developing new technologies to solve the biggest environmental problems currently facing the mining industry

Message: Q&A - Responses To Questions Posted August 13-15, 2018

Q&A AGORACOM FORUM – August 13-15, 2018

Please find enclosed answers to questions posted to AGORACOM between August 13 – 15.  Management has answered all questions, with the exception of those that would be deemed as material disclosure and require a press release. To this end, a full corporate update is expected in August.

When can we expect our ceo to publically address all these concerns asked on here in a news release as a lot of the questions are valid but similar and I’m sure all shareholders would need this clarification?

St-Georges Eco-Mining Corp. (“SX”) will issue press releases in a timely manner as current issues become clarified or new material developments occur. In the meantime, we can tell shareholders that our legal counsel is working its way through issues resulting from the termination (the “Tiande Termination”) of the asset purchase agreement between SX’ subsidiary, ZeU Crypto Netwoks Inc. (“ZeU”), and Qingdao Tiande Technologies Limited and Beijing Tiande Technologies Limited with the intervention of Guiyang Tiande Technologies Limited’s (collectively “Tiande”), while newly appointed officers of SX and officers of ZeU are focusing their efforts on real business development opportunities.

Frank. Were you forced out of the position of CEO? If yes, did the board, including Tsai, vote this?  If yes, on what grounds?

Frank was not forced out or voted out of any position. In fact, the management changes were proposed to the board of SX by Frank himself for the purpose of providing each of SX and ZeU with separate and fully focused management given the opportunities within each.

We don't see / hear of Lord Tim Razzall and the on goings of SX Is he still involved? In what capacity. if Director what areas of influence / responsibilities?

Lord Razzall continues to serve on the boards of SX’ subsidiaries, Kings of the North Corp. and ZeU. He is providing great input, making introductions and meeting with fellow board members of ZeU/SX in London.

When are shareholders going to receive the Plan for the corporation going forward... broken out into 60 days / 120 days / 6 months / 1 year / 2 years / 3 years 

Both SXs and ZeU are moving their business plans forward as intended, with some adjustments to account for the Tiande Termination in the case of ZeU.  We expect to have greater clarity in the really near future and will convey as such to shareholders through the appropriate channels. Suffice it to say we remain committed to ZeU and have already undertaken some meaningful steps.       

As though you were standing before a judge please provide shareholders your argument as what the value of this company currently is what we should expect over the next 180 days / 360 days plus how all directors should not be held directly responsible for decline in share price

As a public company, the question of SX’s valuation can only be answered on a daily basis by markets themselves, not by the company. The job of management and directors is to increase shareholder value by delivering those things the market values most.  We have demonstrated an ability to do this and we are confident in our ability to do it again for the long term.  

This question is for Wei Tek.  Can you please tell us your side of the story?

Please refer to the Tiande letter.

Where does Wei-Tek stand with ZeU now? 

He is neither a director, nor officer of ZeU.

Is Wei Tek still a SX board member?

Wei Tek is now a non-collaborative director of SX board.

Does he own shares of ZeU still? 

As one of the largest shareholder of SX he is entitled to receive common shares of ZeU in the arrangement previously announced.

What is the plan for Zeu moving forward?

For strategic reasons we won’t disclose more than the following at this time: ZeU is pursuing its  listing process on the CSE, recruiting key personnel, continuing discussions, which have been ongoing for past months, with potential partners to secure various collaboration agreements and evaluating opportunities currently being presented to us. In short, we remain very excited by the potential of ZeU.

How do you rebuild confidence in this company?

First, though the Tiande Termination was disappointing and created unexpected issues, it is important for SX shareholders to know that SX and ZeU did everything they could to insure ZeU fulfilled all of its obligations under the APA. However, in order to mitigate potential valuation issue of the assets to be acquired, ZeU felt it was necessary to secure the Canadian Securities Exchange (“CSE”) approval prior to insure they could issue what was contemplated in the APA. In order to insure an expedited process, SX and ZeU undertook the Arrangement procedure which was approved by the shareholders and the Superior Court of Quebec in less than 60 days, ZeU concurrently worked with Tiande to secure their IP outside of China, to increase its value and be in a position to effect a meaningful transfer at closing, as well as, filing to obtain conditional approval from the CSE to list ZeU, which is the last required condition to complete the distribution of ZeU shares to St-Georges shareholders under the Arrangement. These facts are not subjective and irrefutable. 

What the Company was not able to do was control market conditions and valuations for the blockchain and crypto sectors over the past 8 months, which lead to unreasonable and unrealistic demands of our counterparty.

As such, despite our deeply shared disappointment with you in the outcome, shareholders should feel confident that SX and ZeU have unequivocally demonstrated the capability to deliver on obligations it can control and will do so again.   

So we brought a spoon to a gun fight?

We brought a big pen to a celebration - and the other party ran away.

Do we still hold on to the capital raised for ZeU?

Yes as per the terms of the debenture issued pursuant to the subscription agreements accepted by ZeU.

When do you expect to list ZeU now that Tiande and all the legal hoops are out of the way?

The listing process is on-going and we still expect to list ZeU in the fall.

How can we use the Tiande product and at the same time sue?

As previously announced, SX entered into a licence agreement (the “Initial Licence”), which was assigned to ZeU, with Qingdao Tiande Technologies Limited, a subsidiary of Beijing Tiande Technologies Limited, to use proprietary technologies, patents and know-how to develop and commercialize novel mineral commodity production chain control, tracking and trading exchanges (the “Commodity Trading Domain”), in consideration for a royalty of 8% of the gross revenues derived from the licence. Although this licence remains in force, in light of recent event, our legal counsel are reviewing certain aspects of the licence and we will present the result of this analysis in a timely manner.


Are SX shareholders still getting there 8-1 Zeu shares?

SX and ZeU still intend to complete the Arrangement as soon as ZeU has secured the CSE approval. Shareholders of records on August 7, 2018 are entitled to receive ZeU shares under the Arrangement upon its closing.

What will be the share structure of ZeU now?  How many shares issued?

20 million common shares is the current total.  Plus the debenture holders who can convert at $1.

Can we now release all ZeU deals that were not being release due to the closing of the deal?

All material facts have been disclosed by SX and ZeU. If any new facts arise, press releases will be disseminated upon their occurrence as required by securities regulation and CSE policies.

Can we hold all his shares considering he (wife) has been unethical?

No comment.

Out of all ZeU’s team who is staying and who has left or will be leaving?

For now, ZeU will keep any and all personnel matters confidential for strategic reasons.

Did we try to get the business of the CSE trading platform?  What did we lack that they went with another company?

The CSE is not using a blockchain platform. Work on this project commenced some time ago. We would welcome some collaboration in the future. The burden of the proof is on us.

Is ThreeDcapital still investing in ZeU? It was stated at the AGM they are but are they now after this? Did they contribute to the raise? Participate? Not do anything? Why?

ZeU will not disclose nor comment on the investment intentions of third parties.

Now that you will have more time to focus on the growth of ZeU can we expect more regular updates? 

For strategic reasons, ZeU will only report on material facts for the time being.

Does Tiande have the ability to back out of licensing agreement with SX granted them exclusive use of their proprietary technologies.  News was announced January, 4th 2018. 

Please refer to our press release of August 13th for our position on the topic as well as our answers above.

Do we still have rights outside of China and can we stop Tiande from doing business outside China?

ZeU does have rights pursuant to the Initial Licence. As previously mentioned the scope of the Initial Licence will be updated once our analysis has been completed..  

Why did we terminate the Tiande deal?

The deal was not terminated by us. It was terminated by Tiande.

The SX/ZeU team made every effort to compel Tiande to honour its agreement. However, as stated in our announcement of August 13th, despite significant concessions offered by ZeU to negotiate and finalize an amended  agreement, the demands made by Tiande were simply not possible to accommodate in terms of both commercial viability, securities regulations and CSE policies.

Has Tiande tried to do bypass ZeU and do business out of China to your knowledge?  How do we stop them if they do?  What happens if they simply spin out another company, let's say XYZ company, to bypass that rule?

The company is looking at its legal position in this matter and consulting with its legal advisors on potential actions on behalf of its shareholders

In the NR it says we can use Tiandes technology.   Is there any way for them to terminate that?  If no are you 100% sure.

Please refer to our press releases and our answers above.

I thought Tiande deal was a binding contract?  Please explain how this happened and furthermore why did we even entertain the renegotiation?  Deal was done, correct?

Yes, the deal was done correctly. However, the reality of any agreement is that it is only as strong as the paper it is written on. You can only compel compliance of a counter party through litigation, or negotiations. Given the former can only provide a remedy via a lengthy process, it behoved the Company to entertain negotiations once Tiande threatened to pull out.  Our management team is 100% confident it did all it could to address their needs within reason – and then some - but their needs were ultimately beyond what was commercially reasonable, logical or even legal in some instances.

From here on out, our legal advisors will address the Tiande matter, while we focus on day to day business of SX and ZeU.

Frank - considering we can still use everything Tiande, isn't 8.5% better than 150million shares?

ZeU can’t use everything they would have acquired under the asset purchase agreement. It’s an 8% royalty under the Initial Licence. We will let you make your own conclusion once a complete corporate update will have been provided.

What preventative measures have been put in place in order to protect the licensing agreement of 8 percent royalties?

Nothing so far and ZeU we will await the result on the ongoing analysis to determine if any measures are necessary and feasible.

Does the cancellation of the Tiande deal affect the spin-off ratio of 8:1 and is it still an estimated value of 1.00$ per share? 

No, the Arrangement was not conditional upon the acquisition and the distribution will still be effected  at an estimated ratio of 8:1. As stated above, we cannot comment on the estimated value. This will be a matter for the market to decide.

Right now we are sitting at  .075.  If we were to liquidate tomorrow what would we get per share?  What assets do SX and now ZeU hold?

We refer you to our latest financial statements..

How will pursuing legal action against Tiande affect the licensing agreement.

The Initial Licence and the failed asset acquisition are separate matter. Obviously, the Tiande Termination will create some issues but business is business.  

What are your contingency plans in case Tiande breaks contract?

The Tiande Termination occurred and the Initial Licence remain in force. Please see our latest press release and answers above pertaining to our plans for ZeU.  We remain confident and excited by the prospects of ZeU.

Can you also clarify amount of shares being released in ZeU’s ipo now that Tiande has walked away?

ZeU is not undertaking an IPO. There are a total of 20 million ZeU shares issued and outstanding, which will be distributed in accordance with the term of the Arrangement upon it completion.

Are there any restrictions on deals that your able to sign in the fine print of the Tiande licensing agreement ? 

There is no fine print. The Initial License is for Commodity Trading Domain.

I would like to ask if the relationship with Tiande is salvageable to the point that we may have another opportunity to make a deal ? 

No comment at this time.

Why are you not promoting the Licensing Agreement, what is the value of the shares given to Tiande to pay for the licensing agreement?

The only compensation owed to Tiande under the Initial Licence is the 8% royalty

What are all of the business terms of the licensing agreement, is the agreement restricted as to what it can be used for?

The license is for Commodity Trading Domain.

Do you have all the code etc for the Chinese Blockchain in your possession?

No comment at this time.

Why are we only seeking legal advice on suing for expenses?  What about damages to the company?  What about damages to ALL investors that were hanging on of this ZeU deal?  We, the shareholders deserve a response from your legal team.  I want to see a written recommendation signed by the attorneys with reason to why or why not.

ZeU has commenced the process of consulting with its legal advisors to seek full reimbursement and compensation of its expenses, as well as, to review potential actions on behalf of its shareholders.

Where is the Lithium Exraction Tech Results?

We will update our shareholders once more results come in.

Why aren’t we drilling on properties?

In Iceland we have been waiting for drilling permits but that has been delayed due to planning restrictions and discussions are ongoing. We have been doing scout work with drones and expect to identify targets in this season. Weather in Iceland hasn’t been on our side.

Otherwise, we are presently getting organized in properties we like from a potential to extract minerals economically. We will focus on these properties to minimize dilution

Frank.  Is your lithium technology proven?  If so, why aren't companies jumping at the opportunity to work with you?

Not yet.  We have been selected by companies who want to work with us until we have the technology fully tested.

Kindly ask you to provide an update on the mining initiatives, especially Julie Nickel and Iceland. What is the state of play regarding the planned field work and drilling campaign plus necessary permitting on the licenses? Can we still expect some progress eventually? 

A detailed corporate update will be disseminated before the end of the month

Did you or did you not receive the bulk sample from Iconic Minerals and is an update on this lithium extraction tech still scheduled for "early" Q3 as per May monthly progress report? If not, what is the new anticipated timeline? 

We did not. We will update you as soon as we know when.

Will you test the bulk material in Perth at Strategic Metallurgy's lab and how long will it take?

We will be working with a number of laboratories in different areas. Strategic Metallurgy has expertise we will tap into.

Did you get the ICM shares for Stage 1 Benchmark ?

Not Yet.

Can you reveal the source of the Third Party Material you got back in March? 

No, except that we had our own also from Royal and from Iceland

Explain how this isn’t and wasn’t a scam? This is sure a bad day for me, the company, fellow investors. 

The idea that this was a scam is utterly ridiculous. We shouldn’t even dignify this question with a response but if you are a true shareholder, you should know that we received Superior Court Approval for the spin out of ZeU just last month.  SX is a regulated company and all contracts, announcements etc. are done in accordance with the relevant rules and regulations, as are any stock sales by officers and directors of the Company, which were non-existent.

Moreover, our law firm through this entire process is a respected firm, with offices across Canada and Hong Kong.

Hence, your implication is ludicrous. The unfortunate reality is that business deals do not always close for a variety of reasons. We were as deeply disappointed as all shareholders were at this particular outcome. Officer, Directors, Employees and Consultants invested / sacrificed inordinate amounts of time and energy over the past 8 months to get this deal done. 

Where are we at with Borealis exchange and the 3rd possible government that you are negotiating with to sign on?

That is all work in progress and we are delighted that the concept of Borealis is getting momentum and growing in our hands.

Frank, what revenues are we going to be receiving?  So far, I've only seen compensation in shares with holding periods; where are cash revenues?

With respect to lithium, cash revenues are structured to come from royalties in the future. Any comments as to timing would be premature at this moment.

 Can you also clarify the state of and process of listing on the cse?

We are continuing to work to obtain a conditional approval. Questions and comments from the CSE would be the next normal course steps once we updated and filed our listing statement reflecting the Tiande Termination.

Are you allowed to release details of deals prior to CSE listing date? Please see answer above

How are you paying the top executives?? The company has a remuneration committee that suggests to the board the annual pay to executives. The board is of the view that the pay is fair and reasonable. In fact, the Company believes remuneration is below market price for similar positions, indicating the belief of the management team in the company’s future.

Specific further details can be seen in the company’s financial statements.

Do we get in the near future a better news flow?

We always try but we have to respect confidentially agreements and respect our partners. We will strive to update shareholders with activity as much as possible.



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