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-6- either of which would solve the problem. The company intends to pursue one course or the other. At the same time the owners are being asked to approve an increase in capital for a new press and activation of anodyzing pits. There is good rationale for this increase and it was contemplated and ap­proved as part of the original proposal for AAC. In March the outlook for Z-I seemed very good, with the prospect that Chase National Bank would occupy one-third of the building. Yesterday the Committee got word that the financial projections may have to be revised downwards significantly. In addition, the Fund still does not have title to the remaining 7% of the land and there seems to be contingent tax liability of LE 240,000 that the Fund would have to pay upon registering the final portion. It is possible that this tax can be deferred or avoided, but the situation is unclear. Because of these factors it is possible that Z-I will be deferred and that Cairo Properties will proceed first with other and smaller projects, such as Z-2. This situation underlines the need for further management help for the Fund managers, and it has been agreed that MEFCA will delve into the Cairo Properties situation as a first priority. Mr. McCloy returned to the subject of the proposed capital increase for Arab Aluminum Company and explained it in greater detail fo~ the Com­mittee. He stressed that despite the present operating problems, the LE Committee and the Fund management are recommending that the Fund subscribe the additional capital. This is because it is believed that the project is basically a very sound one and that the present operating problems are of the type usually encountered in such projects and that the company is committed to correcting them. Another reason for the recommendation is that it was felt that the Fund should not be diluted in its equity position as ... /