As I pontificated when they were looking at a gold company, before this deal, I said that often small operators put everything they have into mining operation, run out of money and then need additional investment to get them up the final climb. This guys filings show he paid $400000 on the texas railroad website for costs associated with bringing the lease up to snuff. Thats a lot to put out and he must have run out of money if he couldn't pay this vendor. Not making excuses for the guy, it's just the reality of business sometimes.
This is another cost. HIRU will have lawyers that will be aware of this cost.
What is likely is that this has been factored into the costings and will be settled out of court.
Clearly this guy has something, but ran out of cash.
HIRU brings the cash and makes the problem disappear without any court hearing is my best guess.
Thank you for raising this part of the DD Satter. Very interesting.
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