Message-ID: <14779744.1075844491681.JavaMail.evans@thyme>
Date: Wed, 13 Sep 2000 07:27:00 -0700 (PDT)
From: mike.fowler@enron.com
To: petej@andrews-kurth.com
Subject: Online Trading Agreements - Credit Exposure
Cc: sara.shackleton@enron.com
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The online bond trading sites we are evaluating have stated that they and 
their clearing broker are our nominal counterparties.  However, I was 
informed yesterday by Weiss, Peck & Greer that our exposure on affirmed 
trades is to our prime broker.  (Our prime broker has exposure to the site's 
clearing firm.)  We confirmed this with our prime broker and with Sheila 
Glover.    

Thus, statements that 1) transactions will be cleared through our prime 
broker and 2) the site is responsible for the accuracy of terms of offers and 
executed trades (as Buy Side Direct added) may sufficiently address the issue 
of our exposure.

Please let me know if you would like to discuss.

Thanks.

Mike
713-853-9990

---------------------- Forwarded by Mike Fowler/Corp/Enron on 09/13/2000 
02:08 PM ---------------------------


Mike Fowler
09/12/2000 03:49 PM
To: PETEJ@andrews-kurth.com
cc: Sara Shackleton/HOU/ECT@ECT 

Subject: Weiss, Peck & Greer Agreement

Weiss, Peck and Greer (WPG) has addressed the fee and margin issues noted in 
my previous email.

Fees:  We will not be assessed any fees from WPG.  Thus, I suggest that 
section 9 state this, or be removed.  

Margin:  Section 14 should note that margin for our transactions through Buy 
Side Direct would be maintained at our prime broker.  WPG would only request 
margin if our prime broker disaffirms a trade.  

Has the WPG attorney agreed to a time to discuss their agreement ?

Thanks.

Mike
713-853-9990


---------------------- Forwarded by Mike Fowler/Corp/Enron on 09/12/2000 
02:33 PM ---------------------------


Mike Fowler
09/11/2000 02:41 PM
To: PETEJ@andrews-kurth.com
cc: Sara Shackleton/HOU/ECT@ECT 

Subject: Weiss, Peck & Greer Agreement

My only suggestion regarding your comments on the WPG agreement would be not 
to change the 2nd line of 5a from "your Prime Broker" to "the exchange".   

Mike Minnich emailed you and me the following language to incorporate WPG's 
obligation as our nominal counterparty: 

WPG is responsible for the clearance and settlement of all affirmed trades
executed on the BuySideDirect trading system.

This appears reasonable to me (unless you or Sara feel that this could be 
interpretted as excluding trades for which the other counterparty fails).

Rather than waiting until my issues regarding fees (#9) and margin (#14) are 
resolved, I suggest that you forward your comments to Mike Minnich (who will 
provide to WPG's attorneys) and note that we have requested an opportunity to 
discuss fees (#9) and margin (#14) with Mike Minnich and WPG.  We suggest 
deleting #9 as our understanding is that we would not incur charges from 
WPG.  Regarding #14, we would incorporate our Buy Side Direct trading 
activity into our margin account with our prime broker.    Jason, I'll 
provide additional feedback after I discuss these issues with WPG. 

Please call me (713-853-9990) if you would like to discuss.  

Thanks.

Mike