Indonesian Gold (27 page)

‘Screw it!' Walters exploded again. ‘What you're talking
about is effectively a restart. It would have to go to the shareholders
and
the Securities
Commission would want to have their say.'

‘Sure, but all in good time – we'd take it in two steps.
Firstly, my group would acquire your position, I would take a seat on the Board, then we would
work towards having BGC acquire their prospects which, by the time all else is ready, results of
the full drilling program will be in hand to substantiate initial findings and
evaluations.'

‘Who's going to fund all of that?'

Kremenchug
was ready. ‘The
investors,' he replied, confidently. ‘As I said; your twelve and a half percent for a hundred and
fifty grand, cash, and you walk away with enough options to choke a horse.' Kremenchug hesitated,
giving Walters time to absorb the offer. ‘As for you, Chris, you get to remain in the chair with
a five-year contract, also with a fistful of options.'

‘For whatever that might be worth,' the BGC President
intoned, negatively.

‘No, you're wrong, Chris. If you remain in the chair,
you'll receive a healthy salary and two million options. Once production commences, the company's
stock will leap and the options would follow.'

‘Production? Christ, Alex, they don't even have a property
yet! How can you sit there and talk about an operational mine, already?'

‘They will have a mine,' he assured them.

‘Sounds like the same crap you walked in with five years
back,' Walters complained.

‘If this is bullshit, why would they want to pay you out
in cash?' he reminded the banker. ‘I'm not at liberty to reveal too much. Who knows, you might
reject the offer and that would only cause complications when they took the deal elsewhere? But,
I can tell you this. I have never seen a property with such great showings - and it will be
assigned to BGC.'

‘Then why not give it to one of the majors, and sit back
and enjoy life?' Fielding pressed, still suspicious of dealing with Kremenchug.

‘They considered this,' he lied again, ‘but decided that
they would do better with their own publicly-listed company.'

‘Where are these prospects?' Fielding appeared
confused.

‘Indonesia, of course.'

‘Shit! Here we go again,' Walters shook his head, as if he
knew Kremenchug's offer to buy him out had been too good to be true.

‘These prospects will drive the value of BGC shares up to
at least a dollar,' he promised.

‘Sure, Alex, sure.' Walters' spirits had plummeted with
this forecast. ‘Sounds like déjà vu.'

‘Well, it's your choice, Scott,' Kremenchug now went in
for the kill. ‘You can either sell your shares to me when nobody else in their right mind would
give you even a fraction of what I'm offering, sit on the options we'll give you and make a
shit-load of money, or let the company collapse into its shell.'

‘Why don't you just go into the market and buy stock –
Christ, it's low enough?'

‘You
know
why! The stock would climb back once
someone stood in the market with such a huge buy order. Besides, the same restrictions still
apply with respect to controlling interests.'

‘You still won't have control by acquiring my block of
stock.'

‘I know that. But, at least we'll have the largest
individual block and still remain within the legal threshold.'

‘What then?' Fielding asked.

‘As I've already stated, Chris, once we've taken a Board
position and Scott has surrendered his stock, we'll work towards having BGC restructured so that
effective control will pass to the incoming investors by acquisition of their Indonesian
prospects.'

‘And what if I want to negotiate the offer?' Walters'
earlier aggression had dissipated somewhat, sensing that his shareholding could be crucial to any
deal in the making.

‘I'd be obliged to go elsewhere with their money – and
leases.'

‘Your stocks would also be worthless.'

‘Then, I would be looking to the incoming investors for
some sort of compensation with respect to the losses I would incur, by taking the deal
elsewhere.'

‘You'd walk away from your stock in BGC?'

‘Sure,' Kremenchug now spoke with authority. ‘I've already
raised this possibility with the investors. BGC's attraction is nothing more than its existing
structure and foothold in Indonesia. They could spend considerably less and buy their way into a
Kalimantan concession and, no doubt, I would be adequately compensated should they elect to go
elsewhere.'

‘Then why don't you?'

‘Because, they don't want to go public with their
holdings, nor do they wish to hold any positions on the revamped Board.'

Suddenly, the pieces began to fall into place for both
Fielding and Walters.

‘You'll be voted onto the Board?'

‘Yes,' Kremenchug, now over the hump, began to enjoy the
charged atmosphere. ‘I would hold their proxy. As I stated earlier, Chris will be offered the
Presidency and options.'

‘When would I receive the options?' Fielding re-joined the
discussion.

‘You could take them up by paying the twenty-five cents
anytime you wish within five years – the duration of your contract.' Kremenchug suddenly felt
smug – ‘These will be worth a minimum of two million dollars once results of the properties
acquired by the revamped BGC are announced.'

‘Shit!' Walters threw himself back into his chair. ‘You're
a nice piece of work, Kremenchug!' He stole a look in Fielding's direction, convinced that this
man had advance knowledge of Kremenchug's offer. ‘Why not just make a written offer to the Board
to inject capital, assign the leases and leave existing stockholdings intact?'

‘Because, as you reminded us, that would require
scheduling a stockholder's meeting, submissions to the Securities Commission and God knows what
else.'

‘Then why not go that route?'

‘Because that's the deal, Scott.' Kremenchug sat upright,
as if preparing to leave, his expression somber. ‘Take it or leave it.' He knew that Walters
would have to be realistic – it was not as if investors were queuing up outside to save the
ailing company.

Walters chewed on this for some moments before looking
over at Fielding, who raised his hands and shrugged, in a suggestion of
fait accompli
,
then nodded in affirmation.

‘Okay. I'll need a few days to think it over. But, just so
we're clear,' Walters becoming defensive, ‘I'll need to see something concrete as to how we're
going to get paid – you know I'm not in this alone.'

‘That's fine, by me,' Kremenchug agreed graciously, his
insides twisting with excitement at the unexacting win. ‘Let's place a deadline on written
confirmation by… say, midday Monday?' Kremenchug also needed time to facilitate his own,
back-to-back arrangements with Sharon Ducay.

‘Agreed.' Walters cocked his head at Fielding.
‘Chris?'

Fielding shrugged his shoulders. ‘Sure. We'll meet back
here on Monday,' he agreed – yet to be convinced that Kremenchug was the benefactor he made
himself out to be. Over the past, desperate eighteen months, there had been a number of deals
which had collapsed at the eleventh hour and now, due to his extended run of bad
karma
,
Christopher Fielding still could not shake his pessimistic mood.

****

Kremenchug
called Sharon Ducay
to advise that he had secured an in-principle agreement from the BGC President, and Walters, to
facilitate the ‘back door' takeover. Sharon confirmed that she would make funds available to
complete the acquisition, and finance the costs of restructuring the company when the timing was
appropriate.

‘What time frame are we looking at here?' she
asked.

‘Providing Monday's meetings go as planned, we should be
able to secure shareholder approval within six to nine months,' Kremenchug advised.

‘And the final cost?'

‘I had to go to three hundred thousand, for Walters'
stock,' he lied. ‘Then, there's still drilling costs and whatever it takes to secure the property
in Kalimantan. BGC will need some funds to restructure and call the extraordinary stockholders'
meeting towards the end of the year to sanction the acquisition, and effectively pass control to
us.' At the Manila end of this conversation, Sharon shook her head at Kremenchug's
predictability. She had suggested a cap of a quarter of a million for the financier's block of
shares.

‘Okay, that's fine,' Sharon agreed, Kremenchug's request
was still well within her budget. ‘Ring me again on Monday, after the meeting. Remember, Alex,
the General and I have placed our trust in you to finalize all of this as expediently as
possible. The General's not all that well, and I would like to see the arrangements settled while
he is still with us.'

‘I understand, Sharon,' Kremenchug assured her, ‘and I'll
definitely phone you as soon as I have their acceptances on Monday.'

‘We really don't want to start afresh, Alex,' she
reiterated, ‘floating an entirely new entity would disadvantage us in every way. We would have to
start from scratch with the Indonesians, find an underwriter and secure a property under the
revised foreign investment laws – the timing could jeopardize our project. I'm hearing that
current, due diligence procedures in Canada have also become more stringent – a new float would
require independent drilling reports and you know what that would mean.'

‘I'm confident that Fielding and Walters will go through
with the offer, Sharon. Don't worry!'

Their conversation ended and, as it was still early the
following morning, Filipino time, Sharon then went to the General to inform him that it was time
to contact his Chinese friends in Manila, to commence changing some of the gold into dollars. By
Tuesday morning, Sharon placed five hundred thousand dollars into her carry-on case, and locked
this in the cellar.

****

Kremenchug
scowled at the
financier. ‘I think the offer that's already on the table is more than generous.' They had been
locked in negotiations for more than an hour. The remaining Board member had phoned in, advising
Fielding that Walters had his vote. The BGC company secretary had thrown his hands in the air and
left the meeting, returning to his accountancy practice across the hall, requesting he be called
if there was any resolution.

‘Listen, Alex,' Scott Walters' counter offer had all but
derailed their negotiations. ‘I carried this company for the best part of five years, sunk half a
million into its start-up and now deserve to remain in the deal. It's crap to want me out now
that the company has another backer.'

Kremenchug
replied coldly.
‘You're in danger of killing this deal altogether.' He looked over at the BGC President. ‘Tell
Scott again, what happens if I walk?'

‘We don't have to go there,' Fielding all but moaned, ‘for
Chris-sakes, Alex, there must be some room for negotiations here!'

‘Look, Alex,' Walters stepped in, ‘my group simply want
recognition for our participation, to date. We bought in for half a million at the start and
don't believe it's unreasonable to at least expect to take that much out.'

‘You still have the options,' Kremenchug
reminded.

‘As does everyone else,' he retorted.

‘We're not going to give you more than two hundred and
fifty thousand,' Kremenchug had already upped the original offer by fifty thousand, but Walters
remained stubbornly fixed to his counter demands, cutting into the additional hundred thousand he
had earmarked for himself.

‘Here's out final offer,' Walters insisted. ‘We'll take
the deal off-market so that you won't have to disclose the price paid for the stock. That way you
will be able to keep the other shareholders biting at the bit to support the restructuring and
share allocation to your investors. We'll sell you half of our holdings for what we paid for them
originally, the balance of a quarter of a million to be paid by your associates within twelve
months. On top of that, we want to keep the options.'

‘Impossible!' Kremenchug exploded; Walters counter offer
had not really changed in any significant way. ‘Looks like we're stalemated here, gentlemen,' he
said, hesitating, before rising to his feet. ‘I'm sorry, Chris,' he smiled weakly at the BGC
President, ‘but I gave it my best shot.' He started gathering his notes and slowly placed these
inside a black, soft crocodile skin briefcase.

Walters waited, hoping to call Kremenchug's bluff. But
when it became obvious that the man was serious and intended abandoning the negotiations,
Walters' position changed immediately.