BT,Thank you for the response and the subsequent post. And I...

BT,

Thank you for the response and the subsequent post. And I must say that it is fairly obvious to me that the relationship between the CMR Board and HNC has deteriorated so I do agree and I think Oly is incorrect in the assertion that GT has done a deal with HNC.

I think you are suggesting that GT and other major unsecured creditors including HNC must subordinate their debt so that commitments to the JV can be honoured first and foremost from the sales of half the metal output. This to me is an obvious necessity and I am sure the internationally acclaimed Deed Administrator is across that.

I suspect also that the Deed Administrator in addition to proposing the subordination of the debt is instituting a payment mechanism for half the OPEX that eliminates the possibility of CMR defaulting. As I understand it, the MOU allows for a 4 month delay for payment by CMR in any event and maybe that will be enough time if the commencement of the DOCA and the restoration of production is aligned.

But, I am concerned that the subordinated debt is capitalised at 9 percent and it hard to see all that being paid of within 12 months.

Whilst, we have been misled by GT and I believe he and the Board have been negligent in a number of areas I believe he may act reasonably in the matter of debt subordination as it is not in his best interest to have CMR default on a commitment to half the Opex.

I don't think it is in HNC's best interest to cause CMR to go into liquidation as this is a minor investment in the Australian Mining Industry with huge potential for embarrassment and to impact adversely on future Chinese JV's and acquisitions. The last thing they would want is an ASIC investigation into their behaviour.