Message-ID: <23157536.1075858818629.JavaMail.evans@thyme> Date: Thu, 18 Oct 2001 14:16:45 -0700 (PDT) From: adamk@exchange.ml.com To: travis.winfrey@enron.com Subject: RE: Yen CLN follow-up Cc: dan.boyle@enron.com, david.mitchell@enron.com, clint.walden@enron.com, gareth.bahlmann@enron.com, tanya.rohauer@enron.com, sara.shackleton@enron.com Mime-Version: 1.0 Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: 7bit Bcc: dan.boyle@enron.com, david.mitchell@enron.com, clint.walden@enron.com, gareth.bahlmann@enron.com, tanya.rohauer@enron.com, sara.shackleton@enron.com X-From: "Kulick, Adam (CAPMKTS)" @ENRON X-To: Winfrey, Travis X-cc: Boyle, Dan , Mitchell, David , Walden, Clint , Bahlmann, Gareth , Rohauer, Tanya , Shackleton, Sara , Nisbet, Phil (Global Credit Derivatives) , Tell, Eric (CICG - NY SWAPS) X-bcc: X-Folder: \SSHACKL (Non-Privileged)\Shackleton, Sara\Inbox X-Origin: Shackleton-S X-FileName: SSHACKL (Non-Privileged).pst Travis, Apologies for the delayed response - we have had some e-mails problems this week. Understood and agreed on the need for equity certificates. As you know, in the US there is no bright line amount of equity that is required in order to obtain the best treatment, so therefore we thought it best for both you and we to do our research for Japan and then approach counsel. We should have our opinion formed shortly both on the feasibility of equity treatment for the fixed income investors and on the need for certificates. We'd like to talk through a couple more alternatives to make sure we understand the accounting restrictions to cross-default in orders. I'll call you to discuss further. In that call I'd also like to make sure that I understand the prepay. Finally, we are working through a couple of accounting issues on the CLN and also on the reps that you want from Merrill. I am traveling tomorrow and will call you on Monday. Regards, Adam -----Original Message----- From: Winfrey, Travis [mailto:Travis.Winfrey@ENRON.com] Sent: Tuesday, October 16, 2001 2:41 PM To: Adam Kulick (E-mail) Cc: Boyle, Dan; Mitchell, David; Walden, Clint; Bahlmann, Gareth; Rohauer, Tanya; Shackleton, Sara Subject: Yen CLN follow-up Adam, To follow-up on our discussion from last week: With regards to the need for equity/certificates at the Trust level, this is really a function of the requirements posed by the investors. Our tax group would defer to the underwriters. If the note investors can tolerate equity treatment (for tax purposes), then there should be no need for certificates in the structure. In previous transactions, the presence of certificates has allowed the notes to be treated as debt for tax purposes and therefore the payments treated as interest income. With regards to cross-default, a default in the Enron note does not result in a default of the swap between Enron and the third party entity or a default of the swap between Enron and the financial institution. Attached is a diagram of the prepay structure, as discussed last week. <> Feel free to call with any questions. Regards, Travis Winfrey Enron Global Finance 713-345-8404 Travis.Winfrey@enron.com ********************************************************************** This e-mail is the property of Enron Corp. and/or its relevant affiliate and may contain confidential and privileged material for the sole use of the intended recipient (s). Any review, use, distribution or disclosure by others is strictly prohibited. If you are not the intended recipient (or authorized to receive for the recipient), please contact the sender or reply to Enron Corp. at enron.messaging.administration@enron.com and delete all copies of the message. This e-mail (and any attachments hereto) are not intended to be an offer (or an acceptance) and do not create or evidence a binding and enforceable contract between Enron Corp. (or any of its affiliates) and the intended recipient or any other party, and may not be relied on by anyone as the basis of a contract by estoppel or otherwise. Thank you. **********************************************************************