Message-ID: <2550566.1075844476519.JavaMail.evans@thyme> Date: Wed, 1 Nov 2000 07:22:00 -0800 (PST) From: awaskow@exchange.ml.com To: sara.shackleton@enron.com Subject: RE: Master Repurchase Agreement with Enron North America Corp. Mime-Version: 1.0 Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: 7bit X-From: "Waskow, Andrew (OGC)" X-To: "'Sara.Shackleton@enron.com'" X-cc: X-bcc: X-Folder: \Sara_Shackleton_Dec2000_June2001_1\Notes Folders\Notes inbox X-Origin: SHACKLETON-S X-FileName: sshackle.nsf Sara, When you are ready to talk some more about the agreement, please give me a call. Thanks. --Andy Andrew V. Waskow Vice President and Counsel Merrill Lynch & Co., Inc. 4 World Financial Center, Floor 12 New York, NY 10080 Phone: 212-449-5828 Fax: 212-449-0265 awaskow@exchange.ml.com > -----Original Message----- > From: Sara.Shackleton@enron.com [SMTP:Sara.Shackleton@enron.com] > Sent: Wednesday, November 01, 2000 9:37 AM > To: AWaskow@exchange.ml.com > Subject: RE: Master Repurchase Agreement with Enron North America > Corp. > > > Andy: > > I am reviewing your comments and will have an answer shortly. I thought, > however, that you should know that the limitation of liability provision > is > non-negotiable from Enron's viewpoint. If this is problematic, please > advise and we can halt further discussion. Thanks. Sara > > > > > "Waskow, Andrew > > (OGC)" To: > "'Sara.Shackleton@enron.com'" > > ge.ml.com> Subject: RE: Master > Repurchase Agreement with Enron North America > Corp. > > 10/31/2000 > > 06:33 PM > > > > > > > > > > Sara: > > Thanks for the additional information and the recommended changes, each of > which we accept. > > In order to accommodate the deletion of 9(b), we recommend revising your > number 6 to read as follows: > > 6. Substitution > > (a) Paragraph 9(b) is hereby deleted in its entirety. > > (b) Seller shall not retain custody of any Purchased Securities > under any Transaction governed by this Agreement. > > NOTICES: Your suggested language regarding notices is potentially > problematic. Under the Paragraph 13 of the MRA, notices may made orally, > "to be confirmed promptly in writing....", and confirmation of delivery is > not expressly relevant. The unquestionable ability to make oral margin > calls pursuant to Paragraph 4 is vital in fast-moving market conditions, > and > was expressly included in the standard agreement to avoid any doubt as to > their validity. In the default context (Paragraph 11), proof of delivery > of > written notice is of no concern because the exercise of a party's rights > under that Paragraph is not contingent upon delivery of notice. Notice > must > be given "as promptly as practicable." We believe that the proposed > language could cause confusion or uncertainty regarding the validity of > oral > margin calls and would conflict with the operative provisions of Paragraph > 11. We therefore request deletion of your number 8. > > NON-ASSIGNABILITY: As we discussed earlier today, we have a general > aversion to assignments of repurchase transactions due to our regulatory > obligations as a broker-dealers. For that reason, we must be free to > withhold consent to assignment with confidence that such withholding will > not be challenged as "unreasonable." We therefore request deletion of > your > number 9. > > We are still reviewing your proposals regarding SETOFF and LIMITED > LIABILITY. I will also have to review Section 5-1401 of the NYGOL before > commenting on that. > > I look forward to the prompt completion of our negotiations. Thanks again > for the information and recommendations. > > Best regards, > Andy Waskow > > > -----Original Message----- > > From: Sara.Shackleton@enron.com [SMTP:Sara.Shackleton@enron.com] > > Sent: Tuesday, October 31, 2000 6:22 PM > > To: awaskow@exchange.ml.com > > Cc: Ellen.Su@enron.com > > Subject: Master Repurchase Agreement with Enron North America Corp. > > > > Andy: > > > > In the spirit of "full disclosure", I thought I would let you know what > > ENA > > has agreed to on the ISDA side with various Merrill entities. > > ENA has ISDA's with Merrill Lynch International Bank (8/25/95), Merrill > > Lynch Capital Services Inc. (12/2/92) and Merrill Lynch International > > (8/25/95). > > There is no arbitration provision in any of these agreements; there is > > merely silence as to jurisdiction (ENA began negotiating arbitration > > around > > 1997). All of these agreements contain our standard limitation of > > liability language (in boldface) and all permit some type of assignment > to > > an affiliate (in general, without negative tax impact or with sufficient > > credit support). All of the agreements provide for setoff (including > > affiliates of non-defaulting parties) and all contain confidentiality > > provisions. > > > > I would therefore propose the following changes to Annex I: > > > > change the margin deadline time to 10:00 a.m. (NY time) > > delete Par 9(b) - and you can send your additional no custody required > > language > > delete the arbitration provision in its entirety > > > > I hope that you can resond to the remaining issues tomorrow morning so > > that > > we can finalize docs by the afternoon. Thanks for your assistance. > > > > Sara > > > > > > > > > >