lumber reload facility - premier yesterday i was informed that there was a concern about the financial
stability of one of the reload facilities we currently use in the chicago
area , premier reload inc . i met with romney ruder , lumber trader , roy
lipsett , logistics , and mike moscoso , lumber business controller , this
morning to gather information and develop a plan . this is summarized below .
general information :
premier is a facility we have been using for a few months , located in
franklin park within chicago . we deliver to the facility via railcar , and
ship out via truck . we currently have about 3 . 8 million board feet , valued
at about $ 1 million , in the facility . during the holidays , we began
experiencing problems with our railcars not being unloaded timely . we have
been pressing for information , and are hearing rumors that have raised
significant concerns . although enron has not received written notification ,
we learned today that premier notified customers that they would not be
taking in any more products . additionally , we have heard that the owner ,
jeff leske , is closing the facility , and will be going to work for another
reload facility in chicago , reserve marine terminal ( rmt ) . we have been in
negotiations with rmt for a long term arrangement , and much of the
information we have obtained is through our contact there . in fact , we have
diverted recent shipments to rmt . there is a rumor that premier and / or
leske may declare bankruptcy . there is a rumor that premier has been
incurring " switching " fees with the railroad ( ihb ) and has not been paying
them . there is a rumor that premier has not been paying employment taxes and
there are problems with the irs . all in all , there are many rumors but very
few known facts .
plan :
met with legal today to get advice . they recommended moving the product
asap , but until moved , we needed to confirm the product was marked as " enron "
product , and that it is stored separately from other product . they are
drafting a contract to specify the arrangement with premier . it will be
ready tomorrow .
met with credit . they are not a included in the reload selection process , so
the financial stability of the company has not been reviewed . a d & b was
pulled today , and it confirms a lien filed by the irs on 6 / 22 / 00 for
$ 86 , 128 . there is one suit pending by a trucking company in a nominal
amount , filed 1 / 13 / 00 . the company is owned 100 % by leske , and was started
in 1995 . very little other information is available , and d & b did not assign
a paydex score .
mike moscoso and romney ruder are going to the premises tomorrow to : gather
financial information , intentions of the owner and the associated timeline ,
substantiate the inventory , and get the contract signed that legal is
drafting . on friday morning , roy lipsett will join them to meet with rmt ,
discuss movement of the product and complete the negotiations .
depending on the information gathered tomorrow , we will determine next
steps . if we start moving the product to rmt , the estimated timeline is
about 13 to 14 days , moving 10 trucks per day ( total truckloads = 135 ) .
estimated cost for the movement is about is $ 25 , 000 . another $ 25 , 000 would
be incurred for unload fees at rmt if we can ' t get them to wave them . about
half of the product has already been sold , and will be delivered over the
next 5 weeks . romney is working with customers to determine if they can take
the product earlier .
i will keep you informed as to the next events . however , we need to take
immediate steps to put a policy and process in place for warehousing
facilities . i have initiated weekly cross - functional staff meetings ( tax ,
legal , credit , it , logistics , fundemental analysis , accounting , etc . ) , and
our first meeting is scheduled for tomorrow . i will have this on the agenda ,
and will lead the effort to develop the process .
please let me know if you have any questions .
brenda
x 35778
lumber reload facility - premier
yesterday i was informed that there was a concern about the financial
stability of one of the reload facilities we currently use in the chicago
area , premier reload inc . i met with romney ruder , lumber trader , roy
lipsett , logistics , and mike moscoso , lumber business controller , this
morning to gather information and develop a plan . this is summarized below .
general information :
premier is a facility we have been using for a few months , located in
franklin park within chicago . we deliver to the facility via railcar , and
ship out via truck . we currently have about 3 . 8 million board feet , valued
at about $ 1 million , in the facility . during the holidays , we began
experiencing problems with our railcars not being unloaded timely . we have
been pressing for information , and are hearing rumors that have raised
significant concerns . although enron has not received written notification ,
we learned today that premier notified customers that they would not be
taking in any more products . additionally , we have heard that the owner ,
jeff leske , is closing the facility , and will be going to work for another
reload facility in chicago , reserve marine terminal ( rmt ) . we have been in
negotiations with rmt for a long term arrangement , and much of the
information we have obtained is through our contact there . in fact , we have
diverted recent shipments to rmt . there is a rumor that premier and / or
leske may declare bankruptcy . there is a rumor that premier has been
incurring " switching " fees with the railroad ( ihb ) and has not been paying
them . there is a rumor that premier has not been paying employment taxes and
there are problems with the irs . all in all , there are many rumors but very
few known facts .
plan :
met with legal today to get advice . they recommended moving the product
asap , but until moved , we needed to confirm the product was marked as " enron "
product , and that it is stored separately from other product . they are
drafting a contract to specify the arrangement with premier . it will be
ready tomorrow .
met with credit . they are not a included in the reload selection process , so
the financial stability of the company has not been reviewed . a d & b was
pulled today , and it confirms a lien filed by the irs on 6 / 22 / 00 for
$ 86 , 128 . there is one suit pending by a trucking company in a nominal
amount , filed 1 / 13 / 00 . the company is owned 100 % by leske , and was started
in 1995 . very little other information is available , and d & b did not assign
a paydex score .
mike moscoso and romney ruder are going to the premises tomorrow to : gather
financial information , intentions of the owner and the associated timeline ,
substantiate the inventory , and get the contract signed that legal is
drafting . on friday morning , roy lipsett will join them to meet with rmt ,
discuss movement of the product and complete the negotiations .
depending on the information gathered tomorrow , we will determine next
steps . if we start moving the product to rmt , the estimated timeline is
about 13 to 14 days , moving 10 trucks per day ( total truckloads = 135 ) .
estimated cost for the movement is about is $ 25 , 000 . another $ 25 , 000 would
be incurred for unload fees at rmt if we can ' t get them to wave them . about
half of the product has already been sold , and will be delivered over the
next 5 weeks . romney is working with customers to determine if they can take
the product earlier .
i will keep you informed as to the next events . however , we need to take
immediate steps to put a policy and process in place for warehousing
facilities . i have initiated weekly cross - functional staff meetings ( tax ,
legal , credit , it , logistics , fundemental analysis , accounting , etc . ) , and
our first meeting is scheduled for tomorrow . i will have this on the agenda ,
and will lead the effort to develop the process .
please let me know if you have any questions .
brenda
x 35778