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BURNS, FIGA & WILL, P.C. <br /> Cheryl Linden <br /> June 9, 1995 <br /> Page 2 <br /> The next issue raised in your June 23, 1995 letter concerned whether there was an <br /> overlap in payments between those allowed in the cash collateral motions and those requested <br /> in the current Application for Allowance of Administrative Claim. There has not been. <br /> Payments received by Pitkin Iron from MCR through 1992 totalled $348,573.57. Payments <br /> received from MCR by Pitkin Iron through August 1993 totalled $186,472.52. Please see the <br /> running balance attached as an exhibit to the Application for Administrative Claim. <br /> Pitkin Iron's charges to MCR from 1992 through August, 1993 had been paid. These <br /> payments covered payroll costs, insurance, equipment and vehicle rental, reimbursement for <br /> purchase of parts/supplies, and an administrative charge of 15%. <br /> After September 1993, payments from MCR to Pitkin Iron were deferred due to <br /> insufficient funds. As of August 23, 1993, MCR's cash-on-hand totalled $110,628.72, with <br /> accounts payable and anticipated billings of$107,041.02. It should be noted that Pitkin Iron's <br /> continued services were essential to MCR's efforts to sell property and comply with <br /> requirements of the Division of Minerals and Geology. Had Pitkin Iron suspended work in <br /> September, 1993, or thereafter, clean-up of the fabrication shop tract and the Industrial Park <br /> would not have been completed and sale of those properties could not have occurred. <br /> Reclamation would have been suspended and compliance with various requirements and orders <br /> of DMG could not have occurred. <br /> Cash Collateral Authorization. The expenditures approved in the cash collateral motions <br /> exceeded available funds. Work performed by Pitkin Iron, on which this claim is based, was <br /> largely within the scope of activities approved in the Cash Collateral motions. <br /> First Motion. (i) long-term reclamation projects, and (ii) repairs of equipment to be used <br /> for reclamation projects. <br /> Second Motion. (iii) regrading of the raw coal storage area, (iv) covering and regrading <br /> the Sutey pile . . . . (ix) maintenance of equipment of those purposes, (x) grass seeding, and (xi) <br /> other general reclamation work. <br /> Third Motion. Pond cleaning, Flume repair, PCB removal. <br /> Jim Holden sent a letter dated December 9, 1993, to Mike Long, Steve Renner (DMG), <br /> and Cheryl Linden concerning work performed by Pitkin Iron, which is the basis for the present <br /> claim: <br /> Interim maintenance and credit for work performed to date. In resolving the Creditors' <br /> Committee's objection to reimbursement of Pitkin Iron pursuant to Resources' Third Cash <br /> Collateral Motion, Resources stipulated to the following: <br />