Message-ID: <5937344.1075861673402.JavaMail.evans@thyme> Date: Fri, 2 Nov 2001 07:04:07 -0800 (PST) From: john.arnold@enron.com To: sarah.wesner-soong@enron.com Subject: RE: Credit from brokers Mime-Version: 1.0 Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: quoted-printable X-From: Arnold, John X-To: Wesner-Soong, Sarah X-cc: X-bcc: X-Folder: \JARNOLD (Non-Privileged)\Arnold, John\Sent Items X-Origin: Arnold-J X-FileName: JARNOLD (Non-Privileged).pst Understand. Enron has been Man's biggest account for years and during that= time we have paid them a lot in commissions. They approached us on Wednes= day to try to increase the margin required, even though we were below the c= redit threshold that had been established in the contracts written 5+ years= ago. I refused to agree to change the margin calculations. It became cle= ar that Man was uncomfortable with the exposure to such a big account given= that Man is a relatively small shop. I agreed to xpit some positions such= that they would get more comfortable with the outstanding risk in the acco= unt. At the same time I told them I was transacting business as usual and = if they couldnt handle/didnt want the clearing business I would clear someb= ody else but that was a permanent decision for them to make. Clear our bus= iness always, or clear it never. Paribas has stuck with us throughout and = I intend to clear the majority of future biz with Paribas. I agreed during= hours of phone calls wednesday that we would xpit specific futures positio= ns on thursday, which we did, but the rest of the position would stay there= . They agreed. We specifically stated the rest of the positions and the o= ptions would stay and we would work out those positions over time. &!@$ th= em if they are trying to go back on that. =20 -----Original Message----- From: =09Wesner-Soong, Sarah =20 Sent:=09Friday, November 02, 2001 8:42 AM To:=09Arnold, John; Quigley, Dutch Subject:=09Credit from brokers ENE is in a severe liquidity crisis. Even if EDF makes mistakes we have to= be careful how we treat them because Enron's cash position is very precari= ous. It's good to insist that EDF give us what's owed especially since the= y seem to be wrong in this case but as far as lines of credit go, ENE is in= a much worse position than ever before. =20 I am going to get a guarantee to Fimat today from Enron Corp with respect t= o ENA trades. We have never had to do this before but if I do not get it F= imat will keep their trade line at $11 million. Soc Gen (extends credit un= der Fimat line) is being a big pain but having spoken to our bank people we= have no choice but to be grateful we are getting credit these days. =20 Please keep this bad cash/credit situation confidential.