1) MoU is not binding unless both parties agree, as we don't have a copy hard to say so I will assume it is no longer relevant. If it were binding would have been a deed of amendment to JV. Lawyers will understand the diff. JV agreement is the primary doc for running the operation.
2) GT knocked back HNC DOCA which was to rectify the plant and get production up to a certain level as stated in draft, costs would be funded 100% by HNC but in turn wanted their money back for CMR's share out of metal sales, if rectification failed they wanted money repaid out of liquidation proceeds. GT/Cornell had to take a back seat and wait but said NO, it is obvious they want money up front or not prepared to subordinate their debt.
3) Until production levels and costs are known hard to say when debt will be repaid, at the moment they will lose if forced to sell 50% of oxide plant, only hope is to turn it around. Interest cost is minor when weighed up against total debt, I doubt anyone is talking about repaying debts to GT/Cornell within 12 months otherwise they would have agreed to HNC proposal.
4) HNC have come back with if you don't like our DOCA will run operations and burn you off!
Simple summary of where things are at, as stated previously HNC are in box seat, GT is kidding himself if he thinks can force matters his way
CMR Price at posting:
15.0¢ Sentiment: None Disclosure: Not Held
