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McWilliams, Vaughn <br />From: Kevin & Rachel [raverch@kci.net] <br />Sent: Monday, January 25, 2010 8:33 AM <br />To: McWilliams, Vaughn <br />Subject: 3T Cattle-CWCB loan <br />Vaughn, <br />It was a pleasure to meet with you and Tim on January 20, 2010 to discuss the 3T Cattle-CWCB <br />loan contract. As we discussed in our meeting, a breach of our loan contract had occurred, <br />necessitating an immediate response by 3T Cattle to help rectify the situation. 3T Cattle is <br />fully committed to resolving this situation quickly and equitably. <br />The water stock used as security on the 3T Cattle -CWCB loan contract had been sold to <br />Bullseye Feeders/ Kevin Lamb. It is 3T Cattle's understanding, after our meeting last week, <br />that though the loan payments are current, the sale of the water stock has left CWCB without <br />adequate security. Complicating the matter, Bullseye Feeders and Kevin Lamb are in <br />Bankruptcy and have been for two years. 3T cattle is listed as a secured creditor within the <br />bankruptcy with a perfected lien against the water stock being used as collateral to the 3T <br />Cattle-Bullseye Feeder loan. It is anticipated by 3T Cattle Company, 3T's counsel, WestVal <br />Financial, Wells Fargo, 7P Morgan Chase, and other creditors that the Bankruptcy will either <br />be dismissed or converted to liquidation on or near February 1st or 2nd, 2010. It is the <br />hope of 3T Cattle Company to start the foreclosure process as soon as allowable by the <br />courts. <br />Recognizing the desire for a quicker and less complicated resolution to the 3T Cattle - CWCB <br />loan situation, 3T Cattle is committed to paying off the CWCB loan thereby resolving any <br />defaults. 3T Cattle is beginning the process of obtaining a separate loan on several <br />unencumbered properties that should allow it to easily pay off the CWCB loan obligation. In <br />the unlikely event that obtaining a separate loan is not sufficient to pay off the CWCB loan, <br />3T Cattle Company and Kevin Averch will tap into alternate and/or additional resources to <br />accomplish its goal. The anticipated time frame to pay off CWCB would be no later than <br />August 1st, 2010 and more likely as early as mid March. <br />We apologize for any stress this unfortunate situation has created, but assure you and the <br />members of the CWCB board of directors that the resolution of this matter is a top priority <br />of 3T Cattle Company and its officers. <br />Please let me know if there is anything else I can do to be of service. <br />Sincerely, <br />Kevin Averch <br />3T Cattle Company <br />970-443-1107 <br />