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Cheryl A. Linden <br /> May 12, 1994 <br /> Page 3 <br /> Steve Seifert has advised that the Committee is willing <br /> to tell Mid-Valley to drop its development contingency or have <br /> the Committee withdraw its objection. My understanding is that <br /> the DMG wishes to maintain its objection. Thus, we apparently <br /> are faced with the loss of the only non-contingent offer on the <br /> rockdugt plant real estate. <br /> The DMG's objection mentions that Pitkin Iron <br /> Corporation has operated the rockdust plant, and states that the <br /> DMG objects "to the requirement that the debtor, and ultimately <br /> the Division, absorb the expense of any clean-up, and to the <br /> requirement that $40,000 be retained to ensure that such clean-up <br /> occurs. " <br /> There appears to be a bit of confusion concerning the <br /> Eubank holdback provision. Paragraph 17 of the contract provides <br /> for retention of $40,000 in escrow "to assure clean up and <br /> removal of structures, limestone, magnetite, and personal <br /> property as above provided. " if that work is not done, Eubank is <br /> authorized to do the work and be reimbursed at cost plus 15t from <br /> the escrow. <br /> Paragraph 12 of the contract requires Resources to <br /> remove, at its expense, "all limestone, magnetite, personal <br /> property, conveyors, and structures. . . . " The main structure, <br /> including machinery, and the storage tanks, building and <br /> facilities attached to the packwall aggregate plant must be <br /> removed within one year. Everything else, including the <br /> limestone and magnetite deposits, must be removed within six <br /> months. Paragraph 14 requires removal of "all trash piles, scrap <br /> metal, waste materials, and all other debris from the property" <br /> within six months. <br /> Pitkin Iron currently is removing the limestone and <br /> magnetite deposits from the property. Rather than view the <br /> deposits as waste materials, Pitkin views them as a valuable <br /> asset which belongs to Pitkin. <br /> I am advised that Pitkin Iron is milling to sign an <br /> agreement affirmatively obligating Pitkin to perform removal of <br /> the limestone and magnetite, as well as the removal of trash, <br /> scrap, waste materials, and debris as required by Paragraph 14, <br /> and indemnifying Resources from any loss under the Eubank <br /> contract caused by any failure to perform such removal. <br /> Even if Pitkin completed the removal of limestone, <br /> magnetite, and trash tomorrow, the holdback would remain under <br /> b"d 8OSS3l '8 H3G_1OH WJIO:S0 b6. 21 ),dW <br />