SandRidge Energy Inc (SD)

[jtomm]

Expensive Document

With whatever the company might be planning in filing the shelf registration, I was wondering how serious they are about doing something? Roughly, what is the total cost of filing an S-3? You can usually get a pretty good idea of seriousness by the amount of money willing to be spent.

The SEC filing fees alone are $46,350. Then, I have a buddy who's been general counsel to a couple of public companies. I asked him if a shelf registration is something you can usually handle in-house or would there be additional legal fees to hire an outside firm to help? If outside firm, is that like an additional $20-$30K, or how much? He said usually an outside firm is required becuz lots of reading and editing, have to make sure definitions and phrases are stated exactly correct, and match exactly with all previous documents, etc., tons of stuff the SEC requires. He said the tab would be more like $200k to $500k. I was floored. I said even if it never gets used, it might might be $250-$500k just to prepare and file that document? Yep.

So SD must be pretty serious about intending to use this offering. What for, I don't know, but that's likely a darned expensive document.