Message-ID: <32917563.1075845916970.JavaMail.evans@thyme> Date: Mon, 16 Apr 2001 10:41:00 -0700 (PDT) From: lisa.bills@enron.com To: carlos.sole@enron.com Subject: FW: Turbopark Notices and Documents for Delta Turbine Sale Cc: roseann.engeldorf@enron.com, catherine.clark@enron.com, kay.mann@enron.com, herman.manis@enron.com Mime-Version: 1.0 Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: 7bit Bcc: roseann.engeldorf@enron.com, catherine.clark@enron.com, kay.mann@enron.com, herman.manis@enron.com X-From: Lisa Bills X-To: Carlos Sole X-cc: Roseann Engeldorf, Catherine Clark, Kay Mann, Herman Manis X-bcc: X-Folder: \Kay_Mann_June2001_3\Notes Folders\Panda X-Origin: MANN-K X-FileName: kmann.nsf Carlos, I have a bunch of comments and questions on the below. I have copied Herman Manis on this since he wasn't part of your distribution and I want him to read what the sales plan is to insure that he is comfortable with it and that it agrees with what the originators and legal folks have been telling him. Re your email intro: 1. The amount owed to E-Next does not need to be included in this Notice. It must be included in the second notice we must provide to E-Next for the purchase. We refer to it as the Prepayment Notice. 2. I don't understand the flow of the sales process for this deal. My last understanding was that it was to be handled like the CA Development sale. In that deal, my understanding is that ENA assigned its purchase option to CA Dev. The sale of the LLC originally owned by ENA was sold to CA Dev prior to the $$ flowing to E-Next for the purchase of the equipment. CA Dev put the $$ in escrow first then we issued the purchase notice. Please advise if this was not the case and why ENA is the entity purchasing the equipment in this deal. Has accounting and the originator agreed on the accounting treatment this transaction will receive based on the sale process/flow of $$ described below? Notice of Intent to Purchase: 1. Since CA Development was completed, the form of the Notice has been changed to be more detailed with respect to the underlying financing: This letter will serve as written notice to the Administrative Agent that (1) the Development and Construction Manager under the Development and Construction Management Agreement dated as of December 15, 2000, among E-Next Generation LLC, the Developer Subsidiaries from time to time parties thereto, and Enron North America Corp., as Development and Construction Manager (as such terms are define in such agreement), has designated [name of purchaser and state of incorpation], as its designee pursuant to Section 6.1(a) of such Development and Construction Management Agreement, and (2) [purchaser] intends to purchase the Specified Option Property listed (and as defined) in Exhibit 1 attached hereto. The applicable purchase date shall be [insert date]. The Notice should be signed by ENA with Consent provided by Salmon Energy LLC as purchaser. These documents in draft form should be approved by CSFB/Milbank prior to us sending the Notice. When the Notice is sent, the execution copies of all documents associated with the purchase should also be sent to the appropriate parties. Sending one package is the most expedient method and most likely to have the documents executed in the five business days that we need. Rose Engeldorf can provide you with the information you need for whom to send it to. Exhibit 1 to Notice to Purchase: As noted above, item 5 can be deleted in this Notice. In item 6, please spell out the parties involved in the Agreement in Principle as "the foregoing parties" can be interpreted to include WestLB as stated in the May 12, 2000 turbine purchase agreement. As we all know, they are not a party to the Ag in Principle. Also, Kay had been talking with Rose about perhaps changing the AIP to become a change order to the existing LM6000 master turbine purchase agreement. Is this happening? If so, won't this change this description in every schedule to these purchase agreements? Assumption & Assumption Agreement: This Schedule 1 should mirror the Schedule 1 in the Bill of Sale. In Schedule 2, please add an attention line to Shazia Sarker, CSFB , Phone 212 325 9935. Bill of Sale: In first paragraph, please correct E-Next's name. There should not be a "I" at the end of it. Also, insert "the" before the definition of "Developer". Schedule 1 needs to have the same changes made as I discussed above under Notice of Intent to Purchase. UCC-3s: Not part of your package but a required document for releasing the equipment from E-Next to Salmon. Rose can help you insure that these are created. Please provide your comments to the above group along with the next draft of documents, which should probably be ready for review by CSFB/Milbank. -----Original Message----- From: Sole, Carlos Sent: Friday, April 13, 2001 11:48 AM To: Engeldorf, Roseann; Mann, Kay; Bills, Lisa; Clark, Catherine Subject: Turbopark Notices and Documents for Delta Turbine Sale In connection with the required Turbopark notices and documents related to the turbine sale to Delta, attached for your initial review and comment are drafts of the initial notice to CSFB, an assignment and assumption agreement and a bill of sale. Three of the turbines being sold derive from the May 2000 agreement with GE and one of the turbines being sold derives from the April 3, 2001 "Agreement in Principle" with GE. Please note, if possible, we would prefer not to identify what amount is owed by E-Next on the turbines (this impacts the purchase price section in the exhibit on the initial notice). Lastly, as a background refresher, ENA is effectively selling 4 turbines to Delta Power as follows. ENA presently owns 100% of Salmon Energy LLC. Delta is going to place in escrow the monies owed on 4 turbines (as well as ENA's profit on the transaction) and after such escrow deposit, ENA will then proceed with the submittal of the CSFB notice and execution of the assignment and assumption agreement and bill of sale. After these steps have occurred, then ENA will sell 80% of its interest in Salmon to Delta Power. At some future date, ENA's remaining 20% interest in Salmon will be transferred to Delta. Thank you and please call me with any questions. Carlos Sole' Senior Counsel Enron North America Corp. 1400 Smith Street Houston, Texas 77002-7361 (713) 345-8191 (phone) (713) 646-3393 (fax)