1992-10-21_GENERAL DOCUMENTS - C1981017 ‎(2)‎

• Permit No: C1981017
• IBM Index Class Name: GENERAL DOCUMENTS
• Doc Date: 10/21/1992
• Doc Name: Receipt of October 15th letter
• From: Holden & Jessop, P.C.
• To: Winston & Strawn
• Permit Index Doc Type: General Correspondence
• Media Type: D
• Archive: No

CAM
_ 1 _ I _ J
( HOLDEN 8C JESSOP, P.C.
ATTORNEYS AT LAW
303 EAST 171- AVENUE, SUITE 930
DENVER, COLORADO aO2O3-1264
[phone]
FACSIMILE [phone]
October 16, 1992 ;
Neal Wolf
Winston & Strawn
35 West Wacker Drive
Chicago, IL 60601
Re: Mid-Continent Resources ( "Resources" )
Dear Neal:
I have received your letter of October 15 commenting on
the Second Status Report filed in Resources ' Chapter 11 case. I
agree with your statement that Sanwa's "settlement concept"
outlined on June 16 was not an offer insofar as it was
conditioned on approval by Sanwa's senior management. To the
extent that I did not make this clear in the status report, I
apologize. It also is true that the offer or concept was
conditioned on consummation of the Geneva transaction -- I tried
to make this clear in the Status Report when I said that "Sanwa
offered to share with unsecured creditors a portion of the
proceeds from the anticipated Geneva transaction. "
As to your admonition that I should not discuss
settlement negotiations with the Court, I consciously did not
discuss the substance of any settlement offer, but merely
discussed the existence of settlement negotiations, further
noting that "the future of these negotiations is difficult to
predict. " I felt that this was in accordance with the rules of
evidence, but if you disagree I will be more circumspect in the
future. I do not want to chill discussions among the parties or
create concern that statements made in settlement discussions
will be repeated in Court.
I do want to emphasize that Judge Clark has pressed me
on whether the case belongs in bankruptcy in view of the
disparity between the amount of the secured debt and the value of
Resource's assets. This concern of the Court is what led the
Court to order me to file the status report. I need to be able
to point to the existence of negotiations which could produce
some dividend for general creditors, or the case will be at risk
of dismissal. Accordingly, if Sanwa continues to believe that
the problems associated with this mine are best resolved in
Chapter 11, I need to have some ability to advise the Court as to