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Enron Mail |
I definately would not discuss this with Petrobras. Simply confirm that
there is no credit requirement for the Bank or that the Bank we want to use exceeds any credit requirement and arrange the L/C required with Robin Verial. Lets not make this a bigger task than it is. Marcus Stephan 01/10/2001 12:18 PM To: Tracee Bersani/HOU/ECT@ECT@EES cc: Richard A Lammers/SA/Enron@Enron, Rob G Gay/NA/Enron@Enron Subject: Re: Letter Credit. - NY Bank Question Tracee, As I told you by phone, I don't believe it is a good idea to talk to Petrobr?s about the l/c before delivering it to them because they may require a bank's name that we don't have margin to work with right now. Since there isn't any limitation on location of the l/c bank on side letter or on the fuel contract, we don't have any other options besides Arab Bank and its correspondent bank in Brazil. If Petrobr?s have any restrictions on the l/c during our meeting or some days later (when we will be delivering the l/c), we can argue that there was no restriction on location/names of the l/c bank on contract/side letter and ask more time to obtain a new one or with another financial institution later. Rick/Rob - We would like to have your opinion on this. If you believe we should consult Petrobr?s prior to deliver the l/c, I can talk to them and get their point of view on this issue. Unfortunately, our meeting has not been confirmed yet. Regards, Marcus. Tracee Bersani@ECT 01/10/2001 01:17 PM To: Marcus Stephan/SA/Enron@ENRON@EES cc: Richard A Lammers/SA/Enron@Enron, Rob G Gay/NA/Enron@Enron Subject: Re: Letter Credit. - NY Bank Question Marcus, Please have a look at the side letter and contract to see if there is any limitation on location of the L/C bank. ABN Amro had a local branch in Brazil so the $R draws would have been relatively straight forward. However, with Arab Bank's New York Branch, the way a draw would work is this: -Petrobras sends fax to Arab bank indicating a draw request -Arab Bank will send funds to Brazil through its Brazilian correspondent bank and convert dollars to $R. There would be an FX trade and fee associated. (I assume that Enron would pick up the cost of this.) The one issue we need to consider is that any draw request would take approximately 24 hours as it involves a correspondent bank and FX trade. Please confirm that Petrobras would not have a problem with this. Regards, Tracee Marcus Stephan@ENRON 01/10/2001 08:34 AM To: Tracee Bersani@EES cc: Subject: Letter Credit. Tracee, Hi! I was talking to a Tozzini lawyer and he said that that language on the side letter (" reputable institution") is a kind of standard in Brazil for such kind of contracts but that it doesn't have any correlation to any credit rating standard. So, I believe we won't have any problems with the l/c from Arab Bank. I also read the fuel contract and realized that there is no restrictions or requirements for the letter of credit except for its amount. How is the l/c issuance going? Will we be able to have it on Friday? Regards/Marcus.
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