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Enron Mail |
Generally speaking we have only documented that kind of concern when there
were separate legal entities involved (like getting a comfort letter or guaranty from EI when ECT had to do the swap for one of their deals). I think we can get away with pointing out the issue to both commercial sides. Mary Cook 12/14/2000 03:30 PM To: Mark Taylor/HOU/ECT@ECT cc: Subject: VPP Vehicle The VPP swap vehicle is being structured such that if a major adverse reservoir event occurs (no gas!) and as a result the Partnership (owned by Trust/banks) cannot fund the swap payments, then as swap default occurs and if termination payment is owed to ENA, the termination payment will in essence be subordinated to the bank loan repayment. This is clearly a free walk on ENA on the swap (ENA in essence wears reservoir risk on the swap). If this is the commercial deal, so be it. However, I am concerned that the "$ fallout" in such event be charged internally to the finance originators and not the trading arm, but I do not know who to talk to about this. Any ideas? Or should I assume it resolves itself internally as and when it may occur? Mary Cordially, Mary Cook Enron North America Corp. 1400 Smith, 38th Floor, Legal Houston, Texas 77002-7361 (713) 345-7732 (phone) (713) 646-3490 (fax) mary.cook@enron.com
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