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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: tejek who wrote (146999)	5/8/2002 3:46:06 PM
From: ptanner	Read Replies (1) \| Respond to of 1573561

ted, re: "DYN planted a potential bomb on pg 20 something in a 100 plus gas contract" The lender probably wanted the clause rather than DYN. Otherwise, it may be a buying opportunity if the risk from this clause is being exagerrated in the market's response. I haven't investigated this one as I already have one troubled independent power producer in my portfolio which I believe has a more solid balance sheet: CPN. While they are trading at a lower discount to book value their book value has a high cash composition and the company has been responsive to concerns about its position post-Enron. I am not particularly thrilled about their recent convertible offering or the pending (?) 20% dilution from additional shares but they were both actions consistent with the company's stated financial program for balancing debt and equity. EDIT: Another power producer (Williams) specifically removed one of these clauses; though the details are not clear it seemed like it was after the loan had been completed and I wonder what the cost was - this cost should be reflective of the initial benefit received by the company for accepting the clause. Of course, the companies may not have sufficiently considered adverse scenarios in negotiating the agreement so valued the clauses inappropriately. -PT