Member Info for MontiBurns

Earlyretirment - sent several follow up messages but nothing so far from Interactive Investor, really bad service but good to know I am not the only one.

bridget1963 - it’s amazing how disciplined recipients of this report have been, so touché. But one wonders what is the wording of this confidentiality clause (may be even that is confidential). I wonder how long this report is? Plus, what to make of the absence of the trolls here, now the report is available.

It would be interesting to find out how many have seen the report but chosen not to participate in this vote. This may also give an betteridea of how many have been able to obtain the report. If this is one of you, please signal. From a personal perspective, I think there are loads but are inclined to remain silent (for the benefit of the greater?).

Anyone successful with interactive investor?

Well, my struggle with Interactive Investor (originally NatWest Brokers) continues. Despite sending a number of secure messages thru their website, not a single response, so I remain in the dark. I have also reached out to Deloitte a few times with screenshots, but they now want a consent letter from Interactive Investor, so I still find myself on ‘square one’. Equally, I am intrigued by the ironclad confidentiality clause which has stopped many from saying a thing but reading between the lines, I think there is still a pulse.

Anyway, good to see Jim post, which I will also take a sign

Hi Drmike. Deloitte still not got back to me and it and it may take a lot more effort. But you have seen the report, so my question is the level of due diligence and confidentiality requested from shareholders, does the content of the creditor report justify it? Thanks in advance.

ODR1 - with respect, I cannot believe that Deloitte would go to that extent of tracking down an anonymous LSE BB poster given the time and money involved unless it’s ultra-confidential info. So, the bigger question is why go to all this length, if the company is going through the motions of a slow death. For the rest of us, who hold shares via a nominee account, and who are left wondering what is happening to our company, the brick wall we have hit is astonishing. Even the trustworthy posters are conspicuously quiet during this important period. In addition, no one is asking for a verbatim of the creditor report, just a signal if there is still hope and even then, the fear demonstrate is mind boggling. Conversely, you could argue there is hope here given those who have seen the report have not expressed those infamous words ‘teeets up’!

So is the paranoia justified here given FRR’s historical, implied CIA association? No. But be mindful when you get an unexpected knocking at the door in the middle of the night (hehehe).

Drmike, many thanks for your guidance. I am also one of those that holds shares in a nominee account and have provided a screenshot of my holdings but received the same response as FinnFCR. I have replied back and now await a response. Nevertheless, it does seem that the NDA Deloitte has requested shareholders to sign before releasing the report is watertight as it has stopped everyone from saying anything meaningful. For me and many others, we are mystified with this approach. Should we interpret such an approach as good or bad and by having this approach, who is Deloitte trying to protect? Is it SN, the shareholders or just the Creditors. And when You say it is pointless for you or anyone else who has read the report to say much as each reader could arrive at differing Opinion, that is also a little strange thing to say as all shareholders objective should be the same: is there a way back for us. So the question for you personally is, are you hopeful or dejected after reading the report? But you don’t need to answer if you think it will open a deluge of new questions. However does the report give recommendations and does it give a date of the next creditor meeting?

Well, you could add another word to your two words list Ars221, which is neutral, meaning it’s progressing ie there is a proposal which is subject to Creditor vote. Alternatively, the report from Deloitte was only completed post the 14th March meeting which is circulated but awaiting a follow up creditor meeting. We can all guess/assume that the Deloitte report will not be pretty reading but the important question is whether there is a deal from SN to try and put FRC back to pre-wind up condition.

Given there is no money or assets in FRC, and noting Deloitte is not a charity, we can expect a quick conclusion one way or another.

ODR1, perhaps you should have mentioned in your post that you had been in touch with Deloitte and that this information originated from them rather than leaving it a little ambiguous for the readers. But thank you for sharing.

Overall, I do think there has been a distinct change in communication from the company (and Looed) since your email referral to Deloitte. This is my observation and I am not claiming that I am right. Nevertheless, this now a historical event and I see no benefit in debating this moot observation; we should look forward to the next bit of news.

In terms of ‘slow progress’, I find this statement a little perplexing as delays normally translates in to higher costs and we know FRC has no cash or liquid assets so what are Deloitte doing? To me this could mean it’s taking a long time to verify creditor amounts and claims.

Hi ODR1. Regarding your last post, you are saying that the 1st Creditor meeting did not take place as expected on the 14th March as they are still working through the details. . Also just to clarify that your information was directly provided by Deloitte?

So if the Liquidator’s report is going to be ready by next week, has a creditor meeting date pencilled in? Thanks I’m advance.

I guess the outburst from our own Capt Grimsby last night was understandable if misplaced as Looed is only a messenger and not the author of the message. Our frustrations are running high because after Thursday’s meeting, we are left to wonder what is happening. Looed mentioned that this was the first Creditor meeting alluding there could be more. I am sure Team-FRR are fully cognizant of our feelings so it begs the question why have we not received a message either via Jim Slade or Looed? The reason could be one of these: 1) debt reorganization is underway and will require follow up meeting(s) to finalize and conclude before it can be announced, 2) Company unwilling to issue any unofficial statement in case it is referred back to the liquidator, 3) no deal reached and therefore wind up is being concluded.

Hi Looed - I think Deloitte has already stated that any matters relating to FRR should be directed to them, so I am pretty sure there is going to be no response, just like my numerous previous emails to that address. Nevertheless, for a piece of mind, I will do as you say and drop a courtesy email enquiring about yesterdays meeting. Thanks again.

Let me also add my thanks Looed. As you can tell, there are many people who are holding their breath wondering what transpired yesterday. From my perspective, Deloitte will have to issue a shareholder notification in due course on whether a deal was reached with the creditors or no deal and therefore the company is being wound down especially as there are no assets or cash in the company to keep Deloitte employed. Sure, there is a legal and a due process before shareholders are informed but it would not be unreasonable to try and get an early little heads-up from the company if possible things are moving in the right directions. I can als u Der stand FRR’s reservation or not saying much in case it is used by dark forces.

From your perspective, do you think it would be wise to stay quiet and wait for the news to drop or is it worth reaching out to the company for a quick update?

I get what you are saying about this company as the underlying fundamentals were sound for investing. So, what do I mean by that? A huge acreage with partially proven oil fields thanks to the Soviet’s, a country sitting on the doorstep of Europe with EU membership aspirations, important infrastructure running through the block partially owned by BP, and a management team with deep O&G experience and (political) connections. Against this, a mish-mash’ exploration strategy: a lot of money squandered on high risk drills such as Lloyd2 rather than targeting the low hanging fruits like shallow oil fields. But the biggest detriment was politics. First the invasion by the Russians in 2008 and then by the Georgian Dream Government which coming in to power from 2012. To top it all off, you had cannibalistic Directors in form of ZM and Hope. But that’s history so where do we go from here is the million dollar question…

Lifeishard- don’t let any one stop you from keeping a positive perspective here because the alternative could be depression, anxiety and self doubt; people underestimate mental health issues and the gang at FRR has certainty tested our mental state over the years. Anyway, we have little choice but to let this play out now that the company is being managed by Deloitte. And who got us to this point, the people at the helm, namely the FRR Board. Can they get us out of this predicament now, well, Friday could be a hugely monumental occasion.

I also recall a message from the company in Jan 2019 when they said that they intended to keep shareholders updated via RNS-Reach service? And what did we get, zilch. But to be fair, it was ZM who made that proclamation, while at the same time he was engineering the sale/transfer of the company to Green Capital. This was followed up by multiple new legal cases, including getting the permanent injunction against ZM. So company approach can be partially understandable to keep things on the ‘low down’, given the unfolding situation.

Having said all that, we must not be detached from the ‘cold day of reality’ that even if the company can be put back to the pre-wind up status, what price will shareholders have to pay in this enforced creditor restructuring?

ODR1 - yes all supposition on my part but it’s been difficult trying to work out what is going on behind the scenes with recent developments. My line of thinking on why SN consented to the Mourant Court w/up request was: 1) All the legal cost incurred over the years was funded from somewhere/someone so now owes the company an hefty amount, 2) Deloittes stating that they had uncovered substantial liabilities but without specifying for what and to whom (so we assume these relate to legal costs), 3) Company statement via Looed that the company was working on a joint formal plan to return the company’s status to pre-wind up for the benefit of all stakeholders.

So to my mind, the only way for this to happen and to keep the destiny in his own hands, SN has been funding the company for the past 5-yrs, and therefore has become the largest creditor, who would then via his own majority debt approve any settlement plan. Of course, this will mean new money being injected by SN if the plan is to offer some cents to the $. But at the same time, we have to acknowledge that he would be also essentially writing off his own debt for the greater good. There is also the question on legal costs and whether these could have been ‘inflated’ to become the largest creditor over the years; here I mean lawyer fees can be subjective and are free to be set by the legal firm so who knows. But if you want the best, you have to pay over the odds. And here we know there is a ‘legal team’ looking after all of FRR’s cases; how much has this been costing us over the years? I guess it all adds up. Other major creditors are YA, Mourant, the Georgian Govt, employees etc. Is YJ in there to make up the creditor numbers? I think they were only owed £65k?

So the main question is why go down this w/up-and-recovery route? Well, I don’t think there is an option to go in to a voluntary creditor arrangement given the legal battles that FRR has been involved with with some creditors. I also think FRR team may have ‘engineered’ this w/up by deliberately reneging on the previously struck deal with Mourant; perhaps Mourant are an insider for us?

I make huge assumptions and may be akin to the Bourne-type espionage theme but with this company, any thing is possible.

Hi Looed - had some time so revisited your yesterday post timed at 14:26. Couple things came to mind, so wanted your thoughts.

1. I think most people were astutely aware that the Grand Court of Cayman granting the winding up order was involuntary. However, as usual, we sitting on the side lines, were left to wonder why would SN allow this petition (by Mourant for c.$1.3m) to pass through uncontested? The amount was not huge when compared to other creditors like YA. So, yes on one hand, involuntary but on the other, consented. This was also particularly peculiar when we consider the huge number of legal cases FRR has been fighting over the years. So, trying to read between the lines, why would SN allow this unless he had a backup plan (even though you could not uncover any cases where involuntary liquidation companies returned to the market). Also recall, only a few months earlier, he had bilaterally agreed to settle his share of the bill, which was originally secured by ZM and SN’ PGs when Mourantagrred to take on the fiduciary case in the Cayman. Finally, as you alluded yesterday, why allow this winding up to go through if the intention is now to reverse it to pre-wind up order? My answer to that is that SN with the help of Deloitte intends to enforce a settlement with all creditors, where we will learn, that he is infact the largest creditor of the company for funding all the historical legal costs.

2. You referenced the FIC where FTI considered various options from potential parties before making their final recommendations. Can you plz elaborate, what and from whom? Also, what was their final recommendations (apologies, but I missed this altogether although I know the next hearing is scheduled for July).

Hi ‘theprodigy’. I can give you my perspective but I also think that Looed views can also be insightful.

So here goes: from what I understand, the Georgian PSA was re-assigned to FRUS and approved by the GG. This was to stop the FIC JOL from getting their mitts on the oil producing asset. FRUS is a Texan, US registered Company but owned by FRC. But now FRC is in liquidation, we have to assume that Deloitte has control over this entity and therefore over the (expired?) PSA. Perhaps this is why SN is trying get FRC out of Administration?

Having said that, we did speculate here last month that perhaps FRUS ownership was outside the FRC group structure and directly under SN control but atlas, I think Looed confirmed that FRUS was still under FRC.

So where do we go from here as shareholders? FRC (where our shares are issued from), is in liquidation and according to Deloitte, there are more liabilities than assets meaning the company’s net worth is negative, so zero value for shareholders (and may be very little for the creditors too). Our only way out seems to be from the company's last statement that they are working on a plan to return FRC to ‘pre-liquidation’ status for ‘all stakeholders’. I have already given my opinion on this scenario yesterday, either partial settlement for creditors or punting everybody’s dues down the road for a few years. If there is no creditor agreement, the company will be wound up by Deloitte.

So the crucial question is why SN is trying to reverse FRC’s current status back to pre-wind up? Would it not be easier to let FRC collapse and then pick up/renegotiate a new PSA? And here I can think of two reasons why he would not do that: 1) the importance of preserving the Nicandros family name/legacy and 2) keeping intact the cost recovery pool of c.$320m. Here I am assuming that any new PSA will start afresh with zero cost recovery pool while ‘renewing’ exiting agreement allows this to rollover. I also believe US political support for SN remains strong while the Russian geopolitical situation plays in favor of FRR.

Finally to conclude: if FRC is reversed to pre-wind up status then our shares are preserved but this is subject to creditor approval of whatever plan SN proposes or 2) FRC is struck off and SN pick up bits and pieces from the Administrator and lumps it in to a new company, in which case we are reliant on SN to allocate us shares in the new company.

The current situation can take one of many turns so let’s wait and see what the next few weeks bring.

Tabs - perhaps worth revisiting the company’s message of 14th February: ‘We are working closely with Deloitte to return the company to the pre-windup status quo for the benefit of all stakeholders, and we are advancing a joint formal plan in this regard.

As this unfolds, more info will become available. We are grateful for the positive and professional, collaborative relationship we’ve established with Deloitte.”

So what is a joint formal plan? ……agreeing on common objectives and aligning on a single goal or set of goals with the creditors? So with that in mind, the company could propose extending all amounts owed to creditors by say 3 yrs but a face value. I am not sure if this is going to fly (given the recent history) but against the next option of getting zero, may be they will accept. However, I still think, offering a certain amount to the $ as a full and final settlement would be the best way to go but that will depend on how much SN is prepared to spend. The other side of the coin is, why would creditors take a hammering to their dues and the shareholders get a way scot free. Well, the answer to that question is that we have already been put through the mincer multiple times; SN could do us a favor for once.

So, the creditor meeting for the 16th March could prove to be pivotal and perhaps this plan would be circulated for discussion and approval couple a weeks before that meeting.

Other thought that comes to mind is that perhaps the renewal of PSA is purposely being delayed to get this meeting out of the way first, otherwise the value of the assets would be recorded much higher.

I agree with Bezzy that this is not new news but every time something like this crops up, feels like ‘death by thousand cuts’.

Anyway, we all know that the company was put in to liquidation on the 16th January and Deloitte appointed as the Administrator. Deloitte is going through the prescribed process by formally informing the shareholders of this liquidation event. For nominee account holders, each broker will have its own process in terms of what to do with these electronic shares once they received Deloittes notification. For those people that hold the paper share certificate, they probably received a letter. But in reality, nothing has really changed in terms of the liquidation trajectory: Deloitte will manage the company’s affairs in terms of assets and liabilities and liaise with creditors. The important bit of information was revealed by Looed that the first creditor meeting is going to be held on the 14 March. I guess this is where Deloitte will lay out the financial situation of the company, in terms of uncovering substantial liabilities and no liquid assets and therefore creditors unlikely to see any recovery. One also wonders how many of these creditors would actually bother tuning up to this meeting? Perhaps the main protagonist like YA, Mourant, SN would. Then the other crucial question is, will a proposal from SN (or another company backed by SN) be put forward to the creditors at this meeting and if it is, what percentage of creditors would actually vote in favor of this proposal? May be there is so much discontent amongst some creditors that they may (in-spite) vote down the proposal, hence the importance of SN being the major creditor and garnering Deloitte’s support.

As it stands, we the shareholders are legally wiped out, unless the company can be rescued. And here we need to wholeheartedly believe the company’s statement that they intend to put FRC status back to pre-liquidation and this may include SN taking a big haircut to amounts he is owed for funding all the legal costs.

These liquidation processes can be long or short but noting no money/assets in FRC, I would imagine this one to be relatively quick.

Just some thoughts from my side, but crunch time is nearly upon us.

How are you feeling Looed with this whole liquidation situation now…?

That makes a lot of sense Looed, but I think SN was singled out and thanked specially for arranging the meeting and seemed to be in the center of the event (that is what I find fascinating when his company was in a mess).

My comment about the ‘dire position with the GG’ is in reference to no clarity on the expired PSA or any news/agreement on how FRR was going to settle the outstanding legal costs that FRR was ordered to pay by the Arbitration Court (c.$5m?). Until this issue is amicably resolved, there is going to be some apprehension. But alternatively, they may have accepted SN’s version that ZM was the main protagonist evidenced by him openly and blatantly lying in the media that the Arbitration Court had sided with FRR. Then there is also the permanent injunction order granted by the Texan Court.

Also, if I may, any recent interaction with the company and if so, whether you noticed any change in their approach since one of our members made contact with Deloitte. Thanks in advance.