I too have voiced my ire regarding the unsecured loan.

But the more I think about it, the more I suspect there was a lot more to it, as I have opined previously.

Perhaps one of our legal minds can chime in and straighten me out if I am completely out in left field, but......

I'm thinking that the second, unsecured loan was a preplanned means to an end. The prior loan was secured by future revenues from the MMP, and had an expiration in mid July, if I recall correctly. But that second loan had a very near term expiration date - just a couple of months I believe. It was a Promisary Note, with no collateral or security. IMO, if there was a failure the only method of gaining payback was to sue.

Was the true objective to exercise that clause in the CA and obtain a greater percentage interest in the MMP? And maybe to set a precident for the (perhaps expected) default of the first, secured loan when its term expired?

The stated purpose of the loan money was to enable TPL to make their required contribution to PDS to support ongoing operations at Alliacense and ongoing litigation.

The question I have is what would be the advantage of pursuing the exercise of that CA clause by doing it in this round-about way as opposed to a more direct approach?

I would think that an indirect approach would be overall more palatable, perhaps, than a more direct approach/confrontation.

But is there an advantage from the standpoint of litigation costs?

If the objective is basically to get the money situation and the prior agreements between the partners before a judge, either approach would work IMO. But, with a suit solely regarding the exercise of that clause I could see how probable litigation costs could burn a ton of money, with no assurance of recouping.

But with a loan in default, and the exercise of that clause as a possible remedy, they could confidently go to court knowing that they would prevail by being made whole by some method, and not suffer any concern over associated litigation costs - which would probably be passed to the loser.

Would the litigation potentially go smoother using the round-about loan approach? They owe us money, they can't pay, but there is this interesting clause in our basic business agreements that could serve as a proper remedy....

Am I dripping wet?

If the above makes sense, and this is the reality, then I'm truly impressed with PTSC's legal counsel.

SGE