Hyperdynamics Corp (HDYNQ)

[Rule_62]

OK best I can tell under Regulation M:

If the stabilization began prior to the determination of the offering price, it is initiated at the last market price. I can't find anything on whether shorting as a stabilization strategy can be initiated prior to filing. That seems to be what this comes down to. Everything else seems legit. Best I can tell, they could not short from the time of filing until pricing. Nothing about prior to filing.

Securities Lawyer's Deskbook
http://taft.law.uc.edu/CCL/regM/index.html

Excerpts:

Rule 104 Stabilizing and Other Activities in Connection with an Offering

a. "•Maximum stabilizing bid. Notwithstanding the other provisions of this paragraph (f), no stabilizing shall be made at a price higher than the lower of the offering price or the stabilizing bid for the security in the principal market (or, if the principal market is closed, the stabilizing bid in the principal market at its previous close)."

"•Initiating stabilizing when there is no market for the security or before the offering price is determined. If no bona fide market for the security being distributed exists at the time stabilizing is initiated, no stabilizing shall be initiated at a price in excess of the offering price. If stabilizing is initiated before the offering price is determined, then stabilizing may be continued after determination of the offering price at the price at which stabilizing then could be initiated."

Rule 105 Short Selling in Connection with a Public Offering

"a.Unlawful Activity. In connection with an offering of equity securities for cash pursuant to a registration statement or a notification on Form 1-A or Form 1-E filed under the Securities Act of 1933 ("offered securities"), it shall be unlawful for any person to sell short (as defined in Rule 242.200(a)) the security that is the subject of the offering and purchase the offered securities from an underwriter or broker or dealer participating in the offering if such short sale was effected during the period ("Rule 105 restricted period") that is the shorter of the period:

•Beginning five business days before the pricing of the offered securities and ending with such pricing; or

•Beginning with the initial filing of such registration statement or notification on Form 1-A or Form 1-E and ending with the pricing."

Also here's an excerpt on overallotting and stabilization from Barron's Stockbroker Examination
http://books.google.ca/books?id=iD-m9rQ3214C&pg=PA102&lpg=PA102&dq=greenshoe+when+can++shorting+to+support+an+offering+begin?&source=bl&ots=AnV_U8P-Vf&sig=i3JkIDHXkAixKG1So_5ez1yS6Lk&hl=en&ei=RanFTdLzMYygsQO_3cWSAQ&sa=X&oi=book_result&ct=result&resnum=4&ved=0CC0Q6AEwAw#v=onepage&q&f=false