| UNITED STATES | ||||
SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 | ||||
| FORM 40-F | ||||
| (Mark One) | ||||
| o | REGISTRATION STATEMENT PURSUANT TO SECTION 12 OF THE SECURITIES EXCHANGE ACT OF 1934 | |||
| OR | ||||
| x | ANNUAL REPORT PURSUANT TO SECTION 13(a) OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||
For the fiscal year ended: December 31, 2009 | Commission File Number: 333-96537 | |||
| COMPTON PETROLEUM CORPORATION | ||||
(Exact name of Registrant as specified in its charter) | ||||
| ALBERTA, CANADA | ||||
| (Province or other jurisdiction of incorporation or organization) | ||||
1311 (Primary Standard Industrial Classification Code Number (if applicable)) | ||||
| NOT APPLICABLE | ||||
| (I.R.S. Employer Identification Number (if applicable)) | ||||
SUITE 500, 850 - 2ND STREET S.W., CALGARY, ALBERTA, CANADA T2P 0R8 (403) 237-9400 | ||||
| (Address and telephone number of Registrant’s principal executive offices) | ||||
CT CORPORATION SYSTEM, 111 EIGHTH AVENUE, NEW YORK, NEW YORK 10011 (212) 894-8400 | ||||
(Name, address (including zip code) and telephone number (including area code) of agent for service in the United States) | ||||
| Securities registered or to be registered pursuant to Section 12(b) of the Act: | ||||
| Title of Each Class | Name of Each Exchange on Which Registered | |||
| Common Shares, no par value | NewYork Stock Exchange | |||
| Securities registered or to be registered pursuant to Section 12(g) of the Act: | ||||
| None | ||||
| (Title of Class) | ||||
| Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act: | ||||
| None | ||||
| (Title of Class) | ||||
| For annual reports, indicate by check mark the information filed with this Form: | ||||
x Annual information form | x Audited annual financial statements | |||
Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report: | ||||
| 263,573,461 Common Shares outstanding as of December 31, 2009 | ||||
| Indicate by check mark whether the Registrant by filing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934 (the “Exchange Act”). If “Yes” is marked, indicate the filing number assigned to the Registrant in connection with such Rule. | ||||
o Yes | x No |
| Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. | |
x Yes | oNo |
| The Annual Report on Form 40-F shall be incorporated by reference into or as an exhibit to, as applicable, the Registrant's Registration Statement under the Securities Act of 1933; Form F-10 (File No. 333-163381). | ||||
PRINCIPAL DOCUMENTS
| The following documents have been filed as part of this Annual Report on Form 40-F: | |
| A. | ANNUAL INFORMATION FORM |
| For the Annual Information Form of Compton Petroleum Corporation ("Compton") for the year ended December 31, 2009, see Exhibit 20.1 of this Annual Report on Form 40-F. | |
B. | AUDITED ANNUAL FINANCIAL STATEMENTS |
| For Compton's audited consolidated financial statements for the year ended December 31, 2009 and 2008, including the auditor's report with respect thereto, see Exhibit 20.2 of this Annual Report on Form 40-F. For a reconciliation of important differences between Canadian and United States generally accepted accounting principles, see Note 22 of the Notes to the audited consolidated financial statements. | |
C. | MANAGEMENT'S DISCUSSION AND ANALYSIS |
| For Compton's Management's Discussion and Analysis for the year ended December 31, 2009, see Exhibit 20.3 of this Annual Report on Form 40-F. | |
| DISCLOSURE CONTROLS AND PROCEDURES | |
| A. | CERTIFICATIONS |
| The required disclosure is included in Exhibits 31.1, 31.2 and 32.2 of this Annual Report on Form 40-F. | |
| B. | EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES |
| Compton maintains disclosure controls and other procedures and internal control over financial reporting designed to ensure that information required to be disclosed in the reports filed under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commission's (the "Commission") rules and forms. Compton's principal executive officer and principal financial officer evaluated the effectiveness of Compton's disclosure controls and procedures (as defined in the Exchange Act Rules 13a-15(e) and 15d-15(e)) as of the end of the period covered by this report and concluded that such disclosure controls and procedures are effective to ensure that information required to be disclosed by Compton in reports that it files or submits under the Exchange Act is (i) recorded, processed, summarized, and reported within the time periods specified in the Commission's rules and forms and (ii) accumulated and communicated to Compton's management, including its principal executive officer and principal financial officer, to allow timely decisions regarding required disclosure. | |
2
It should be noted that while Compton's principal executive officer and principal financial officer believe that Compton's disclosure controls and procedures provide a reasonable level of assurance that they are effective, they do not expect that Compton's disclosure controls and procedures or internal control over financial reporting will prevent all errors and fraud. A control system, no matter how well conceived or operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. |
MANAGEMENT'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
The required disclosure is included beginning on page 14 of the Management's Discussion and Analysis of Compton for the fiscal year ended December 31, 2009, filed as part of this Annual Report on Form 40-F and included herein.
ATTESTATION REPORT OF THE REGISTERED PUBLIC ACCOUNTING FIRM
The required disclosure is included in the "Independent Auditor's Report" that accompanies the Consolidated Financial Statements of Compton for the fiscal year ended December 31, 2009, filed as part of this Annual Report on Form 40-F and included herein.
CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING
There were no changes during the year ended December 31, 2009 that materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
NOTICES PURSUANT TO REGULATION BTR
None.
AUDIT COMMITTEE FINANCIAL EXPERT
The Board of Directors of Compton has determined that J. Stephen Allan is an "audit committee financial expert" (as defined in paragraph 8(b) of General Instruction B to Form 40-F) serving on its Audit, Finance and Risk Committee. Pursuant to paragraph 8(a)(2) of General Instruction B to Form 40-F, the Board has determined that Mr. Allan meets the definition of independence applicable to audit committee members of New York Stock Exchange listed companies. For a description of Mr. Allan’s relevant experience in financial matters, see the "Directors and Officers" section in Compton's Annual Information Form for the year ended December 31, 2009, which is included as Exhibit 20.1 of this Annual Report on Form 40-F.
CODE OF BUSINESS CONDUCT AND ETHICS
Compton has adopted a "code of ethics" (as that term is defined in Form 40-F), entitled the "Code of Business Conduct and Ethics" that holds all of Compton's directors, officers, employees, and consultants to high standards of legal and moral conduct in all areas of operations. In addition to meeting legal and regulatory requirements, Compton strives to conduct all operations fairly and with integrity. Compton's Code of Business Conduct and Ethics may be viewed on Compton's website at www.comptonpetroleum.com.
In the past fiscal year, there has not been any amendment to the Code of Business Conduct and Ethics. No waivers from the Code were granted to the Corporation's Directors, Officers, employees or consultants in 2009. A departure from the code was reported in 2009 in respect of a conflict of interest concerning an employee for which Management took immediate action to resolve the conflict.
PRINCIPAL ACCOUNTANT FEES AND SERVICES
Grant Thornton LLP ("Grant Thornton") has been the auditor of Compton since 1996. The aggregate amounts billed by Grant Thornton for each of the last two fiscal years for audit fees, audit-related fees, tax fees, and all other fees, including expenses, are set forth below. All amounts are in Canadian dollars.
3
AUDIT FEES: The aggregate fees billed for each of the last two fiscal years of Compton ending December 31, 2009 and December 31, 2008, for professional services rendered by Grant Thornton for the audit of its annual financial statements, the review of Sarbanes-Oxley Act and similar Canadian regulatory compliance, or services that are normally provided by Grant Thornton in connection with statutory and regulatory filings or engagements for those fiscal years, are $1,030,849 and $860,974 respectively. In addition, in 2009 and 2008 respectively, fees paid to Grant Thornton related to the review of Sarbanes-Oxley Act and similar Canadian regulatory compliance amounted to $158,945 and $1,220.
AUDIT-RELATED FEES: The aggregate fees billed for each of the last two fiscal years of Compton ending December 31, 2009 and December 31, 2008, related to audit related services were $51,636 and $55,765 respectively. Services were provided to translate the annual and interim financial statements into French as well as the reimbursement of the prorate share of annual fees charged by the U.S. and Canadian public accounting boards.
TAX FEES: The aggregate fees billed for each of the last two fiscal years of Compton, ending December 31, 2009 and December 31, 2008, for professional services rendered by Grant Thornton for tax-related services consisting of the review of tax forms were $21,945 and $nil, respectively.
ALL OTHER FEES: The aggregate fees billed for each of the last two fiscal years of Compton ending December 31, 2009 and December 31, 2008, for other services including assistance in the preparation of the prospectus document, the preparation of a scoping, planning and implementation document to support the transition to International Financial Reporting Standards on January 1, 2011, and minor GST research were $137,000 and $1,220 respectively. Compton's Audit, Finance and Risk Committee pre-approved all of the noted services.
AUDIT COMMITTEE PRE-APPROVAL POLICIES AND PROCEDURES: The Audit, Finance and Risk Committee of Compton considered the above fees and determined that they are reasonable and do not impact the independence of Compton's auditors. Further, such Committee determined that in order to ensure the continued independence of the auditors, only limited non-audit related services would be provided to Compton by Grant Thornton and in such case, only with the prior approval of the Audit, Finance and Risk Committee. The Committee has pre-approved Management to retain Grant Thornton to provide miscellaneous, minor, non-audit services in circumstances where it is not feasible or practical to convene a meeting of the Audit, Finance and Risk Committee, subject to an aggregate limit of $25,000 per quarter.
OFF-BALANCE SHEET ARRANGEMENTS
Compton does not have any material off-balance sheet arrangements.
CONTRACTUAL OBLIGATIONS
The required disclosure is included on page 12 of the Management's Discussion and Analysis of Compton for the fiscal year ended December 31, 2009, filed as part of this Annual Report on Form 40-F and included herein.
IDENTIFICATION OF THE AUDIT COMMITTEE
Compton has a separately designated standing audit committee established in accordance with Section 3(a)(58)(A) of the Exchange Act. The members of the audit committee are: J. Stephen Allan (Chair), M.F. Belich, T.S. Granger, R.B. Hurtibise, and W.M. Shimmerlik.
4
DISCLOSURE PURSUANT TO THE REQUIREMENTS OF THE NEW YORK STOCK EXCHANGE
PRESIDING DIRECTOR AT EXECUTIVE SESSIONS OF NON-MANAGEMENT DIRECTORS: Compton's Chair of the Board, who is not a member of Compton's management, presides at all executive sessions of non-management directors of Compton's Board of Directors. In the absence of the Chair of the Board, pursuant to the Board of Directors Charter, the members of the executive session choose a member to preside over such executive session.
COMMUNICATIONS WITH NON-MANAGEMENT DIRECTORS: Communications with Compton's non-management directors may be addressed to: Chair of the Board; c/o Corporate Secretary, Compton Petroleum Corporation, 500, 850 - - 2nd Street S.W., Calgary, Alberta, Canada T2P 0R8.
CORPORATE GOVERNANCE GUIDELINES: Compton has adopted Corporate Governance Principles, which can be found on the Compton's website at www.comptonpetroleum.com.
5
UNDERTAKING AND CONSENT TO SERVICE OF PROCESS
UNDERTAKING
Compton undertakes to make available, in person or by telephone, representatives to respond to inquiries made by the Commission staff, and to furnish promptly, when requested to do so by the Commission staff, information relating to: the securities registered pursuant to Form 40-F; the securities in relation to which the obligation to file an annual report on Form 40-F arises; or transactions in said securities.
CONSENT TO SERVICE OF PROCESS
Compton has previously filed a Form F-X in connection with the class of securities in relation to which the obligation to file this report arises.
Any change to the name or address of the agent for service of process of Compton shall be communicated promptly to the Commission by an amendment to the Form F-X referencing the file number of the relevant registration statement.
SIGNATURE
Pursuant to the requirements of the Exchange Act, Compton certifies that it meets all of the requirements for filing on Form 40-F and has duly caused this Annual Report to be signed on its behalf by the undersigned, thereto duly authorized.
Dated this 25th day of February, 2010.
COMPTON PETROLEUM CORPORATION | ||||
| By: | /s/ C.W. Leigh Cassidy | |||
| Name: | C.W. Leigh Cassidy | |||
| Title: | Vice President, Finance & Chief Financial Officer | |||
6
Documents filed as part of this report:
EXHIBIT INDEX
| EXHIBIT NO. | DESCRIPTION | |
| 20.1 | Annual Information Form for the fiscal year ended December 31, 2009. | |
| 20.2 | Consolidated Financial Statements for the fiscal years ended December 31, 2009 and 2008. | |
| 20.3 | Management's Discussion and Analysis for the fiscal year ended December 31, 2009. | |
| 23.1 | Consent of Grant Thornton LLP, independent chartered accountants. | |
| 23.2 | Consent of Netherland, Sewell & Associates, Inc. | |
| 31.1 | Certification of Chief Executive Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934. | |
| 31.2 | Certification of Chief Financial Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934. | |
| 32.1 | Certification of Chief Executive Officer pursuant to Rule 13(a)-14(b) and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. 1350). | |
| 32.2 | Certification of Chief Financial Officer pursuant to Rule 13(a)-14(b) and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. 1350). |
7