California I think it is important to note that FRR has always been in a precarious financial position and this is not a new phenomenon that Hope’s lawyers are trying to portray now. As an early O&G junior explorer, this is the modus operandi not just for FRR but for nearly all small oil companies. So for over 20-yrs, these incumbent long term Directors have balanced the books by honouring their fidicuary duties to employees and creditors (I can’t recall any legal action been brought against them, so great track record). In fact, historically speaking, they have personally financed the company when there was no other finance option available, which was subsequently converted to ordinary equity at a premium. How much Director RPNs converted? $26m. This is Directors level of commitment to their stakeholders. Then we know that Zaza offered a personal loan of $5m, but what did Hope offer? Sweet FA. Infact, Hope lawyers go back to claiming that Hopes actions were to protect Outrider and other creditors and therefore fulfilling his fiduciary duties. And this is going to be crux of the legal argument. Well, that cant be true, because if it was, he would have started raising these issues as soon as became the Director of FRR back in Feb 2017 and not from April last year. There are clear cut legal cases where a Director should excuse himself from Board discussions when he is conflicted, not use his veto power to protect his own position. This vulture is now arguing that he vetoed the proposals to protect creditors but did he then offer superior terms for his own $2m loan? As far as Judge Kawaley’s comments are concerned on the financial state of FRR (and this shows how little he understands the early explorer industry), FRR has been in this financial state for over 20-yrs without any creditor not getting paid. Infact you could argue that over the 18months, FRR made more progress with new equity raised, progressing drilling operations and securing discussions with international heavyweights. I can also name at least half a dozen AIM O&G companies that have a similar financial position to FRR. And what about the Regulators such LSE who continually monitor these small companies. Anyway, I think this is why FRR want a Jury trial because when the facts are heard, and Hope is exposed for the vulture that he is and how he has taken advantage of the opportunistic purchase of heavily discounted company debt. When the facts are finally presented, then you could see his motivations which resulted in him not honouring his fiduciary duties. Will the preliminary injunction be granted? I don’t know. It will depend on the hearing on the 6th June; it will all come down to the persuasion of the argument from the respective lawyers. But as it is FRR who has brought this action, they should be given their day in the court I believe. This is a war to the end NOW, either it’s bye bye Outrider or bye bye FRR, no middle ground. Shame they couldn’t see a win-win situation. But what is clear from the submissions is that Hope was cheer leading for FRR to fail so he could exercise his plan. JMO
California thefozzer: Did anyone clock from the court docs that T45 was just doing 50bopd No, can you copy the section or reference it?
California Paying the 2m would have bought Zaza 12 months, they could then have pursued the legal avenue during this time for his lack of fiduciary duties. I can only guess, due to the PSA ticking, that Zaza needed to get the Durham term sheet through as soon as possible and had his hand forced. Let’s hope FRR have the means to pay off Hope, I see paying him off as the only way forward out of this mess.
California Paid the 2m and then what Fozz, watch Hope veto all attempts at raising finace.
California Looking back I bet Zaza wished he paid him the $2m and then went after him through the courts in order to get rid of him. Where’s our 5m tax rebate from the Georgians!!!
California You lot better hope that this was a time wasting exercise and that Zaza now has money to pay off Hope.
California Booster are you Dodge from ADVFN? Ya weirdo!!!
California Eyes, I’d have to agree with our LSE brothers that it looks very bad for FRR. Hope has already pulled the trigger and things are now in motion that will cause great harm to FRR. I think our only chance is the proved declaration of solvency which will require a guarantee of a loan to repay OMF.
California Zaza is even moe incompetent than that idiot Theresa May. She has now gone and Zaza is next.
California Taffy52 has posted a full write up of the Response to Motion on LSE and by all accounts it is not looking at all good for Zaza and FRR. ‘slam dunk’ seems to be the quote of the day. To sum up Taffy52 says: “I don’t think the injunction will be granted. What are the chances that Zaza will complete the declaration of solvency by the 29th? Basically he has to say that FRR will pay its debts within 12 months. If he doesn’t do this I think it’s all over. If he knowingly misleads the court he faces 2 years in prison. Can he find $30 million in that time and be certain of it? Are we actually producing oil?” This from Zeninvestor: “This is only about the injunction and the liquidation of FRCC (from which the assets have been removed). Steve N and Zaza have until 28 May to sign the declaration of solvency form (stating that they can pay the debt within 12 months). This then goes before the Cayman Court. If the court is convinced the the liquidation is halted for 12 months. With Hope off the board, Zaza can produce his $150 million JV assuming it’s ready to go. Don’t panic yet!” And this from regdik: “Will need a Lawyer to look at the finer points but two very different submissions. FRR looking at the whole picture and Hope’s isolating and dissecting various points and looking at jurisdiction and points of law. Its all up to the Judge now how he sees it. The Cali judge can’t rule on the company transferring asset as that is Cayman jurisdiction as is the liquidation. What he is to rule on is there a case to keep status quo until a trial or let Outrider seek to chase the asset.”
California Weak and pathetic Zaza gets another kick in the nuts. There is no chance of an injunction. Zaza is just as pathetic as Theresa May, maybe he should join the Conservative Party.
California Looks like Hopes response has now been added May 23rd “Opposition/Response to Motion”. Will await Pacer detectives for actual wording! CourtListener Docket for Frontera Resources Corporation v. Hope, 3:19-cv-01996 -... Docket for Frontera Resources Corporation v. Hope, 3:19-cv-01996 — Brought to you by the RECAP Initiative and Free Law Project, a non-profit dedicated to creating high quality open legal information.
What Next I’d agree the loss of the Nomad was a big spanner in the works and unexpected. The GG will take back the asset and give it to a super major if FRR lose this legal battle. Hope will get zero apart from a load of legal bills. Interesting what happens next, I still don’t see Steve losing this one but we’ll see. Just a view, not stating any facts whatsoever.
What Next But the likes of Exxon can get it. What is becoming clear is that Zaza’s little plan begani to unravel from the day the Nomad resigned and has gone further downhill since to the point where he is begging the judge for mercy. Legally Zaza doesn’t appear to have a leg to stand on so unless he’s got some mates with 150mill to bail him out it’s the end of the line in 2 weeks time.
What Next Hope is going to lose the prized B12 asset, he will never get his hands on it or recoup his $22m if he continues on his current path. That’s my view.