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Enron Mail |
See below from Mary Ellen Bell at Louis Dreyfus.
----- Forwarded by Stephanie Panus/NA/Enron on 04/05/2001 09:16 AM ----- BellM@louisdreyfus.com 04/04/2001 03:39 PM To: stephanie.panus@enron.com cc: nidia.mendoza@enron.com Subject: ISDA Enron/LD Plastics Stephanie, Upon checking the file for a status update, I realized that during our last draft of 3/15 I indicated that LD was still considering part (h) Liquidity in OTC Markets. Since you have not yet had a chance to respond to the comments of 3/15, I thought you might want to consider this last open point and respond to the comments in their entirety. Please verify that my interpretation of part (h) is correct. Is Enron saying that if at any time Enron believes that a market quote on a swap for periodic payment, margining or termination does not reflect what the quote would be if there were an active market in the commodity or option, then the swap is valued at whatever price Enron puts on it? If this is correct, LD's position would be that if, at the time at which the parties are negotiating the terms of the Transaction, they feel that the relevant commodity is one for which the market is not liquid, so that reference to market or index prices does not result in an appropriate valuation, then at that time the parties should agree to a mark to model formula which should be included in the Confirmation and that formula should be deemed to be a material term of the transaction which without agreement to, no Transaction should be deemed to have been entered into. Regards Mary Ellen Bell Louis Dreyfus Contract Administration tel: (203) 761-8108 fax: (203) 761-8182 e-mail: bellme@louisdreyfus.com
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