertise in evaluating assets in the "PNG jungle".
• amend IOC charter to require shareholder approval of any sale of 10% or greater of IOC assets
• adopt a more rigorous disclosure policy by BOD to insure that shareholders "understand fully the exploration and development status of the Corporation's onshore licenses and development assets in the Papua New Guinea jungle"

2126, thanks for your summaries and for your diligence and patience in wading through all of this.

[Indoreservoir]

Spite. This release goes beyond presentation of fact to take opportunity for unneeded digs at management. This makes Phil look more bitter than concerned. Not how best to express concern.

*******

Agreed. When I ask someone to do something for me (especially something they are initiallty reluctant to do)...and they decide to do it...I usually say "thank you" (or at least try to be somewhat conciliatory).  Phil got what he wanted...and then still chose to attack Hession further.  Certainly allows one to question Phil's true motives.  That being said, it's probably a good end result.

They weren't reluctant - they flatly rejected PM's request and acted against the law.

I think PM attacked our Seven Million Dollar Man (MH) to illustrate MH incompetence and arrogance.

Maybe PM was a bit over the top in his press release, but the fact is he should not have had to initiate legal proceedings

I think PM's motives are clear - to reign-in our Seven Million Dollar Man for the benefit of shareholders (which materially excludes most of the Board).

Hats off to PM.

[2126]

Again, as I explained in an earlier post, again on 4/15/16, despite what Phil may think or feel or demand, the IOC BOD did not act illegally in rejecting a minority shareholder's demand to hold a special meeting:

"RE: Phil and legal proceedings:

Under Yukon corporate law, shareholders holding 5% or more of a corporation's shares may requisition (request) the BOD to call a special meeting. The directors are required to call such meeting unless 1) a 'record date' has already been set, 2) a shareholder's meeting has already been set and notice has already been given, 3) the business of the proposed special meeting as stated in the request (requisition) includes issues that "there are reasonable grounds for believing the primary purpose is to enforce a personal claim or redress a personal grievance against the corporation, its officers or directors." Additionally, if the directors who were proffered the request (requisition) do not call such special meeting within 21 days of the request, those requesting the special meeting may then call for the meeting. (Source: Yukon Business Corporation Act, Part 11: Shareholders, Section 144: Meetings on Requisition of Shareholders) .

It appears that what PM et al. have done is, on April 12, filed an action with the Yukon courts to call for such a special meeting."

[efi426hemi]

In Vegas waiting while my wife is shopping......

I think it is pretty obvious what is going on here, Phil has caught wind of a sale or merger and doesn't believe it brings fair value to shareholders, hence the approval of >10% company by shareholders, the rest of the ammendments is just noise.

Health and happiness,
Hemi

[katytrader]

In Vegas waiting while my wife is shopping...... I think it is pretty obvious what is going on here, Phil has caught wind of a sale or merger and doesn't believe it brings fair value to shareholders, hence the approval of >10% company by shareholders, the rest of the ammendments is just noise. Health and happiness, Hemi

Good grief!! The guy who wants to save money wants to have more shareholder votes at whatever costs on what in any other company would be delegated to the company's board????

So I'll ask once again.....yet to receive a comment from anyone here.....why would a professional money manager support any proposal which would hamper the company's ability to sell assets?    Remember, everyone votes on sale/merger of the company.  So here PM is addressing smaller potatoes.   As I wrote elsewhere, this is all about power and influence for a guy who couldn't get a deal done which would have made the pros happy.  Do you really think these people would give Philippe a second chance?

[efi426hemi]

Yup he wants control on asset sales, saving costs is just his bitterness towards current management and those amendments are just noise. You should ask about informal road shows by those not named PM for the purpose of not selling the company, some believe strongly in the license potential for right or wrong.

I will be using "good grief" tonight when the roulette table eats me alive......

[efi426hemi]

Let me put it another way, rank the 7 points PM wants voted on from highest to lowest of importance from PM's perspective.

Remember this is a guy who couldn't do a deal because he felt no one was ever paying him what the licenses were worth.

K, I am done, time to lose my shorts, come on red 27

Health and happiness,
Hemi

[ArtM72]

Spite. This release goes beyond presentation of fact to take opportunity for unneeded digs at management. This makes Phil look more bitter than concerned. Not how best to express concern.

I don't agree.  From what I've read so far he is simply putting IOC management responses in the proper context.

[ArtM72]

Mulacek might be pushing too hard for shareholder value, but my Trojan Horse theory of the past three years has yet to be disproved, with every reason to believe Hession is actively witholding information relevant to shareholder value to reduce the cost of acquisition. If the observation the Board of Directors of IOC violated the law is accurate we have further reason to believe something pretty nefarious may be going on that needs to be monitored and corrected. That would begin with voting to adopt Phil's proposals.

BTW, I don't think all analysts covering this stock have special information relative to the asset size, or could properly interpret that information if it was presented to them.

[ArtM72]

Steve, did you learn from this self-serving release that InterOil proposed a reduction of the board size to 8, which Mulacek rejected?  As for "delay", no responsible Board would respond without consultation with lawyers and amongst themselves.  If one thinks this doesn't take time, I would suppose that one has little experience with lawyers and committee meetings.   How long might one suppose a Board would take to fully discuss the implications of all of the proposals, not least of which is that four of the Board would have to give up their seats?  Personally, I am surprised that Finlayson suggested a Board of 8, assuming PM's filings to be true.

This is a negotiation in which one side decides to selectively disclose to an audience.  No doubt on advice of counsel, and perhaps also Board preference, the company has chosen to remain silent.  There is nothing peculiar or nefarious in waiting until the last day, or minute for that matter, in responding to an action which was not welcome.  From IOC's perspective, there is nothing to be gained in a public war of words with a diissident shareholder and his family.

You have defeated your own arguement by stating at the outset how difficult it is to make a timely decision then how IOC mgt should never respond until the last minute.  The fact is the required timing of IOC's response was not the result of any unreasonable PM demand but the requirements of Yukon law.  We've got our vote.   As they say, any exposure is good exposure.

Mulacek Rules!