1992-09-24_GENERAL DOCUMENTS - C1981017

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September 22, 1992 Page 4 the Division's existing collateral) ; the Mid-Continent Quarry and the equipment located within-the rockdust plant, all of which is integral to the operation of the rockdust plant; and the Marblehead Quarry, which has not operated in recent years but which might be attractive to a purchaser seeking to purchase the plant as an operating facility. This would permit the Division's existing collateral to be marketed as a discrete economic unit, and avoids the need to allocate purchase price between the plant, quarries, and equipment if those assets are otherwise sold as a unit. We do not have an estimate of the value of the rockdust plant and related assets, and obviously the Division would need more information about value before agreeing to waive its claims against the bankruptcy estate. At the present time, there are no funds available for reclamation activities. Reclamation activity needs to begin after the snowmelt in the Spring' of 1993. The rockdust plant may not have been sold by then. We need to set up an expedited program to Bell the rockdust plant and related assets as a going concern. In the short term, we may need some ability to use other liquidation proceeds for reclamation purposes. General unsecured ,preditors In June, at a meeting in my office, Sanwa offered to share 16% of every dollar distributed in Resources' bankruptcy with the general unsecured creditors, provided that those creditors did not also attempt to assert claims against Resources' corporate affiliates, who have guaranteed Resources, obligations to Sanwa. This offer expressly was conditioned on the consummation of the pending sale negotiations with Geneva. After the collapse of the Geneva negotiations in inid- July, I spoke to Neil to discuss Resources' intent to commence the ,salvage of its mine assets and the reclamation of the mine site. At that time, Neil indicated that Sanwa might be willing to renew its previous offer to the Creditors' Committee, notwithstanding the termination of the Geneva negotiations. Around the same time, Bob Delaney spoke to Andy Heinz and was left with the impression that Sanwa is not inclined to share liquidation proceeds with the unsecured creditors. I suggest that Sanwa now renew the offer to the unsecured creditors, subject to the proposed carve-out to the Division. That will place the ball squarely in the Creditors' Committee's court, and should satisfy questions about the S'd dOSS3r T W3T1OH WdTO:EO 26. 22 d3S