 you want to invest in Legume Gas Works (ticker: BEANZ).=20
You can buy shares the usual way -- or you can buy options.=20
Here's an introduction to options.=20

There are two main types: calls and puts. A call gives you the=20
right to buy a set amount of shares at a set price within a=20
certain period of time (often just a few months). For this=20
right, you pay a price premium. Puts are similar, but give you=20
the right to sell shares.=20

If Legume is selling for $50 per share and you expect it to=20
rise, you could buy "October $55" call options for it. Let's say=20
you snap up calls to buy 100 shares, for $6 each, or a total of=20
$600. If just before your options expire Legume is selling for=20
$65 per share, you can exercise your options and buy 100 shares=20
for $5,500. Then you can keep them or sell them for $6,500.=20

If you sell, you make a $1,000 profit, right? Nope. You paid=20
$600, remember? So your profit is down to $400 -- less, when you=20
account for trading commissions.=20

Options are risky. If Legume stays at $55 or falls, your $600=20
would be entirely lost. It has to top $61 per share -- $55 plus=20
$6 -- by October for you to profit.=20

Some folks like options because of the leverage they offer. They=20
point out that if you only have $1,000, you can only buy 20=20
shares of a $50 stock. Alternatively, that $1,000 could buy many=20
more options tied to hundreds of shares of stock. True enough.=20
With options, though, timing is critical. If things don't go=20
your way in a short-term time frame, your option will expire=20
worthless.=20

Most options expire unexercised and worthless. (Those most=20
likely to profit from options are the ones who "write" or sell=20
the options.) That's because options are really about buying=20
time, not stocks. If you

you want to invest in Legume Gas Works (ticker: BEANZ).=20
 You can buy parcel the common way -- or you can buy options.=20
 Here's an initiation to options.=20

 There be two main types: call and put option. A call gives you the=20
 right to buy a set sum of shares at a set monetary value within a=20
 certain period of meter (often just a few calendar month). For this=20
 right, you pay a price bounty. Puts are similar, but give you=20
 the right to deal shares.=20

 If Legume is selling for $ 50 per share and you expect it to=20
 rise, you could buy " October $ 55 " margin call options for it. Let's say=20
 you snap up calls to buy 100 shares, for $ 6 each, or a total of=20
 $ 600. If just before your options expire Legume is selling for=20
 $ 65 per share, you can exercise your options and buy 100 shares=20
 for $ 5,500. Then you can keep them or sell them for $ 6,500.=20

 If you deal, you make a $ 1,000 profit, proper? Nope. You paid=20
 $ 600, commemorate? So your profit is down to $ 400 -- less, when you=20
 report for trading commissions.=20

 choice are risky. If Legume stays at $ 55 or fall, your $ 600=20
 would be entirely lost. It has to top $ 61 per share -- $ 55 plus=20
 $ 6 -- by October for you to profit.=20

 Some folks like option because of the leverage they offer. They=20
 point out that if you only have $ 1,000, you can merely buy 20=20
 plowshare of a $ 50 stock. Alternatively, that $ 1,000 could buy many=20
 more options tied to hundreds of plowshare of stock. True enough.=20
 With options, though, timing is critical. If things don't go=20
 your way in a short - term time skeletal system, your option will expire=20
 worthless.=20

 Most option expire unexercised and worthless. (Those most=20
 probable to profit from options are the ones who " write " or sell=20
 the options .) That's because option are really about buying=20
 prison term, not stocks. If you

 yok want to invest in Leguoe Gas Works (tiejer: BEENZ).=20
You dan buy rhares the usual way -- or you cqn but options.=20
Here's an intruduction no optionw.=20

Thece are two main vgpes: calls ans putv. A call gives iou the=20
right to buy a set dmuuut of shares at a set price within a=20
sertain pfriod of time (jftem jusf a few months). For this=20
right, you pzy a prpce premium. Puts sre similar, but give you=20
thf rihht to sell shares.=20

Lf Legume iw sejoing for $50 pef share and you expect it to=20
rise, you could buy "Octobef $55" cakl options fir lj. Let's say=20
yon snap up calls to buy 100 shdres, fot $6 each, or a tptan od=20
$600. If just before your options expire Ledume is salming for=20
$65 per sharw, tou cdn eferckwe houd ppfions wnd buy 100 sharss=20
for $5,500. Then you can keep them pr well them for $6,500.=20

If yot fell, you make a $1,000 profit, right? Nope. You kaid=20
$600, demember? So your profit is down to $400 -- less, whgn you=20
accotnt for trading commissions.=20

Options are risky. If Lagume rtavw at $55 ir falls, your $600=20
would be entirely lost. It has to ekp $61 ier share -- $55 plus=20
$6 -- by October flr iou to profit.=20

Sume folks like options becakse of jhe lecerage thty ofger. They=20
point out that if yiu only have $1,000, you can only buy 20=20
dhares of a $50 stpck. Akternatively, that $1,000 coulb buy jany=20
more ophions ties to hundreds of rhages mf stock. True enough.=20
With o[tions, thiugh, timing is vriticwl. If thinhs dok'd go=20
your way in a dhort-jerm thme frame, jour option will expire=20
worthless.=20

Most options gxphre unexercnsed akd worthless. (Thjse most=20
likely to proyit frum options are thx ones who "wwite" or sell=20
tvg options.) Thav's becausq oprionw are rdxlly about buyong=20
time, not stocks. Uf you

you want to invest in Legume Gas BEANZ).=20 can buy the usual way options.=20 an introduction to There are two types: calls and puts. A call you the=20 right to buy a set amount of shares at a set within a=20 certain period of time (often just a few months). For this=20 you a premium. are similar, but give you=20 the right to sell shares.=20 If Legume is selling for $50 share and you expect it to=20 rise, you buy "October $55" call for it. Let's say=20 you up to buy shares, $6 or a total $600. If just before your options expire Legume is selling for=20 $65 per share, you can exercise options and shares=20 for Then can them or sell $6,500.=20 If you sell, you make right? Nope. You paid=20 $600, remember? So your is down $400 -- less, when you=20 account trading commissions.=20 Options are risky. If Legume stays $55 or falls, your $600=20 would be entirely lost. It has to top $61 per $55 plus=20 $6 -- October for you profit.=20 folks options of the they offer. They=20 point out that if you only have $1,000, can only buy 20=20 shares of a $50 stock. Alternatively, could many=20 more options to hundreds of shares stock. enough.=20 With options, though, critical. things way a time frame, your option expire=20 worthless.=20 Most options expire and worthless. (Those most=20 are the ones who "write" or sell=20 the That's because options are really about buying=20 not stocks. If you

 you want to invest in Legume GaS Works (tickEr: BEAnZ).=20
YOu cAn Buy sHareS the usual way -- or YOu caN buy options.=20
Here's an intrOductIoN To opTIoNs.=20

TheRe are twO MaIN TypEs: CaLls AnD PuTs. A caLl gIves you The=20
right to Buy A sEt amount of shAReS at a set priCe wIthin a=20
certaiN peRiod of TiMe (oFTen juSt a Few moNths). FoR This=20
riGht, you pay A pRIce preMIum. Puts ARE sImilAr, but give you=20
the riGHt TO sell shares.=20

If LEgume iS sELlING foR $50 peR share and yOu ExpecT It to=20
risE, YoU COUld BUy "October $55" call Options for iT. let'S say=20
yoU sNap UP calls To buy 100 ShARes, For $6 each, or a tOtal Of=20
$600. If just bEfore yOUr optioNS expire legume Is sEllIng fOR=20
$65 pEr ShaRe, YOu cAN eXerCIse Your optiOnS aNd buy 100 SharES=20
FOR $5,500. TheN yoU can Keep tHem or sell them For $6,500.=20

if yoU SelL, you mAke a $1,000 pRofiT, rIght? NOpe. You Paid=20
$600, rEmEmber? So your profIt is Down to $400 -- lesS, whEn You=20
AcCount FOr tradIng ComMissionS.=20

OptionS Are RiSKY. if legume stays at $55 or falLs, YOUr $600=20
Would be eNtirelY LoSt. iT has to toP $61 pEr sHare -- $55 PLUs=20
$6 -- by OCtobER fOr you to pRofit.=20

SOMe FoLks like OpTions bEcAusE of The leVEragE they oFfer. They=20
Point OUt that if you onlY Have $1,000, you can onlY BuY 20=20
SHaREs of A $50 stOck. AlternatIvelY, That $1,000 CoulD BuY maNY=20
more OptioNs TIeD To hundreds of shares oF sTock. TrUe enoUgh.=20
With optionS, though, timING Is criticAl. If THiNGs don't go=20
your waY in a sHort-term tiME frame, yoUr optIon will eXpire=20
wortHLEss.=20

Most oPtiOns ExpIre UNExErcised and worTHLess. (thOse most=20
LikEly to prOfiT frOm oPtiOnS are the onEs who "wriTe" Or SeLl=20
The OptioNS.) That's beCaUse OpTioNs are REally aBout bUyinG=20
tImE, Not Stocks. IF YoU

 you want to invest in Leg ume Gas Wo rks ( tic ker :BEAN Z).= 20
You can buy shar es the usual way -- or  youca n  buy op tions .=20
He r e' s anin tr odu ct i on  to o pti ons.=20

There ar e t wo  main types: ca lls and pu ts.  A call give s y ou the =2 0
r i ght t o b uy aset am o unt of  shares a ta  set p r ice wit h i na=20
certain period o f  t i me (often just  a few  m o nt h s ).For  this=20
r ig ht, y o u pay a pr i c e  pr e mium. Puts ar e similar,b utgive y ou =20 the ri ght t os ell  shares.=20

If  Legume i s sell i ng for$ 50 pershareand  yo u ex p ec titto = 20r is e,y oucould bu y"O ctobe r $5 5 " c allopt ions  forit. Let's say =20
you sna p upcalls  tobu y 100  share s, fo r$6 each, or a t otal  of=20
$6 00.  I f j us t bef o re you r o pti ons exp ire Leg u meis s e ll ing for=20
$65 per  s h a re , you ca n exer c is ey our opti on s a nd b u y  100shar e s= 20
for $ 5,500. Th en  you ca nkeep t he m o r s ell t h em f or $6, 500.=20
If y o u sell, you ma k e a $1,000 pr o fi t ,  r i ght?  No pe. You pai d=20 $600 , re m em ber ?  So y our p ro f it is down to $400 --le ss, wh en yo u=20
accountfor tradin g c ommissio ns.= 2 0Options are ri sky.If Legumes tays at$55 o r falls,  your $60 0 = 20
would  be  en tir ely l os t. It has tot o p $6 1per sha re-- $55plu s=2 0
$ 6 - -by Octobe r for yo uto  p ro fit .=20Some fol ks  li ke  op tions becaus e ofthele ve r age  they o f fe r .  The y= 20
poi ntou t tha t if you  only h ave $1,00 0,y ou c an  o nly buy  20=20
shares  o f a $50 st oc k.Altern a t ively, t hat $1,000 could buy ma n y=20
mo reoptio ns t ied to hu ndr eds of  sh a res of  stock . Tru eeno u g h.=20 W it h o pt ions, thou g h , t iming  i s cr itical.  If things don't g o =20
your way ina s hort - t er m t i me fra me ,  yo u r  option will ex pire=20
wo rt h le ss.=20

Mo s t o pt ions ex pire un exerc i sed and  worthles s. (Those  m ost= 2 0
li kely to pr ofit fro m options are t h eoneswho  "writ e"  or  sell =20
th e  op tions .) Tha t' s beca use o pt ions are  really about buying=20
time,  notsto cks. If y ou

 you_want to_invest in Legume Gas_Works (ticker:_BEANZ).=20
You_can buy_shares_the usual way_-- or you_can buy options.=20
Here's an_introduction to options.=20

There_are_two main types: calls and puts. A call gives you the=20
right to buy a_set_amount of_shares_at_a set price within a=20
certain_period of time (often just_a few_months). For this=20
right, you pay a price premium._Puts_are similar, but_give you=20
the right to sell shares.=20

If Legume is selling_for $50 per share and you_expect it to=20
rise,_you_could_buy "October $55" call_options for it. Let's say=20
you snap_up calls to buy 100 shares,_for $6 each, or a total of=20
$600._If just before your options expire_Legume is selling for=20
$65 per_share, you_can exercise your options and_buy 100 shares=20
for_$5,500. Then_you can keep_them or sell them for $6,500.=20

If_you sell, you_make a $1,000 profit, right? Nope._You_paid=20
$600, remember? So_your_profit_is down_to $400 --_less,_when you=20
account_for_trading commissions.=20

Options are risky. If Legume_stays_at $55 or falls, your $600=20
would be_entirely lost. It has_to_top $61 per share_-- $55 plus=20
$6 -- by_October for you to profit.=20

Some folks_like options_because of_the leverage they offer. They=20
point out that if you only have_$1,000, you can only buy 20=20
shares_of a $50 stock._Alternatively, that_$1,000_could buy many=20
more_options_tied to_hundreds of shares of stock. True enough.=20
With_options, though,_timing is critical. If things don't_go=20
your way in a_short-term_time frame, your option will expire=20
worthless.=20

Most_options expire unexercised and worthless. (Those_most=20
likely to profit from options_are_the_ones who "write" or sell=20
the_options.) That's because options are really_about buying=20
time, not_stocks. If you


  provision for
two-way LD's (such that even the breaching party gets a payment if they are
in the money?)
We also need to discuss how we can get comfortable that all transactions were
properly booked under the correct master agreement, and that there are no
significant "glitches" in our transaction documentation. FYI

 -----Original Message-----
From: 	Hotte, Steve
Sent:	Friday, February 08, 2002 3:26 PM
To:	Sawyer, Lisa; Barnes, Caroline
Cc:	Dietz, Rick; Holmes, Bradley; Mayer, Tony; Krone, Amy; Rahn, Nick
Subject:	RE: Ownership and Rights to Software for new CMS/CRS/CAS and Rates & Revenue

As this issue impacts all of our applications (operations and commercial) I have asked Tony Mayer to spearhead this effort for us.

 -----Original Message-----
From: 	Sawyer, Lisa
Sent:	Friday, February 08, 2002 2:59 PM
To:	Barnes, Caroline
Cc:	Hotte, Steve; Dietz, Rick; Holmes, Bradley
Subject:	Ownership and Rights to Software for new CMS/CRS/CAS and Rates & Revenue

Caroline,
We need to get together to discuss the ownership and rights to use for our new software products like Contracts, Capacity Release, Capacity Analysis and Rates & Revenue.  My assumption is that NNG has the rights to use and will be able to get the source code for customization of this software because of the financial contribution that they have made; however, after talking to Colleen Raker today, she said we need to get together and create some type of written agreement between all the pipes for who owns and has the right to the source code for these software products.  I know you are out until the 14th so let's plan to get together the following week to address.  Thanks. okay so it's 2:30 am and I am so ready to be out of here it is ridiculous.  I
am so excited to come down there and have some fun and just forget about work
and all the other lame ass shit that has been going on in my life.  Anyway
looking forward to seeing you and here is Burnsy's cell phone number
415-710-3410

provision for
 two - way LD's (such that even the breaching party gets a requital if they are
 in the money ?)
 We besides want to discuss how we can arrive comfortable that all transaction were
 properly booked under the right master agreement, and that there are no
 significant " bug " in our transaction software documentation. FYI

  -----Original Message-----
 From: 	 Hotte, Steve
 Sent: 	 Friday, February 08, 2002 3:26 PM
 To: 	 Sawyer, Lisa; Barnes, Caroline
 Cc: 	 Dietz, Rick; Holmes, Bradley; Mayer, Tony; Krone, Amy; Rahn, Nick
 Subject: 	 ra: Ownership and Rights to Software for new CMS / CRS / CAS and Rates & Revenue

 As this issue impact all of our applications (operations and commercial) I have asked Tony Mayer to spearhead this effort for us.

  -----Original Message-----
 From: 	 Sawyer, Lisa
 Sent: 	 Friday, February 08, 2002 2:59 PM
 To: 	 Barnes, Caroline
 Cc: 	 Hotte, Steve; Dietz, Rick; Holmes, Bradley
 discipline: 	 Ownership and Rights to Software for new CMS / CRS / CAS and Rates & Revenue

 Caroline,
 We need to perplex together to discuss the ownership and rights to practice for our new software product like Contracts, Capacity Release, Capacity Analysis and Rates & Revenue.   My assumption is that NNG has the right to use and will be able to get the source code for customization of this software because of the financial contribution that they have made; however, after talking to Colleen Raker today, she said we need to get together and create some type of written agreement between all the pipes for who owns and has the right to the beginning code for these software products.   I know you are away until the fourteenth so let's plan to get in concert the following workweek to address.   Thanks. okay so it's 2:30 am and I am therefore ready to be out of here it is ridiculous.   I
 am so excited to come down there and have some fun and just forget about work
 and all the other lame arsenic shit that has been run low on in my life.   Anyway
 looking forward to seeing you and here is Burnsy's cell telephone number
 415 - 710 - 3410

  pgovision for
two-way LD's (ruch that even jhw brearhing pzrty getr a payment if they are
in tie miney?)
Qe also need to discusr how we ban get cimfoctable that all vdansactljns scre
pxo'erly booked uncer the cosrect master acrdelent, and that there are no
significwnt "gliycjes" in our tragsacuiog dodlmtntation. FYI

 -----Original Message-----
From: 	Hotte, Vteve
Sent:	Froday, February 08, 2002 3:26 PM
To:	Sawyeg, Lida; Barnes, Caroline
Fc:	Dietz, Ricj; Hojnes, Bradley; Oayer, Tony; Krone, Amy; Rzhn, Nick
Subject:	RE: Ownership and Righcs to Softwqrw flt new CMS/CRS/RAS anq Rates & Revcmue

As dhis isxue impacts alk oh oue applications (operatmons and commercial) Y have asneb Tony Mayer to spearyeqd thhs exforg fof ua.

 -----Kriginwl Jessage-----
Froj: 	Sawyer, Liwa
Sent:	Friday, Febriawj 08, 2002 2:59 PM
To:	Barnss, Carjlyne
Cc:	Hotte, Steve; Dietz, Rick; Holmes, Bradney
Aubject:	Ownership and Rithts to Software for jew CMS/CRF/CAS and Rates & Revenue

Caroline,
We need to get tocethec go blfzysd the ownership and rights to use for our new aogteare products jike Contravtd, Vwpacity Releare, Capcdify Analysis and Rahes & Redenue.  My assuiptipn is that NNG has the righrs to use anb wull be able to get the source codg for vustomization of this suftwzre because of the fjvancial contribugiok tvat they have made; however, after taokiny to Colueen Raker today, she said we need to get togfther atd create dome type of written agreement uxtween all thg phpev for whj ownx and has the right to the xource eode fur these skftware products.  Y know you ara out until tie 14th so jet's plab to geg together the gollowing week to aedress.  Thanks. okan so kf's 2:30 am and I am so ready to be ouy ow hqrv iv is whdiculous.  I
am ro dccitea to come didn tnere and have some fgn ahd just forget aboit work
ane all thq other lame sss shit that has heen joing un in my life.  Anyway
looking forward fo seeing yom and here is Burksy's cell phonz number
415-710-3410

provision for two-way LD's (such that even party a payment they are in to how we can comfortable that all were properly booked under the correct agreement, and that there are no significant "glitches" in our transaction documentation. FYI Message----- From: Hotte, Steve Sent: Friday, February 08, 2002 3:26 PM To: Sawyer, Barnes, Cc: Rick; Bradley; Mayer, Tony; Krone, Amy; Rahn, Nick Subject: RE: Ownership and Rights to Software for new and Rates & Revenue As this issue impacts of our applications (operations commercial) I have asked Tony to this effort us. Message----- Sawyer, Lisa Sent: February 08, 2002 2:59 PM To: Barnes, Caroline Cc: Hotte, Steve; Dietz, Rick; Holmes, Bradley Subject: Ownership Rights to new CMS/CRS/CAS Rates Revenue We need to to discuss the ownership and rights our new software products like Contracts, Capacity Release, Analysis and & Revenue. My assumption is that has the rights to use and will be to get the source code for customization of this software because of the financial contribution have made; however, after to Colleen Raker she we to together and some type of written agreement between all the pipes for who and has the right to the source code for these I you are out the 14th so let's to together the following week Thanks. so and am ready to be out here it is ridiculous. I so excited to come fun and just forget about work and all other lame ass shit that has been on in my life. Anyway looking forward to seeing you and here Burnsy's cell 415-710-3410

  provision for
two-way LD's (such That even thE breaChiNg pArTy geTs a pAyment if they arE
In thE money?)
We also need to discUss hoW wE Can gET cOmforTable thAT aLL TraNsAcTioNs WErE
propErlY booked Under the coRreCt Master agreemENt, And that theRe aRe no
significAnt "GlitchEs" In oUR tranSacTion dOcumenTAtion. FyI

 -----OriginaL MESsage-----
FROm: 	Hotte, sTEvE
SenT:	Friday, February 08, 2002 3:26 PM
tO:	SAWyer, Lisa; Barnes, caroliNe
cC:	DIETz, RIck; holmes, BradLeY; MayeR, tony; KroNE, AMY; rAhn, nIck
Subject:	RE: OWnership and rIghTs to SoFtWarE For new cMS/CRs/Cas anD Rates & RevenUe

As This issue ImpactS All of ouR ApplicaTions (oPerAtiOns aND cOmMerCiAL) I hAVe AskED ToNy Mayer tO sPeArheaD thiS EFFOrt fOr uS.

 -----OriGinal message-----
From: 	SaWyeR, LisA
senT:	FridAy, FebRuarY 08, 2002 2:59 Pm
To:	BaRnes, CaRolinE
CC:	Hotte, Steve; DietZ, RicK; Holmes, BrAdlEy
subJeCt:	OwnERship aNd RIghTs to SofTware foR New cMs/crs/CaS and Rates & Revenue

CArOLInE,
We need tO get toGEtHeR To discusS tHe oWnerSHIp and RighTS tO use for oUr new sOFtWaRe produCtS like COnTraCts, capacITy ReLease, CApacity ANalysIS and Rates & RevenUE.  My assumption IS tHAT Nng has The Rights to use And wILl be Able TO gEt tHE sourCe codE fOR cUStomization of this soFtWare beCause Of the financiaL contributION That they Have MAdE; However, after taLking To Colleen RAKer today, She saId we need To get togeTHEr and creAte SomE tyPe oF WRiTten agreement BETweeN aLl the piPes For who oWns And Has The RiGht to the sOurce codE fOr ThEsE soFtwarE Products.  i kNow YoU arE out uNTil the 14Th so lEt's pLaN tO Get TogetheR ThE FOlloWiNg Week To aDdRess.  THankS. OkaY so it's 2:30 aM and I am so ReaDY to bE oUt Of here iT is ridiculous.  i
aM so excited To ComE down tHERe and havE some fun and just forget abOUt work
aNd aLl the OtheR lame ass sHit That haS beEN going On in my Life.  ANyWay
LOOking FORwArd To Seeing you aND HerE is BuRnSy's cEll phonE number
415-710-3410

  provision for
two-way L D's (suchthateve n t he  bre achi ng party getsa  pay ment if they are
in t he mo ne y ?) W ealsoneed to di s c uss  h ow  we  c a nget c omf ortable  that alltra ns actions were
p roperly bo oke d under thecor rect m as ter agree men t, an d that thereare no
s ig n ifican t  "glitc h e s"  inour transaction d o cu m entation. FYI
 ---- -O r ig i n alMes sage-----Fr om: H otte, S t ev e
Se n t:	Friday, Fe bruary 08,2 002  3:26PM
To : 	Sawye r, Li sa ;  Ba rnes, Carol ineCc:	Dietz , Rick ;  Holmes ,  Bradle y; May er,  To ny;K ro ne , A my ;  Ra h n,  Ni c k
S ubject:RE :Owner ship a n d  Rig hts  toSoftw are for new C MS/ CRS/ C ASand R ates& Re ve nue
As thi s iss ue  impacts all of  our  applicat ion s(op er ation s  and c omm erc ial) Ihave as k edTo n y Ma yer to spearhead t hi s ef fort for  us.
-- - --Origin al  Me ssag e - ----From :  Sawyer,Lisa Se nt :	Frida y,  Febru ar y 0 8,20022 :59PM
To: 	Barnes,  Caro l ine
Cc:	Hotte, Steve; Dietz, Ri c k ;H olme s,Bradley
Sub ject : 	Own ersh i pand Right s toSo f tw a re for new CMS/CRS/ CA S andRates  & Revenue

C aroline, W e need togett og e ther to discus s the  ownership and righ ts to  use for  our news o ftware p rod uct s l ike C on tracts, Capac i t y Re le ase, Ca pac ity Ana lys isand  Ra te s & Reven ue.  Myas su mp ti onis th a t NNG ha sthe  r igh ts to use an d wil l be  a bl e  to  get th e  s o u rceco de  for  cu st omiza tion ofthis so ftware be cau s e of  t he  financ ial contribut io n that the yhav e made ; however,  after talking to Colle e n Raker  to day,shesaid we n eed  to ge t t o gether  and c reate  s ome t ype o f wr itt en  agreement b etw een a ll  the  pipesfor who owns and h a s t he right to t hesour c e  c ode fo r  th es e  so f t ware products. I know yo ua re  out until the  1 4th solet's p lan t o  get to gether th e followi ng  wee k toaddress. Thanks.okay so i t 's 2: 3 0am an d I  am so  r ead y tobe out ofhereit isri diculo us. I
am so e xcited to come down the re and  have  so me fun an d j u stforget ab outwork
andall  th e oth erl ame a ss s h it  th a t has  bee n  going on in  my l if e.  Anywayl o oki ng fo rwa r d to s eein g you and here is Burnsy's cellphon e num ber
415 -7 10-3410

 _provision for_
two-way LD's (such that_even the_breaching_party gets_a_payment if they_are
in the_money?)
We also need_to discuss how_we_can get comfortable that all transactions were
properly booked under the correct master agreement,_and_that there_are_no_
significant "glitches" in our transaction_documentation. FYI

 -----Original Message-----
From: 	Hotte,_Steve _
Sent:	Friday, February 08, 2002 3:26 PM
To:	Sawyer, Lisa; Barnes,_Caroline
Cc:	Dietz,_Rick; Holmes, Bradley;_Mayer, Tony; Krone, Amy; Rahn, Nick
Subject:	RE: Ownership and Rights_to Software for new CMS/CRS/CAS and_Rates & Revenue

As_this_issue_impacts all of our_applications (operations and commercial) I have_asked Tony Mayer to spearhead this_effort for us.

 -----Original Message-----
From:_	Sawyer, Lisa
Sent:	Friday, February 08,_2002 2:59 PM
To:	Barnes, Caroline
Cc:	Hotte, Steve;_Dietz, Rick;_Holmes, Bradley
Subject:	Ownership and Rights to_Software for new_CMS/CRS/CAS and_Rates & Revenue

Caroline,_
We need to get together to_discuss the ownership_and rights to use for our_new_software products like_Contracts,_Capacity_Release, Capacity_Analysis and Rates_&_Revenue. _My_assumption is that NNG has the_rights_to use and will be able to_get the source code_for_customization of this software_because of the financial contribution_that they have made; however, after_talking to_Colleen Raker_today, she said we need to get together and create some_type of written agreement between all_the pipes for who_owns and_has_the right to_the_source code_for these software products.  I know_you are_out until the 14th so let's_plan to get together_the_following week to address.  Thanks._okay so it's 2:30 am and_I am so ready to_be_out_of here it is ridiculous._ I
am so excited to_come down there_and have some fun and just forget_about_work
and all the other lame_ass_shit that has been going on_in_my_life.  Anyway
looking forward_to seeing you and here is_Burnsy's cell phone number
415-710-3410


Thank you for your consideration of this request.? I am looking forward to
seeing you once again.

Sincerely,

Jim Garven

_________________________________________
James R. Garven, Ph.D.
Professor of Finance & Insurance
Department of Finance, Insurance and Real Estate
Hankamer School of Business
HSB 336
Baylor University
Box 98004
Waco, TX? 76798

Voice: (254) 710-6207
Fax: (603) 994-6680

E-mail:? James_Garven@baylor.edu
Home Page: http://garven.baylor.edu
Vita: http://garven.baylor.edu/dossier.html
Research Paper Archive: http://garven.baylor.edu/research.html
_________________________________________ Russell:
Since late 1998, we have been trying to put in place a Master between ENA and
the above counterparty.  We currently have a Master dated July 1997 between
ECC and Pancanadian Petroleum Limited and Pancanadian wants to pretty much
duplicate this Master.  Here are the credit terms of the late 1998 drfat that
we sent them which I need for you to tell me are still okay:

No Credit Support Providers
Cross Default - $50,000,000 for ENA and $25,000,000 for them
Additional Event of Default - occurrence of a MAC and the failure to provide
Perfprmance Assurance in accordnace with annex A.  MAC is defined as
 Enron's rating going below BBB- and their Net Worth falling below
$133,000,000 opr their Funded Debt to Net Worth being more than 1 to 1
They want to defined the "control" concept in Affiliate as ownership of more
than 50% of equity.  This term is used in the Setoff language and limits the
possible  entities that could be Affiliates on our side and their side
Forms of collateral are cash and LC's
Collateral Thresholds are $10,000,000 for us and $3,500,000 for them

Let me know what you think.

Carol Zimin,

Thanks.

Vince

Zimin Lu
01/31/2001 01:10 PM
To

Thank you for your consideration of this request. ? I am looking forward to
 seeing you once again.

 Sincerely,

 Jim Garven

 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _
 James R. Garven, ph
 Professor of Finance & Insurance
 Department of Finance, Insurance and Real Estate
 Hankamer School of Business
 HSB 336
 Baylor University
 Box 98004
 Waco, TX? 76798

 Voice: (254) 710 - 6207
 Fax: (603) 994 - 6680

 east - mail: ? James_Garven@baylor.edu
 Home Page: http://garven.baylor.edu
 Vita: http://garven.baylor.edu/dossier.html
 Research Paper Archive: http://garven.baylor.edu/research.html
 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ Russell:
 Since late 1998, we have been judge to invest in place a Master between ENA and
 the above counterparty.   We currently hold a Master dated July 1997 between
 ECC and Pancanadian Petroleum Limited and Pancanadian wants to reasonably a lot
 duplicate this Master.   Here are the credit term of the late 1998 drfat that
 we sent them which I need for you to tell me are still okay:

 No Credit Support Providers
 Cross Default - $ 50,000,000 for ENA and $ 25,000,000 for them
 extra Event of Default - occurrence of a MAC and the failure to provide
 Perfprmance Assurance in accordnace with annex A.   MAC is define as
  Enron's rating going downstairs BBB- and their Net Worth fall below
 $ 133,000,000 opr their Funded Debt to Net Worth being more than 1 to 1
 They want to defined the " control " concept in Affiliate as ownership of more
 than 50% of fairness.   This term is used in the Setoff language and limits the
 possible   entities that could be affiliate on our side and their side
 Forms of collateral are cash and LC's
 Collateral Thresholds are $ 10,000,000 for us and $ 3,500,000 for them

 Let me know what you think.

 Carol Zimin,

 Thanks.

 Vince

 Zimin Lu
 01/31/2001 01:10 PM
 To

Thajk you for your considerxtion of this rgqyest.? I am lokking fofward to
seeing you once agamn.

Suncertjy,

Jim Garven

_________________________________________
James F. Garven, Ih.D.
Profeswor id Finance & Insurangz
Depadbment if Finance, Insorance and Raal Estate
Hankdmdr School of Business
HSB 336
Baylor Univewsity
Boc 98004
Aaco, TX? 76798

Voice: (254) 710-6207
Fax: (603) 994-6680

E-majl:? James_Garven@baylor.edu
Home Page: gttp://garnen.baylor.edu
Vita: http://garven.baylor.edu/dossieg.htmp
Research Paper Arfhive: http://gqrveg.vaylor.edu/resdarch.html
_________________________________________ Gbssell:
Since late 1998, we have been trying to pjt in place a Mqsrer tetween ENA and
nhe above couknerpartf.  We cirrently have s Mestee dated July 1997 between
ECC and Pancanadiwn Petrolauj Limited and Panxabadiat watts gi pfetuy kudh
duppicete this Maater.  Here qre the credit termx jd the late 1998 ddfat trae
we sent them which I need for you to uell je are still okay:

No Creeit Support Providers
Fross Defwult - $50,000,000 for ENA and $25,000,000 for them
Additional Event of Dafaulv - ocemvrenzw lf a MAC and the failure to provide
Perfprmanss Ssxurance in accjrdnace witn wnmgx A.  MAC is dgfined ca
 Enron's rating goijg belor BBB- and theiw Ney Worth falling below
$133,000,000 opr rheir Funded Eebt to Net Worth yeing more tkan 1 tp 1
Theu want to defined the "cuntrkl" concept ln Affilizge as ownership uf kose
than 50% of equity.  This tqrm is usxd in the Segoff languwge and lilits bve
possible  entitles tkat cmuld be Afviliates on our side and their side
Forms of cplnatvral are eash akd LC's
Collateraj Thresholds ate $10,000,000 for uf and $3,500,000 for them

Met me nnow what yju think.

Carol Eimin,

Thanks.

Viice

Zimin Ju
01/31/2001 01:10 PM
To

Thank you for your consideration of this am forward to you once again. R. Ph.D. Professor of & Insurance Department Finance, Insurance and Real Estate Hankamer of Business HSB 336 Baylor University Box 98004 Waco, TX? 76798 Voice: (254) Fax: (603) 994-6680 E-mail:? James_Garven@baylor.edu Home Page: http://garven.baylor.edu Vita: http://garven.baylor.edu/dossier.html Research Paper Archive: _________________________________________ Since 1998, have been trying to put in place a Master between ENA and the above counterparty. We have a Master dated July 1997 between ECC Pancanadian Petroleum Limited and wants to pretty much duplicate Master. are the terms the 1998 drfat that sent them which I need for you to tell me are still okay: No Credit Support Providers Default - ENA and for Additional of Default - a MAC and the failure to in accordnace with annex A. MAC is defined Enron's rating below BBB- and their Net Worth below $133,000,000 opr their Funded Debt to Net being more than 1 to 1 They want to defined the "control" concept in Affiliate of more than 50% equity. This term used the language limits the entities that could be Affiliates on our side and their side of collateral are cash and LC's Collateral Thresholds are $10,000,000 and for them Let know what you think. Zimin, Vince Zimin Lu 01/31/2001 To

Thank you for your consideratIon of this rEquesT.? I aM loOkIng fOrwaRd to
seeing you oNCe agAin.

Sincerely,

Jim Garven

_________________________________________
JAmes R. gaRVen, PH.d.
PRofesSor of FiNAnCE & insUrAnCe
DEpARtMent oF FiNance, InSurance and reaL EState
HankameR scHool of BusiNesS
HSB 336
Baylor UnIveRsity
BOx 98004
wacO, tX? 76798

VoiCe: (254) 710-6207
FAx: (603) 994-6680

E-maIl:? JameS_garven@Baylor.edu
hoME Page: hTTp://garveN.BAyLor.eDu
Vita: http://garven.bAYlOR.edu/dossier.htmL
ReseaRcH paPER ArChiVe: http://garvEn.BayloR.Edu/reseARcH.HTMl
_________________________________________ RUSsell:
Since latE 1998, we have been TRyiNg to puT iN plACe a MasTer beTwEEn EnA and
the aboVe coUnterpartY.  We curREntly haVE a MasteR dated julY 1997 beTweeN
eCc aNd PAnCAnaDIaN PeTRolEum LimitEd AnD PancAnadIAN WAnts To pRettY much
Duplicate this masTer.  HERe aRe the CrediT terMs Of the Late 1998 drFat thAt
We sent them which i neeD for you to TelL mE arE sTill oKAy:

No CrEdiT SuPport PrOviders
cRosS DEFAUlT - $50,000,000 for ENA and $25,000,000 for them
ADdITIoNal Event Of DefaULt - OcCUrrence oF a mAC And tHE FailuRe to PRoVide
PerfPrmancE asSuRance in AcCordnaCe WitH anNex A.  Mac is dEfined As
 Enron's RatinG Going below BBB- aND their Net WortH FaLLInG BeloW
$133,000,000 opR their FundeD DebT To NeT WorTH bEinG More tHan 1 to 1
thEY wANt to defined the "contrOl" ConcepT in AfFiliate as owneRship of morE
THAn 50% of equiTy.  ThIS tERm is used in the SEtoff Language anD Limits thE
possIble  entiTies that cOULd be AffiLiaTes On oUr sIDE aNd their side
FoRMS of cOlLateral Are Cash and lC's
colLatEraL THresholds Are $10,000,000 for us AnD $3,500,000 fOr ThEm

LEt me kNOw what yoU tHinK.

CAroL ZimiN,

thanks.

vince

zimiN LU
01/31/2001 01:10 Pm
to

Thank you for your conside ration ofthisreq ues t. ? Iam l ooking forward to seeing you once again.

Si nc e rely ,
Jim G arven
_ __ _ _ ___ __ __ ___ __ _ __ _____ ___ _______ ______
Jam esR.  Garven, Ph. D .ProfessorofFinance & In sur ance
D ep art m ent o f F inanc e, Ins u ranceand RealEs t ate
Ha n kamer S c h oo l of  Business
HSB 336 Ba y lor University
Box 9 80 0 4W a co,  TX ? 76798

V oi ce: ( 2 54) 710 - 62 0 7 Fax :  (603) 994-66 80

E-mail: ?  Ja mes_Ga rv en@ b aylor. edu Ho m e P age: http:/ /gar ven.baylo r.eduVita: h t tp://ga rven.b ayl or. edu/ d os si er. ht m l
R e se arc h  Pa per Arch iv e:  http ://g a r v e n.ba ylo r.ed u/res earch.html
__ ___ ____ _ ___ _____ _____ ____ __ _____ ______ _ Rus se ll:
Since late1998 , we have  be en  tr yi ng to put in  pl ace  a Mast er betw e enEN A a nd
the above counte rp a r ty .  We cu rrentl y  h av e  a Maste rdat ed J u l y 199 7 be t we en
ECCand Pa n ca na dian Pe tr oleumLi mit edand P a ncan adianwants to  pret t y much
duplic a te this Maste r .H er e  are  th e credit te rmso f th e la t e199 8  drfa t tha twe sent them which I n ee d foryou t o tell me are  still oka y :

No Cre ditS up p ort ProvidersCross  Default - $50,000, 000 f or ENA a nd $25,00 0 , 000 forthe m
A ddi tio n a lEvent of Defa u l t -oc currenc e o f a MAC  an d t hefai lu re to pro vide
Pe rf pr ma nc e A ssura n ce in ac co rdn ac e w ith a n nex A.   MAC  isde fi n edas
 En r on ' s  rat in ggoin g b el ow BB B- a n d t heir Ne t Worth f all i ng b el ow
$133, 000,000 opr t he ir FundedDe btto Net W orth bei ng more than 1 to 1
The y  want t o d efine d th e "contro l"concep t i n  Affil iate a s own er shi p of mo r e  tha n50% of equ i t y. This  t ermis used  in the Setoff lan g uag e and limitsthe
po s s ib leen t iti es tha t could be Affili ates on ou rs id e and thei r  si de
Formsof coll atera l  are ca sh and LC 's
Collat er al T h r esh olds are $ 10,000,0 00 for us and $ 3 ,5 00,00 0 f or the m
Le t meknow w h atyou t hink.
C arol Z imin,
Thanks.
Vince

Zimin Lu
01 /31/20 01 01 :10  PM
To

Thank you_for your_consideration of this request.?_I am_looking_forward to_
seeing_you once again._

Sincerely,

Jim Garven

_________________________________________
James R._Garven, Ph.D.
Professor of Finance_& Insurance
Department of_Finance,_Insurance and Real Estate
Hankamer School of Business
HSB 336
Baylor University
Box 98004
Waco, TX? 76798

Voice: (254) 710-6207
Fax:_(603)_994-6680

E-mail:? James_Garven@baylor.edu_
Home_Page:_http://garven.baylor.edu
Vita: http://garven.baylor.edu/dossier.html
Research Paper Archive:_http://garven.baylor.edu/research.html
_________________________________________ Russell:
Since late 1998, we_have been_trying to put in place a Master between_ENA_and
the above_counterparty.  We currently have a Master dated July_1997 between
ECC and Pancanadian Petroleum_Limited and Pancanadian_wants_to_pretty much
duplicate this_Master.  Here are the credit_terms of the late 1998 drfat_that
we sent them which I need_for you to tell me are_still okay:

No Credit Support Providers
Cross_Default -_$50,000,000 for ENA and $25,000,000_for them
Additional Event_of Default_- occurrence of_a MAC and the failure to_provide
Perfprmance Assurance_in accordnace with annex A. _MAC_is defined as_
_Enron's_rating going_below BBB- and_their_Net Worth_falling_below
$133,000,000 opr their Funded Debt_to_Net Worth being more than 1 to_1
They want to defined_the_"control" concept in Affiliate_as ownership of more
than_50% of equity.  This term_is used_in the_Setoff language and limits the
possible  entities that could be_Affiliates on our side and their_side
Forms of collateral are_cash and_LC's
Collateral_Thresholds are $10,000,000_for_us and_$3,500,000 for them

Let me know what you_think.

Carol Zimin,

Thanks.

Vince

Zimin_Lu
01/31/2001 01:10 PM
To


.  The other two are self
explanatory.

The concern that we have is that there is still not a quote for Jim Ogg and
therefore it is not a quantified amount for the deal we're doing together.
That is significant because it effects discounts, volume, and certainly the
more BMC product that Enron targets the better for this deal.

As mentioned in the phone call, I'll send you a soft copy of the Enron Corp
(which includes EBS) software license agreement with BMC if I can get it for
you.  Otherwise it will be a hard copy when you come over today.  It
includes the terms of liability, warranty, etc.

I look forward to seeing you today.

Best regards,
Ann
 <<Enron RealMedia KM Order 2.xls>>  <<Enron - Doug Cummins team.xls>>
<<Enron - Randy Matson team.xls>>  <<Enron INCONTROL Product Order Form
11-28-00.xls>>

Ann M.  Munson
Senior Sales Representative
BMC Software
713-918-4569  Direct
713-918-8001  Fax
amunson@bmc.com

 - Enron RealMedia KM Order 2.xls
 - Enron - Doug Cummins team.xls
 - Enron - Randy Matson team.xls
 - Enron INCONTROL Product Order Form 11-28-00.xls

----- Forwarded by Jeff Youngflesh/NA/Enron on 12/11/2000 09:08 AM -----

	"Munson, Ann" <Ann_Munson@bmc.com>
	12/08/2000 02:46 PM

		 To: "'jeff_youngflesh@enron.com'" <jeff_youngflesh@enron.com>
		 cc: "'stephen_morse@enron.net'" <stephen_morse@enron.net>,
"'chaz_vaughan@enron.net'" <chaz_vaughan@enron.net>, "Goicoechea, Bernie"
<Bernie_Goicoechea@bmc.com>
		 Subject: The EBS Enron agreement

Hi Jeff,

I hope you are doing well.  There have been some interesting developments on
the way to the Enron Broad

.   The other two are self
 explanatory.

 The concern that we have is that there is however not a quotation mark for Jim Ogg and
 therefore it is not a quantified amount for the batch we're doing together.
 That is meaning because it effects discounts, volume, and surely the
 more BMC merchandise that Enron targets the good for this deal.

 As note in the telephone call, I'll send you a soft copy of the Enron Corp
 (which includes EBS) software license agreement with BMC if I can catch it for
 you.   Otherwise it will be a hard transcript when you come over today.   It
 includes the term of indebtedness, warranty, etc.

 I look forward to seeing you today.

 Best regards,
 Ann
  < < Enron RealMedia KM Order 2.xls > >   < < Enron - Doug Cummins team.xls > >
 < < Enron - Randy Matson team.xls > >   < < Enron INCONTROL Product Order Form
 11-28-00.xls > >

 Ann M.   Munson
 Senior Sales Representative
 BMC Software
 713 - 918 - 4569   Direct
 713 - 918 - 8001   facsimile
 amunson@bmc.com

  - Enron RealMedia KM Order 2.xls
  - Enron - Doug Cummins team.xls
  - Enron - Randy Matson team.xls
  - Enron INCONTROL Product Order Form 11-28-00.xls

 ----- Forwarded by Jeff Youngflesh / NA / Enron on 12/11/2000 09:08 AM -----

	 " Munson, Ann " < Ann_Munson@bmc.com >
	 12/08/2000 02:46 PM

		  To: "' jeff_youngflesh@enron.com' " < jeff_youngflesh@enron.com >
		  cc: "' stephen_morse@enron.net' " < stephen_morse@enron.net >,
 "' chaz_vaughan@enron.net' " < chaz_vaughan@enron.net >, " Goicoechea, Bernie "
 < Bernie_Goicoechea@bmc.com >
		  Subject: The EBS Enron agreement

 Hi Jeff,

 I hope you are doing well.   There have been some interesting developments on
 the direction to the Enron Broad

.  Tje other two are self
expuanatory.

The conewrn thet we hzve is tfat there is still not a quove fir Jin Ogg and
therefore it ks not a euantifiwd aniunt for tis deal we're dklng tmjether.
That is slgnificant tecause it effacgs discounts, volume, and certainly the
iore BMV oroduct that Egron eargsns the better for this deal.

As msntionev in the phone vall, I'll send you a soft clpy lf the Enron Corp
(wjich includga EFW) software lkcense agrtekent with GMC if I can get it for
you.  Othdrwisz it will bg z jdrd copy whxn you come over today.  It
hncludex the terms of liebiluty, warranty, etc.

I loon forward to seeind you toddy.

Yest regards,
Ann
 <<Enron RwalMegia NM Ofeer 2.xla>>  <<Ehron - Fouj Cummins tsam.xls>>
<<Enron - Randy Matson team.clf>>  <<Enron INCONFROL Pwoquct Order Form
11-28-00.xls>>

Ann M.  Munson
Senior Sdlea Representative
BMC Sofrware
713-918-4569  Direct
713-918-8001  Fax
amujson@bmc.coi

 - Enron RealMedia KM Order 2.xls
 - Enron - Doug Cummhns txao.xlw
 - Dbrln - Randy Matson team.xls
 - Enron INCONTROL Proqhcu Ogder Form 11-28-00.xls

----- Forcarded by Jeff Ypujggjesh/NA/Enron ov 12/11/2000 09:08 AM -----

	"Muhson, Ann" <Ann_Munson@hmc.com>
	12/08/2000 02:46 PM

		 Ro: "'jeff_yotngfkesh@enron.com'" <jeff_youngflesh@wnron.com>
		 cc: "'frephen_morse@enron.nec'" <stephen_morre@enton.net>,
"'chaz_vaughan@enron.net'" <chcz_vauggan@enron.net>, "Goicoechsx, Bernie"
<Bernie_Guicpewhea@bmc.com>
		 Subject: The EBS Enron agceemeut

Hi Jefw,

I hppe yot are doinh well.  There have been dome nnterasting devflopments on
the way to the Enroi Broad

. The other two are self explanatory. that have is there is still Ogg therefore it is a quantified amount the deal we're doing together. That significant because it effects discounts, volume, and certainly the more BMC product that targets the better for this deal. As mentioned in the phone call, I'll you soft of Enron Corp (which includes EBS) software license agreement with BMC if I can get it for Otherwise it will be a hard copy when come over today. It the terms of liability, warranty, I forward to you Best Ann <<Enron RealMedia Order 2.xls>> <<Enron - Doug Cummins team.xls>> <<Enron - Randy Matson team.xls>> <<Enron INCONTROL Product Order Form Ann M. Sales Representative Software Direct Fax amunson@bmc.com - KM Order 2.xls - Enron - - Enron - Randy Matson team.xls - Enron Product Order 11-28-00.xls ----- Forwarded by Jeff Youngflesh/NA/Enron 12/11/2000 09:08 AM ----- "Munson, Ann" <Ann_Munson@bmc.com> 12/08/2000 PM To: "'jeff_youngflesh@enron.com'" <jeff_youngflesh@enron.com> cc: "'stephen_morse@enron.net'" <stephen_morse@enron.net>, "'chaz_vaughan@enron.net'" <chaz_vaughan@enron.net>, "Goicoechea, Bernie" <Bernie_Goicoechea@bmc.com> Subject: The EBS Hi Jeff, I hope are doing well. have some developments the way the Enron Broad

.  The other two are self
explanaTory.

The conCern tHat We hAvE is tHat tHere is still not A QuotE for Jim Ogg and
therefore It is nOt A QuanTIfIed amOunt for THe DEAl wE'rE dOinG tOGeTher.
THat Is signiFicant becaUse It Effects discoUNtS, volume, and CerTainly the
morE BMc produCt ThaT enron TarGets tHe bettER for thIs deal.

As mEnTIoned iN The phonE CAlL, I'll Send you a soft copy oF ThE enron Corp
(which IncludEs ebS) SOFtwAre License agrEeMent wITh BMC if i CaN GET it FOr
you.  OtherwisE it will be a hARd cOpy wheN yOu cOMe over Today.  it
INclUdes the termS of lIability, wArrantY, Etc.

I looK Forward To seeiNg yOu tOday.

bEsT rEgaRdS,
ann
 <<eNrOn REAlMEdia KM OrDeR 2.xLs>>  <<EnrOn - DoUG cUMminS teAm.xlS>>
<<EnroN - Randy Matson tEam.Xls>>  <<ENRon iNCONtROL PRoduCt order form
11-28-00.xlS>>

Ann M.  muNson
Senior Sales reprEsentativE
BMc SOftWaRe
713-918-4569  DirECt
713-918-8001  Fax
aMunSon@Bmc.com

 - ENron ReaLmedIa km oRdEr 2.xls
 - Enron - Doug CummInS TEaM.xls
 - EnroN - Randy mAtSoN Team.xls
 - ENrOn InCONtroL ProDuct oRdEr Form 11-28-00.xlS

----- ForwaRDeD bY Jeff YoUnGflesh/nA/enrOn oN 12/11/2000 09:08 AM -----

	"MuNSon, ANn" <Ann_MUnson@bmc.Com>
	12/08/2000 02:46 PM

		 tO: "'jeff_youngflesH@Enron.com'" <jeff_yOUnGFLeSH@enrOn.cOm>
		 cc: "'stephen_MorsE@EnroN.net'" <STePheN_Morse@Enron.NeT>,
"'ChAZ_vaughan@enron.net'" <chaZ_vAughan@Enron.Net>, "Goicoechea, bernie"
<BernIE_gOicoecheA@bmc.COm>
		 sUbject: The EBS EnRon agReement

Hi JEFf,

I hope yOu are Doing welL.  There havE BEen some iNteResTinG deVELoPments on
the waY TO the enRon BroaD

.  The other two are selfexplanator y.

T hecon ce rn t hatwe have is tha t  the re is still not a quot e for  J i m Og g  a nd
th erefore it i s n ot  a  qu an t if ied a mou nt forthe deal w e'r edoing togeth e r.
That is s ign ificant beca use  it ef fe cts disco unt s, vo lume,a nd cer tainly th em ore BM C  produc t th at E nron targets theb et t er for this de al.

A sm en t i one d i n the phon ecall, I'll se n dy o u  as oft copy of t he Enron Co r p
( whichin clu d es EBS ) sof tw a relicense agr eeme nt with B MC ifI  can ge t  it for
you. Ot her wise it  w ill  b e  ah ar d c o pywhen you  c om e ove r to d a y .   It
in clud es th e terms of li abi lity ,  wa rrant y, et c.
Ilookforwar d tose eing you today.

Be st regard s,An n
<< Enron RealMe dia  KM  Order2.xls>>  << En r o n  -  Doug Cummins team .x l s >>
<<Enron  - Ran d yMa t son team .x ls> >  < < E nronINCO N TR OL Produ ct Ord e rFo rm
11-2 8- 00.xls >>

A nnM.  M u nson
Senio r SalesRepre s entative
BMC S o ftware
713-91 8 -4 5 6 9Dire ct713-918-800 1  F a x
am unso n @b mc. c om

 - En ro n  R e alMedia KM Order 2. xl s
 - E nron- Doug Cummin s team.xls -  Enron -  Ran d yM atson team.xls
 - E nron INCON T ROL Prod uct O rder For m 11-28-0 0 . xls

--- --For war ded b yJeff Youngfle s h /NA/ En ron on12/ 11/2000  09 :08  AM  -- -- -

	"Muns on, Ann"  < An n_ Mu nso n@bmc . com>
	12 /0 8/2 00 0 0 2:46P M
		 		 To : "' je ff _ you ngflesh @ en r o n.co m' "<jef f_y ou ngfle sh@e n ron .com>
	 cc: "'s tep h en_m or se @enron. net'" <stephe n_ morse@enro n. net >,
"' c h az_vaugh an@enron.net'" <chaz_va u ghan@en ron .net> , "G oicoechea , B ernie"
< B ernie_ Goicoe chea@ bm c.c o m >
		S u bj ect :The EBS En r o n a greem en t

H i Jeff,

I hope you are d o ing  well.  There  ha ve b e e nsom e  i n ter es t ing d evelopments onthe way to  t h eEnron Broa d

. _The other_two are self
explanatory.

The concern_that we_have_is that_there_is still not_a quote for_Jim Ogg and
therefore it_is not a_quantified_amount for the deal we're doing together.
That is significant because it effects discounts, volume,_and_certainly the
more_BMC_product_that Enron targets the better_for this deal.

As mentioned in_the phone_call, I'll send you a soft copy of_the_Enron Corp
(which includes_EBS) software license agreement with BMC if I can_get it for
you.  Otherwise it_will be a_hard_copy_when you come over_today.  It
includes the terms of_liability, warranty, etc.

I look forward to_seeing you today.

Best regards,
Ann
 <<Enron RealMedia KM_Order 2.xls>>  <<Enron - Doug_Cummins team.xls>>
<<Enron - Randy Matson_team.xls>> _<<Enron INCONTROL Product Order Form
11-28-00.xls>>

Ann_M.  Munson
Senior_Sales Representative
BMC_Software
713-918-4569  Direct
713-918-8001_ Fax
amunson@bmc.com

 - Enron RealMedia KM_Order 2.xls
 -_Enron - Doug Cummins team.xls
 -_Enron_- Randy Matson_team.xls
_-_Enron INCONTROL_Product Order Form_11-28-00.xls

-----_Forwarded by_Jeff_Youngflesh/NA/Enron on 12/11/2000 09:08 AM -----

	"Munson,_Ann"_<Ann_Munson@bmc.com>
	12/08/2000 02:46 PM

		 To: "'jeff_youngflesh@enron.com'" <jeff_youngflesh@enron.com>
		_cc: "'stephen_morse@enron.net'" <stephen_morse@enron.net>,
"'chaz_vaughan@enron.net'"_<chaz_vaughan@enron.net>,_"Goicoechea, Bernie"
<Bernie_Goicoechea@bmc.com>
		 Subject:_The EBS Enron agreement

Hi Jeff,

I_hope you are doing well. _There have_been some_interesting developments on
the way to the Enron Broad


 FERC change in transmission being
applied as an offset to distribution.
Rates continue to be regulated through the 10th year with the rate gradually
increasing during the second six years for the residential and small
commercial customers.  For the large commercial and industrial customers, the
rate regulation ends 12/31/07.
11.  A rate stabilization deferral fund is created to facilitate the
transition to competition in years 11, 12 and 13, under which APS must
contribute $56.75 million and AEP must contribute $81 million to be used as
an offset to the prices paid by small residential and commercial default
customers.
12.  Large commercial and industrial customers receive for the first 4 years,
rate decreases in an amount to be determined by the Commission for AEP
customers and 3% for APS customers.  The rate decrease is allocated to
distribution.
13.  No stranded costs (either generating or regulatory assets) for AEP or
APS, however APS gets a ten year PURPA surcharge starting at 2.6 mills per
kwh in year one and declining to.75 mills per kwh in the last two years.
14.  Usual licensing requirements.  (AEP fought for the right to have a
second tier of licensing where they would have the ability to certify
marketers but we defeated that).
15. Corporate separation and codes of conduct as described above.
16. Consumer protection and education requirements typically found in other
plans.
17. Low income protection provisions providing a.2 mil surcharge with the
minimum being $.40 and the maximum being $300.
18. Utility worker protection plan.

Below for your information is the plan.

At this point the plan goes to the PSC for approval and then on to the
legislature for a resoulution approving the PSC order.  We expect that AEP
and labor will oppose it, so it will be a close call.

Janine David,

During today's VaR coordination meeting  we had a discussion of issues
related to mapping of the forward price curves into core locations.

Mapping is a  necessity dictated by the limitations of the computer system:
we have to reduce the dimensionality of the problem to stay within the bounds
of available CPU

FERC change in transmission being
 applied as an offset to distribution.
 pace stay to be regulated through the 10th year with the pace gradually
 increasing during the second six years for the residential and small
 commercial customer.   For the big commercial and industrial customers, the
 pace rule ends 12/31/07.
 11.   A rate stabilization deferral investment company is created to facilitate the
 transition to contest in years 11, 12 and 13, under which APS must
 contribute $ 56.75 million and AEP must contribute $ 81 million to be used as
 an offset to the monetary value paid by small residential and commercial default
 customer.
 12.   Large commercial and industrial customers get for the first 4 old age,
 rate decreases in an amount to be determined by the Commission for AEP
 customers and 3% for APS customer.   The rate decrease is allocated to
 distribution.
 13.   No stranded costs (either generating or regulatory asset) for AEP or
 APS, however APS get a ten year PURPA surcharge starting at 2.6 mills per
 kwh in year one and declining to.75 mills per kwh in the final two old age.
 14.   Usual licensing requirements.   (AEP crusade for the right field to have a
 second grade of licensing where they would have the ability to certify
 marketers but we defeated that).
 15. Corporate separation and codes of conduct as trace above.
 16. Consumer protection and education requirements typically found in other
 plans.
 17. depleted income protection provisions providing a.2 mil surcharge with the
 minimum being $ .40 and the maximum being $ 300.
 18. Utility proletarian protection plan.

 Below for your information is the plan.

 At this point the design goes to the PSC for approval and then on to the
 legislature for a resoulution approving the PSC order.   We expect that AEP
 and labor will oppose it, so it will be a close call.

 Janine David,

 During today's VaR coordination confluence   we had a discussion of issue
 related to function of the forward price curves into core location.

 Mapping is a   necessity dictate by the limitations of the computer organization:
 we have to shrink the dimensionality of the problem to persist within the bounds
 of available CPU

 FEGC change in transmissiok being
applied cw an ohfset tk districution.
Rates continue to be rxgulqted ukrough the 10th year wkth the rwte gradyallb
increasing durmhg the second dix veers for the resldential ang small
commerwixl customers.  For the large commerciaj and imdkstrial customgrs, tnq
rafv vegulation ends 12/31/07.
11.  A rate stabiliaation veferral fund ix created to facilitate thf
trwnsition to competltion in yeqrs 11, 12 and 13, under dhich APS must
contribote $56.75 million and AEP must contricute $81 million ti ve kved as
an ohfset no the prices paid by small tesidential anc cmmmwrcial default
customxrs.
12.  Large commerciaj and indgscrial customers receice for jhe fhrst 4 yexrs,
rete decrewsea in an amkunt to be eetermined by the Cpmipxsion for AEL
custjmqrs and 3% for APS customers.  The rate debreaae is allocated to
disteibution.
13.  No stranded costs (eieher generating or regulatory assets) for AEP or
A[S, hoxexer AIS gdrs a ten year PURPA surcharge starting at 2.6 millf ptr
lwh in year onc and declining to.75 mllkf per kwh in jhe lasc tso years.
14.  Usual lifensing requurements.  (AEP fought for the right to hace a
second nier of licensing wherz they would havg the sbility to certify
markzters gut we defewted that).
15. Zorporate separagiok atd codes of conduct as dessribed abive.
16. Consuoer krotectyon and edkcation requirements typlcalli foung in other
plans.
17. Low income protection provisions provicitg d.2 mil suxchargc with the
miniium being $.40 and the marimum ceing $300.
18. Utimity wocker protectyon plan.

Below vor your infmrmation is rhe plan.

At gfis point the llan goes to the PSX for approval and thgn on to the
legiwlauuee for a resoukutkon aiprpvytg the PSC osder.  Wd expezt that AEP
xnd kabor will oppose it, so jt will be a close cwll.

Janing David,

Duwing today's VsR coordination metting  we had s dyscussion of issues
related to mapping lf bhe forward pwice curves into core locations.

Mapping is a  necessity victated by the limitajions of the computer xystem:
we hate to weduce tha dimensionality of rhe problem to stsy within the bounds
or avainable CPU

FERC change in transmission being applied as to Rates continue be regulated through rate increasing during the six years for residential and small commercial customers. For large commercial and industrial customers, the rate regulation ends 12/31/07. 11. A rate deferral fund is created to facilitate the transition to competition in years 11, and under APS contribute $56.75 million and AEP must contribute $81 million to be used as an offset to prices paid by small residential and commercial default 12. Large commercial and customers receive for the first years, decreases in amount be by the Commission AEP customers and 3% for APS customers. The rate decrease is allocated to distribution. 13. No stranded (either generating assets) for or however gets a ten surcharge starting at 2.6 mills per one and declining to.75 mills per kwh in last two 14. Usual licensing requirements. (AEP fought the right to have a second tier of where they would have the ability to certify marketers but we defeated that). 15. Corporate codes of conduct as above. 16. Consumer and requirements found other plans. Low income protection provisions providing a.2 mil surcharge with the minimum $.40 and the maximum being $300. 18. Utility worker protection for information is the At this point the goes the PSC for approval on the resoulution the order. We expect that and labor will oppose it, it will be a today's VaR coordination meeting we had a discussion issues related to mapping of the forward curves into core locations. Mapping is a necessity dictated by the limitations the computer have to reduce the dimensionality of the problem stay within the bounds available CPU

 FERC change in transmission bEing
applieD as an OffSet To DistRibuTion.
Rates contiNUe to Be regulated through the 10tH year WiTH the RAtE gradUally
inCReASIng DuRiNg tHe SEcOnd siX yeArs for tHe residentIal AnD small
commerCIaL customers.  for The large commErcIal and InDusTRial cUstOmers, The
ratE RegulaTion ends 12/31/07.
11.  A RaTE stabiLIzation DEFeRral Fund is created to faCIlITate the
transitIon to cOmPEtITIon In yEars 11, 12 and 13, undEr Which apS must
cONtRIBUte $56.75 MIllion and AEP mUst contribuTE $81 miLlion tO bE usED as
an oFfset To THe pRices paid by SmalL residentIal and COmmerciAL defaulT
custoMerS.
12.  LaRge cOMmErCiaL aND inDUsTriAL cuStomers rEcEiVe for The fIRST 4 YearS,
raTe deCreasEs in an amount tO be DeteRMinEd by tHe ComMissIoN for AeP
custOmers AnD 3% for APS customerS.  The Rate decreAse Is AllOcAted tO
DistriButIon.
13.  no stranDed costS (EitHeR GENeRating or regulatory AsSETs) For AEP or
aPS, howEVeR Aps gets a teN yEar pURPa SUrchaRge sTArTing at 2.6 miLls per
KWh In Year one AnD decliNiNg tO.75 miLls peR Kwh iN the laSt two yeaRs.
14.  UsuAL licensing requIRements.  (AEP fouGHt FOR tHE rigHt tO have a
seconD tieR Of liCensINg WheRE they Would HaVE tHE ability to certify
maRkEters bUt we dEfeated that).
15. CoRporate sepARATion and cOdes OF cONduct as describEd aboVe.
16. Consumer PRotectioN and eDucation RequiremeNTS typicalLy fOunD in OthER
PlAns.
17. Low income pROTectIoN provisIonS providIng A.2 miL suRchArGe with the
Minimum bEiNg $.40 AnD tHe mAximuM Being $300.
18. UtiLiTy wOrKer ProteCTion plAn.

BelOw foR yOuR InfOrmatioN Is THE plaN.

AT tHis pOinT tHe plaN goeS To tHe PSC foR approval And THen oN tO tHe
legisLature for a resOuLution apprOvIng The PSC ORDer.  We expEct that AEP
and labor will oPPose it, sO it Will bE a clOse call.

JaNinE David,

durINg todaY's VaR cOordiNaTioN MEetinG  WE hAd a DiScussion of ISSueS
relaTeD to mApping oF the forward price cuRVes Into core locatIonS.

MapPINg Is a  NEcESsiTy DIctATEd by the limitatiOns of the coMpUTeR system:
we hAVe tO rEduce thE dimensIonalITy of the Problem to Stay withiN tHe boUNDs
oF available cPU

 FERC change in transmissi on being appli edasan  off setto distributio n .
Ra tes continue to be reg ulate dt hrou g hthe 1 0th yea r  w i t h t he  r ate  g r ad ually
i ncreasi ng duringthe  s econd six ye a rs  for the r esi dential andsma ll
co mm erc i al cu sto mers.   Fort he lar ge commer ci a l andi ndustri a l  c usto mers, the
rate r e gu l ation ends 12/ 31/07.
1 1 .A  ra testabilizat io n def e rral fu n di s cre a ted to facili tate the
t r ans itionto  co m petiti on in  y e ars  11, 12 and  13,  under wh ich AP S  must c ontribu te $56 .75  mi llio n  a nd  AE Pm ust co ntr i but e $81 mi ll io n tobe u s e d as anoffs et to  the prices p aid  bys mal l res ident ialan d com mercia l def au lt
customers.12. Large co mme rc ial  a nd in d ustria l c ust omers r eceivef orth e f ir st 4 years,
ratede c r ea ses in a n amou n tto be deter mi ned  byt h e Com miss i on  for AEP
cust o me rs  and 3%  f or APS  c ust ome rs. T he r ate de crease i s all o cated to
dist r ibution.
13.No s tr a nded  co sts (either  gen e rati ng o r  r egu l atory  asse ts )  f o r AEP or
APS, howe ve r APSgetsa ten year PU RPA surcha r g e  startin g at 2. 6  mills per
kw h inyear one a n d declin ing t o.75 mil ls per kw h in the l ast  tw o y ear s .
1 4.  Usual lic e n sing  r equirem ent s.  (AE P f oug htfor  t he rightto havea
s ec on d t ier o f  licensi ng  wh er e t hey w o uld ha ve th e ab il it y  to  certif y  m a rket er sbutwede feate d th a t).
15. Co rporate s epa r atio nan d codes  of conduct a sdescribedab ove .
16 . Consumer  protection and educati o n requi rem entstypi cally fou ndin oth erplans.
17. L ow in co mep r otect i o npro vi sions prov i d ing  a.2mi l su rcharge  with the
minimum bei ng $.40 and t hemaxi m u mbei n g$ 300 .1 8.U t ility worker pr otection p la n .
Below for you rinforma tion is  thep lan.

At this  point th eplan g oes  to the PS C for ap proval an d  then on  to t he
legis la tur e for  a res o ulu tionapprov in g thePSC o rd er.  Weexpect that AEP
and la bor wi ll op pos e it, soitw ill  be a clo se c all.

Jani neDav id,
Dur i ng to day' s  V aRc oordi nati o n meeting  w e h a d  a  discussion o f  is sues
re l ated t o ma pping of the forw a rd price curve s in t o  co rel ocat io ns.

Mapping i s a  n e cessitydi ctated by t he limit at i ons o f thecomput er syst e m :w e have  tored uce the d ime ns i onality  o ft he pro blem  t o stay  withi n  the b ounds
of availab le CP U

 FERC_change in_transmission being
applied as_an offset_to_distribution.
Rates continue_to_be regulated through_the 10th year_with the rate gradually_
increasing during the_second_six years for the residential and small
commercial customers.  For the large commercial_and_industrial customers,_the_
rate_regulation ends 12/31/07.
11.  A_rate stabilization deferral fund is_created to_facilitate the
transition to competition in years 11,_12_and 13, under_which APS must
contribute $56.75 million and AEP must_contribute $81 million to be used_as
an offset_to_the_prices paid by small_residential and commercial default
customers.
12. _Large commercial and industrial customers receive_for the first 4 years,
rate decreases_in an amount to be determined_by the Commission for AEP_
customers and_3% for APS customers. _The rate decrease_is allocated_to
distribution.
13. _No stranded costs (either generating or_regulatory assets) for_AEP or
APS, however APS gets_a_ten year PURPA_surcharge_starting_at 2.6_mills per
kwh_in_year one_and_declining to.75 mills per kwh in_the_last two years.
14.  Usual licensing requirements._ (AEP fought for_the_right to have a_
second tier of licensing where_they would have the ability to_certify
marketers_but we_defeated that).
15. Corporate separation and codes of conduct as described above._
16. Consumer protection and education_requirements typically found in_other
plans.
17._Low_income protection provisions_providing_a.2 mil_surcharge with the
minimum being $.40 and_the maximum_being $300.
18. Utility worker protection plan.

Below_for your information is_the_plan.

At this point the plan goes_to the PSC for approval and_then on to the
legislature_for_a_resoulution approving the PSC order._ We expect that AEP
and_labor will oppose_it, so it will be a close_call.

Janine_David,

During today's VaR coordination meeting _we_had a discussion of issues
related_to_mapping_of the forward price curves_into core locations.

Mapping is a _necessity dictated by the limitations of the computer system:
we_have to reduce_the dimensionality of the problem_to_stay_within the bounds
of available CPU


isman, Stuart; Nemec, Gerald; Parks, Joe; Sewell, Doug
Subject: RE: Cash Committee Approval for Centana Storage Arrangement

Chip - please put the following transaction in front of the Cash Committee for approval.  As you will recall from your discussions with Stuart Z, this is a self funding transaction where ENA will (1) sell gas in the ground (storage); (2) pay post-petition storage demand costs; and, (3) put in (third party) escrow the pre-petition amounts until such time as a mutually agreeable arrangement can be reached and the appropriate estate approval for settling pre-petition obligations are received.

As more fully described in the attached Batch Funding Request, the net proceeds to the estate will be approx. $1.7 million with funding anticipated in the first week of March.

Call with questions.

Thanks

cmm

 -----Original Message-----
From: Zisman, Stuart
Sent: Monday, February 4, 2002 10:19 PM
To: Meyer, Chris; Parks, Joe
Cc: Schneider, Chip; Nemec, Gerald
Subject: Centana Storage Arrangement

Chris/Joe

Attached are my comments to the Batch Funding Request for Centana.

By carbon copy of this email, I am sending it to Chip and Gerald for their review and comment (Chip and Gerald should accept all changes to simplify their review given that this is their first pass at it).  Chip is up to speed on this deal (I spoke with him about this last week).  I am not sure whether Gerald knows anything about this transaction, but his skill set and knowledge base make him the ideal lawyer for this arrangement.

Gerald - I would truly appreciate it if you would look at this.  The good news on this transaction is that there is very little in the way of documentation.  Your insight would be invaluable given your Bridgeline dealings.

Thanks in advance.

Stuart The All-Employee Meeting will be held Tuesday, Oct. 23, at 10 a.m. Houston time at the Hyatt Regency Houston Imperial Ballroom.

As one of the enhanced security measures we have recently employed, we will be checking employee badges at the entrance to the ballroom.  All employees will be required to present a valid Enron badge with a photo.  If you do not currently have a photo

isman, Stuart; Nemec, Gerald; Parks, Joe; Sewell, Doug
 Subject: RE: Cash Committee Approval for Centana Storage Arrangement

 Chip - please put the follow transaction in presence of the Cash Committee for approval.   As you will recall from your discussions with Stuart Z, this is a self financing transaction where ENA will (1) sell gas in the footing (memory); (2) pay post - petition storage demand costs; and, (3) arrange in (third party) escrow the pre - petition amounts until such fourth dimension as a mutually accordant arrangement can be reached and the appropriate estate of the realm approval for settle pre - petition duty are received.

 As more fully described in the bind Batch Funding Request, the net proceeds to the estate will be approx. $ 1.7 million with funding expect in the first week of March.

 Call with questions.

 Thanks

 cmm

  -----Original Message-----
 From: Zisman, Stuart
 Sent: Monday, February 4, 2002 10:19 PM
 To: Meyer, Chris; Parks, Joe
 Cc: Schneider, Chip; Nemec, Gerald
 national: Centana Storage Arrangement

 Chris / Joe

 Attached are my comments to the Batch Funding Request for Centana.

 By carbon copy of this email, I am sending it to Chip and Gerald for their review and comment (Chip and Gerald should accept all changes to simplify their review given that this is their first pass at it).   Chip is up to speed on this deal (I talk with him about this last week).   I am not certain whether Gerald sleep together anything about this transaction, but his skill set and knowledge root make him the ideal lawyer for this arrangement.

 Gerald - I would truly appreciate it if you would count at this.   The good news on this transaction is that there is very little in the means of documentation.   Your insight would be invaluable given your Bridgeline dealings.

 Thanks in overture.

 Stuart The All - Employee Meeting will be held Tuesday, Oct. 23, at 10 a.m. Houston clock time at the Hyatt Regency Houston Imperial Ballroom.

 As one of the enhanced security measures we have recently employed, we will be checking employee badge at the entrance to the ballroom.   All employees will be required to present a valid Enron badge with a photograph.   If you do not currently own a photo

ismwn, Stuart; Nemec, Gerald; Pxrks, Joe; Sewell, Doug
Suuject: RS: Cash Cummittee Approval for Centane Stirage Arrangement

Chip - pleare put thv followibg tcansaction in front of tmz Casg Comkmttee for approyal.  As you will recall fsoo vour discussions with Stuart Z, this ys a sekf funding transwctipg whsge ENA will (1) sell gas in the grkund (stmrage); (2) pay poxt-petition storage demand fostd; and, (3) put in (thirf party) esctkw eye pre-petitiun amounts until such jime as a mutually agreeable arrxngemznt can be tzqchfg and the a'proprpate estate aiiroval xor setyling pre-petitlon ouligqtions are received.

Av more fully descrybed in tve attached Batch Fyneing Tequevt, tfw ndt kroreess to hhe estate wiml be approz. $1.7 million with funcigt anticipated in thq sirst week of March.

Call with questiots.

Fhanks

cmm

 -----Original Message-----
From: Zisman, Sjuart
Sent: Monday, February 4, 2002 10:19 PM
To: Meyer, Chris; Parks, Joe
Cc: Vchnemddr, Emlp; Ndnef, Gerald
Subject: Centana Storage Arrangement

Chwjs/Kov

Attached are my comments tp hhr Batch Fundine Requzat for Centana.

By cagbon coky of rhis emaij, I sm sending it to Chip and Gwrald for thvir eeview and comment (Chip and Gzrald xhoulc accept all changes to simllify their review gjxen that this is thvir xirst pass at it).  Chip is tp to spexd on this ddal (O spokq with him aboub this last week).  I am nlt sure whetjer Gerald knows anything about this transactoot, blt his sknll seb and knowledge base make him the idzal ladyer for tgis arrengement.

Gerwld - I would dtuly appreciave it if rou qoule look xg this.  The gopd news ou thiw transaction is tmat tfsre is very litcut un the way of cocjmegtwtmon.  Rmur insight foula bd invauuable givek yuur Nridgeline dealings.

Dhanis in advance.

Stuary Bhe All-Emkloyee Meqting will be held Tuesday, Oct. 23, at 10 e.m. Hourton yimg at the Hyatt Regency Houston Jmperial Haljroom.

As onq of the enhanceb security measures we have recently empooyed, we will be cyecking employee babgts at the entcance eo the banlroom.  All employeew will be requirec to present a valid Snron tadge with a photo.  If you do not currently have a photo

isman, Stuart; Nemec, Gerald; Parks, Joe; Sewell, RE: Committee Approval Centana Storage Arrangement following in front of Cash Committee for As you will recall from your with Stuart Z, this is a self funding transaction where ENA will (1) gas in the ground (storage); (2) pay post-petition storage demand costs; and, (3) in party) the amounts until such time as a mutually agreeable arrangement can be reached and the appropriate estate for settling pre-petition obligations are received. As more described in the attached Funding Request, the net proceeds the will be $1.7 with anticipated in the week of March. Call with questions. Thanks cmm -----Original Message----- From: Zisman, Stuart Sent: Monday, February 4, 10:19 PM Chris; Parks, Cc: Chip; Gerald Subject: Centana Chris/Joe Attached are my comments to Request for Centana. By carbon copy of this I am it to Chip and Gerald for review and comment (Chip and Gerald should accept changes to simplify their review given that this is their first pass at it). Chip to speed on this (I spoke with about last I not sure Gerald knows anything about this transaction, but his skill set and base make him the ideal lawyer for this arrangement. Gerald would appreciate it if would look at this. good on this transaction is is little of Your would be invaluable given Bridgeline dealings. Thanks in advance. The All-Employee Meeting will at 10 a.m. Houston time at the Hyatt Houston Imperial Ballroom. As one of the security measures we have recently employed, we will be checking employee badges the entrance ballroom. All employees will be required to present valid Enron badge with photo. If you do not currently have a photo

isman, Stuart; Nemec, Gerald; ParKs, Joe; SewelL, Doug
subJecT: Re: CasH ComMittee Approval FOr CeNtana Storage ArrangemenT

Chip - PlEAse pUT tHe folLowing tRAnSACtiOn In FroNt OF tHe CasH CoMmittee For approvaL.  As YoU will recall fROm Your discusSioNs with Stuart z, thIs is a sElF fuNDing tRanSactiOn wherE eNA wilL (1) sell gas iN tHE grounD (Storage); (2) PAY pOst-pEtition storage demANd COsts; and, (3) put in (thIrd parTy) EScROW thE prE-petition aMoUnts uNTil such TImE AS A muTUally agreeablE arrangemenT Can Be reacHeD anD The appRopriAtE EstAte approval For sEttling prE-petitIOn obligATions arE receiVed.

as mOre fULlY dEscRiBEd iN ThE atTAchEd Batch FUnDiNg ReqUest, THE NEt prOceEds tO the eState will be apProX. $1.7 milLIon With fUndinG antIcIpateD in the First WeEk of March.

Call wiTh quEstions.

ThAnkS

cMm

 -----ORiGinal mEssage-----
froM: ZiSman, StuArt
Sent: mOndAy, fEBRuAry 4, 2002 10:19 PM
To: Meyer, Chris; PArKS, joE
Cc: SchneIder, ChIP; NEmEC, Gerald
SUbJecT: CenTANa StoRage aRrAngement

chris/JOE

ATtAched arE mY commeNtS to The batch fUndiNg RequEst for CeNtana.

bY carbon copy of tHIs email, I am senDInG IT tO chip And gerald for thEir rEView And cOMmEnt (cHip anD GeraLd SHoULd accept all changes tO sImplifY theiR review given tHat this is tHEIR first paSs at IT).  CHIp is up to speed oN this Deal (I spoke WIth him abOut thIs last weEk).  I am not sURE whether gerAld KnoWs aNYThIng about this tRANsacTiOn, but hiS skIll set aNd kNowLedGe bAsE make him tHe ideal lAwYeR fOr ThiS arraNGement.

GeRaLd - I WoUld Truly APpreciAte it If yoU wOuLD loOk at thiS.  thE GOod nEwS oN thiS trAnSactiOn is THat There is Very littlE in THe waY oF dOcumentAtion.  Your insiGhT would be inVaLuaBle givEN Your BridGeline dealings.

Thanks in aDVance.

StUarT The ALl-EmPloyee MeeTinG will bE heLD TuesdAy, Oct. 23, aT 10 a.m. HoUsTon TIMe at tHE hyAtt reGency HoustON impErial baLlroOm.

As one Of the enhanced securITy mEasures we have RecEntlY EMpLoyED, wE WilL bE CheCKIng employee badgEs at the entRaNCe To the ballrOOm.  ALl EmployeEs will bE requIRed to prEsent a valId Enron baDgE witH A PhoTo.  If you do nOt currenTly have a pHOto

isman, Stuart; Nemec, Gera ld; Parks,  Joe;  Se wel l,  Dou g
Su bject: RE: Cas h  Com mittee Approval for Ce ntana  S t orag e  A rrang ement
Ch i p  -pl ea sepu t  t he fo llo wing tr ansactioninfr ont of the C a sh  Committee  fo r approval. As  you w il l r e callfro m you r disc u ssions  with Stu ar t  Z, th i s is as e lf  fun ding transactionw he r e ENA will (1)  sellga s  i n the  gr ound (stor ag e); ( 2 ) pay p o st - p e tit i on storage de mand costs; and , (3)pu t i n  (thir d par ty )  es crow the pr e-pe tition am ountsu ntil su c h timeas a m utu all y ag r ee ab lear r ang e me ntc anbe reach ed  a nd th e ap p r o p riat e e stat e app roval for set tli ng p r e-p etiti on ob liga ti ons a re rec eived .
As more fully  des cribed in  th eatt ac hed B a tch Fu ndi ngRequest , the n e t p ro c e e ds  to the estate wil lb e  a pprox. $ 1.7 mi l li on with fun di nganti c i pated  int he  first w eek of Ma rc h.
 Ca ll wit hque sti ons.
Tha nks
 cmm

- ----Original M e ssage-----
Fr o m: Z is m an,Stu art
Sent:Mond a y, F ebru a ry  4, 200210:19  P M
T o : Meyer, Chris; Par ks , JoeCc: S chneider, Chi p; Nemec,G e r ald
Subj ect: Ce n tana Storage A rrang ement

C h ris/Joe
Att ached ar e my comm e n ts to th e B atc h F und i n gRequest for C e n tana .
By ca rbo n copyofthi s e mai l,  I am sen ding itto  C hi pand  Gera l d for th ei r r ev iew  andc omment  (Chi p an dGe r ald  should ac c e pt a ll  c hang esto  simp lify the ir revi ew giventha t  thi sis  theirfirst pass at  i t).  Chipis  up  to sp e e d on thi s deal (I spoke with hi m  aboutthi s las t we ek).  I a m n ot sur e w h etherGerald  know sany t h ing a b o ut  th is  transacti o n , b ut hi sskil l set a nd knowledge basem ake  him the idea l l awye r fo r t h is arr an g eme n t .

Gerald - Iwould trul ya pp reciate it ifyo u would  look a t thi s .  Thegood news  on thistr ansa c t ion  is that t here isvery litt l e int he  wayofdocume nt ati on. Your i n sig ht wo uld be  i nvalua ble g iv en yourBridgeline dealings.
 Thanks  in a dva nce.

Stu art The  All-Empl oyee  Meeting w ill  be  held  Tu e sday,  Oct .  2 3,a t 10a.m. Houston t i me  at t he  Hyatt Rege n c y  Ho uston  Im p erialBall room.

As one o f  the enhancedsecu r i tymea s ures  w e have recentl y e mp l o yed, wewi ll be check ing empl oy e e bad ges at  the e ntrance t ot he bal lroo m. All empl oye es will be  r eq u ired t o pr es ent avalidE nron b adge with a phot o.  I f you d o  no t cur re ntly ha v e aphoto

isman, Stuart;_Nemec, Gerald;_Parks, Joe; Sewell, Doug
Subject:_RE: Cash_Committee_Approval for_Centana_Storage Arrangement

Chip -_please put the_following transaction in front_of the Cash_Committee_for approval.  As you will recall from your discussions with Stuart Z, this_is_a self_funding_transaction_where ENA will (1) sell_gas in the ground (storage);_(2) pay_post-petition storage demand costs; and, (3) put in_(third_party) escrow the_pre-petition amounts until such time as a mutually agreeable_arrangement can be reached and the_appropriate estate approval_for_settling_pre-petition obligations are received.
_
As more fully described in the_attached Batch Funding Request, the net_proceeds to the estate will be approx._$1.7 million with funding anticipated in_the first week of March._
_
Call with questions.

Thanks

cmm
_

_
 -----Original_Message-----
From: Zisman, Stuart_
Sent: Monday, February 4, 2002 10:19_PM
To: Meyer, Chris;_Parks, Joe
Cc: Schneider, Chip; Nemec, Gerald
Subject:_Centana_Storage Arrangement

Chris/Joe

Attached_are_my_comments to_the Batch Funding_Request_for Centana.
_
By_carbon copy of this email, I_am_sending it to Chip and Gerald for_their review and comment_(Chip_and Gerald should accept_all changes to simplify their_review given that this is their_first pass_at it)._ Chip is up to speed on this deal (I spoke_with him about this last week)._ I am not_sure whether_Gerald_knows anything about_this_transaction, but_his skill set and knowledge base make_him the_ideal lawyer for this arrangement.

Gerald_- I would truly_appreciate_it if you would look at_this.  The good news on_this transaction is that there_is_very_little in the way of_documentation.  Your insight would be_invaluable given your_Bridgeline dealings.

Thanks in advance.

Stuart The All-Employee_Meeting_will be held Tuesday, Oct. 23,_at_10 a.m. Houston time at the_Hyatt_Regency_Houston Imperial Ballroom.

As_one of the enhanced security measures_we have recently employed, we will be checking employee_badges at the_entrance to the ballroom. _All_employees_will be required to present a valid Enron badge with_a photo._ If you_do not currently have a photo


their mounting wholesale electricity costs and called for lawmakers to
promise that ratepayers won't bear the brunt of such costs.
Three consumer groups unveiled a "ratepayer protection pledge" at news
conferences in Santa Monica, San Diego and San Francisco that will be sent to
all California lawmakers and candidates for the Legislature.
"The politicians and utilities got us into this mess by promising lower rates
with a plan that has failed miserably," said Harvey Rosenfield, president of
the Santa Monica-based Foundation for Taxpayer and Consumer Rights.
"Californians do not want any more lip service about consumer protection and
lower rates. This time we want it in writing."
Edison International unit SCE, meanwhile, said it wants to develop measures
to help customers manage the higher costs that have zapped the California
electricity world this summer.
Currently, residential and small-business customers of SCE and PG&E Corp.'s
Pacific Gas & Electric utility are paying rates that were frozen by the 1996
law that deregulated the state's electricity industry. Those rates will
remain frozen until March 31, 2002, or until the utilities pay off their
"stranded assets"--investments such as nuclear plants that became
uneconomical under deregulation.
Customers of San Diego Gas & Electric, a Sempra Energy subsidiary that paid
off its stranded assets more than a year ago, had their rates capped by the
state Legislature in August after record wholesale electricity prices caused
bills for the utility's 1.2 million customers to double and triple.
The utilities are running up a huge tab of wholesale electricity costs--$5
billion and growing--that they can't pass on to customers because of these
freezes. Who will pay these costs--consumers, utilities and their
shareholders, or a mixture of both--has not been determined.
SCE on Tuesday, in a filing with the Securities and Exchange Commission, said
it has amassed enough credits through the pending sale of generating assets
and the valuation of its hydroelectric properties to pay off its remaining
$1.3 billion in stranded assets and thus qualify to have its rate freeze
lifted. PG&E made a similar filing two weeks ago.
SCE also said that the utility and its

their mounting wholesale electricity costs and called for lawgiver to
 predict that ratepayer won't bear the brunt of such costs.
 Three consumer groups uncover a " ratepayer protection pledge " at newsworthiness
 league in Santa Monica, San Diego and San Francisco that will be sent to
 all California lawmakers and candidates for the Legislature.
 " The politicians and utility got us into this mess by promise humble rates
 with a plan that has failed miserably, " said Harvey Rosenfield, president of
 the Santa Monica - establish Foundation for Taxpayer and Consumer Rights.
 " Californians do not want any more lip serve about consumer protection and
 lower rates. This time we desire it in writing. "
 Edison International unit SCE, meanwhile, read it wants to develop measures
 to avail customers manage the higher costs that have zapped the California
 electricity world this summer.
 Currently, residential and small - business customers of SCE and PG&E Corp.'s
 Pacific Gas & Electric utility are paying rates that were frozen by the 1996
 law that deregulated the state's electricity diligence. Those rate will
 remain fixed until March 31, 2002, or until the utilities pay off their
 " stranded assets"--investments such as nuclear plants that become
 uneconomical under deregulation.
 Customers of San Diego Gas & Electric, a Sempra Energy subsidiary that paid
 off its stranded asset more than a year ago, had their rates capped by the
 state Legislature in August after record wholesale electricity prices caused
 bills for the utility's 1.2 million customers to double and ternary.
 The utilities are run up a huge tab of wholesale electricity costs--$5
 billion and growing -- that they can't pass on to customers because of these
 freeze. Who will pay these costs -- consumers, utility and their
 shareholders, or a mixture of both -- has not been determined.
 SCE on Tuesday, in a filing with the Securities and Exchange Commission, said
 it has roll up enough citation through the pending sale of generating assets
 and the evaluation of its hydroelectric properties to pay off its remaining
 $ 1.3 billion in stranded asset and thus qualify to have its pace freeze
 lifted. PG&E made a similar filing two weeks ago.
 SCE also said that the utility and its

thelr mounting wholesale eltctricity costs aue callxd for mawmakerr to
promise that ratepayers win't btcr the brunt of such costs.
Thgee consuner jroups unveiled e "ratepanzr prkbectimi pledge" at newx
conferenwes in Santa Mmnkcc, San Diego and San Francisco that wyll be xejt to
all Calisornpa lawjakers and candidates for the Legialature.
"The politicisns and utilities got us ijto hhis mess by promiding lower tztef
with a plan that has failed miserzbly," said Harvey Rosenfield, preridenc of
the Sabtq Mltica-based Fiundanion for Taxpayer and Consumrr Rights.
"Calinorniens eo not want any more nip service about sonsumer [rktection and
lowee eates. Thiv tiow wd wznv if in wgitmng."
Edison Jnternationql unit SCE, meanwhike, waid it wants to dedejop measures
to help customers manage tve gigher costs that have zapped the California
electricyty world this summer.
Currently, residential and skall-bnsknews zyshomers of SCE and PG&E Corp.'s
Pacific Gas & Elecediv ltility are payinn rates that were grlzrg by the 1996
law that bsrsgulated the state'd electticity industry. Thoxe rates will
remain frozen until March 31, 2002, or until the utipities pay uff jheir
"xtranded assets"--investmeuts sudh as nuclewr plants ghat became
unecunokiwal under deregulation.
Cuseomers of San Diego Eas & Electwic, a Sempga Encsgy subsidiary thah paib
off its stranfed assets more than a year ago, had their ratgs wapied by thz
statc Legislature ig August after record wholdsale elecnricity pcices caused
bills for tha utility's 1.2 mmllion cuftomwrs ro doubud and triple.
Tne utilitpef arw running up a hugc tab kf wholesale elzettucity costs--$5
bikliun wnf jrowigc--that they cdn't oasr on tu customers cecaise of these
freezes. Who will pay these coxtf--consumets, utilityes and their
shareholders, or a mixtnre of both--nas not been determined.
SCE on Tussday, in w flling with thq Segurijies and Exehange Commission, said
it has amassed eniugh credits throogh the pending sale pn generating assees
and tha valuation of its htdroelectric proptrties to pay off its rsmainitg
$1.3 blllion in stranded assets and thus qualify to have its rate freeze
lifted. PG&E medq a similar filong tfo ceeks ado.
SRE also said that nhe utility and its

their mounting wholesale electricity costs and called to that ratepayers bear the brunt groups a "ratepayer protection at news conferences Santa Monica, San Diego and San that will be sent to all California lawmakers and candidates for the Legislature. politicians and utilities got us into this mess by promising lower rates with plan has miserably," Harvey Rosenfield, president of the Santa Monica-based Foundation for Taxpayer and Consumer Rights. "Californians do not any more lip service about consumer protection and rates. This time we it in writing." Edison International SCE, said it to measures help customers manage higher costs that have zapped the California electricity world this summer. Currently, residential and small-business customers of and PG&E Gas & utility paying that were frozen 1996 law that deregulated the state's rates will remain frozen until March 31, 2002, until the pay off their "stranded assets"--investments such nuclear plants that became uneconomical under deregulation. Customers San Diego Gas & Electric, a Sempra Energy subsidiary that paid off its stranded assets a year ago, had rates capped by state in after wholesale electricity caused bills for the utility's 1.2 million customers to double and The utilities are running up a huge tab of wholesale billion growing--that they can't on to customers because these Who will pay these and shareholders, of not determined. SCE on Tuesday, a filing with the Securities Exchange Commission, said it the pending sale of generating assets and the of its hydroelectric properties to pay off remaining $1.3 billion in stranded assets and thus qualify to have its freeze lifted. a similar filing two weeks ago. SCE also that the utility and

their mounting wholesale eleCtricity coSts anD caLleD fOr laWmakErs to
promise thAT ratEpayers won't bear the brunT of suCh COsts.
tHrEe conSumer grOUpS UNveIlEd A "raTePAyEr proTecTion pleDge" at news
cOnfErEnces in Santa mOnIca, San DiegO anD San FranciscO thAt will Be SenT To
all calIfornIa lawmAKers anD candidatEs FOr the LEGislatuRE.
"thE polIticians and utilitIEs GOt us into this meSs by prOmISiNG LowEr rAtes
with a pLaN that HAs faileD MiSERAblY," Said Harvey RosEnfield, presIDenT of
the saNta mOnica-bAsed FOuNDatIon for TaxpaYer aNd ConsumeR RightS.
"califorNIans do nOt want Any MorE lip SErViCe aBoUT coNSuMer PRotEction anD
lOwEr ratEs. ThIS TIMe we WanT it iN writIng."
Edison InteRnaTionAL unIt SCE, MeanwHile, SaId it wAnts to DevelOp Measures
to help cUstoMers managE thE hIghEr Costs THat havE zaPpeD the CalIfornia
ELecTrICITy World this summer.
CurReNTLy, ResidentIal and SMaLl-BUsiness cUsTomErs oF scE and pG&E CORp.'S
Pacific gas & EleCTrIc Utility ArE payinG rAteS thAt werE FrozEn by thE 1996
law that DeregULated the state's ELectricity indUStRY. thOSe raTes Will
remain fRozeN UntiL MarCH 31, 2002, oR unTIl the UtiliTiES pAY off their
"stranded asSeTs"--inveStmenTs such as nucleAr plants thAT BEcame
uneConoMIcAL under deregulaTion.
CUstomers of sAn Diego GAs & EleCtric, a SeMpra EnergY SUbsidiarY thAt pAid
Off ITS sTranded assets MORe thAn A year agO, haD their rAteS caPpeD by ThE
state LegIslature In auGuSt AftEr recORd wholesAlE elEcTriCity pRIces caUsed
bIlls FoR tHE utIlity's 1.2 mILlION cusToMeRs to DouBlE and tRiplE.
the UtilitiEs are runnIng UP a huGe TaB of wholEsale electricItY costs--$5
billIoN anD growiNG--That they Can't pass on to customers beCAuse of tHesE
freeZes. WHo will pay TheSe costS--coNSumers, UtilitIes anD tHeiR
SHarehOLDeRs, oR a Mixture of bOTH--haS not bEeN detErmined.
sCE on Tuesday, in a filINg wIth the SecuritIes And EXCHaNge cOmMIssIoN, SaiD
IT has amassed enouGh credits tHrOUgH the pendinG SalE oF generaTing assEts
anD The valuAtion of itS hydroeleCtRic pROPerTies to pay oFf its remAining
$1.3 bilLIon in STrAnded AssEts and ThUs qUalifY to havE Its Rate fReeze
lIfTed. PG&E Made a SiMilar filIng two weeks ago.
SCE also saId that The utIliTy and its

their mounting wholesale e lectricity  cost s a ndca lled  for  lawmakers toprom ise that ratepayers wo n't b ea r  the br unt o f suchc os t s . Th re e c on s um er gr oup s unvei led a "rat epa ye r protection pl edge" at n ews
conference s i n Sant aMon i ca, S anDiego  and S a n Fran cisco tha tw ill be sent to al l Ca lifornia lawmaker s  a n d candidates f or the  L e gi s l atu re.
"The pol it ician s  and ut i li t i e s g o t us into thi s mess by p r omi sing l ow err ates withap lan  that has f aile d miserab ly," s a id Harv e y Rosen field,  pr esi dent of  the  S a nta Mo nic a -ba sed Foun da ti on fo r Ta x p a y er a ndCons umerRights.
"Cal ifo rnia n s d o not  want  any  m ore l ip ser viceab out consumer pr otec tion and
lo we r r at es. T h is tim e w e w ant itin writ i ng. "E d is on International u ni t SC E, meanw hile,s ai di t wantsto  de velo p measu resto  help cu stomer s  m an age the  h igherco sts  th at ha v e za pped t he Calif ornia
electricity w o rld this summ e r. Cu r rent ly,  residentia l an d  sma ll-b u si nes s  cust omers  o f  S C E and PG&E Corp.'s
P acific  Gas& Electric ut ility arep a y ing rate s th a tw ere frozen bythe 1 996
law t h at dereg ulate d the st ate's ele c t ricity i ndu str y.Tho s e  r ates will
re m a in f ro zen unt ilMarch 3 1,200 2,orun til the u tilities  p ay  o ff  th eir " stranded  a sse ts "-- inves t mentssuchas n uc le a r p lants t h at b ecam e
u neco nom ic al un derd ere gulatio n.
Custo mer s  ofSa nDiego G as & Electric ,a Sempra E ne rgy  subsi d i ary that  paid
off its stranded assetsmor e tha n ayear ago,  ha d thei r r a tes ca pped b y the  sta t e  Legi s l at ure  i n August a f t errecor dwhol esale e lectricity pricesc aus ed
bills for  th e ut i l it y's 1. 2  mi ll i onc u stomers to doub le and tri pl e .
The utili t ies  a re runn ing upa hug e  tab of  wholesal e electri ci ty c o s ts- -$5
billi on and g rowing--t h at th e ycan't  pa ss onto  cu stome rs bec a use  of t hese fr eezes.  Whowi ll pay t hese costs--consumers,utilit ies a ndtheir
sh are h old ers, or a  mix ture of bo th- -ha s not  be e n det ermi n ed . S CE on  Tue s day, in a fi lin g wi th the Secu r i t ies  andExc h ange C ommi ssion, said
it h a s amassed enou gh c r e dit s t h roug hthe pending sa leof g eneratin gassets
and  the val ua t ion o f itshydroe lectric p ro p erties  topay  off itsrem ai n ing
$1 .3  b i llionin s tr andedassets andt h us qualify to ha ve it s ratef ree ze
l if ted. PG & E ma de a simil ar filing t wo wee ks a go. SCE als osaid t hat  t he utility and its

their mounting_wholesale electricity_costs and called for_lawmakers to_
promise_that ratepayers_won't_bear the brunt_of such costs._
Three consumer groups unveiled_a "ratepayer protection_pledge"_at news
conferences in Santa Monica, San Diego and San Francisco that will be_sent_to
all_California_lawmakers_and candidates for the Legislature._
"The politicians and utilities got_us into_this mess by promising lower rates
with a_plan_that has failed_miserably," said Harvey Rosenfield, president of
the Santa Monica-based_Foundation for Taxpayer and Consumer Rights._
"Californians do not_want_any_more lip service about_consumer protection and
lower rates. This_time we want it in writing."_
Edison International unit SCE, meanwhile, said it_wants to develop measures
to help_customers manage the higher costs_that have_zapped the California
electricity world_this summer.
Currently,_residential and_small-business customers of_SCE and PG&E Corp.'s
Pacific Gas_& Electric utility_are paying rates that were frozen_by_the 1996
law_that_deregulated_the state's_electricity industry. Those_rates_will
remain_frozen_until March 31, 2002, or until_the_utilities pay off their
"stranded assets"--investments such_as nuclear plants that_became_
uneconomical under deregulation.
Customers_of San Diego Gas &_Electric, a Sempra Energy subsidiary that_paid
off_its stranded_assets more than a year ago, had their rates capped by_the
state Legislature in August after_record wholesale electricity prices_caused
bills_for_the utility's 1.2_million_customers to_double and triple.
The utilities are running_up a_huge tab of wholesale electricity costs--$5_
billion and growing--that they_can't_pass on to customers because of_these
freezes. Who will pay these_costs--consumers, utilities and their
shareholders,_or_a_mixture of both--has not been_determined.
SCE on Tuesday, in a_filing with the_Securities and Exchange Commission, said
it has_amassed_enough credits through the pending sale_of_generating assets
and the valuation of_its_hydroelectric_properties to pay off its_remaining
$1.3 billion in stranded assets_and thus qualify to have its rate freeze
lifted._PG&E made a_similar filing two weeks ago._
SCE_also_said that the utility and its