Member Info for Looed

Lifeishard — I’ll have to respectfully disagree. If someone is confident in their understanding of company law, it’s fair to expect that their explanation reflects the recognised legal structure and facts — not just a preferred interpretation.

If there’s been a misunderstanding, then there is no harm in that as these are complex matters, and we’re all here to support and learn. That said, continuing to promote a view that doesn’t align with well-established principles or multiple sources is hardly helpful. Ideally, the poster can offer the BB a more fact-based exchange rather than relying on the tone or tactics of earlier posts.

Monti — repeating “company law” doesn’t cover for the fact that you clearly misunderstand some of its basics. You are now dragging Aurora1 back over ground they've already covered in their earlier posts, and without so much as a thank you.

The idea that FRUS only “now seemingly” has governance misunderstands how subsidiaries work. As a wholly owned subsidiary, FRUS has always had its own legal structure, that is basic corporate law and why FRUS is always referred to as “100% wholly owned subsidiary”.

Instead of goading others to do leg work for you, why not do it yourself and share your findings. Perhaps start with a search of “do shareholders own the assets of a company” and “I am a shareholder in a holding company so do I also own its subsidiaries”, and so on.

You remind me of the lyric, “facts won’t do what I want them to”

Thanks again Aurora1. That is a very clear explanation of how standard corporate structures work.

Thanks again, if you have the time, perhaps you can run Montiburns claim that "everything FRC owns (directly and indirectly), we (the shareholders) own" via Grok and see if it agrees?

Auora1 - many thanks for checking that.

Aurora1 – thanks for taking the time to do this. To the point raised by Njames, your report stated “Records indicate that FRUS has forfeited its right to transact business in Texas…”

Would you be able to ask Grok which specific records that statement is based on? According to the Texas Comptroller’s website, the entity shows as “active” though that the site isn't always up to date. Since Grok referenced “records,” it would be helpful if it could point to the exact source or data point. Thanks.

As a coda, to your comment that "Deloitte can cover this point off in their next statement to stakeholders" you will find they already covered the FRC - subsidiary relationship in their First Report of 22 March 2024, p8, bullets 1 & 3.

Monti - can you please stop it with the ridiculous slights and innuendos. You own shares in FRC and FRC owns assets which include FRUS. I am merely explaining the relationship between parties.

For some, there seems to be confusion over certain aspects of share ownership so I hope the following helps to clarify -

https://www.minutebox.com/blog/2018-10-30-do-shareholders-of-a-corporation-own-the-property-of-a-corporation#:~:text=Posted%20on%20October%2030%2C%202018%20by%20Daniel%20Levine&text=Although%20the%20corporation%20will%20be,able%20to%20legally%20own%20property.

https://www.forbes.com/sites/petergeorgescu/2021/07/21/the-shareholders-are-not-the-owners-of-a-corporation/

https://www.pqmagazine.com/the-myth-of-shareholder-ownership/

And there should be plenty more resources out there to better explain the legal framework if of interest.

Monti – here is a direct statement from Deloitte:

"...question on Frontera Resources US LLC, it is a wholly owned subsidiary of the Company, it has its own board, governance and control, and is a debtor of the Company, however it represents no value to the Company."

I trust that is clear. It also aligns with the points I’ve made in recent posts.

You've now made two silly unfounded accusations toward me despite my continuing to provide information to you in good faith. I think it's best we leave it there.

Monti – My thoughts are that it feels like you've handed me a to-do list and then sent me off with an accusation as motivation.

The assets of FRC — including FRUS — are part of the liquidation estate and are under the control of Deloitte, not former officers of the company. Any material change in ownership or asset status would have to be reported by Deloitte as part of their obligations to stakeholders.

I'm not sure how you arrived at the idea that I’m providing “silent cover,” whatever that’s meant to imply.

Lifeishard – the message at the time reflected that there were still efforts happening behind the scenes. But a lot has changed since last September — the "comms chain" ended, and developments around the tender, Deloitte’s process, and the broader situation have all moved forward as has been discussed here.

WHamBoy - As Deloitte have now said that they consider the matter effectively concluded, a very ball-park guess would be 4-8 weeks. I think it depends how "concluded" they actually are and if they can obtain an administrative decision as they previously stated. Further updates will be posted on the Deloitte FRC page.

Short answer: yes.

This is a fundamental principle of corporate law across nearly all legal systems. While each jurisdiction may have its own variations and tweaks, the core concept is the same.

Lifeishard – thanks. Yes, that’s the gist of it. If there’s any intention for FRUS (or anything tied to the old structure) to be revived or moved forward, then a stakeholder would need to step in before the FRC process fully concludes or they would need to be well prepared to deal with the legal and ownership complications afterward.

Each scenario has its own set of protocols and hurdles. Both scenarios are messy, but at least on paper, pre-dissolution is always cleaner than post-dissolution.

If there’s something to be salvaged or restructured, it really does need action while the window is still technically open.

Phil_2018, you said: “My view of the shareholding is that a company has to be owned by someone....I believe that we would own FRUS by default no transfer of shares needed, as it was part of the same company.”

That view seems logical, but from a corporate structure perspective:

It’s true that every company must be owned by someone. But in corporate group structures, ownership is typically held by the parent company, not its individual shareholders.

In this case, FRC is the legal owner of FRUS, as its wholly owned subsidiary. Your ownership of shares in FRC is separate and distinct from FRC’s ownership of FRUS or any other assets.

In other words, when you hold shares in FRC, you own a direct stake in FRC, you have no direct ownership of FRC + FRUS as no such structure exists.

In the liquidation, all of FRC’s assets — including its shares in FRUS — were handed over to Deloitte, to manage, transfer, or write off.

Deloitte assessed that FRUS had no recoverable value, so they did not sell, transfer, or wind it down. It was left as is (cheapest option for Deloitte).

If FRUS isn’t dealt with before FRC’s dissolution, then it is stranded — FRUS will exist legally, but its shares will ownerless, because FRC, the shareholder, will no longer exist.

While FRUS may have its own board and governance, all that authority flows from the shareholder, (FRC). Once FRC is dissolved, there’s no shareholder to support or direct that governance.

FRUS will be considered a so-called “zombie company” — technically alive, but unable to make shareholder-level decisions or act meaningfully. It’s in legal and operational limbo.

Corporate law is clear: assets belong to the company, not to its shareholders, and they do not transfer automatically — a formal legal process is required.

If FRC is dissolved, shareholders have no legal ownership of any remaining assets — unless there was a transfer or distribution before dissolution.

Any attempt to revive or take control of FRUS after dissolution (an "FRUS 2.0") would likely require legal action to untangle the ownership issue and could be challenged by creditors, former stakeholders, or regulators.

B-2-0, FRC is not being restructured, it is being liquidated — a completely different process where the usual flexibility around share transfers does not apply. Any transfer of shares (e.g. in FRUS) would need to follow a formal legal process involving resolutions, approvals, and crucially, the agreement of Deloitte who control the share register. They would also be required to inform stakeholders, as this would be a material development — and all of that would need to happen before dissolution. There is no evidence that, to date, any such process has taken place.

Monti — as mentioned earlier, it’s my understanding that FRC alone is being liquidated though that doesn't mean some of the subsidiaries are unaffected subject to their current standing. FRUS having its own board or governance doesn’t neccessarily mean it’s active (Deloitte confirmed it has no value); it just confirms it is a legally separate subsidiary.

Monti – just to clarify one point regarding your comment: "this news that FRC and subsidiaries are going to be liquidated while FRUS is untouched..." — that’s not entirely accurate in terms of the subsidiaries.

As far as I’m aware, only FRC, the parent company, is being liquidated. Its subsidiaries — including FRUS — are not part of the liquidation and remain separate legal entities.

Not sure if your statement was based on something I said in my previous post, or if you’ve come across separate documentation regarding the subsidiaries.

Monti - Deloitte has said FRUS has no assets and no recoverable value, which is why they’ve chosen not to spend time or money winding it down. It’s effectively a dormant or so-called “zombie” company — still on the books but inactive.

So, while FRUS may still legally exist, it’s not a sign of something being preserved by Deloitte, just a case of it not being worth the cost to formally close out as part of the current process.

If you’re looking into who is managing FRUS, then you can check:

The Texas Comptroller website (free but frequently out of date) or the Cayman Register (paywalled but more accurate)

F you’re wondering things like:

- Why wouldn’t a liquidator chase down a debt?

- How can a wholly owned subsidiary be treated as a separate entity?

- Why does FRUS still exist if it has no assets?

and so on, then your best bet is to ask an AI as that can quickly factor in all the legal and financial variables to give you a fairly accurate and balanced explanation.