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Anybody extending that kind of $ would be on a secured basis. So let's say $20 million gets siphoned off to pay GOGC, Green, Uniserve, YA, Outrider and whomever else, $80 million is loaned on a secured basis to put into drilling. If successful, maybe SH's end up with some return behind the lender, if not, then the lender takes over.
It does seem they really want to be done with Frontera. They had to spend a lot of money in the arbitration to get back the block, then terminated the PSC as to the remainder. Then endured a negative PR campaign accusing them of bad faith and attempted expropriation. They backed off due to political pressure, but according to the single letter they sent are being sticklers about exactly what depths and zones Frontera are allowed to "exploit" from the remainder, exactly as is spelled out in the PSC. They have seemingly ignored the rest of Frontera's increasingly desperate pleas, including the request for an extension of the PSC. Agree with others who have said even if ZM is stopped, there's still a long way to go. Frontera would have to show the money in my view to have a prayer of making a deal with the government and settling with creditors. They owe $ to the government ($6 million), maybe Green, maybe Uniserve, and Hope, before the first dollar goes to the drilling program. Promises of big funding in the past have not come to fruition.
Two signed orders posted, both in company's favor: one denying ZM's special appearance (i.e., that he appeared only to challenge jurisdiction) and the second denying his motion to dismiss.
Jonathan, if they fail to respond within the additional 7 days, a default could be rendered again. But I doubt they would have spent the time and money to instruct UK counsel to fight to set aside the judgment only to default. It appears they intend to defend the claim. YA contended to the Judge that Frontera has no defence, but the Judge was not persuaded that was a reason not to set aside the default judgment.
Bono's name came up because YA attempted to serve Frontera through him as a Frontera representative in their lawsuit in the UK to collect what they say they were owed under their financing agreements and 2018 settlement agreement. Bono at that time was no longer a Frontera employee, but was still listed in some of Frontera's secretary of state documents as a Vice President. Frontera didn't respond to the suit and a default judgement in the amount of GBP 2.3 million was obtained.
Once Frontera awoke from its slumber and decided to defend the case, they had to get the default set aside, and it appears they have successfully done so by challenging the service on Bono as invalid. Basically it means there will now be a contested suit between the parties in UK. Outcome may still be the same but at least Frontera will mount a defense, via Haynes & Boone.
Mole, Green contract and two addendums here:
https://www.hcdistrictclerk.com/edocs/public/ViewFilePage.aspx?Get=BvuC47fSdHfduCCwYF4nv0PpAS/9QQ8+69aKKxO/XC4Og5sDBi7NAgVdcXHH5DKRrRDc8i3EyqextVli9G6eqr1Q3Kk2YNL8nelqjmPiqL2sWR9M8QRAXpUXoljj62C0SUOWSNPxU0o=
I agree SN is coming across better than expected. HIs voice and demeanor are that of a person shaken to core by the betrayal of a long time colleague and friend. ZM appears to be a scoundrel.
Even if the transfer to Green is undone, and even if the transfer to FRUS is belatedly recognized, FTI still likely overturns it as a fraudulent transfer, and then it goes to Uniserve or the GG.
I think SN may know and realize the license is lost, but he's determined to make dam sure ZM will not benefit from it.
This is historic fascinating stuff. Not only for the drama of shareholders current predicament and the dire straits in which the company finds itself, but the history of entry into former Soviet republics by what at the time were a group of extremely heavy hitters. The fact that it turned out so badly by loss of the license in Azerbaijan and probable loss in Georgia is a tale for the ages--greed, incompetence, arrogance, bad luck, bad decisions.
SN says they've spent $1 million -$3 million in Moldova thus far.
Filed as Exhibit H to ZM's declaration filed 27 May 2021 are the following:
Forward Sale and Purchase Contract dated 25 April -- $2.8 million, no security
Addendum #1 dated 24 July 2018 -- $5.0 million, no security
Addendum #2 dated 19 October 2018 -- $10.0 million; security interest in all produced oil and gas in possession; all rights under PSC; all rights under Mineral Use License; all rights to 50% interest in FEGL; all rights to any other property of FRGC or FEGL.
Addendum #2 is arguably when the "steal" began, by mortgaging the entire company for a $5 million increase in the oil forward sale. Was it at that time a deliberate move by ZM? On or about the same time, there was a failure to disclose this to investors on AIM and a deliberate default under the loan notes to Outrider. So did SN know about it? Why didn't the company disclose? Incompetence, negligence, malevolence? What a messed up clown show.
The remainder of the Green Capital documents were filed yesterday. Should show how the amount grew to $5.8 million and came to include a security interest. There are two amendments.
I believe there is a link between Lundin and Shamaran. There's a Lundin on the Board of Shamaran, and several Lundins on the Board of Lundin.
Getting good. SN saying why the farmout from FRGC to FRUS was done. ZM's counsel should cross examine on this point. Says it was because of "financing" and because investment bankers advised them it would be easier to finance if held in a US entity rather than Cayman. Every shareholder should be listening now. Saying why Szescila resigned (due to Zaza), why ZM was retained in Spring of 2018. Great stuff.
Claudia Frost for ZM is one of the best in Houston. Laura Gibson for SN is good too but it seemed mostly a more junior guy doing the speaking
SN lawyers arguing the transfer to FRUS was valid and signed by ZM, and all that was left to foreclose on in Cayman was the 5% royalty. Wave away the arbitration ruling Invalidating the transfer saying it was suspended (which isn’t really true, the termination was suspended not the entire ruling). Say what happens in the Caymans is irrelevant because the interest was already transferred. (Obviously FTI and the Cayman court saw it differently.) Now going on about Green being run by Zaza’s cousin. SN sitting impassively looking like Santa Claus from the kids show Rudolf the Red Nosed Reindeer. ZM smirking and rolling his eyes.
Re brown envelope--w ZM as bag man.
Like many things about this company, the reasoning for defunding the share registrar, Computershare, while paying for other services, like lawyers (sometimes) and lobbyists, is murky. The maintenance fees are not that significant and if the company ever hoped to do a sale or relist, having a proper share register to know who owns what shares is of utmost importance. Shareholders can't get certificates, private transfers cannot be tracked, it will be a big mess. Did the company throw in the towel on the future sometime in 2019 when they stopped paying Computershare, or was it negligence or inattentiveness to allow this situation to continue? They are still fighting in courts as if it all still matters, so why not pay the nominal fees to Computershare to keep the register alive, and with it the ability of shareholders to receive certificates and record private transfers of shares?
Oddly, SN continues to act as if the arbitration panel did not rule the transfer to FRUS invalid. Sure ZM may have signed the transfer documents but they never were registered in Georgia and a year later the tribunal ruled against the company saying the transfer did not meet the requirements of the PSC. SN did file a letter from GOGC stating that the termination of the PSC was temporarily suspended and a raft of documents purporting to show FRUS did have the requisite operating experience, but there's nothing showing the Georgians ever acted upon that and approved the transfer. Even if the transfer to FRUS is approved by the Georgians, it is still subject to being undone by FTI as a fraudulent transfer. It's obvious it was done to escape the hands of the liquidators, just ahead of the posse, and likely to be undone on that basis. In which case it's back to FRGC, and hence to Green/Uniserve/Georgian govt.
Is this article the result of the poster on the other site, Brookemia, making good on his promise to contact an investigative journalist if the company did not adequately respond to his questions?