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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 40-F
[_] Registration Statement pursuant to section 12 of the Securities
Exchange Act of 1934
[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, 2005
Commission File Number: 333-96537
COMPTON PETROLEUM CORPORATION
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(Exact name of Registrant as specified in its charter)
ALBERTA, CANADA
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(Province or other jurisdiction of incorporation or organization)
1311
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(Primary Standard Industrial Classification Code Numbers)
NOT APPLICABLE
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(I.R.S. Employer Identification Number (if applicable))
SUITE 3300, 425-1ST STREET, S.W., CALGARY, ALBERTA, CANADA T2P 3L8
(403) 237-9400
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(Address and telephone number of Registrant's principal executive offices)
CT CORPORATION SYSTEM, 111 EIGHTH AVENUE, NEW YORK, NEW YORK 10011
(212) 894-8400
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(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:
Common Shares, no par value
SECURITIES REGISTERED OR TO BE REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
TITLE OF EACH CLASS: None
SECURITIES FOR WHICH THERE IS A REPORTING OBLIGATION PURSUANT TO
SECTION 15(d) OF THE ACT:
7 5/8% Senior Notes due 2013
FOR ANNUAL REPORTS, INDICATE BY CHECK MARK THE INFORMATION FILED WITH THIS FORM:
[X] Annual information form [X] Audited annual financial statements
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.
127,263,476 Common Shares outstanding as of December 31, 2005
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Indicate by check mark whether the Registrant is furnishing the information
contained in this Form 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.
Yes [_] No [X]
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.
Yes [X] No [_]
PRINCIPAL DOCUMENTS
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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, 2005, 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, 2005 and 2004, 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 19 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, 2005, see Exhibit 20.3 of this Annual Report on Form 40-F.
CONTROLS AND PROCEDURES
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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, as amended, is recorded,
processed, summarized, and reported within the time periods specified in the
Commission's rules and forms. Compton's principal executive officer and
principal financial officer evaluated the effectiveness of Compton's disclosure
controls and procedures 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 the registrant in reports that it
files or submits under the Exchange Act is (i) recorded, processed, summarized,
and reported within the time periods specified in Securities and Exchange
Commission 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. However, as
recommended by the Commission in its adopting release, Compton will continue to
periodically evaluate its disclosure controls and procedures and will make
modifications from time to time as deemed necessary to ensure that information
is recorded, processed, summarized, and reported within the time periods
specified in the Commission's rules and forms.
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 the Company'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.
During the fiscal year ended December 31, 2005, there were no changes in
Compton's internal control over financial reporting that have materially
affected, or are reasonably likely to materially affect, Compton's internal
control over financial reporting.
AUDIT COMMITTEE FINANCIAL EXPERT
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The Board of Directors of Compton has determined that John Thomson 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 applied the definition of independence applicable to the audit committee
members of the New York Stock Exchange ("NYSE") listed companies. Mr. Thomson
is a corporate director and meets the NYSE definition of independence. For a
description of Mr. Thomson's relevant experience in financial matters, see the
"Directors and Officers" section in Compton's Annual Information Form for the
year ended December 31, 2005, which is included as Exhibit 20.1 of this Annual
Report on Form 40-F.
CODE OF BUSINESS CONDUCT AND ETHICS
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Compton's Code of Business Conduct and Ethics 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 2005, no waivers of, or amendments to, the Code of Business Conduct and
Ethics were made.
PRINCIPAL ACCOUNTANT FEES AND SERVICES
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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. 2004 amounts have been updated to
account for differences between accrued costs and actual billings. All amounts
are in Canadian dollars.
AUDIT FEES: The aggregate fees billed for each of the last two fiscal
years of Compton ending December 31, 2005 and December 31, 2004, for
professional services rendered by Grant Thornton for the audit of its annual
financial statements or services that are normally provided by Grant Thornton
in connection with statutory and regulatory filings or engagements for those
fiscal years, are $481,230 and $350,455 respectively.
AUDIT-RELATED FEES: The aggregate fees billed for each of the last two
fiscal years of Compton, ending December 31, 2005 and December 31, 2004, for
audit-related services by Grant Thornton were $221,997 and $131,315
respectively. In 2005, fees were incurred for services related to the Company's
equity offering in February 2005 and the issuance of the Company's U.S. dollar
Senior Notes in November 2005. Fees in 2004 related to the discussion of
accounting matters and reporting to the Trustee regarding compliance with the
Senior Notes Indenture.
3
TAX FEES: The aggregate fees billed for each of the last two fiscal years
of Compton, ending December 31, 2005 and December 31, 2004, for professional
services rendered by Grant Thornton for tax-related services consisting of the
review of tax forms were, $10,000 and $9,000 respectively. Compton's Audit,
Finance and Risk Committee approved all of the noted services.
ALL OTHER FEES: The aggregate fees billed for each of the last two fiscal
years of Compton ending December 31, 2005 and December 31, 2004, for other
services consisting of the translation of Compton's quarterly and annual
reports into French and discussions regarding the requirements of the Sarbanes
Oxley Act of 2002, were $41,930 and $49,598 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 very 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 $20,000 per quarter.
OFF-BALANCE SHEET ARRANGEMENTS
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Compton does not have any material off-balance sheet arrangements.
CONTRACTUAL OBLIGATIONS
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See page 11 of the Management's Discussion and Analysis of Compton for the year
ended December 31, 2005 attached hereto and included herein.
NOTICES PURSUANT TO REGULATION BTR
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None.
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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.
SIGNATURES
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 23th day of March, 2006.
COMPTON PETROLEUM CORPORATION
By: /s/ Norman G. Knechtu
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Name: Norman G. Knecht
Title: Vice President, Finance
and Chief Financial Officer
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Documents filed as part of this report:
EXHIBIT INDEX
EXHIBIT
NUMBER DESCRIPTION
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20.1 Annual Information Form for the fiscal year ended
December 31, 2005.
20.2 Consolidated Financial Statements for the fiscal years
ended December 31, 2005 and 2004.
20.3 Management's Discussion and Analysis for the fiscal year
ended December 31, 2005.
23.1 Consent of Grant Thornton LLP, independent chartered
accountants.
31.1 Certification of Chief Executive Officer pursuant to Rule
13a-14(a) or 15d-14 of the Securities Exchange Act of
1934.
31.2 Certification of Chief Financial Officer pursuant to Rule
13a-14(a) or 15d-14 of the Securities Exchange Act of
1934.
32.1 Certification of Chief Executive Officer pursuant to Rule
13a-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
13a-14(b) and Section 1350 of Chapter 63 of Title 18 of
the United States Code (18 U.S.C. 1350).