Member Info for ronwoking

Senseman,as per ususal you are right on the button.

My experience as a banker is that however bad you think a bankruptcy is ,it is usually 3 or 4 time worse.

I have no doubt that the owners played many games to keep their ship afloat for as long a possible and to siphon off as much cash as possible for their personal future.

Anyone who thinks that there is a pot of gold somewhere that will magically appear for the benefit of the Dcus is whistling in the wind.

The price of oil and the Hurricane production numbers, are in my opinion totally irrelevant in the current situation. The scale of the debts is a multiple of those numbers.

It is my hope that the owners of Prax can be found and brought to book for governance breeches .

Little Ned, Where is the research that says that 17.5% of the sales proceeds of hurricaneprax will accrue to the DCU holders.

Hurricane has no obligations to the DCU holders and Prax's obligations are the sole obligations of Prax Exploration and Production PLC and are unsecured..

The DCU holders will be queuing up against the banks and possibly HMRC.

As per the deed setting up the Dcus and the Dcu entitlements.The obligations are direct unsecured obligations of

Prax Exploration and production PLC

The debt interconnections between the various group companys are no doubt very compelx,but if the banks in particular are owed mnoey by any group companies I would be astonished if the banks had not insisted on cross default provisions and multiple group guarantees that would impact Prax and put the banks ahead of the Dcu holders in the pecking order.

The HMRC position is probably equally complex.A tax debt by an individual group company would probably not flow into any other group company but would ofcourse impact any sale price for that company.It is not clear to me which companies actually owe HMRC for unpaid taxes.

The consequences for the directors of those companies could be very serious and personal and criminal.

Any buyer of Prax would inherit its obligations to the Dcu holders but those obligations are unsecured obligations and the banks and HMRC would rank ahead of the Dcu holders.

I would doubt if the assets of Prax are sufficient to meet those obligations let alone the Dcu debts.

There is no obligation of HUR to pay anything to the Dcu holders.

If any money is realised from the sale of Prax assets,the banks and HMRC get first priority.

Dive Centre ……I disagree .The terms of the Prax acquisition of HUR do not require HUR to pay anything to Prax let alone the Dcu holders. That obligation is held by Prax alone .Where they get the money to meet that obligation is down to Prax .

There is no legal connection that I can see between Hurricane Energy and the DCU payments.

The Dcus and the obligations to the holders of Dcus are unsecured obligations of Prax alone..That relationship is clear from the deed poll terms.

Should any money accumulate in Hurricane, there is no contractual obligation between Hurricane and the Dcu holders that I can see that would route money to the Dcus

Should any money come into Prax from Hurricane ,that money becomes a Prax asset and the Dcu holders will be queuing up for payment with other unsecured creditors behind secured creditors and HMRC.

Should Prax upstream assets be sold,I do not see any route by which the proceeds of that sale belong in any way to Dcu holders ....unless ofcourse the proceeds were large enough to settle the debts of Prax to its bankers and HMRC at which point they may become available to unsecured creditirs .

The proceeds would be Prax assets and the obligations of Prax to Dcu holders remain unsecured debts and unsecured contractual obligations of Prax.

If someone sees a link between the cash flows of Hurricane revenue into the DCUs bypassing Prax and its administrators I would be glad to see it and even more glad to be mistaken.

It will be very interesting to track the legal pathway from Hurricane through Prax to the DCU holders.

The cash that funds the DCU payments clearly comes from Hurricane profits through the remaining well .Hurricane is a subsidiary of Prax and I do not know if Hurricane is under administration..... hopefully not and it is still profitable.

If the hurricane profits due to the DCU holders are escrowed in some fashion or hypothecated in favour of the DCU holders then that is good news and might be protected .

If not, then the Prax administrator will no doubt seek to channel the funds from Hurricane into Prax at which point they are long gone.

Aside from the banks who must surely hold substantial security over Prax assets,HMRC are in a 1st preferred position as a creditor and get preference over any Prax assets.

I suspect that will be the outcome and will be astonished (and delighted) if the Hurricane cash flows are protected from the Prax bankruptsy.

As usual Senseman provides a reasoned and logical summary of the situation.

Hur was sold away from us with our own money and a jam tomorrow promise from a crooked buyer.

Par fro the course from the Hur directors who ofcourse organised a similar stunt earlier.

Looking forward ,I am now wondering if the hur well is actually producing any more and if the hur acreage has any value at all .

We shall clearly see no further cash fro Prax.

for my part,I offer my thanks to Senseman for his contributions.

After the hur debacle ,I shifted my investment on aim to a gold producer which has since trippled and unlike so many aim companies has a competent board.

Nonsense

Brown sold the gold on the back of Treasury and BofE advice which was terrible advice.

Gold was close to a cyclical low and gold like many commodities is subject to a long term cyclical cycle.

The sale cost the uk over $200 billion dollars and counts as one of the worst if not the worst financial decision made by any govt .Its a lesson hard learned ........

Never let politicians near market decisions.

As to illiqidity ....a sale of 400 tonnes hardly supports that proposition.

Still no sign of the CVRs on my Barclays platform.

On my lloyds and II accounts they have been credited to my trading accounts

My CVRs have not yet appeared in my Barclays investment accounts.They were posted to my Lloyds and II accounts days ago.

Anyone else with the same problem

My MMTL cvr allottment has not appeared on my barclays platform .No problem with Lloyds and Intl Investor.has anyoner else had a problem .

I would be surprised if the MTL CVR would be in an ISA as the ISA regulations would disqualify it because it is not a quoted security.That ofcourse is a different issue to its taxable status as in my view the allocation of the CVR is a repayment of capital from the Condor take over ....so if the Condor shares were held in an ISA ,the CVR could be regarded as a tax free capital; repayment.

The situation is analogous to the takeover of Hurricane Energy by Prax exploration .The take over was partly in cash and partly via an unquoted Deferred Consideration Units ( DCU).The cash element was paid into the ISA but all the ISA managers that I use (Lloyds ...Barclays....II) would not allow the DCU into the ISA but credited them into a regular trading account. Revenue from the DCUs ( a profit share)payable semi annually has been credited to the trading account.

I have regarded all the payments generated by the DCU as capital repayments related to the Hurricane takeover and therefore non taxable. HMRC may differ in their view but that remains to be seen.

The takeover structure of Condor is virtually identical.

In my case my condor shares are held in ISAs .Accordingly the allottment of MTL shares in exchange will also be held in the ISA . The status of the CVR is uncertain and will certainly be unlisted and therefore not eligible to be held in an isa.

However I shall regard any payments coming to me in respect of the CVR as a capital payment in respect of either my condor shares or my MTL shares and therefore not taxable.HMRC may disagree ofcourse.

In some respects the situation is similar to the Hurricane Energy (HUR) take over by Prax which is a private company and therefore unlisted and not eligible for an Isa.The take over did not include any prax shares unlike the MTL takeover but was a mixture of cash and an entitlement (represented by a security) to a share of future profits.The enttilement although unlisted can be traded in an arrangement that matches buyers and sellers. The entitlement cannot be held in an Isa.

I regard the entitlement payments, of which there have been 2 this year as a capital payments for my HUR shares which were held in an isa. So far no opinions from HMRC.

I have changed my mind concerning the offer and will accept the terms.My chief regret and frankly anger is that the Chairman and CEO will be moving onto the MTL board .I wished to see the back of these people who have so failed CNR .

I hope that their influence at MTL will be minimal.

I do not believe that the CVRs will qualify for being held in an ISA.Like the Prax DCUs they will need to be held in a trading account .

However there is an argument that they represent a return of capital re the CNR sale and if the CNR shares were held in an ISA then the return is tax free.

A point of the %age voting system.

Many shareholders will be holding their CNR shares with Isa managers or other investment managers.

It is very important to note that when an investment manager votes he DOES NOT vote the number of shares that he is managing. As a nominee shareholder he has just ONE vote.

Investors who hold their shares through such nomineees are effectively disenfranchised in corporate action voting .It is a huge loophole .

An investor with 1 share has the same voting power as a nominee of 1,000,000 shares.

CNR shareholders have been well and truly stitched up by the board.

A paltry jam today offer dependent on the future MTL share price and a dubious jam tomorrow offer via a CVR that is effectively an IOU and easy to avoid.

Ofcourse it is entirely possible for CNR shareholders to reject the deal as the board only commands 28.8% of the shares and acceptance needs 75%.

But the dirty trick is in the situation if a better offer is received and the board is committed to oppose it . The better offer needs the 75% majority to approve it and the boards holding of 28.8% is effectively a blocking holding.

What a disgraceful ploy by the board to deny the shareholders the possibility of a higher competing offer.

Legally speaking I do not know if the board undertakings not to support a higher offer lapse or not if the shareholders reject the current offer.

I shall vote against this offer as a matter of principle and urge other shareholders to do likewise..

If it were possible I would call for an EGM and sack the entire board who have ridden a gravy train for years.

Personally speaking I will have nothing to do with any company that has any of the current board members as directors.