Two news releases: Will Charlie connect this time?First NR:
Earthworks update of Cortina Project progress
March 15, 2019
Earthworks management has received the formal analysis by its technical consultants, SCS Engineers (SCS), of the Federal Site Specific Flexibility Requests (SSFR’s) for the Cortina Integrated Waste Management Facility in California. Over the past month, SCS has both analyzed the pending SSFR submittals and reviewed separate analyses of those submittals by the Kletsel Dehe Nation’s (Tribe) independent consultant, Dwyer Engineering, and by the Tribe’s Wintun Environmental Protection Agency [WEPA].
Based on SCS’s review, we are pleased to report that the seismic, water quality monitoring and alternative daily cover SSFR submittals were found to be acceptable. While there was no clear conclusion on an alternate liner/cover SSFR, many of the concerns in that SSFR are addressed in the CIWM SSFR submittals, so some re-direct to those findings will be needed. Other concerns will be addressed in final design as proposed. SCS confirmed that no major obstacles were identified in the findings of either Dwyer or WEPA, and that clarification on the alternate liner/cover SSFR comments by those parties was warranted.
Because Earthworks’ subsidiary CIWM must use the critical path method of project management to ensure the timeliness and efficiency of its performance, clearing these Federal approval requirements is a significant milestone for moving forward. It reinforces management’s position that the project can be built.
SCS will now discuss their findings with the WEPA, with a view to making any necessary modifications to finalize the SSFR’s by collaboratively addressing any remaining issues prior to submission to the U.S. EPA.
Second NR:
Earthworks amendment defers debt payments to North Bay
March 20, 2019
Earthworks Industries Inc. (“EWK”) and its wholly-owned subsidiary, Cortina Integrated Waste Management Inc. (“CIWM”) (together “Earthworks”) have signed an Amendment Agreement dated March 19, 2019 (“the Amendment”) revising the terms of their Settlement Agreement with North Bay Corporation and its wholly-owned California subsidiary, Cortina Landfill Company (together “North Bay”) relating to Earthworks’ indebtedness to North Bay of $4,644,916 (the Balance Amount”). The principal terms of the Amendment Agreement are as follows:
a) annual installment payments of $500,000 each which were to commence to be payable March 31, 2019 are deferred by two years and will now commence to be payable March 31, 2021;
b) North Bay will settle $20,000 of the Balance Amount by subscribing that amount for shares of Earthworks in the next private placement financing that Earthworks undertakes
c) the Payout Option that Earthworks has to settle the Balance Amount is extended to March 31, 2021 but the amount payable to exercise the Payout Option is increased to $2,250,000;
d) in the event that EWK signs and closes an arms length agreement to sell 100% of the shares of CIWM for consideration which exceeds the then amount of the Balance Amount, or if CIWM signs and closes an arms length agreement to sell all or a portion of its Cortina landfill project:
(i) EWK or CIWM, which, whichever is the seller, shall forthwith after the closing pay to North Bay the whole amount of the Balance Amount and accrued interest then owing; and
(ii) EWK or CIWM, whichever is the seller, shall also forthwith after the closing of the sale agreement, pay to North Bay 10% of the amount of consideration received from the sale, less:
A. the amount paid pursuant to Sub-Clause (i); and
B. $6,720,633, being a portion of EWK’s investment in and costs of the Cortina landfill project.
e) if EWK or CIWM execute a final sale agreement as anticipated by Sub-Clause (d), the Payout Option will be suspended and will become again an exercisable option only if the sale agreement is terminated and not closed;
f) Earthworks will repay to North Bay a loan North Bay recently made to Earthworks of $50,000 on or before April 30, 2019.
All references to monies above are in U.S. dollars.
The first NR basically says that the company's engineers and the bands engineers are pretty much in agreement and will sort out minor things that could perhaps be done better. This has taken a good while to get to (years) and although it seems a bit boring, it looks as if any differences can be quickly solved.
EWK has been years getting to this point and it is monumental achievment, even if it has not been met with great cheers. It had to be done before anything else is going to happen.
The second one has North Bay extending the timeline for payment from EWK. I think North Bay likes what they see and this is a huge vote of confidence. You don't leave several million dollars on the table for two more years, unless you expect it to really do you a lot of good.
So, perhaps the most intersting news we have seen from EWK in ages.
I always think of this as the Charlie Brown Stock. One day Charlie is going to kick the football right out of the park. I think he will wind up for anoher run now and Lucy will not be able to snatch it away again.