_GENERAL DOCUMENTS - C1981017 ‎(252)‎

• Permit No: C1981017
• IBM Index Class Name: GENERAL DOCUMENTS
• Doc Name: Bid Documents ‎(IMP)‎ 1993 Correspondence
• Permit Index Doc Type: General Correspondence
• Media Type: D
• Archive: No

Dl� JAN 14 1993
HOLDEN & JESSOP, P.C.
L J ATTORNEYS AT LAW
303 CAST 177- AVENUE SUITE 630
SL DENVER, COLORADO 8 0 2 0 3-12 64
i
13031 660.7700 I
•ACSIM-LE [phone] IY
January 13, 1993
David G. Crumbaugh
Winston & Strawn
35 West Wacker Drive R EC E#VF
Chicago, IL 60601
Stephen W. Seifert JAN 1 51993
Fairfield and Woods, P.C.
1700 Lincoln Street, Suite 2400 -
Denver, Colorado 80203 MINERALS
Frank R. Johnson
Assistant Attorney General
1525 Sherman Street - 5th Floor
Denver, Colorado 80203
Re: Mid-Continent Resources ( "Resources" )
Gentlemen:
I am writing you, as representatives of the three major
creditor camps, to provide an update on various topics which were
discussed at the November 5 meeting held in Steve Seifert's
office. In particular, I want to discuss (i) the status of
liquidation efforts, (ii) our current estimate of liquidation
values and reclamation costs; (iii) pending negotiations for sale
of the mine to a new operator; (iv) a Chapter 11 plan; and (v)
Resources ' request for use of cash collateral.
Liquidation of Equipment
Since November 5, Resources has received its first
payment of net equipment sales proceeds from M&E Equipment, in
the amount of $86,761. These funds are invested at Central Bank
of Denver, and are collateralized with federal securities in the
manner required by 11 U.S.C. S 345. The existence of liquidation
proceeds, for the first time in this case, gives rise to cash
collateral issues, which are discussed later in this letter.
Winter has caused M&E to suspend operations at the site
until Spring, but M&E is continuing its efforts to market the
equipment described in M&E's brochure.
One troublesome matter is that Resources now expects
that the probable net to the estate from equipment sales will be