Risk versus Reward, page-158

Hi Sediaws,

I am in no way suggesting that the things you said happened didn't happen or that you deliberately made any false statement. As I have explained however your statement "You can’t get any more final" is at odds with the fact that they skipped a very major step in the contract to get the transaction to the state they they believed they could call it "complete". It seems somewhat obvious that it would have been much more "final" if they hadn't skipped clauses in the contract. As is stands the ownership is in dispute, the share certificate has been cancelled and its in international arbitration. A very, very long way from "You can’t get any more final".

As for your question, based on the sequence of events, the statements made by AVZ, and the court decision to revoke the share certificate, its likely that Dathomir had decided not to proceed for whatever reason and AVZ appears to have decided to conclude the transaction by force. This is where AVZ appear to have given up some moral high ground.

If Dathomir were in breach of contract AVZ were required to take it to arbitration under the JV agreement. Remember that Dathomir were still a member of the JV when it appears that Dathomir and Cominiere have refused to ratify the transaction at a Dathcom EGM. AVZ have been upfront about demanding that all the other disputes be resolved that way but appear to have decided that the rule didn't apply to them.

Since AVZ have contradicted themselves on this issue in statements made to market its very hard to know the truth about what the exact wording in the contract was but their response to the ASX was concerning to say the least.

I am not suggesting that AVZ won't win this case in the end or that they aren't still entitled to getting their hands on the additional share in the project. I suspect if we unravel the entire thing it will come down to what the court believes regarding the implied obligation as I mentioned yesterday. This is the big unknown. However its likely that AVZs own actions and choice to skip arbitration may also not look good to the court. Had they taken it straight to arbitration then they might be in a slightly better position going into the case.

Of coarse there are likely to be one or more other factors in this dispute which we aren't aware of. Much of what we know has not come directly from AVZ and they have not been forthcoming throughout the entire exercise. They didn't even want shareholders to know that there were disputes in the first place.

For the sake of AVZ shareholders I hope that the court rules in AVZs favor. I am merely pointing out the legal aspects of the case based on what we know. There is no point pretending that its all black and white when it clearly isn't. It wasn't a simple transaction. It doesn't appear to have been settled properly. None of the parties appear to have acted entirely appropriately. Its a mess.

As you say this is only for discussion. The shares don't trade so having an open discussion can't impact anything. All bets have been finalized. Can't change them until after the outcome. By then this discussion becomes irrelevant anyway.