---------------------- Forwarded by Kay Mann/Corp/Enron on 04/04/2001 06:24 
PM ---------------------------


"Campbell, Carolyn" <CCampbell@KSLAW.com> on 04/04/2001 05:58:50 PM
To: "'kay.mann@enron.com'" <kay.mann@enron.com>
cc: "Keffer, John" <JKeffer@KSLAW.com> 

Subject: New Proposal by Delta on HSR Fee Split

Kay:
 
I advised Greg Lang that Enron had approved our tentative proposal on
splitting the HSR fee, with Enron bearing a maximum of $25k. 
 
Bill Blumenthal (our HSR expert) has now spoken with Dave Burns (Paul
Hastings' HSR expert), and Bill reports back that Mr. Burns now agrees that
there is exposure to an HSR filing requirement upon exercise of the
put/call.  Apparently, Mr. Burns had not previously focused on the transfer
of the remaining 20% interest in the LLC pursuant to the put/call in his
analysis.  They also agree that the filing fee will be determined by the
fair market value of the assets in the LLC at that time.
 
Greg Lang called after his report from his HSR expert and now proposes the
following alternatives:
 
1.  Straight-up 50/50 split of fees (with no $25k maximum on Enron's
contribution), so that the parties are equally incentivized to minimize the
fee; or
 
2.  Draft additional provisions whereby Enron consents in advance to some
structure such that upon exercise of the put/call, the value of the assets
owned by the LLC are as low as possible.  This may involve transferring one
or more of the turbines to another LLC wholly owned by the LLC.  (Greg
thinks that the value of the assets of wholly-owned subsidiaries need not be
included in the threshold calculation, but I have not confirmed this).  I
indicated that this could be viewed by the FTC as a subterfuge for avoiding
filing requirements.  He called back and subsequently advised that the
solution may then involve transferring each of the turbines to a separate
LLC owned 80/20 by PPL and ENA (to be in compliance with GE requirements)
and that Delta would have a business justification for doing this on the
basis of flexibility to put these turbines in various different projects.  
 
Please advise of your thoughts on this issue.  Thank you.
 
 
Carolyn M. Campbell
King & Spalding 
713-276-7307 (phone)
713-751-3280 (fax)
 <mailto:ccampbell@kslaw.com> ccampbell@kslaw.com
 
 



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