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Enron Mail |
Jeff:
Do you have a preferance regarding the payment of "Default Interest"? Please let me know. Sara Shackleton Enron North America Corp. 1400 Smith Street, EB 3801a Houston, Texas 77002 713-853-5620 (phone) 713-646-3490 (fax) sara.shackleton@enron.com ----- Forwarded by Sara Shackleton/HOU/ECT on 02/16/2001 11:45 AM ----- Tanya Rohauer 02/16/2001 11:30 AM To: Sara Shackleton/HOU/ECT@ECT cc: Subject: Re: Bear Stearns "Securities Loan Agreement" I think this is Kinneman's decision. To the extent that an agreement uses a rate that may result in P&L when it is pulled out of the book, that is his risk. Not too big of an issue from my perspective. From: Sara Shackleton on 02/16/2001 09:22 AM To: Tanya Rohauer/HOU/ECT@ECT cc: Subject: Bear Stearns "Securities Loan Agreement" Tanya: We finally agreed on the guaranty form (the cap is $25 million) and are about ready to execute the actual agreement. I have one question: in the ISDA world, we use "cost of funds plus 1%" as the default interest rate. The Bear document provides: "...interest thereon at a rate equal to (A) in the case of purchases of Foreign Securities, LIBOR, (B) in the case of purchases of any other securities (or other amounts, if any, due to Lender hereunder), the Federal Funds Rate or (C) such other rate as may be specified in Schedule B, in each case as such rate fluctuates from day to day, from the date of such purchase until the date of payment of such excess." What is your preference: Bear's standard language or do you want to specify another rate? Sara Shackleton Enron North America Corp. 1400 Smith Street, EB 3801a Houston, Texas 77002 713-853-5620 (phone) 713-646-3490 (fax) sara.shackleton@enron.com
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