Magpie Mines - info taken from financialsThe Magpie Mines Inc. was no longer consolidated after March 31, 2023, the date that the Group lost control of The Magpie Mines Inc.
The Group held 112,643,924 common shares of The Magpie Mines Inc., a private company at January 31, 2024 (2023-112,643,924). These common shares were valued at Nil as January 31, 2024
In the Consolidated Statement of Operations and Comprehensive Loss, the Group has recorded a gain of $429,696 from the deconsolidation of The Magpie Mines Inc. on March 31, 2023, the date Fancamp lost control over Magpie. Fancamp has recorded the $1,964,511 advanced to The Magpie Mines Inc. as well as an allowance for the possibility that this debt will not be fully repaid (See Note 6 – Other Receivable) and filed a notice of its intention to collect the amount due.
The directors of The Magpie Mines Inc. issued themselves Special Shares which allow for the election of 2/3 of the board of directors of The Magpie Mines Inc. While Peter H. Smith was CEO of Fancamp, the Group was provided assurance that it could exercise control but to date 2 of the directors of The Magpie Mines Inc. have refused to relinquish the Special Shares or co-operate with Fancamp Exploration Ltd. in any way.
Mr. Smith caused Magpie to be incorporated with a capital structure that included a class of special shares (the “Special Shares”). The Special Shares carried the right to appoint 51% of Magpie’s directors and, as a result, the holder(s) of the Special Shares could effectively control Magpie. The Special Shares should have been issued to Fancamp, but Mr. Smith issued them to himself and two individuals.
On May 27, 2021, the Group discontinued the lawsuit against the third individual after the special shares issued to that individual were conveyed to Fancamp.
By way of the Transaction, it appears that Smith and Kamaleddine seek to sell their Special Shares for millions of dollars of personal benefit to the further prejudice of Fancamp.
On August 10, 2023, Fancamp received a response from Chrome Co. in which it indicated that Fancamp’s letter “does provide some clarifications as part of our ongoing due diligence efforts in this matter.” It is unclear to Fancamp whether Chrome Co. intends to proceed with the Transaction.
Fancamp will continue to take appropriate steps to protect its interests including but not limited to the recovery of the special shares.
Fancamp’s continues to maintain its shareholdings and position with respect to holding the previously announced secured convertible promissory note in the principal amount of C$34.5 million in Chrome Co., as it relates to the sale of Fancamp’s beneficial interests in Koper Lake-McFaulds mining claims.