So this bit is hard to pin down. I am not sure how this can be the case, or you need to be a lawyer to grok this shit. Either way, SQ42 and SC are so heavily intertwined, I can’t see how once can be cleanly separated from the other.
For starters, this exclusionary clause, which people have pointed out, is in the Schedule 1 - Definitions. section of the document. ie this bit does not mean shit unless the term ‘Exlcuded Collateral’ is actually used meat of the document.
Which it isn’t under Section 4 or 5 - Charges and Assignments and Trust, respectively. As far as I can see, ‘Excluded Collateral’ is not used anywhere in the document outside of the definitions section, meaning it tells us nothing at all.
The term used in Sections 4 and 5 is ‘Game’ and ‘Game Assets’, defined thusly:
Without viewing the loan agreement, we don’t know what ‘Game’ refers to - is it just SQ42, or SC, or everything? Can’t tell. CIG tell us it is SQ42 only, but a ‘careful review of the security’ in the public documents does not seem to make that clear.
But what does seem to be evident is that more than just the ‘Game’ is up as security as evidenced by Section 4 and 5, but maybe some of that is pretty standard stuff and included whether F42/CIG own any or not (freehold property, for example).
But what is weird, presuming it does only actually apply to SQ42, how can it be so cleanly separated from SC in terms of IP, assets, code, recordings, scripts/scripting, etc? There must be tremendous crossover of many of those things in the SC! If they default and lose a bunch of SQ42 IP, then they lose access to any of that IP used in SC. I can’t imagine CIG don’t realise that and I can’t imagine they are keeping that fact omitted from the bank. Which makes any agreement apparently involving just SQ42 really odd, to my mind.
I can buy the currency hedging angle to a certain extent - a previous global CFO I worked under played FX all the time and hedging markets was a daily business practice, but it was a business conducive to such things.
