new cash conrol process - 2 : 00 pm meeting , december 5 , 2001 in the 50 th floor board room
overview
our bankruptcy filing requires a cultural change in the cash management procedures of enron . because of our fiduciary obligation to our creditors , we now must move to centralized cash management . these new procedures will amend our prior policy . as management of the " debtor " , we should approach each decision about our business , including cash receipts and disbursements , from the perspective of , " does this enhance the value of the debtor ' s estate ? " this memo addresses the new policies that are to be immediately implemented both for entities in the chapter 11 reorganization and entities that have not filed . there will be a meeting wednesday , december 5 , 2001 at 2 : 00 pm in the board room on the 50 th floor to discuss the new policies .
as a debtor - in - possession ( " dip " ) , we have new cash flow reporting obligations and we must develop and adhere to a cash flow budget . failure to adhere could have serious consequences to our dip financing availability as well as diminish our credibility with the creditors with whom we must negotiate our ultimate exit from chapter 11 as a reorganized entity .
all enron business units ( not just the ones in bankruptcy ) will need to conform to these new requirements because additional entities are likely to be included in the bankruptcy filing , and because it is extremely important for enron management to be able to see the totality of cash flow requirements for the company .
there are special procedures outlined at the end of the memo specifically relating to the business units in bankruptcy ( the debtor business units ) .
new processes and procedures
until further notice , a newly formed committee , the cash flow management committee ( the " committee " ) , will meet daily to review and approve daily payments and 5 - day projections for each business unit . the committee will be headed by george wasaff and will also consist of ray bowen , dave gorte , tim despain , bob butts , julia murray and lisa mellencamp . the committee will be assisted by our financial advisor , batchelder & partners and our outside counsel , weil , gotshal ( 2 ) be mission critical ; and ( 3 ) there must not be a substitute vendor . the business unit heads will be responsible for ensuring that recommendations to the committee for any disbursements to critical pre - petition vendors meet this test . the committee ' s presumption will be that a vendor is not critical . if you believe that a pre - petition claim clearly meets the " critical " test , you may submit it as a clearly flagged item , stating your reasons for requested payment . the committee and corporate management will consider these recommendations by the business unit .
internal controls
we need to reassess internal controls and determine if changes are required , especially in light of recent personnel changes . all internal controls , new and existing , will be subject to review by andrew parsons . he will be communicating with you regarding his assessment and requirements for any changes to be made .
i look forward to seeing you this afternoon at the meeting .
exhibit a - enron entities that have filed
filed december 2 , 2001
1 . enron metals and commodity
2 . enron corp . ( main case )
3 . enron north america corp .
4 . enron power marketing , inc .
5 . pbog corp .
6 . smith street land company
7 . enron broadband services , inc .
8 . enron energy services operations , inc .
9 . enron energy marketing corp .
10 . enron energy services , inc .
11 . enron energy services , l . l . c .
12 . enron transportation services company
13 . bam leasing company
14 . ena asset holdings , l . p .
filed december 3 , 2001
15 . enron gas liquids , inc .
filed december 4 , 2001
16 . enron global markets , l . l . c .
17 . enron industrial markets , l . l . c .
18 . enron networks , l . l . c .
new cash conrol process - 2 : 00 pm meeting , december 5 , 2001 in the
50 th floor board room
overview
our bankruptcy filing requires a cultural change in the cash management procedures of enron . because of our fiduciary obligation to our creditors , we now must move to centralized cash management . these new procedures will amend our prior policy . as management of the " debtor " , we should approach each decision about our business , including cash receipts and disbursements , from the perspective of , " does this enhance the value of the debtor ' s estate ? " this memo addresses the new policies that are to be immediately implemented both for entities in the chapter 11 reorganization and entities that have not filed . there will be a meeting wednesday , december 5 , 2001 at 2 : 00 pm in the board room on the 50 th floor to discuss the new policies .
as a debtor - in - possession ( " dip " ) , we have new cash flow reporting obligations and we must develop and adhere to a cash flow budget . failure to adhere could have serious consequences to our dip financing availability as well as diminish our credibility with the creditors with whom we must negotiate our ultimate exit from chapter 11 as a reorganized entity .
all enron business units ( not just the ones in bankruptcy ) will need to conform to these new requirements because additional entities are likely to be included in the bankruptcy filing , and because it is extremely important for enron management to be able to see the totality of cash flow requirements for the company .
there are special procedures outlined at the end of the memo specifically relating to the business units in bankruptcy ( the debtor business units ) .
new processes and procedures
until further notice , a newly formed committee , the cash flow management committee ( the " committee " ) , will meet daily to review and approve daily payments and 5 - day projections for each business unit . the committee will be headed by george wasaff and will also consist of ray bowen , dave gorte , tim despain , bob butts , julia murray and lisa mellencamp . the committee will be assisted by our financial advisor , batchelder & partners and our outside counsel , weil , gotshal ( 2 ) be mission critical ; and ( 3 ) there must not be a substitute vendor . the business unit heads will be responsible for ensuring that recommendations to the committee for any disbursements to critical pre - petition vendors meet this test . the committee ' s presumption will be that a vendor is not critical . if you believe that a pre - petition claim clearly meets the " critical " test , you may submit it as a clearly flagged item , stating your reasons for requested payment . the committee and corporate management will consider these recommendations by the business unit .
internal controls
we need to reassess internal controls and determine if changes are required , especially in light of recent personnel changes . all internal controls , new and existing , will be subject to review by andrew parsons . he will be communicating with you regarding his assessment and requirements for any changes to be made .
i look forward to seeing you this afternoon at the meeting .
exhibit a - enron entities that have filed
filed december 2 , 2001
1 . enron metals and commodity
2 . enron corp . ( main case )
3 . enron north america corp .
4 . enron power marketing , inc .
5 . pbog corp .
6 . smith street land company
7 . enron broadband services , inc .
8 . enron energy services operations , inc .
9 . enron energy marketing corp .
10 . enron energy services , inc .
11 . enron energy services , l . l . c .
12 . enron transportation services company
13 . bam leasing company
14 . ena asset holdings , l . p .
filed december 3 , 2001
15 . enron gas liquids , inc .
filed december 4 , 2001
16 . enron global markets , l . l . c .
17 . enron industrial markets , l . l . c .
18 . enron networks , l . l . c .