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Enron Mail |
ON further reflection, if Mavrix is to be a wholly owned sub of Enron
Pipeline Company (or whatever the current name is of the top-tier ETS entity) then that entity ought to issue the guaranty. Mavrix intends to buy capacity from TW and possibly NN. It would be innappropriate to have TW issue the guaranty if TWs guaranty would likely operate in favor of TW. Same for NN. DF Rod Hayslett 01/31/2001 01:16 PM To: Jerry Peters/NPNG/Enron@ENRON cc: Mary Kay Miller/ET&S/Enron@ENRON, Drew Fossum/ET&S/Enron@ENRON, Susan Scott/ET&S/Enron@ENRON, Steven Harris/ET&S/Enron@ENRON, Tracy Geaccone/GPGFIN/Enron@ENRON, John Jesse/NPNG/Enron@ENRON Subject: Re: Mavrix The consideration isn't the point, its the fact that a creditworthy party, Enron for instance, has guaranteed the business and in fact they are creditworthy. Therefore we haven't given Mavrix a special deal compared to other shippers, since they are now by way of the guarantee creditworthy. As I told you on the phone, Enron will do this for others as well, it's just not cheap, it's like dealing with the guys in the pool hall! Jerry Peters 01/31/2001 12:56 PM To: Rod Hayslett/FGT/Enron@ENRON cc: Mary Kay Miller/ET&S/Enron@ENRON, Drew Fossum/ET&S/Enron@ENRON, Susan Scott/ET&S/Enron@ENRON, Steven Harris/ET&S/Enron@ENRON, Tracy Geaccone/GPGFIN/Enron@ENRON, John Jesse/NPNG/Enron@ENRON Subject: Re: Mavrix What is the objective of having Mavrix pay its parent/affliate (ETS) a guarantee fee? Will this prove that granting credit was non-discriminatory? I would argue no, since we don't look at the consideration paid for guarantees of other companies. The fact that a credit-worthy party has issued a guarantee should be enough. Legally, Mavix is a separate company. Parent companies frequently guarantee obligations of subsidiaries without any direct consideration (other than enabling their subsidiary to transact business). Rod Hayslett 01/31/2001 07:56 AM To: Mary Kay Miller/ET&S/Enron@ENRON cc: Drew Fossum/ET&S/Enron@ENRON, Susan Scott/ET&S/Enron@ENRON, Steven Harris/ET&S/Enron@ENRON, Tracy Geaccone/GPGFIN/Enron@ENRON, Jerry Peters/NPNG/Enron@ENRON, John Jesse/NPNG/Enron@ENRON Subject: Re: Mavrix I didn't necessarily mean that we would pay a third party, just someone else at Enron. From: Mary Kay Miller 01/31/2001 07:14 AM To: Rod Hayslett/FGT/Enron@ENRON cc: Drew Fossum/ET&S/Enron@ENRON, Susan Scott/ET&S/Enron@ENRON, Steven Harris/ET&S/Enron@ENRON, Tracy Geaccone/GPGFIN/Enron@ENRON, Jerry Peters/NPNG/Enron@ENRON, John Jesse/NPNG/Enron@ENRON Subject: Re: Mavrix I agree with Rod. By having it done by an outside party seems to make more sense from an external view. MK Rod Hayslett 01/31/2001 06:40 AM To: Drew Fossum/ET&S/Enron@ENRON cc: Susan Scott/ET&S/Enron@ENRON, Mary Kay Miller/ET&S/Enron@ENRON, Steven Harris/ET&S/Enron@ENRON, Tracy Geaccone/GPGFIN/Enron@ENRON, Jerry Peters/NPNG/Enron@ENRON, John Jesse/NPNG/Enron@ENRON Subject: Re: Mavrix First, Mavrix is a subsidiary of what company? I don't believe I have seen that anywhere, but had heard that it was TW. If it is not a subsidiary of NNG why would NNG issue a guaranty for Mavrix? I can have the guarantee priced and then Mavrix can pay to have someone guarantee it's positions. This is not rocket science, but I believe we need to make an effort to keep things looking like they are at arms length and that this is a separate company. If you all agree, let me know and I can have someone get with Steve Harris and get the guaranty priced. For Jerry and John: Let me know but I think we can get this priced down here inside the day. Let me know how you want to proceed. Drew Fossum 01/30/2001 06:01 PM To: Susan Scott/ET&S/Enron@ENRON cc: Mary Kay Miller/ET&S/Enron@ENRON, Steven Harris/ET&S/Enron@ENRON, Rod Hayslett/FGT/Enron@ENRON, Tracy Geaccone/GPGFIN/Enron@ENRON Subject: Re: Mavrix I guess you wouldn't want to use any of the joint venture entities to issue the guarantee because of the complexities of their ownership structures. You also wouldn't want to go outside of ETS because of marketing affiliate issues. By process of elimination, I guess I'm OK with NN issuing the guarantee. In my view, if Mavrix' commercial strategies are unsuccessful and Northern has to perform on the guarantee, good luck recovering any of those dollars in Northern's next rate case. Thanks. DF Susan Scott 01/30/2001 02:27 PM To: Drew Fossum@ENRON, Mary Kay Miller/ET&S/Enron@ENRON, Steven Harris/ET&S/Enron@ENRON, Rod Hayslett/FGT/Enron@ENRON, Tracy Geaccone/GPGFIN/Enron@ENRON cc: Subject: Mavrix Mavrix Transportation Trading Corp., which is a subsidiary of ETS, needs to satisfy TW's creditworthiness requirements in order to enter into a transportation agreement with TW. Paul Cherry has suggested that Northern Natural Gas issue a guarantee. Please let me know whether you think this would be acceptable. If Mavrix wanted to hold NNG capacity, TW could issue the guarantee.
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