General discussion, page-9290

Respectfully, the point of my most recent post was to highlight there are ways that is possible to not be true and that it’s not that simple.

Our Board have said it’s possible but highly unlikely that FFX will be held liable for Morila SA. They’ve in my view implied (by repeatedly bringing it up and other actions) that it’s more likely that someone may at least have a go.

Our Auditor has said there’s a material risk of it being possible.

Our Board made a focus of the floated recapitalisation package agreements by Morila SA’s creditors to not pursue legal action, and were prepared to offer them a sizeable percentage of FFX in part to gain agreements to not pursue legal action again Morila SA.

They’re also still actively trying to find a way to cleanly walk away from Morila SA. If what you said was true they could simply walk, and Mali could simply award the permit to whoever comes along next and makes a good case for it. There wouldn’t be a need to sell the entity for nominal compensation, yet alone also sell a bunch of other entities we hold that still have some worth too for nominal consideration as well.

If there was no risk of leaking liability, who wouldn’t want a free gold mine? Why do we have to sweeten the deal with more freebies on top?

Two of the pathways to the “contained liability” argument not being true is when you have controlling parent entities, especially with overlapping directors, and the controlled subsidiary either fails to meet legal obligations or trades without being reliably solvent. Our Board noted solvency concerns when they decided to “cut ties”. They’ve also noted a risk of legal action. Yes they think they’re safe as a parent company of a holding company for the reason you mention, and like all shareholders I hope they’re right. But the people who have looked at this and got legal opinions on it have declared they’re not certain in the 2022 Annual Report and elsewhere.

We don’t know for sure who the Directors (especially Chair) of Morila SA were when the MEIM deal was struck, but we know our CFO, COO, and GM Mining were on there late last year, and we know Fraser and Lowe are the Directors of the Jersey intermediary you mention.