It is about a month Since Mr. Penet came here from Nantes. I got intelligence of it next day, went to See him, had a Short conversation, and Spoke very a little, as I was determined to find out his Sentiments before he could know mine. He appeared to be confused irresolute and discontented both from his discourse and countenance; complained of your drafts to a large amount in favour of a Spaniard, by paying which very a little would remain to his house of the produce of your tobacco arrived in 2. large Vessels at Lorient and Nantes in February, mentioning the large orders you expected to have executed, and the heavy debt which it Seemed as if you had forgotten; attempted to exculpate Mr. D’Acosta for having not paid the letter of credit, observing that the house had letters from you, or Mr. Jameson, or both, in which the operations respecting Mr. Smith and me were countermanded; Said that the purport of my mission had been written from Virginia to Philadelphia, and Some of our Delegates had been instructed to inquire after the probability of Success from persons, whom he was not at liberty to mention; and endeavoured to make me understand (though not in clear terms) that it was believed in America, that I had Settled my matters with the Enemy, and gone to England. Four, or five days after we met for the 2d. time by appointement; he treated me like an intimate friend, and with a distinguished kindness; informed me of his Success with his Partners here, whom he had persuaded into his plan; Said that your drafts should be paid and your orders executed; blamed very much Mr. D’Acosta’s unaccountable behaviour to me, which he Said to have heared of by Some of the Clerks in Nantes, and to have had Some words with him about it already; expected that the brothers D’Acosta Should not be long his Partners; asked if I had his letter of credit, and When I Should want the money, &c. &c. I answered that I would raise the money whenever he pleased; I had studiously avoided to mention a word about it myself; I took notice, but very gently, of his attempts in the first conversation to exculpate Mr. D’Acosta, to which he replied in a manner as if he had been certain I would approve his direction in Speaking of a Partner; and I did not give the least hint of remembering any thing of his confusion, irresolution, and inconsistence, which I dare Say he remembered nothing of himself. Mr. Penet’s Situation must have been very disagreable the first time I Saw him. I had already been informed in Nantes that he is not a man of capital, which you must have observed in letter 6; and am now certain it is the case. He knew, that his Partners here were in bad humour, and that all his engagements in America must fall to the ground, and he himself be reduced to nothing, if he did not Succeed to persuade them into his views. This, I think, accounts fully for the monstruous difference between his first and Second conversation. He paid me the 300 Louis the 6th. instant, and is now gone back to Nantes. While he was here I Saw him often, as he Shewed a great regard for me, attachement to the american Cause, and even procured me the acquaintence of a person, who is in the way of giving a lift in matters of importance for us. But we ought notwithstanding to be on our guard for the following reason. I know that his Partners would make a great deal of their money on the Spot, and have reason to believe what has been suggested to me by an old acquaintence, who is a banker in Paris, that they would not have embarked in Such affairs, unless they had been assured of extraordinary profits. A mixture of ambition and vanity extravagance and generosity must rise Mr. Penet’s expences to a considerable amount. His Show gave offence in Nantes and has been ridiculed in Paris. Count Kaunitz, who was here in his way to Madrid Ambassadour to the King of Spain from the Emperor, asked me if I knew a person lately come from America (whom from his description I found to be Mr. Penet) who (the Count Said with a Smile to the whole company) had taken great pains with his tongue and by Showing his rings the night before at the play to be taken particular notice of. The whole must come out of the profits in the American affairs, as he has got no others. Therefore we ought, I repeat, to be on our guard. And as you cannot See these things from Such a distance, I think it incumbent on me to inform you. I hope that my character is Sufficiently known to take for granted, that I am induced to give Such informations merely from my regard to the public interest. I wish however that interest may never be prefered to gratitude and delicacy. Both these are due to Mr. Penet by what I heared of the late Governor and the Gentelmen of the council. First of all you will easily See by the quality and price of the goods you receive, and the accounts of Sale of your tobacco, whether you are imposed, or not. If not, the informations I give you can do no harm. And if you Should be imposed, I wish that the paying of your debt may always precede your complaints. Of the 2 evils I would prefer the being imposed to the risk of hurting the credit and honour of the State. My greatest apprehensions are on account of the £100,000 Sterling he is empowered to borrow. He has avowed to me, that he never expected to raise a farthing on that commission, but that he had taken it merely as a Security, principally to Satisfy the minds of his Partners. If then from the nature of his Commission he has in his power to make the State answerable for that Sum without any further formality from you, I wish that you will withdraw it from him as soon as possible, and that it may be done with great precaution and delicacy. Indeed his extravagant expences would hurt the credit of any rich merchant, and it is prudent to be afraid of those who have So great a thirst for appearing So much higher than their Station. I have the honour to be most respectfully, Sir, Your Excellency’s most obedient & most humble Servant,