'5~A /1~.~(

	   TO:     (4 Pages)

	   FROM: Sherrie Gibson

			 /

	   *DATE: January 27, 1998

	   RB: Updated Collateral Valuation


	   After numerous conversations with bank personnel and corrections to bank-prepared
	   schedules, the following is a summary of our discussions:

	   Compass Bank:
	   Due to the increased value of the collateral, the amount available to borrow (Schedule
	   1) is approximately ~ If this amount is funded and the collateral drops belows
	   the margin, the bank will call for additional collateral or request that payment be made
	   to the line of credit.

a~oC,I~
O~6tt~

NationsBank:
The Collateral Valuation Report (Schedule 2) as of today reflects that you are limited to
borrow on the personal line as a result of the amount of the line of credit (although you
have additional borrowing power). NationsBank is amenable to increasing your
personal line of credit to $35,000,000 with the same terms, so you can take advantage
of your full borrowing power. Again, if the amount funded exceeds the renuired
collateral, additional collateral or payment to the line of credit will be required.

	      partnership's line of credit is limited by its required collateral. I suggested and the
	   bank concurred, that the collateral on both lines of credit be cross-pledged. At your
	   request, the bank will begin the appropriate paperwork. Hopefully by cross-pledging
	   the assets, it will alleviate the limitation in availability to borrow.

	  4%zas Commerce Bank:
  ~        The $1,500,000 line of credit was opened on 9/30/97 with 30,000 shares of Compaq
	   stock as collateral. An unsecured line of credit was not established at this time. I
	   requested a $250,000 - $500.000 unsecured line of credit with an interest rate of prime-
	   .5 ( I mentioned to the bank that this is a competitive rate.) I thought that I would start
	   the process if you were interested in establishing an unsecured line of credit. The bani~
	   will notify me within the next two days on what they can offer.

	   Attached is a summary of the lines of credit prepared by Sally (Schedule 3) which
	   reflects the new information. I tried to anticipate your questions regarding these loans.
	   Please advise me.
					   ~ApA~'


							      LAY-G34 0689


							       GOVERNMENT
								  EXHIBIT
								   1037
								 Crim No. H-04-2S (S-2)

&

as,

I





									      *T1 3-NI-SETh
    JAN-26-99   10:32AM     PROM-COMPASS SANK PRIVATE CLIENT SERVICES


Line of Credit Availability
As of 1/22/98 Revised

Enron Stock (202,237 at $42.25)
Enron Oil & Gas Stock (20,000 at S21.25)
Lii Lilly & Co. (10,000 at $69.3 125)
 TOTAL COU..ATERAL

Margin

 TOTAL AVAILABLE TO BORROW
 Less: CWTCnC Ours~ndings
 TOTAL UNFUNDED BUT AVAILABLE

 $8,544,513 ('
   425 ,000(

  9,662,638

      80%

  7,730,111

~ '~c                 't.o053 000

									LAY-G34 0690





J~N 27 '96 2:24 FR PCG ~ ESTATE     73 247 6455 TO 96300189

    P. 0'8i
3~ Z7 '96  01:03PM

Kenneth L Lay
Collateral Valuation
January 27, 1996

281.000.000 Line of Cr.dj~
   Outstanding Loan Balance

   Collateral currently pledged:
    675,827 shares Enron Corp.
    493,784 shares Compaq Computer
    10,000 shares Copytele
    15,000 shares Afr*Cure Technologies
    0 shares Enron Global Power & Pipelines
    10,000 shares Fiberchem
    5,000 shares EO'IT Energy Partners
    86,473 shares TCW Core Equity Fund
    61,666 shares TCW Mid.Cap Growth
    17,278 shares TCW Small Cap Growth
    40,697 shares TCW Latin American Equity

   Total Market Value of Collateral
   Less: Collateral Roqulred (70% LTV)

   L Excess (Deficit) Collateral
   Borrowing Power
    yallable to Borrow


   Outstanding Loan Balance

   Collateral currently pledged:
   * 30,000 shares Enron Oil & Gas
    21,369 shares TCW Small Cap Growth
    20,220 shares Eli Lilly & Co.
    0 shares TCW Asia Pacifr Equity

   Total Market Value of Collateral
   Law Collateral Required (70% LTV)

   Excess (Deficit) Collateral
   L Borrowing Power
    vallable to Borrow

$80,799,999


$27,539,950
$14,890,074
   $32,500
  $178,126
      $0
   $1,875
   $92,500
$1,219,700
  $610,785
  $809,582
  $498,181

$45,178,122


$1,173,124
  $821,186
  $200,000 I


	  I po~cA  ~
  $175,000- *~ht  IOc~v~ Wi~

 S600, 000
 $382,932
$1,390,125

4 r O~-1 P~i1:j'
Plac.e. k~pqr1-vv~r~

$2,873,057


$2,128,057 I
$1,486,140 I
	I
$1,187,575 .ro~c4ed V~ ~~1,5O0

Total Net Excess (Deficit) Collateral
Total Net Availabl, to Borrow

$5,017,169
$1,387,575

								  LAY-G34 0691


							   ** TOT~ PAGE. 81 **





Jan. 27. 1998    2:~2P1~~     CHAIRI&AN'S  OFFICE

No  ~5?~     P    /~
 3~ 27 '98      ~:1jpp~

     INS~ITIFflON      LINE          FUNDED           AVAILABLE BALANCE
		       SlOM          7,124,950            S 605,000
     Libor * 1.00                    (5,035,614 investments)
				     (1,946,866 personal)
				     ( 142,400 Looscan)

     prime~ rate       S500,000      S 500,000             SO
		       Unscured      (personal)

     Enron Corn.       S4M        ('i2,040,004)            $1,960,000
     fed. rate, changes monthly   \CI5U~i~) investments)
				     (1,779,000 personal)
				     ( 111,000 Reba)

     NationsBank
     Libor + .9        S31.OM        530,799,999           S 200,000
		       Non-Purpose ( 12,817,242 luvestuients)
				     (  231,423 Kingston, B/HI, Wilier, Way)
				     (   93,500 1741 Sul Ross)
				     (  159,633 Columbia add-on, ShadyLane)
				     (17,441,201 personal)

	prime. .5      S750,000      S  750,000            SO
		       Unsecured     (personal)

	Partnership    52,750,000    S  175,000            SI,117SO00
	Line           Non-Purpose
	Libor + .9

TCB/Cbuse
Lihor + 1.00


1/20/98
CC: KLL
   LPL
   SBG

S1.SM

S1,500,000             S 0
(1,390,000 personal)
( 110,000 loan to mv. Partnership)

Today I have borrowed 5800,000 from the NationsBank line for
expenses.

3~                      LAY-G34 0692

Pc43~ 9-