Member Info for Njames

1.2 Term
The Block 12 PSA has a twenty-five year term which will expire on 13 November 2022. The term includes
an exploration phase which will expire on 13 November 2012 (the ‘‘Exploration Phase’’). If commercial
production remains possible in relation to any part of Block 12 which is specified in a development area or areas
under the Block 12 PSA (‘‘Development Areas’’), Frontera Georgia shall be entitled, after the expiration of the
Block 12 PSA, to receive an extension of the term of the Block 12 PSA and the Mineral Licence regarding such
Development Areas for a further period of five years (or the production life of the Development Area if this is
shorter).

1.3 Relinquishments
Save as otherwise agreed between Frontera Georgia, the State Agency, and Saknavtobi, Frontera Georgia
shall relinquish its rights to Block 12 in respect of any area outside of any Development Area at the end of the
Exploration Phase.

1.11 Termination
Frontera Georgia may by written notice to Saknavtobi relinquish its rights and be relieved of its obligations
under the Block 12 PSA at any time if, in Frontera Georgia’s opinion, circumstances do not warrant continuing
Petroleum Operations. The State may only terminate the Block 12 PSA on ninety days’ notice if Frontera Georgia
has committed a material breach of the Block 12 PSA (being a fundamental breach tantamount to a frustration of
the Block 12 PSA which may include failure to complete any work programmes approved pursuant to the Block
12 PSA) which is proved at arbitration.

1.12 Governing Law and Dispute Resolution
All disputes arising between Saknavtobi and Frontera Georgia shall be settled under UNCITRAL before a
panel of three arbitrators. Any arbitration shall be held in Stockholm, Sweden and shall be conducted in the
English language and text. Any party may by 30 days’ written notice initiate the arbitration proceedings and any
decision shall be final and binding on the parties. Any arbitration panel shall apply the terms of the Block 12 PSA
as supplemented and interpreted by general principles of the laws of Georgia, the United States and the State of
Texas as are in force on the date of the Block 12 PSA.

Sure it is. It's a final result. If they were still a public company they'd be obliged to state what the results are. In any event, the GG has publicly stated the result and they are bound by the same terms as Frontera.

I sure reads like something SN would have written. He loves the word "associated" and also has a tendency to use the same words repeatedly within a sentence or paragraph. I count at least 4 occurrences of that word. What's interesting is that while condemning the Georgian govt's spin on the arbitration results, he/they don't put out the "facts" about the result. If it's not what the GG says it is, then please tell us what it really is.

1.12 Governing Law and Dispute Resolution
All disputes arising between Saknavtobi and Frontera Georgia shall be settled under UNCITRAL before a
panel of three arbitrators. Any arbitration shall be held in Stockholm, Sweden and shall be conducted in the
English language and text. Any party may by 30 days’ written notice initiate the arbitration proceedings and any
decision shall be final and binding on the parties. Any arbitration panel shall apply the terms of the Block 12 PSA
as supplemented and interpreted by general principles of the laws of Georgia, the United States and the State of
Texas as are in force on the date of the Block 12 PSA.

Well done.

With respect, that massive of an increase in production seems highly unlikely given the historical success of this team and financial difficulties the last couple of years. Not ruling it out for a deeper pocketed outfit with a fresh set of eyes to come in and achieve such results in the future. Also, they did have some production and revenues prior to 2008 from Georgia. See the financials from 2002-04 in the AIM listing document from 2005 that I linked to earlier.

If you go to this website, it is a page relating to Frontera's 2005 IPO, and there is an icon to click and get a pdf of the listing document: http://www.preqveca.ru/en/placements/72/.In Section 6 of the listing document on page 139 is a summary of the PSA and Mineral License. Basically there is/was an exploration phase (which originally expired in 2012, and I believe may have been extended 5 years to 2017) and a development phase which expires in 2022. The Mineral License also expires in 2022. Frontera had to declare areas for commercial production by end of 2012/2017, and the rest of Block 12 outside of those areas would then have to be relinquished. They could also get a 5-year extension to the PSA with respect to development areas that still had commercial production by the expiration (2022). It's likely the dispute revolves around the areas if any that Frontera were able to successfully get approved as development areas or establish commercial production. The relinquishment of those areas would have no relation to how much money was invested if commercial (i.e., profitable) production was never established, even if a large amount of prospective resources (=/= reserves) was believed to have been discovered. The Government likely wants to get those parts of Block 12 back where there is no commercial production or approved development area and enter a new PSA with someone who has deeper pockets and less baggage. Spending 20 years and $500MM to have only a few hundred barrels a day of production probably doesn't strike the Georgians as a big success.

American, or as W used to say, Murkan. Which at this point is really a misnomer. They were founded in 1996 as an American company with mostly American shareholders, directors and officers. But as of this moment, the majority shareholders are non-U.S., of the three remaining directors, only one (SN) is American, and none of the remaining officers (to the extent any still remain besides ZM) are American. The only thing still American is SN and the location of the headquarters office.

https://www.loebsmith.com/cayman-legal/insolvency-in-the-cayman-islands-setting-aside-antecedent-transactions/24/

Agreed. They are likely to try to get the transfer overturned as a fraudulent conveyance. But if the Georgian govt has already approved the transaction, then it will indeed be a fight to reverse it.

Friend of mine who used to be associated with FRR had a brief encounter with international fugitive SN in a Houston restaurant recently. Good to know he's back in Houston and no longer avoiding legal summonses while being out of the court's jurisdiction, promoting Georgian wine and submitting fake Ukrainian oil bids.

A new set of attorneys to stiff. Kornblum better have gotten a large retainer up front.

There is a further document that was filed, an Affidavit of Service, whereby counsel for the Liquidators, Holland and Knight, served the Petition for Recognition and other previously filed documents on the (if history is any guide, soon to withdraw due to nonpayment of invoices) counsel for Frontera.

9. A hearing on the Petition is scheduled before the Honorable Michael E. Wiles on
January 15, 2020, at 11:00 a.m., in Room 617 of the U.S. Bankruptcy Court for the Southern
District of New York, One Bowling Green, New York, NY 10004-1408.

According to the website, the headquarters is still the same location on Post Oak they've occupied for 20 years. They changed the registered address to a law firm in downtown Houston, probably so process servers would go there instead of the HQ looking to serve SN and ZM. No one at the law firm front desk will reveal any information about Frontera to an off the street inquiry.

This is a reference to an arbitration decision in 2008 involving a Chinese group that had farmed into Block 12 for a partial interest, failed to fully perform, and had to relinquish the interest back to Frontera. When Frontera IPO'd on AIM, the Chinese launched an arbitration trying to get the interest back saying that they had in fact performed. The arbitration went against them and Frontera retained 100%.

Levan B. (General Counsel), George Kalandarishvili (CFO) and Levan Paitchadze (Chief Accountant) all list October 2019 as end of their time at Frontera.

1. According to the order, the sanctions are being considered against Frontera not Hope:

"In addition to their failure to disclose, Plaintiffs’ failure to take responsibility for the required disclosure gives further evidence of their unclean hands and lack of entitlement to the balance of the equities. FN4"

"FN4 The determination of whether sanctions will issue against Plaintiffs will be addressed in a separate order after further briefing."

2. There's a school of thought on here that Frontera will say nothing / can say nothing until the court action is concluded. They could easily make general comments about the status of this material litigation without getting into details if they wanted to or were forced by AIM rules to do so. Last fall and at other times in the past they made plenty of RNS about various status of litigation. The fact is, Frontera was always parsimonious with negative news even when required by AIM rules to disclose. The are not disclosing anything now because they don't have to now that they are delisted. If there were good news, I presume they would trumpet it.

3. No major or any other party would do a deal with Frontera until they are assured the asset is not at risk. IMO, it remains to be seen whether Hope or the liquidators will challenge the transfer of the Block 12 license ahead of the creditor posse. It could be challenged as a fraudulent conveyance and unwound. Or perhaps Hope is satisfied with the 5% royalty interest remaining in FRCC.

4. I believe the solvency declaration is a delaying tactic. They figure it gives them a year (maybe, if accepted by the liquidators) to seek financing, so they signed in expectation that something can be done in the next year to become solvent.

5. I doubt this case goes to trial in California. The judge is clearly not impressed with Frontera's case. Action will return to the Caymans. Now that FRCC has been placed into liquidation, doubt there will be an out of court settlement, short of paying the full balance due to Hope. At least he's off the board.

Frontera Delaware no longer exists. In the 2011 restructuring, Frontera Resources Corporation (Delaware) became Frontera Resources Corporation (Cayman). There was a new AIM relisting application filed in connection with the restructuring, and shareholders hold shares in FRC (Cayman).

Check this link for the original AIM listing document of Frontera back in 2007. The structure is shown on page 10. It's pretty clear they took the action of moving the asset to keep it out of Hope's hands before he could foreclose on the FRCC shares, since FRCC held the PSA/license. Maybe that was part of the overall strategy--even if FRC don't win the case against Hope they bought time to do the necessary to move the asset. It seems the GG would have to be complicit as PSA probably has restrictions on transfer that require consent of GG.

http://www.preqveca.ru/placements/memorandum/download/72/

Interesting to note, following the IPO there were 55 Million shares in issue, with an IPO valuation of GBP 82.5 million.