Member Info for MontiBurns

The Liquidator is duty bound to inform the Court that company/group is under their control and in the process of being wound-up. In addition, all creditors have been notified of Deloitte’s appointment via public announcement/publishments. So, perhaps the Texas case is more relevant to the Directors’ PGs.

Well, it’s alittle perplexing is that this Texas cases continues to rumble-on despite the appointment of Liquidators. Typically, all court proceedings are ceased against a company when it’s enters administration and a plaintiff’s claim is then registered with the Liquidator. I mean why would someone continue to incur financial costs when the company is insolvent and there is remote monetary recovery. The only difference here is that may be SN and ZM have issued their J&S personal guarantees and the creditor feels a summary judgment will allow them recourse to these individuals especially SN being a Texan resident.

Separately, will the arrival of Trump, a Republican and a businessman, in to the White House help US Companies like FRR who have been unfairly treated by foreign Govts? We understand there is strong political association between FRR and the Republican Party, but in all honesty it may be a long shot.

Finally some action on Bidzina from the US and thereby opening signaling to the rest of the world what Georgian Dream Party is up to (and has been up to since coming to power some 12 yrs ago), ie playing a double-game with the West and ‘Mother-Russia’. Hopefully also a deterrent to other wannabe Georgian Political figures who think they charm and sweet talk as if they are pro-West but in reality are Ruskie friendly.

Wishing very miserable, depressed and hopeful FRR shareholder a very happy 2025.

The other factor that could play a significant role in the future is FRR is the imminent arrival of Trump in to the White House and we know historically FRR is closely attached to the GOP. Let’s see what January brings…….

Given the silence for many months now, combined with negative news from Deloitte and the contentious results from the Georgian Election, should we (the shareholders, both the passive and the active) just sit on our hands or try to reach out some contacts for any upcoming news? Is there a strategy or is it the case of waiting and see? Rodders befriended some chaps from Deloitte by grassing up the management when they communicated with us after the appointment of the liquidators, so perhaps these nice chaps can now return the favor? Feels like we (the shareholders) are against the wall, blind folded waiting for the firing squad to shoot. And if that is the case, I will pray the SN chokes on his fat, juicy, golden roasted turkey this Xmas while all his loyal investors enjoy another Xmas with ‘beans in toast’. Well, it could be worse, we could all be stuck in Gaza!

Was SN not sitting on the Liquidation Committee at Deloitte? Yes he was. Do we know if he is still sitting on this Committee? If he has bailed already then we are indeed in the last throes of extinction. And if the end is nigh, why can we cannot use our access to get some heads up from the company, rather than facing death by thousand cuts on a daily basis.

Whether it was going to be this quarter or next quarter, I think it is fair to say that we can finally put this ghost to rest. The final straw was probably the Georgian Dream party being re-elected with the slimiest of margins at 53%, although bitterly contested by the opposition and populists. Does a Republican President-elect alter our position going forward, perhaps…..

Yes, we have been loyal and patient because…….

1) We were told after the delisting, don’t worry we will still communicate with you officially via RNS-Reach Service……..what did we get?

2) For years and years, we stood tall with the company during the multiple legal cases, hoping to get some news once these concluded, particularly relating to ZM permanent injunction…… but another false dawn

3) Company went in to liquidation knowingly after SN reneged on a payment plan with Mourant, but were reassured that the management was working hard to ‘return the company to pre-liquidation status’……. Now we are sifting through Gazettes for official confirmation.

Then you have some here who have the gall to suggest that just because most shareholders who didn’t have the means (money & know-how) are somehow more culpable than the people who got us to this place. When are we going to call it a ‘spade of spade’ about the ineptitude and deception propagated by SN and his crew?

Worth remembering that the profit sharing agreement signed between FRR and the Georgian Govt back in 1997 stated that oil profits would be split 51-49 in favour of the GG but this was after FRR had recovered all its costs. This cost recovery pool stands around $320mln (more or less), meaning that any one that acquired FRC, and quickly developed these oil fields like the Taribani would not need to pay anything to the GG until all the investment costs were fully recovered. Further, any new inward investments in to the fields would also be subject to this recovery treatment before any share in paid out. Hence, this is a hugely attractive financial incentive for any Major that could be interested in acquiring FRR/FRC. At the same time, I would say that the Georgian Govt (especially after the GD Party came in to power in Oct 2012), that this arrangement became a big cause of frustration and irritation as Georgia had not received a penny from FRR for all the oil sales it did since 1997, especially as the oil sold by FRR was mainly coming from the old Soviet-era drilled wells like the Mirzaani field. Conversely, and to give SN and his team some credit, they will argue that all sales proceeds (and more) was reinvested in to developing Georgias O&G sector.

As far as accountancy is concerned, an Auditor will only recognize this as an asset if there was healthy annual sales and profits going through books, which has never been the case. Previously, we have discussed the benefits to someone like BP who own a big stake in the BTC pipeline that runs from Azerbaijan to Europe and directly goes through B12.

There also been discussions here about B12 geology in the Kura Basin and Azerbaijan major oil and gas fields like Shah Deniz where BP is a long term operator and therefore would make the ideal partner. Anyway, this is all a pipe dream because the PSA has expired.

Anyway, as requested by JimS and Looed, still sticking around to see if any thing good comes…

Hi Lifeishard. While I am not chucking in the towel, we certainly can’t ignore the fact that we are still inching towards extinction after Deloittes statement to dissolve the company. Sure, we got a cryptic message, but in reality what does that mean? We have had similar messages from the company over the years and yet we continued our march towards implosion, whether that was during the Cayman Court cases, the California cases, the permanent Injunction case, the UK cases or the Texas cases. After each legal event, we got a reassuring message but the situation got progressively worse, finally with the surprising news that Mourant had put the company in to liquidation for a relatively small unpaid legal bill of around $1.2m.

During all these legal tribulations, SN has not felt the moral need to reach out to us. That makes me wonder what his moral code is? Does he have a conscience or has his moral compass is broken beyond repair?

Also, recall many of the long term investors here focused and relied on his comments when an RNS was released. These comments are recorded in the passage of time and can be checked back through multiple news platforms. But my point is this, how many times did he deliberately mislead us in these comments? Inly he can answer that. If he is ethical and has a moral code of conduct through his religious beliefs, then he should know that he bears the majority of responsibility to save us from financial disaster and to put this company back to ‘pre-liquidation’ status as he claimed. On the other hand and to be fair to him, how much is out of his control? Probably a lot especially if the GG are not renewing the PSA or signing-off to the debt repayment plan (for the outstanding tribunal costs).

Overall I think it would be somewhat foolhardy not to think we are on a life-support machine, possibly gasping our last breathes and the only way to snap out of this depression is to get some direct, clear news from them.

For Looed: those people that have and are assisting you, it would be good to know who these are so we can pay our sincere thanks.

Tsbs1 - with respect, I think you are conflating two issues here as the debt default was not the reason for the Georgian Govt dragging FRR to the Arbitration Tribunal (but this was the beginning of the end imho). Nevertheless, I will acknowledge a lot operational failings on SN and FRR’s part, especially taking a ‘headless chicken’ approach to exploration activities in B12 in the early years, which yielded minimal results in terms of oil production. But in all fairness, the real problems for FRR started after the arrival of the Georgian Dream Party in 2012. For investors, this was the perfect storm ie poor operational performance combined with unfriendly political environment. Then the arrival of Hope and ZM on the scene from 2016-onward put the whole situation in a different sphere. The amount of lies ZM spewed (a Georgian by the way), was beyond belief. He will have to answer to his Lord while SN has to answer to us for backing his judgment and his plan to approve the higher share capital back in 2016. A lot of us will take this grievance against him to our final resting place and may be unforgiving. Why? Many here wholeheartedly invested (incl. me) over a very long time, did so for the noble cause of improving our families quality of l life.

But ultimately, I do hold the Georgians responsible for the greater destruction of FRR, first the Georgian Dream Party, followed by ZM. As far as the Americans are concerned, the capitalist, Hope , was opportunistic and within his right to claim on the debt he bought, while SN (the son of a legendary CEO), tried his best to emulate his father’s achievements but failing spectacularly, taking down with him hundreds of small retail investors.

Firstly thanks to JimS and Looed for a somewhat cryptic but positive message following Deloitte’s news that it had reached the end of the road and would apply to the Court to dissolve the company. But what to make of this message…….’we may want to stick around a while longer’? Reading between the lines, my personal view is that heavy US political pressure came crashing down on the Georgian Government following this official news from Deloitte. You could probably hear the fury from the US Senators (led by Ted Cruz), decrying how could this Pro-Russian Georgian Government treat a long-term, loyal American company that has invested over a half a billion dollars in their economy be treated in this scandalous way. What triggered this US reaction? The fact there has been no response to the renewal of the PSA request, which directly influenced Deloittes decision to wind up FRC, is now being used to whip the Georgians (and rightly so). So, it’s now ‘do or die’ time for us and the Georgian-hoodwinker-politicians. Let’s hope this US political pressure finally yields a positive response for FRC, otherwise there will be a heavy price to pay by the Georgians for many years to come in terms of future international integration (EU, NATO)and direct inward investments. Fingers crossed.

Well, been away for a few days and only now catching on this news. Yes, it seems the unstoppable force finally collided with the unmovable force and it is the Georgian Govt that has triumphed. Remember the article we saw a few days back when the Georgian Prime Minister was accusing oligarch for infiltrating and influencing US Institutions to impose sanctions on the Georgians? Well, perhaps that was the fallout from Deloitte throwing in the towel because the PSA expired in August and no further word heard from the Georgians. It is a very sad state of affairs especially after the huge investment was made in their O&G over the years, that they could not find a solution on the outstanding arbitration costs, especially as it was a Georgian at FRR that lied and cheated everyone in to this mess. Let’s us hope karma catches up with them all but especially for SN and ZM……..yes SN has unclean hands in this debacle.

Interesting read, possibly explains why things are held up in Georgia regarding FRC’s request to renew the PSA. While it does not specifically mention FRR, the reference made to ‘oligarchs’ in respect of Georgia-US relations is pretty easy to work out. Here is the snippet from the article but I do recommend everyone have a full read:

‘….Kobakhidze also said the State Department was “not to blame for the recent sanctions” and emphasised the influence of “oligarchic forces over official institutions” as the primary cause of the measures.

Formally, this statement was issued by the US State Department, which is very sad for us, because we have to answer to the State Department in this case. However, we want to emphasise that the State Department is not the cause of the issue; rather, it is the oligarchic forces that have a significant influence on formal institutions in the US. Therefore, our criticism is not directed at the US, but at the oligarchic influences”, he said.’

My guess is that SN has been filling his boots with more shares in lieu of funding the litigation cases over the past 5 years or converted his salary in to shares (he was on the book up until liquidation point). That is the most plausible explanation as no law firm (or vendor) would accept shares for services rendered for a company that is delisted. The other other person could be Linsemayer, working as the consultant. It’s all supposition at this stage but the fact someone (outside the company) would want to take shares is a perplexing conundrum and one not easy to unravel. As far as informing the shareholders of new shares issued, then yes, ordinarily this is a material reporting item for LSE registered companies. However as mentioned earlier, the increased share headroom was approved many years ago and around 1.7bn was still available.

Now, while long term shareholders continue to suffer because of the lack of information, it is high time that SN steps outside of the shadows, where he thinks he is away from the shareholders view, and accepts his substantial share of responsibility for the failings of FRR and his appointed management team. We need him to crawl out of whichever rock he is hiding and give us a small update, that is not an unreasonable expectation. Ideally, he should have done this prior to liquidation process while he could still do as an officer of the company. But now, he can hide behind the liquidation process by saying he is restricted from saying anything. And Rodders fk’d it up for us by reporting a company message to Deloitte.

Anyway, we know SN wants to return the company to pre-liquidation status but that whole proposal hangs on the GG renewing the PSA. What’s holding things up there? How about FRR repaying the arbitrations costs, pay any outstanding wages and show GG that your pockets are full of cash to restart drilling campaign at Taribani. We know he doesn’t have the funds to repay the arbitration costs of c.$5m but he is probably trying it to offset this against the cost recovery pool, and perhaps this is where we have an impasse.

Tabs - my suggestion that SN would be cautious on dilution was caveated by a limited number of shares available so not the solution. And if dilution was an option, this would have been accessed prior to the appointment of liquidators (imo). Also SN has self interest at heart for not going down the route of dilution as he is c.11% shareholder. Having said all that, I would not completely rule out debt-for-equity exchange but that will require shareholder approval. Equally, Deloitte could work with creditors directly to bring the company out of liquidation but that will require new management and new money, especially as the PSA is expired; I can’t see the GG wanting to work with money-men creditors but any thing is possible when you grease enough hands. As far SN being a proud man, well that is in the dirt given his monumental failure with FRR and appointment the right people in the executive management team. But is there still time for redemption for him? Only time will tell…….

Anyway, our first priority is getting the PSA renewed, perhaps thn the pieces will start to fall in their place.

Firstly, I don’t understand YJ’s continued perusal against FRC when the company is in liquidation and the amount speed was around £65k. But I do think it will be kicked out by the Judge when it comes to the hearing. Why? From what I recall when dealing with companies in Administration, as soon as the liquidator is appointed, all legal actions from creditors cease, and creditors work with the Administrator in terms of registering their owed amount and their security/collateral. The Receiver then works on behalf of all creditors. Perhaps YJ has appointed a lawyer on a ‘no win, no pay’ basis.

As far as dilution is concerned, I think SN is cautious on going down this route. Firstly (as I recall), the authorized issued capital only allows for the issuance of another 1.7bn ordinary shares which is not enough to cover all creditors. And secondly, SN whole proposal (imo) is based on restructuring existing debt and making scheduled repayments, which will be based on the proven oil reserves and drilling techniques at the Tariban Field. I think this is why he chose to go down the ‘engineered liquidation’ process to get Deloitte to mediate an acceptable repayment plan with the creditors. I also remember seeing a brokers report from WH Ireland that valued Taribani oil from two zones (excluding gas) at $475m.

The questions we have right now Re: 1) has SN secured the funding to restart at Taribani, 2) has the Georgian Givt agreed to extend Taribani PSA and 3) are Creditors agreeable to SN’s proposed repayment plan?

If any one has any answers or thoughts on my questions, would love to hear them.

Thanks for the clarification Looed, but I do recall a corporate g’tee, perhaps from FRCC, which was the intermediate holdco of FEGL, underpinning FIC’s financial obligations. SN being the ever-astute person, thought that he could probably dissolve FRCC if worse came to worse, without hindering FEGL’s operations in Georgia. Anyway, it matters not now as the whole group is in liquidation and the expired PSA was shifted from FEGL to FRUS as FIC Administrators took control.

Looed, agree that this case is drag on the FRC situation both in terms of SN’s time and money (for self representation in this Looed). I also recall that apart from the Personal G’tees there was also Corporate/Parent G’tee from FRR PLC/FRC but not entirely sure. However with FRC in liquidation, the low hanging fruit for recovery is definitely by going after SN in Texas. I guess, this is something that should not be overlooked so easily as SN and ZM were totally committed to making FRR a success at that time that they staked their personal wealth and reputation on the line to rollover the CLNs and accede to Hope’s demands. So, one has to wonder why they did this if the operational prospect looked bleak in Georgia? Perhaps the answer can be found at the Georgian Dream Party’s doorstep; they made it hell for the company which was capped off by taking an American company to the Arbitraion Tribunal despite investing over 20-yrs and nearly half of billion dollars to progress Georgia’s O&G industry. I can understand why SN feels so aggrieved for the treatment he and FRR has received over the past 10-yrs. Then he was back-stabbed by another Georgian, who he groomed for succession at the company.

Anyway, the point I wanted to make on the FIC situation is that the case rumbles on after 5-yrs is because Hope continues to personally fund the liquidation proceedings because he believes that he can recover a lot more than he originally purchased the CLNs at. Plus, he can claw back all of Griffin’s liquidation costs from the recovery as the claim on SN’s PG will include the Liquidators costs. Perhaps this is why SN put FRC in to an engineered liquidation because it has now come to a point of ’all or nothing’ for the both protagonists.

The only reason why the case should not be closed (after 5 long years of trying, as well as noting [apparently] Hope/OMF have fallen on hard times), is because Griffin et al sees strong recovery from calling up on SN’s personal G’tee which is securing the corporate loan notes (ZM’s PG is there too and both were issued on Joint&Several basis but I guess ZM is probably out of reach in terms of judiciary and quick recovery). Also, most here will recall that Hope/OMF acquired these CLNs at highly distressed value (perhaps 20cents to the $) so even if Hope gets a partial recovery from his current ‘par value’, he is still going to come out of this pretty well, hence the legal struggle continues.

Anyway, the fact the Liquidators are still trying to flog this dead horse, may be a sign that the horse may not be clinically dead, as we are lead to believe. And on a somber thought, even if there is a road back for FRR, what value will the long, miserable suffering shareholders have? That’s a moral question for SN.

Rodders, plz excuse me if I put on my rose tainted glasses on for a few minutes: The fact the liquidation appears to be ‘suspended in motion’ ie no material update to report since the first creditor report can also be perceived a positive rather than a negative. Really!? I hear you ask. Sure, the fact FRC continues to hang in there despite no financial resources is difficult to understand as any other company in our situation would be going through the motions of being expunged from the legal and regulatory registrars. Further, if SN was such an unscrupulous fella, don’t you think Deloitte (as the Court appointed Administrator) would have thrown the in the towel by now rather than getting strung along by him for this long? I think yes, unless SN is again pulling the levers of the US Political establishment to stave off Deloitte desires to close this FRC saga?

So, Monti how do you explain all this, I hear you say? To me, SN is only going to fund FRC if GG agree to extend the PSA, which is still pending as far as I know. No point in chucking in money until then. So, I think SN has a plan to get FRR producing again quickly, and this could be from arranged funding to a JV. Deloitte know this, and the Creditors know this and therefore all are patiently waiting to hear back from GG.

This is the only plausible logic I can come up with under these circumstances. There is no G’tee that the PSA will be extended as the cost from Arbitration is also unpaid, but perhaps the US Political machine is helping to overcome this issue somehow.

Anyone got spare $5m to pay the GG so we can all move forward?

Again…’no one is wrong, just somebody is right’. Keep posting logical thoughts and share info with your fellow FRR shareholders.

Do you remember the Company announcement after the forced delisting in Dec 2018, that the company would continue to communicate with its Shareholders through the RNS-Reach service? Well, we are over 5-years after that announcement and we have not been directly addressed by SN (being the Chairman of FRR). Sure, you could argue that (post the delisting event), a large can of worms was open with ZM, Hope and YA……and then what followed was an host of litigations. Then there was the constant lying about the Arbitration decision and ultimately losing the Block. Infact I struggle to think of examples when FRR-team has not twisted facts to present a highly inaccurate position to its members. So, now, we are over 7-months in to an ‘engineered’ liquidation, thinking there was a master plan to reschedule creditor payments but that also looks a difficult ask unless the GG can renew the PSA. We should also be told about Moldova PSA, as there seems to be some speculation that this may have been rescinded.

I think we have been patient but a few kind words from the Chairman may go a long way to restoring our confidence in him and the company.