1993-07-08_GENERAL DOCUMENTS - C1981017

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JUL 08 '93 05:54PM HOLDEN & JESSOP -P.4 Neil wolf Stephen W. Seifert Frank R. Johnson July S, 1993 Page 3 reclamation which was to be charged against the rockdust plant. Rather than charge theme expenditures against the rockdust plant, the sums expended should simply be deducted from the sum which the Plan otherwise requires to be transferred from the Creditors' Trust to the Reclamation Account. Another point which needs some fine-tuning concerns the manner in which Funds are transferred from the Creditors' Trust to the Reclamation Account and Environmental Trust. As drafted, the funds come off the top until the Creditors' Trust has satisfied its obligation to provide funds. Since reclamation is a multi-year task, this probably would put funds into the Reclamation Account before they are needed, and could prevent the Creditors' Trust from making interim distributions to Sanwa and the general creditors. I think that most of these questions can be worked out between Resources and the Division, at least insofar as the questions are mechanical details that do not impact on other creditors. Resources is attempting to set up a meeting with the Division next week to discuss these issues as well as the current status of reclamation activities. Another aspect of the Plan that will need some revision concerns executor xx contracts. There are some leases/operating agreements with Pitkin Iron Corporation which need to be addressed in the Plan. I am currently reviewing those agreements. With regard to Section 6.2 of the Plan, I appreciate that many of the details have not previously been discussed with Sanwa or the Committee. In particular, I handled the selection of the trustee in a manner that was balanced between what I understand to be the position of the Committee (that the trustee should be unrelated to Resources) and the position of Sanwa (that an independent trustee will introduce an unnecessary layer of expense, and that the cost of such a trustee should be charged against the unsecured creditors if such a trustee is their requirement) . At the same time, I drafted Section 6.2.5 so that what I have provided remains in the Plan only if Sanwa and the Committee are unable to otherwise agree on procedures for the trustee's selection and compensation. Resources views management of the Creditors' Trust as an internal creditor issue, and will abide by any reasonable resolution.