vmac transaction louise overall idea seems logical method leverage collateral received profitable deals one additional benefit would allowed us use securities collateral counterparty would accept sure kind securities also think enrononline continue success medium term need form margining collateral part system better sense weither would issue us given healthy enron issue europe banks regardless issues big systems issue implementing day mark market liquidity calculation accross products enrononline therefore assume would rolled highest volume products increase cost transaction liquidity algorithm hard counterparties swallow want post incremental capital contract issue make collateral part enrononline deals difficult differentiate counterparties existing exposures assign collateral rights existing net exposures vmac likely logistical issue must many counterparties high value ones could doable would counterparty agree already collateral e g lc may require posting timing might implemented end ql unlikely give immediate benefit cost sure us brokerage seems equivalent 40 brokerage paid sides destroy margins threshold would credit threshold would onnerous parties quick win effectively using collateral received post collateral sleave would possible negotiate directly counterparty given select require high postings currently either case would negotiate adjustment collateral done without sleave bigger haircut would avoid delay setting wholesale know legally possible call discuss want detailed work let know original message kitchen louise sent 27 november 2001 16 04 romano marcello subject fw vmac transaction get working original message eichmann marc sent wednesday november 21 2001 2 51 pm kitchen louise lavorato john cc richter brad subject vmac transaction louise john general description transaction negotiating vmac virtual markets assurance corporation fsa financial securities assurance fsa aaa rated insurance company large enough provide us credible deal deal highlights fsa would wrap enron credit exposure follows 1 case default fsa would liquidate contracts sleeved enron use proceeds money transactions pay money transactions 2 case enron money portfolio trades sleeved vmac fsa would pay counterparties 100 collateral previously posted enron managed day day basis fsa mentioned possibility extending line credit enron based net collateral position 1 3 billion today net mark market position 1 4 billion date haircuts line credit would negotiated might significant fsa vmac would receive compensation fee structure described terms conditions current structure risk fsa vmac exposed risk simultaneous default enron another counterparty operational risk marking market positions liquidating contracts please find enclosed following 1 transaction structure describes payment logic case default 2 terms conditions describes terms conditions negotiation contract 3 collateral haircuts describes collateral haircuts securities posted fsa guarantee net mark market position money 4 fsa snapshot 5 fsa rating aaa qualification fsa moody please feel free contact brad richter clarify doubts respect marc eichmann work 713 345 8422 cell 713 870 2696 manager transaction development enrononline llc