Message-ID: <9277408.1075862325527.JavaMail.evans@thyme> Date: Fri, 16 Nov 2001 18:29:49 -0800 (PST) From: adam.umanoff@enron.com To: stanley.horton@enron.com Subject: Wind Company Mime-Version: 1.0 Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: quoted-printable X-From: Umanoff, Adam X-To: Horton, Stanley X-cc: X-bcc: Newell, Eric , Westbeld, Mike X-Folder: \SHORTON (Non-Privileged)\Horton, Stanley\Deleted Items X-Origin: Horton-S X-FileName: SHORTON (Non-Privileged).pst While I understand that the Wind Co is clearly a "non-core" asset for Enron= , I am very concerned about the apparent decision in Houston not to provid= e short-term liquidity for our operations (I have heard that the wind co is= on its own for cash going forward). While I am probably more eager than a= nyone to have the Wind Co regain its financial independence, I can not do i= t overnight and am worried about the potentially devasting impact which a l= ack of short-term capital will have on our business and, quite directly, th= e value of this asset to Enron. As you know, our lenders on IMI/Clear Sky have refused to fund a construct= ion loan (they will not take Enron equity bridge risk) - this construction = loan was the most important piece of our working capital/cash funding for Q= 4. AEP and its lenders on IMI/Clear Sky are also expressing serious concer= n about the Enron warranty guaranty (we will likely have to reserve cash to= secure our warranty obligations, further exacerbating our cash position). = FPL and AEP have in essence put on hold their deals with Enron Wind pendin= g some clarity on how Enron's liquidity difficulties may affect Enron Wind.= AEP has gone as far as saying the Enron Wind is probably BK without worki= ng capital support from Enron, and are understandably asking why should the= y be comfortable with our performance risk? Our European vendors, still mi= ndful of Tacke's bankruptcy in 1997, are extremely concerned about our fina= ncial condition. And a number of our counterparties who owe us money but a= re also owed money by Enron affiliates are seeking to set-off those obligat= ions. While I will have better numbers over this weekend, without the IMI/= Clear Sky construction loan, I will need between $30-35mm through the end o= f the year (until the AEP sale closes) in order to meet our working capital= needs. Without that support, I can almost guaranty you I will not be able= to sell IMI/Clear Sky to AEP and am worried about our short-term financial= survival. =20 Stan - this clearly has serious implications for the value of Enron Wind an= d our sales effort. I am meeting again with my finance team (such as it is= ) over the weekend and on Monday morning. I will set up some time with you= on Monday or Tuesday to discuss. I know there is no desire to support the= Wind Co medium to long-term, but a decision to cut us off now could be fat= al. =20 Adam