*Purchase January 15, 2002 through January 28, 2002, midnight
 Pacific Time.
*Fares are each way with roundtrip purchase.
*Fares do not include federal excise tax of up to $3.00 per
 take off and landing.
*Fares do not include airport-assessed passenger facility
 charges (PFC) of up to $18 roundtrip.

For more details, please visit us at:
http://www.southwest.com/hotfares/promotional.html#california?src=e011502

*****************************************************************
Visit Florida, Where You Can Have It All for $39, $49, $59, or $79 each way.

World-famous theme parks and attractions, white sandy beaches,
the warmth of the ocean, crystal-clear natural springs,
pampering spas, Golf at more than 1,100 courses, history and culture.

Can't decide?  No problem.  In Florida, it's easy to do it all and now
is the perfect time to visit.

*Travel through February 14, 2002.
*Purchase January 28, 2002, midnight
 Pacific Time.
*Fares are each way with roundtrip purchase.
*Fares do not include federal excise tax of up to $3.00 per
 take off and landing.
*Fares do not include airport-assessed passenger facility
 charges (PFC) of up to $18 roundtrip.

For more details go to http://www.southwest.com/hotfares/florida.html

=================================================================
FRIENDS FLY FREE
=================================================================
Long Island/Islip, NY to/from Providence, RI for $49 each way
and bring a friend for FREE!

*Travel January 18, 2002 through June 7, 2002.
*Purchase January 15, 2002 through May 23, 2002, midnight
 Pacific Time.
*Fare is each way with roundtrip purchase.
*Fare does not include a federal excise tax of $3.00 per takeoff
 and landing for the fare-paying Customer.
*Fare does not include airport-assessed passenger facility
 charges (PFC) of $6 and federal September 11th Security Fees of
 $5 round

* Purchase January 15, 2002 through January 28, 2002, midnight
  Pacific Time.
 * Fares are each way with roundtrip purchase.
 * Fares do not admit union excise tax of up to $ 3.00 per
  contract off and landing.
 * fare do not admit airport - assessed passenger facility
  charges (PFC) of up to $ 18 roundtrip.

 For more contingent, please visit us at:
 http://www.southwest.com/hotfares/promotional.html#california?src=e011502

 * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
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 Long Island / Islip, NY to / from Providence, RI for $ 49 each way
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*Pugchase January 15, 2002 through January 28, 2002, midnntht
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*****************************************************************
Visit Florida, Wjere You Can Have It Apl for $39, $49, $59, ot $79 ewxh way.

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*Travwl through February 14, 2002.
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For more details gl yj http://www.soutfwest.com/hktfares/florida.html

=================================================================
VRIENDS FLY DREE
=================================================================
Long Islsnd/Islip, NY to/from Providenxe, RI for $49 ecch way
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*Travgl Janiary 18, 2002 through June 7, 2002.
*Pbrchass January 15, 2002 through Jxy 23, 2002, midnight
 Pxcinic Time.
*Fare is each way witr roundtrmp puxchase.
*Fxre coes njt include a federal excise tax of $3.00 per tdkeoff
 anf landing for the fare-paying Customer.
*Fare dogs tot include airpprt-assessed pwssenger facilnty
 chaxges (PWC) of $6 and federan September 11th Security Xges of
 $5 rounv

*Purchase January 15, 2002 through January 28, Pacific *Fares are way with roundtrip federal tax of up $3.00 per take and landing. *Fares do not include passenger facility charges (PFC) of up to $18 roundtrip. For more details, please us at: http://www.southwest.com/hotfares/promotional.html#california?src=e011502 ***************************************************************** Visit Florida, Where You Can Have It All for $49, or each World-famous theme parks and attractions, white sandy beaches, the warmth of the ocean, crystal-clear natural springs, spas, Golf at more than 1,100 courses, history culture. Can't decide? No In Florida, it's easy to it and now the time visit. *Travel through 14, 2002. *Purchase January 28, 2002, midnight Pacific Time. *Fares are each way with roundtrip purchase. *Fares not include tax of to per off and landing. not include airport-assessed passenger facility charges to $18 roundtrip. For more details go to ================================================================= FRIENDS FREE ================================================================= Long Island/Islip, NY to/from RI for $49 each way and bring a for FREE! *Travel January 18, 2002 through June 7, 2002. *Purchase January 15, 2002 through 2002, midnight Pacific Time. is each way roundtrip *Fare not a federal tax of $3.00 per takeoff and landing for the fare-paying Customer. does not include airport-assessed passenger facility charges (PFC) of $6 September Security Fees of round

*Purchase January 15, 2002 through JanUary 28, 2002, midnigHt
 PacIfiC TiMe.
*fareS are Each way with rouNDtriP purchase.
*Fares do not incLude fEdERal eXCiSe tax Of up to $3.00 pER
 tAKE ofF aNd LanDiNG.
*FAres dO noT includE airport-asSesSeD passenger faCIlIty
 charges (pFC) Of up to $18 roundtRip.

for morE dEtaILs, pleAse Visit Us at:
htTP://www.soUthwest.coM/hOTfares/PRomotioNAL.hTml#cAlifornia?src=e011502

*****************************************************************
VisiT flORida, Where You CaN Have IT ALL fOR $39, $49, $59, Or $79 eAch Way.

World-faMoUs theME parks aND aTTRActIOns, white sandy Beaches,
the wARmtH of the OcEan, CRystal-Clear NaTUraL springs,
pamPeriNg spas, GolF at morE Than 1,100 couRSes, histOry and CulTurE.

Can'T DeCiDe?  NO pROblEM.  IN FlORidA, it's easy To Do It all And nOW
IS The pErfEct tIme to Visit.

*Travel thRouGh FeBRuaRy 14, 2002.
*PurChase januArY 28, 2002, midnIght
 PaCific tiMe.
*Fares are each wAy wiTh roundtrIp pUrChaSe.
*fares DO not inCluDe fEderal eXcise taX Of uP tO $3.00 PER
 tAke off and landing.
*FaReS DO nOt includE airpoRT-aSsESsed passEnGer FaciLITy
 chaRges (pfC) Of up to $18 roUndtriP.

foR mOre detaIlS go to hTtP://wwW.soUthweST.com/HotfarEs/floridA.html

=================================================================
frIENDS FLY FREE
=================================================================
LONg Island/Islip, ny tO/FRoM provIdeNce, RI for $49 eacH way
ANd brIng a FRiEnd FOr FREe!

*TravEl jAnUAry 18, 2002 through June 7, 2002.
*PurchAsE JanuaRy 15, 2002 thrOugh May 23, 2002, midnigHt
 Pacific TIME.
*fare is eaCh waY WiTH roundtrip purcHase.
*FAre does not INclude a fEderaL excise tAx of $3.00 per taKEOff
 and laNdiNg fOr tHe fARE-pAying Customer.
*fARe doEs Not inclUde Airport-AssEssEd pAssEnGer faciliTy
 chargeS (PfC) Of $6 AnD feDeral sEptember 11Th secUrIty fees oF
 $5 Round

*Purchase January 15, 20 02 through  Janu ary  28 ,2002 , mi dnight
 Pacif i c Ti me.
*Fares are each w ay wi th roun d tr ip pu rchase.
* F a res  d onot  i n cl ude f ede ral exc ise tax of  up  t o $3.00 per t ake off an d l anding.
*Fa res  do no tinc l ude a irp ort-a ssesse d  passe nger faci li t y
 ch a rges (P F C )of u p to $18 roundtri p .For more detai ls, pl ea s ev i sit  us  at:
http: // www.s o uthwest . co m / h otf a res/promotion al.html#cal i for nia?sr c= e01 1 502

* ***** ** * *** *********** **** ********* ****** * ******* * ******* ****** *
V isi t Fl o ri da , W he r e Y o uCan Hav e It All  f or  $39,  $49 , $ 5 9, o r $ 79 e ach w ay.

World-f amo us t h eme  park s and  att ra ction s, whi te sa nd y beaches,
the  war mth of th e o ce an,  c rysta l -clear  na tur al spri ngs,
p a mpe ri n g sp as, Golf at more t ha n 1, 100 cour ses, h i st or y  and cul tu re.
 C a n't d ecid e ? No prob lem. I nFl orida,it 's eas ytodoit al l  and  now
i s the pe rfect time to visit.

*Travel thr o ug h Fe b ruar y 1 4, 2002.
* Purc h aseJanu a ry  28 ,  2002 , mid ni g ht
 Pacific Time.
*F ar es are  each  way with rou ndtrip pur c h a se.
*Fa resd on ot include fed eralexcise tax of up to  $3.0 0 per
take offa n d landin g.
*F are s d o no t include air p o rt-a ss essed p ass enger f aci lit y  ch ar ges (PFC)  of up t o$1 8ro und trip.
For mor edet ai lsgo to http:/ /www. sout hw es t .co m/hotfa r es / f lori da .h tml
== == ===== ==== = === ======= ========= === = ==== == == ======= =============
F RIENDS FLY  F REE
==== = = ======== ======================= = ======= === ===== ==== ========Lon g Isla nd/ I slip,NY to/ fromPr ovi d e nce,R I  f or$4 9 each way and  brin ga fr iend fo r FREE!

*Travel J a nua ry 18, 2002 t hro ughJ u ne  7, 20 0 2.
* P urc h a se January 15,2002 throu gh Ma y 23, 2002 ,  mi dn ight
Pacific  Time .
*Fare  is eachway withro undt r i p p urchase. *Fare do es not in c ludea  f edera l e xciseta x o f $3. 00 per tak eoff
 andla ndingfor t he  fare-pa ying Customer.
*Fare d oes no t inc lud e airport -as s ess ed passen gerfacility  ch arg es (P FC) of $6  and fe der a l Sep temb e r 11th Se c ur ity F ee s of
 $5 r o u n d

*Purchase_January 15,_2002 through January 28,_2002, midnight_
_Pacific Time._
*Fares_are each way_with roundtrip purchase._
*Fares do not include_federal excise tax_of_up to $3.00 per
 take off and landing.
*Fares do not include airport-assessed_passenger_facility
_charges_(PFC)_of up to $18 roundtrip.

For_more details, please visit us_at:
http://www.southwest.com/hotfares/promotional.html#california?src=e011502

*****************************************************************
Visit Florida,_Where You Can Have It All for $39,_$49,_$59, or $79_each way.

World-famous theme parks and attractions, white sandy_beaches,
the warmth of the ocean,_crystal-clear natural springs,_
pampering_spas,_Golf at more than_1,100 courses, history and culture.
_
Can't decide?  No problem. _In Florida, it's easy to do it_all and now
is the perfect time_to visit.

*Travel through February_14, 2002._
*Purchase January 28, 2002, midnight_
 Pacific Time._
*Fares are_each way with_roundtrip purchase.
*Fares do not include_federal excise tax_of up to $3.00 per
_take_off and landing._
*Fares_do_not include_airport-assessed passenger facility_
_charges (PFC)_of_up to $18 roundtrip.

For more details_go_to http://www.southwest.com/hotfares/florida.html

=================================================================
FRIENDS FLY FREE
=================================================================
Long Island/Islip, NY_to/from Providence, RI for_$49_each way
and bring_a friend for FREE!

*Travel January_18, 2002 through June 7, 2002._
*Purchase January_15, 2002_through May 23, 2002, midnight
 Pacific Time.
*Fare is each_way with roundtrip purchase.
*Fare does_not include a federal_excise tax_of_$3.00 per takeoff_
_and landing_for the fare-paying Customer.
*Fare does not_include airport-assessed_passenger facility
 charges (PFC) of_$6 and federal September_11th_Security Fees of
 $5 round


 developed by this research should be transferable to a number of
other settings, such as pricing services.  Services are unique, and there are
many cases where customers will only buy one of many services offered by a
given company.  Our model will help companies decide which services to offer
to which customers and how much to charge for these services.

Research Strategy:

Our research strategy is to divide the pricing problem into two components
which can be combined to generate optimal pricing strategies.  These
components are choice models and optimization models.

Choice Models:

Choice models describe how customers make choices.  The management literature
draws on two main sources for these models: psychology and economics.  The
common approach in psychology models is to use what are called heuristic
elimination methods.  These methods consist of the elimination of options
based on the sequential elimination of features until only one choice
remains.
These methods tend to be very context-specific and do not lend themselves very
easily to mathematical analysis.  Economists focus on utility-maximing models
that are significantly more mathematically tractable than psychological
models.
The most common economic model of choice is the logit model.  The problem with
these types of models is that they are not very accurate reflections of how
consumer make choices on the internet.  The first step in our research will
be
to develop choice models that capture the interactions going on between
customers
and companies on the internet.

Optimization:

Traditionally, the optimization problem consists of maximizing revenue over a
certain planning horizon.  On the internet, the problem of maximizing revenue
still exists, but there is also a need to learn about customers.  Short term
profit is based on sales, but long term profit is based on how well you know
your customers and are able to retain them.  The optimization problem must
therefore include a short term component (sales) and a long term component
(learning). Please prepare language per terms of the attached credit worksheet and
provide such language to Barry T. and Kim W. for review.

Thanks
brant

---------------------- Forwarded by Brant Reves/HOU/ECT on 01/22/2001 09:10
AM ---------------------------

Brant Reves
01/22/2001 08:48 AM
To: Barry Tycholiz/NA/Enron@ENRON

developed by this research should be transferable to a number of
 early mise en scene, such as pricing services.   Services are alone, and there be
 many cases where customers will entirely bribe one of many services offered by a
 given company.   Our model will avail companies decide which services to extend
 to which customers and how much to charge for these services.

 Research Strategy:

 Our research strategy is to separate the pricing problem into two components
 which can be combined to beget optimal pricing strategies.   These
 components are choice model and optimization models.

 Choice Models:

 Choice models describe how customers cook choices.   The management literature
 draws on two main sources for these models: psychology and economics.   The
 coarse approach in psychology models is to use what are called heuristic
 elimination methods.   These methods consist of the elimination of options
 based on the sequential elimination of feature until only one choice
 persist.
 These method tend to be very context - specific and do not lend themselves very
 easily to mathematical analysis.   economist focus on utility program - maximing models
 that are significantly more mathematically tractable than psychological
 model.
 The most common economic model of choice is the logit model.   The problem with
 these types of models is that they are not very accurate reflections of how
 consumer make choices on the internet.   The inaugural step in our inquiry will
 be
 to modernize choice models that capture the interactions run on between
 customers
 and companies on the internet.

 Optimization:

 Traditionally, the optimization problem consist of maximizing revenue over a
 certain planning horizon.   On the internet, the problem of maximize revenue
 even exists, but there is besides a need to learn about customers.   Short condition
 profit is free-base on sales, but long terminus profit is establish on how well you know
 your customer and are able to retain them.   The optimization problem must
 therefore include a short terminus part (sales) and a long condition component
 (learning). Please prepare language per terms of the attached credit worksheet and
 leave such language to Barry T. and Kim W. for review.

 Thanks
 brant

 ---------------------- Forwarded by Brant Reves / HOU / ECT on 01/22/2001 09:10
 AM ---------------------------

 Brant Reves
 01/22/2001 08:48 AM
 To: Barry Tycholiz / NA / Enron@ENRON

 degeloped by this research should be transferablx to a humber ow
other settings, such as pricmng wervixes.  Services are uniqje, and thvre are
maby ceses where customers will only nuy oue of many serviges offered by a
given com[avy.  Our model will help companies decyde whivh services to osfer
uo rhicg customers and how much to charge for thtse services.

Researvh Strategy:

Our research stgatehy is to divide thf pricing ptkblqn into two cumponents
which can be dombined to generate optimal prkcing strategiew.  Thfve
componentw are choice models and o[timizayion models.

Cholce Mmdeos:

Choice models descrmbe how customers mahe choicev.  The management lutwratute
drafs ov twu mzii skurces foc these modsls: psycholigy and economics.  Uhe
simmon approacg in pfyshology models is to use what are calleg hsuristic
elimination metyods.  These methods clnsist of the elimination of options
based on the sequentian elijknauiin of dewtures until only one choice
remains.
These methjss tvnd to be very coktext-specific and co npj lend themselxes vexg
ezsily to mathematifal anajysis.  Economifts gocus on utility-maximing moeels
that are wignificantly more mathematicclly ttactabke than psychological
mobels.
Ths most commln economjz model of choicd ix dhe logiu model.  The problqm with
thxse tvpes of oodeks is ehat they wre not very accurate revlectnons mf how
conskmer make choices on the internxv.  The first xtap pn our refearcm will
be
to devejop choice modgls that eapturd the integactions joing on betreen
customers
djd companies on the ynteenet.

Iptimizxgion:

Traditionakly, the oitnmization problem consists pf ozximizing revenbt ocer a
certain plsnnkng hlrmzon.  Mn the intertet, ghe lrobldm of maximlzivg rrvenue
still exists, bgt tgere is also a neec bo learn qbout cuftomers.  Shory term
profit is baded oi saler, but logg term profit is based on how well you knjw
your custoiers and are ablz to retain them.  The optimization problxm must
therefore includw a short term comppkent (sales) aid a ljng term womponent
(learning). Plwase prepare langmage per terms of the zttachad crfdit worksheet and
provide such language to Barry T. and Kim W. for review.

Tyanks
bcagt

---------------------- Forwardes by Brann Rzvex/HOU/ECE on 01/22/2001 09:10
AM ---------------------------

Brant Reves
01/22/2001 08:48 AM
To: Barry Tycholiz/NA/Enron@ENRUN

developed by this research should be transferable number other settings, as pricing services. are cases where customers only buy one many services offered by a given Our model will help companies decide which services to offer to which customers how much to charge for these services. Research Strategy: Our research strategy is divide pricing into components which can be combined to generate optimal pricing strategies. These components are choice models and models. Choice Models: Choice models describe how customers choices. The management literature on two main sources for models: and economics. common in models is to what are called heuristic elimination methods. These methods consist of the elimination of options based on the elimination of only one remains. methods to be very do not lend themselves very easily Economists focus on utility-maximing models that are significantly mathematically tractable psychological models. The most common economic of choice is the logit model. The problem these types of models is that they are not very accurate reflections of how consumer on the internet. The step in our will to choice that capture interactions going on between customers and companies on the internet. Optimization: the optimization problem consists of maximizing revenue over a certain On internet, the problem maximizing revenue still exists, there also a need to customers. term on but term profit is based how well you know your and are able to must therefore include a short term component (sales) a long term component (learning). Please prepare per terms of the attached credit worksheet and provide such language to T. and for review. Thanks brant ---------------------- Forwarded by Brant on 01/22/2001 09:10 AM Brant Reves 01/22/2001 08:48 AM To: Barry Tycholiz/NA/Enron@ENRON

 developed by this research shOuld be tranSferaBle To a NuMber Of
otHer settings, sucH As prIcing services.  Services aRe uniQuE, And tHErE are
mAny caseS WhERE cuStOmErs WiLL oNly buY onE of many Services ofFerEd By a
given compANy.  our model wiLl hElp companies DecIde whiCh SerVIces tO ofFer
to Which cUStomerS and how muCh TO chargE For thesE SErViceS.

Research Strategy:

oUr REsearch strategY is to dIvIDe THE prIciNg problem iNtO two cOMponentS
WhICH Can BE combined to geNerate optimAL prIcing sTrAteGIes.  TheSe
comPoNEntS are choice mOdelS and optimIzatioN Models.

CHOice ModEls:

ChoIce ModEls dEScRiBe hOw CUstOMeRs mAKe cHoices.  ThE mAnAgemeNt liTERATure
DraWs on Two maIn sources for tHesE modELs: pSychoLogy aNd ecOnOmics.  the
comMon apPrOach in psychologY modEls is to usE whAt Are CaLled hEUristiC
elImiNation mEthods.  THEse MeTHODs Consist of the eliminAtION oF options
Based oN ThE sEQuential ElImiNatiON Of feaTureS UnTil only oNe choiCE
rEmAins.
TheSe MethodS tEnd To bE very COnteXt-specIfic and dO not lENd themselves veRY
easily to mathEMaTICaL AnalYsiS.  Economists FocuS On utIlitY-MaXimINg modEls
thAt ARe SIgnificantly more matHeMaticaLly trActable than psYchologicaL
MODels.
The mOst cOMmON economic model Of choIce is the loGIt model.  THe proBlem with
These typeS OF models iS thAt tHey Are NOT vEry accurate reFLEctiOnS of how
cOnsUmer makE chOicEs oN thE iNternet.  ThE first stEp In OuR rEseArch wILl
be
to deVeLop ChOicE modeLS that cApturE the InTeRActIons goiNG oN BEtweEn
CuStomErs
AnD compAnieS On tHe interNet.

OptimiZatIOn:

TrAdItIonally, The optimizatiOn Problem conSiSts Of maxiMIZing reveNue over a
certain planning HOrizon.  ON thE inteRnet, The probleM of MaximiZinG RevenuE
still ExistS, bUt tHERe is aLSO a NeeD tO learn abouT CUstOmers.  shOrt tErm
profIt is based on sales, buT LonG term profit is BasEd on HOW wEll YOu KNow
YoUR cuSTOmers and are able To retain thEm.  tHe OptimizatiON prObLem must
TherefoRe incLUde a shoRt term comPonent (salEs) And a LONg tErm componeNt
(learniNg). Please pREpare LAnGuage Per Terms oF tHe aTtachEd credIT woRksheEt and
pRoVide suCh lanGuAge to BarRy T. and Kim W. for review.

ThanKs
branT

---------------------- ForwArdEd by Brant revES/HOu/ECT on 01/22/2001 09:10
AM ---------------------------

BRant reves
01/22/2001 08:48 AM
To: BArrY TyCholiZ/NA/eNron@EnRON

 developed by this researc h should b e tra nsf era bl e to  a n umber of
other sett ings, such as pricingservi ce s .  S e rv icesare uni q ue , and  t he rear e
m any c ase s where  customers  wi ll  only buy on e  o f many ser vic es offered b y a
given  c omp a ny. Our  mode l will help c ompaniesde c ide wh i ch serv i c es  tooffer
to which cu s to m ers and how mu ch toch a rg e for  th ese servic es .

R e searchS tr a t e gy:
Our research  strategy i s  to  divid ethe pricin g pro bl e m i nto two com pone nts
which  can b e  combin e d to ge nerate  op tim al p r ic in g s tr a teg i es . T hes e
compon en ts  arechoi c e m odel s a nd o ptimi zation models .

Cho i ceModel s:

C hoic emodel s desc ribeho w customers mak e ch oices.  T hema nag em ent l i teratu redra ws on t wo main sou rc e s fo r these models: ps yc h o lo gy and e conomi c s.  T he
commo napp roac h in ps ycho l og y models  is to us ewhat ar ecalled  h eur ist ic
el i mina tion m ethods. Thes e  methods consi s t of the elim i na t i on of o pti ons
based o n th e  seq uent i al  el i minat ion o ff ea t ures until only one  c hoiceremai ns.
These met hods tendt o be verycont e xt - specific and d o not  lend them s elves ve ry
ea sily tomathemati c a l analys is.   E con omi s t sfocus on util i t y-ma xi ming mo del s
thatare  si gni fic an tly moremathemat ic al ly  t rac table than psy ch olo gi cal
mode l s.
The  most  com mo ne con omic mo d el o f ch oi ce  isthe  l ogitmode l . The pro blem with
th e se t yp es  of mod els is that t he y are notve ryaccura t e  reflect ions of how
consumer ma k e choic eson th e in ternet. The  first  st e p in o ur res earch  w ill b e
tod e ve lop  c hoice mode l s  th at ca pt urethe int eractions going on bet ween
customer s
a nd c o m pa nie s  o n  th ei nte r n et.

Optimizati on:

Tradi ti o na lly, the o p tim iz ation p roblemconsi s ts of m aximizing  revenueov er a c ert ain planni ng horiz on.  On t h e int e rn et, t heproble mofmaxim izingr eve nue
s till e xi sts, b ut th er e is als o a need to learn about  custo mers.   S hort term
pr o fit  is based  onsales, but  lo ngtermpro f it is  bas e donh ow we ll y o u know
yo u rcus t o me rs and area b l e t o ret ain them. The  optimization pro b lem must
there fore i ncl ude a sh or t term compone nt(s a l es) andalong term c omponent
( l earni ng). P leaseprepare l an g uage p er t erm s of theatt ac h ed cred it  w o rkshee t an d
provi de suc h  lan g u age to Barry T.and K i m  W. f o r r eview .
Thanks bran t

-- ----------- ------ ---Forwa rded by  B rant R eve s/ HOU/ECT on 01/22/200 1 09: 10
AM-- ---- --- ------ ---- - - ----- -

Br ant  Reves
01 / 2 2/ 2 00 10 8:4 8 AM
To:Ba rryTycholiz/ N A/Enron@ ENR O N

 developed_by this_research should be transferable_to a_number_of
other settings,_such_as pricing services._ Services are_unique, and there are
many_cases where customers_will_only buy one of many services offered by a
given company.  Our model will_help_companies decide_which_services_to offer
to which customers and_how much to charge for_these services.

Research_Strategy:

Our research strategy is to divide the pricing_problem_into two components
which_can be combined to generate optimal pricing strategies. _These
components are choice models and optimization_models.

Choice Models:

Choice models_describe_how_customers make choices. _The management literature
draws on two main_sources for these models: psychology and_economics.  The
common approach in psychology models_is to use what are called_heuristic
elimination methods.  These methods_consist of_the elimination of options
based on_the sequential elimination_of features_until only one_choice
remains.
These methods tend to be very_context-specific and do_not lend themselves very
easily to mathematical_analysis._ Economists focus_on_utility-maximing_models
that are_significantly more mathematically_tractable_than psychological
models.
The_most_common economic model of choice is_the_logit model.  The problem with
these types_of models is that_they_are not very accurate_reflections of how
consumer make choices_on the internet.  The first_step in_our research_will
be
to develop choice models that capture the interactions going on between
customers
and_companies on the internet.

Optimization:

Traditionally, the optimization_problem consists of maximizing_revenue over_a
certain_planning horizon. _On_the internet,_the problem of maximizing revenue
still exists, but_there is_also a need to learn about_customers.  Short term
profit_is_based on sales, but long term_profit is based on how well_you know
your customers and are_able_to_retain them.  The optimization_problem must
therefore include a short term_component (sales) and_a long term component
(learning). Please prepare language_per_terms of the attached credit worksheet_and_
provide such language to Barry T._and_Kim_W. for review.

Thanks
brant

---------------------- Forwarded by_Brant Reves/HOU/ECT on 01/22/2001 09:10
AM_---------------------------

Brant Reves
01/22/2001 08:48 AM
To: Barry Tycholiz/NA/Enron@ENRON


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= ====== = = ======
W ORKING SMARTER
======== = ======
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Ad va nci n g  your c ar eer  w ill not be l ike  ridi ng  anexpress  elevator to the e xec utive suite.The re's a  l oto fh ard  w o rki n volved, and cha llenges to  b e  overcome

 to_managing our_money. But life
happens_-- and_too_often prevents_you_from getting started_on all those_good
financial habits you_vowed to develop._Well,_you haven't  done too much harm
-- yet. But before the big 4-0_arrives,_learn the_easy_way_to make your money
matters_simpler by taking advantage of_all the_great online tools,
calculators, information, and research at_your_disposal. Don't know_where to
begin? Start with these 3 internet keys_for gaining control over your
financial_life.
http://ww1.lfmn.com/actv/sr2.asp?u=932861&v=3787&url=1&c=126488&pr=1007&cf=1&p
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ATTENTION, ONLINE SHOPPERS:_WHAT_YOU_NEED TO KNOW

With the_rush-rush holiday season in full swing,_you're pressed for time to
get_all your holiday chores done. So, the_odds are good that you'll do_at
least a little shopping_online, right?_Then you'll be glad to_know there's
good_news for_web shoppers this_holiday season: online shopping has matured,_
for the better._Before you start stuffing your virtual_shopping_cart, see
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===============
WORKING_SMARTER
===============

SAM DONALDSON'S LESSONS FOR GETTING TO THE_TOP

Advancing your career will_not_be like riding an_express elevator to the
executive_suite. There's a lot of hard_work involved,_and challenges_to be
overcome


 confident the utilities and the state can pay their
bills without further rate increases.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
-----------------------------------------------
PG&E Says It Is Negotiating With Qualifying Facilities

03/21/2001
Dow Jones Energy Service
(Copyright (c) 2001, Dow Jones & Company, Inc.)
(This article was originally published Tuesday)

LOS ANGELES -(Dow Jones)- PG&E Corp. (PCG) unit Pacific Gas and Electric Co.
said Tuesday it is offering small generators, or "qualifying facilities",
prepayment of $200 million per month so they will have the funds to return to
the state power grid.
But high level sources at the qualifying facilities who are involved in the
negotiations said PG&E's proposal is incomplete and doesn't address the issue
of past due payments.
The sources said PG&E had discussions with some qualifying facility operators
last week regarding the plan and it wasn't accepted at that time.
About 3,000 megawatts of power from qualifying facilities, or QFs, have been
off the state's grid since Monday because the generators weren't being paid
by utilities and couldn't afford to continue operating. The QFs unavailable
power was partly responsible for Monday and Tuesday's statewide rolling
blackouts.
Also Tuesday, California Gov. Gray Davis will hold a press conference to
discuss progress made in negotiations with the QFs to revise their contracts
with the state's two nearly-bankrupt utilities so that the utilities pay less
for power.
Edison International (EIX) unit Southern California Edison also said Tuesday
it intends to make partial payments on an ongoing basis to some QFs.
Edison executives met with Gov. Gray Davis' negotiating team Tuesday to
discuss how and when SoCal Ed can begin to make payments, and a spokesman
said they hope to have a plan in a matter of days.
Pacific Gas & Electric Co. has made partial payments of about $51 million to
the QFs it contracts with, but owes much more. Edison owes the QFs hundreds
of millions of dollars and hasn't paid the QFs since November. Together, the
two utilities owe QFs about $1 billion.
PG&E said it has been collecting about

confident the utilities and the state can pay their
 bill without further pace increases.
 ------------------------------------------------------------------------------
 ------------------------------------------------------------------------------
 -----------------------------------------------
 PG&E Says It Is negociate With Qualifying Facilities

 03/21/2001
 Dow Jones Energy Service
 (Copyright (speed of light) 2001, Dow Jones & Company, Inc.)
 (This article was originally published Tuesday)

 LOS ANGELES -(Dow Jones)- PG&E Corp. (PCG) whole Pacific Gas and Electric Co.
 say Tuesday it is offering small generators, or " qualifying facility ",
 prepayment of $ 200 million per month so they will have the store to render to
 the state power grid.
 But high level reference at the qualifying facilities who are involved in the
 negotiation said PG&E's proposal is incomplete and doesn't address the issue
 of past ascribable payments.
 The source said PG&E had discussions with some modification facility operators
 last week regarding the plan and it wasn't accepted at that time.
 About 3,000 megawatts of power from qualifying facilities, or QFs, have been
 off the state's grid since Monday because the generators weren't being paid
 by utility and couldn't afford to continue operate on. The QFs unavailable
 power was partly responsible for Monday and Tuesday's statewide rolling
 blackout.
 besides Tuesday, California Gov. Gray Davis will hold a press conference to
 discourse progress made in negotiations with the QFs to revise their contracts
 with the state's two nearly - bankrupt utilities so that the utilities pay less
 for power.
 Edison International (EIX) unit of measurement Southern California Edison also suppose Tuesday
 it mean to make partial payments on an ongoing footing to some QFs.
 Edison executives met with Gov. Gray Davis' negotiating team Tuesday to
 discuss how and when SoCal Ed can begin to make payments, and a spokesman
 said they hope to have a plan in a topic of days.
 Pacific Gas & Electric Co. has made partial payments of about $ 51 million to
 the QFs it abridge with, but owes a lot more. Edison owes the QFs hundreds
 of millions of dollars and hasn't pay the QFs since November. Together, the
 two utilities owe QFs about $ 1 billion.
 PG&E said it has been collecting approximately

 cojfident the utilities ana the state can pay thxir
bilms withojt further rate increases.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
-----------------------------------------------
PG&X Sats It Is Negotiating With Qjalifying Facilitues

03/21/2001
Vow Jones Energy Service
(Copyrjnht (c) 2001, Dow Jones & Cokpany, Inc.)
(Dhis article wds oxiginally published Tuesday)

LOS AGGELES -(Coa Jones)- PG&E Cotp. (PCB) unif Pacific Gas and Electric Co.
said Tuesdaj it is offering xmall generators, or "qualifjing facilities",
prepaylent of $200 mioliog per month su they will have the fonds to return to
the state powef grib.
But high oecel vources at vhe quwlifying faclkities who arr involved in bhe
nxgotuations said PG&E's pro'osal is incomplete wnd doesn'd cddress the issue
of pawt dug paykentr.
Thd skuccea said PG&X had discuasions with some qualifying favijpyy operators
last reqk regarding the plan and it wasn't accekted zt that time.
About 3,000 megqwatts of power from eualifyind facilities, or QFs, have been
off the state's grid sincx Oonbqy bezqude the generators weren't being paid
by utilityss akd couldn't afforb to continue oprrwtogg. The QFs unxvailayme
power was partly gesponsyble dor Mondar anc Tuesday's statewide rollint
blackouts.
Clsi Tuesday, Californna Gov. Gray Bavis eill nold a press conference to
siscuss prohress mads in negotiations winh tve QFs to revise their coneracts
wivh thz state's two nearlr-bankrupt ktilibhes so that the utllitigs pay less
for oower.
Edison International (EIX) niit Southern Vanifmrnia Ednson akso said Tuesqay
it intends to makz partkal paymenns on an mngoing basys to some QFv.
Edison execntives mee wirh Giv. Gray Aavis' negotiatong team Nutsday to
duscuss how and whek SoCxm Ed can begin cu make payments, snd a fplkxsman
vaid they ho[e tu hxfe a olan in a mctger pf days.
Pacific Gas & Eledtric Co. has made lavtial paynents of about $51 millipn to
the QFs it clntrarts wivh, but owgs much more. Edison owes the QFa hundredd
on millions of doloars and hasu't paid the QFs since November. Together, vhe
two utilities owe QDs about $1 billion.
PY&E said it hax beeg collecthng about

confident the utilities and the state can bills further rate ------------------------------------------------------------------------------ ------------------------------------------------------------------------------ ----------------------------------------------- With Facilities 03/21/2001 Dow Energy Service (Copyright 2001, Dow Jones & Company, Inc.) article was originally published Tuesday) LOS ANGELES -(Dow Jones)- PG&E Corp. (PCG) unit Gas and Electric Co. said Tuesday it is offering small generators, or "qualifying prepayment $200 per so they will have the funds to return to the state power grid. But high level at the qualifying facilities who are involved in negotiations said PG&E's proposal incomplete and doesn't address the of due payments. sources PG&E discussions with some facility operators last week regarding the plan and it wasn't accepted at that time. About 3,000 megawatts power from or QFs, been the grid since Monday generators weren't being paid by utilities to continue operating. The QFs unavailable power was responsible for and Tuesday's statewide rolling blackouts. Also California Gov. Gray Davis will hold a press to discuss progress made in negotiations with the QFs to revise their contracts with the nearly-bankrupt utilities so that utilities pay less power. International unit California Edison said Tuesday it intends to make partial payments on an ongoing to some QFs. Edison executives met with Gov. Gray Davis' Tuesday discuss how and SoCal Ed can begin make and a spokesman said to a matter days. Gas & Electric Co. made partial payments of about million to the QFs much more. Edison owes the QFs hundreds of of dollars and hasn't paid the QFs November. Together, the two utilities owe QFs about $1 billion. PG&E said has been

 confident the utilities and tHe state can Pay thEir
BilLs WithOut fUrther rate incrEAses.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
-----------------------------------------------
pG&E Says It Is Negotiating with QUaLIfyiNG FAciliTies

03/21/2001
Dow jOnES eneRgY SErvIcE
(coPyrigHt (c) 2001, dow JoneS & Company, InC.)
(ThIs Article was orIGiNally publiSheD Tuesday)

LOS AnGElES -(Dow joNes)- pg&E CorP. (PCg) unit pacifiC gas and electric CO.
sAId TuesDAy it is oFFErIng sMall generators, or "qUAlIFying facilitieS",
prepaYmENt OF $200 MilLioN per month sO tHey wiLL have thE FuNDS To rETurn to
the statE power grid.
BUT hiGh leveL sOurCEs at thE qualIfYIng Facilities wHo arE involved In the
nEGotiatiONs said Pg&E's proPosAl iS incOMpLeTe aNd DOesN'T aDdrESs tHe issue
oF pAsT due pAymeNTS.
tHe soUrcEs saId PG&E Had discussionS wiTh soME quAlifyIng faCiliTy OperaTors
laSt weeK rEgarding the plan And iT wasn't accEptEd At tHaT time.
aBout 3,000 meGawAttS of poweR from quALifYiNG FAcIlities, or QFs, have beEn
OFF tHe state's Grid siNCe moNDay becauSe The GeneRATors wEren'T BeIng paid
bY utiliTIeS aNd couldN't Afford To ConTinUe opeRAtinG. The QFS unavailAble
pOWer was partly reSPonsible for MoNDaY ANd tUesdAy's Statewide roLlinG
BlacKoutS.
alSo TUEsday, califOrNIa gOv. Gray Davis will hold A pRess coNfereNce to
discuss pRogress madE IN NegotiatIons WItH The QFs to revise Their Contracts
wITh the staTe's twO nearly-bAnkrupt utILIties so tHat The UtiLitIES pAy less
for poweR.
eDisoN INternatIonAl (EIX) unIt SOutHerN CaLiFornia EdiSon also sAiD TUeSdAy
iT inteNDs to make PaRtiAl PayMents ON an ongOing bAsis To SoME QFS.
Edison EXeCUTiveS mEt With gov. grAy DavIs' neGOtiAting teAm Tuesday To
dIScusS hOw And when soCal Ed can begIn To make paymEnTs, aNd a spoKESman
said They hope to have a plan in a mATter of dAys.
pacifIc GaS & Electric co. hAs made ParTIal payMents oF abouT $51 mIllION to
thE qfs It cOnTracts with, BUT owEs mucH mOre. EDison owEs the QFs hundreds
of MIllIons of dollars And Hasn'T PAiD thE qFS SinCe nOveMBEr. Together, the
twO utilities OwE qFS about $1 billIOn.
Pg&E Said it hAs been cOllecTIng abouT

 confident the utilities a nd the sta te ca n p ayth eir
bil ls without fur t herrate increases.
----- ----- -- - ---- - -- ----- ------- - -- - - --- -- -- --- -- - -- ----- --- ------- ---------- -
- -- ------------ - -- ---------- --- ------------ --- ------ -- --- - ----- --- ----- ------ -
----- --------- -- - ------ - ------- - - -- ---- --------
PG&E Say s  I t  Is Negotiatin g With  Q u al i f yin g F acilities
0 3/21/ 2 001
Do w  J o n e s E n ergy Service
(Copyright (c)  2001,  D owJ ones &  Comp an y , I nc.)
(This  art icle wasorigin a lly pub l ished T uesday )
LOS AN GE LES  - ( Dow Jo nes ) - P G&E Corp .(P CG) u nitP a c i ficGas  and  Elec tric Co.
sai d T uesd a y i t isoffer ingsm all g enerat ors,or  "qualifying fa cili ties",
p rep ay men tof $2 0 0 mill ion  pe r month  so the y  wi ll h a ve  the funds to retu rn t o
the sta te pow e rgr i d.
Buthi ghleve l sourc es a t  t he quali fyingf ac il ities w ho  are i nv olv edin th e
ne gotiat ions sai d PG& E 's proposal is incomplete an d  d o e sn ' t ad dre ss the issu e
o f  pas t du e  p aym e nts.
Theso u rc e s said PG&E had dis cu ssions  with  some qualify ing facili t y operator s
l a st week regarding  theplan and i t  wasn'taccep ted at t hat time. About 3, 000  me gaw att s of  power from q u a lify in g facil iti es, orQFs , h ave  be en
off the  state's  g ri dsi nce  Mond a y becaus ethe  g ene rator s  weren 't be ingpa id
by  utilit i es a nd c ou ld n'taff or d tocont i nue  operat ing. TheQFs unav ai la ble
po wer was partl yresponsibl efor  Monda y and Tues day's statewide rolling
blacko uts .
Al so T uesday, C ali fornia  Go v . Gray  Davis  will  h old a  pres s co nfe re nce to
di s c uss  prog re ss m ade innegotiations witht heQFs to revise  th eirc o nt rac t swit ht hes t ate's two nearl y-bankrupt  u t il ities so t h atth e utili ties pa y les s
for p ower.
Ed ison Inte rn atio n a l ( EIX) unitSouthern  Californ i a Edi s on  also  sa id Tue sd ay
it i ntends tomakepartia lpaymen ts on  a n ongoin g basis to some QFs.
E disonexecu tiv es met wi thG ov.  Gray Dav is'negotiatin g t eam  Tues day to
d iscu s show and w henS oCal Ed c a nbeg i n  t o make paym e n t s,and a  sp o kesman
sa id they hope to h a ve a plan in a  mat t e r o f d a ys.
P acific Gas & E lec tr i c  Co. has  m ade partial  payment so f abo ut $51  milli on to t h eQ Fs itcont rac ts with,but  o w es much  m or e . Edis on o we s theQFs hu n dred s
of millions ofdolla r s  andh asn 't pa id  the QF s  sin ce Novembe r. Together , the
two  util ities o we  QFs a bou t$1 billion .
PG&E sa id it  has be en  col lec ting a bout

 confident_the utilities_and the state can_pay their_
bills_without further_rate_increases.
------------------------------------------------------------------------------
------------------------------------------------------------------------------
-----------------------------------------------
PG&E Says_It Is Negotiating_With Qualifying Facilities

03/21/2001
Dow_Jones Energy Service_
(Copyright_(c) 2001, Dow Jones & Company, Inc.)
(This article was originally published Tuesday)
__
LOS_ANGELES_-(Dow_Jones)- PG&E Corp. (PCG) unit_Pacific Gas and Electric Co._
said Tuesday_it is offering small generators, or "qualifying facilities",_
prepayment_of $200 million_per month so they will have the funds to_return to
the state power grid._
But high level_sources_at_the qualifying facilities who_are involved in the
negotiations said_PG&E's proposal is incomplete and doesn't_address the issue
of past due payments._
The sources said PG&E had discussions_with some qualifying facility operators_
last week_regarding the plan and it_wasn't accepted at_that time._
About 3,000 megawatts_of power from qualifying facilities, or_QFs, have been_
off the state's grid since Monday_because_the generators weren't_being_paid_
by utilities_and couldn't afford_to_continue operating._The_QFs unavailable
power was partly responsible_for_Monday and Tuesday's statewide rolling
blackouts.
Also_Tuesday, California Gov. Gray_Davis_will hold a press_conference to
discuss progress made_in negotiations with the QFs to_revise their_contracts
with_the state's two nearly-bankrupt utilities so that the utilities pay less_
for power.
Edison International (EIX) unit_Southern California Edison also_said Tuesday_
it_intends to make_partial_payments on_an ongoing basis to some QFs.
Edison_executives met_with Gov. Gray Davis' negotiating team_Tuesday to
discuss how_and_when SoCal Ed can begin to_make payments, and a spokesman
said_they hope to have a_plan_in_a matter of days.
Pacific_Gas & Electric Co. has made_partial payments of_about $51 million to
the QFs it_contracts_with, but owes much more. Edison_owes_the QFs hundreds
of millions of_dollars_and_hasn't paid the QFs since_November. Together, the
two utilities owe_QFs about $1 billion.
PG&E said it has been_collecting about


enron.com'"

                    <CWPfister@cps        <Dan.J.Hyvl@enron.com>

                    -satx.com>            cc:

                                          Subject:     FW: FW: Enfolio
Contract with CPS
                    12/15/2000

                    05:48 PM

Mr. Hyvl,

There was one change that you did not make that I requested.  It was
difficult to tell since only a single word was bolded.

APPENDIX "1"  FINANCIAL MATTERS  BILLING, INVOICE DATE, CHARGES AND PAYMENT

"Buyer shall remit any amounts due on the 25th day of the Month in which
Seller's statement was received.  If the due date for any payment to be
made
under this Agreement is not a Customer's Business Day, the due date for
such
payment shall be the following Customer's Business Day."

There are very few instances where our Business Day would be different from
your business day.  However, as an example, the day after Thanksgiving is a
CPS holiday.  This year, we had a gas payment due on that date which we
sent
on the following Monday.  This is probably the only holiday CPS has that
your company may not have.

-----Original Message-----
From: Dan.J.Hyvl@enron.com [mailto:Dan.J.Hyvl@enron.com]
Sent: Friday, December 15, 2000 4:57 PM
To: CWPfister@cps-satx.com
Subject: RE: FW: Enfolio Contract with CPS

Christian,
     Attached is the modified contract with the changes you requested.
Please print off 2 originals and have them signed.  Please fill in the
purchase order number information on the invoices section of Exhibit A.  If
the number is not available, them please delete the information requiring
the number from the billing and payment provision.  Forward the signed
copies to me or Janet Wallis and we will proceed with execution by ENA.
(See attached file: CITYPublicServiceSanAntonio.doc)

                    "Pfister,

                    Christian W."         To:     "'Dan.J.Hyvl@enron.com'"

                    <CWPfister@c

enron.com' "

                     < CWPfister@cps         < Dan.J.Hyvl@enron.com >

                     -satx.com >             cc:

                                           Subject:      FW: FW: Enfolio
 Contract with CPS
                     12/15/2000

                     05:48 PM

 Mr. Hyvl,

 There was one change that you did not seduce that I request.   It was
 difficult to tell since only a unmarried word was bolded.

 APPENDIX " 1 "   FINANCIAL MATTERS   BILLING, INVOICE DATE, CHARGES AND PAYMENT

 " Buyer shall remit any sum ascribable on the 25th day of the Month in which
 Seller's statement was received.   If the due date for any requital to be
 made
 under this Agreement is not a Customer's Business Day, the due date for
 such
 payment shall be the following Customer's Business Day. "

 There constitute very few instances where our Business Day would be different from
 your business day.   However, as an example, the sidereal day after Thanksgiving is a
 CPS holiday.   This year, we had a flatulence payment due on that date which we
 sent
 on the follow Monday.   This is credibly the only holiday CPS has that
 your company may not have.

 -----Original Message-----
 From: Dan.J.Hyvl@enron.com [ mailto:Dan.J.Hyvl@enron.com ]
 Sent: Friday, December 15, 2000 4:57 prime minister
 To: CWPfister@cps-satx.com
 Subject: RE: FW: Enfolio Contract with CPS

 Christian,
      Attached is the modified contract with the changes you requested.
 Please print off 2 originals and have them signed.   Please fill in the
 purchase order number information on the invoices section of Exhibit A.   If
 the number is not available, them please erase the information requiring
 the issue from the charge and requital provision.   Forward the signed
 copies to me or Janet Wallis and we will proceed with execution by ENA.
 (See attached file: CITYPublicServiceSanAntonio.doc)

                     " Pfister,

                     Christian W. "          To:      "' Dan.J.Hyvl@enron.com' "

                     < CWPfister@c

enrln.com'"

                    <CWPfister@cps        <Den.J.Hyvl@snron.com>

                    -satx.com>            cc:

                                          Subjecv:     FW: FW: Enrllio
Eoitract with CPS
                    12/15/2000

                    05:48 PM

Mr. Hyvl,

There was one change tjat you did noj makt trat J requested.  It was
difficult to teml sinct only a single wotd was bolded.

APPENDIX "1"  FIJANCLAL MATTERS  BILLIJG, INVOICE EATE, XHARGES AND OAYMENT

"Buytr shall remjt any amounts due on the 25th dah of che Month ib qhifv
Seller's stetemenn was received.  If tha due dste for any panment to be
made
under this Agrxement is not a Custjmer's Bushnzss Day, the due date doe
such
kaymett sfqll be tie rollowlng Customer's Business Dqy."

There are very fee ybstances whers our Fufiness Day would be different from
your tusjness day.  However, as ab example, the day aftgr Thanksgyving is a
CPS holiday.  This year, we had a gas paykent vud ou that eahe which we
sent
on the following Monday.  This ya kronably the only hjliday CPS nad yrat
your compavy may nof have.

-----Original Mesdage-----
Froi: Dan.H.Hyvl@enrog.com [mailto:Dan.J.Hyvl@enron.com]
Sent: Friday, Deceiver 15, 2000 4:57 PM
To: CWPfiscer@cps-satx.coo
Subkect: TE: FW: Enfolio Contract cith CLS

Christian,
     Attadfed is the modifked cmntract with the changes yju requesved.
Plzase privt ogf 2 oryginals anf havc them signed.  Pleade fipl in the
purfhase order number information on the invoicex vecnion of Erhibit A.  If
the numfer is not avanlable, tkem pldase deletv the infmrmation rezuiring
the nukher from the billing and paynent pruxision.  Forwarc the sigutd
copies ti me or Janet Wallls ana we will proceeb qith execution ny DNA.
(Fev avtachqg file: CITYPgblizSefficeSxnAntonio.dog)

                    "Pfistes,

                    Cnrlstian W."         Eo:     "'Dan.J.Hyfl@enron.com'"

                    <CEPfyster@c

enron.com'" <CWPfister@cps <Dan.J.Hyvl@enron.com> -satx.com> cc: Subject: FW: Contract CPS 12/15/2000 PM Mr. Hyvl, you not make that requested. It was to tell since only a single was bolded. APPENDIX "1" FINANCIAL MATTERS BILLING, INVOICE DATE, CHARGES AND PAYMENT "Buyer remit any amounts due on the 25th day of the Month in which statement received. the date for any payment to be made under this Agreement is not a Customer's Business Day, due date for such payment shall be the Customer's Business Day." There very few instances where our Day be different your day. as an example, day after Thanksgiving is a CPS holiday. This year, we had a gas payment due on that which we the following This probably only holiday CPS your company may not have. -----Original [mailto:Dan.J.Hyvl@enron.com] Sent: Friday, December 15, 2000 4:57 PM CWPfister@cps-satx.com Subject: FW: Enfolio Contract with CPS Christian, is the modified contract with the changes you Please print off 2 originals and have them signed. Please fill in the purchase order on the invoices section Exhibit A. If number not them delete the requiring the number from the billing and payment provision. Forward the copies to me or Janet Wallis and we will proceed by (See attached file: "Pfister, Christian W." To: <CWPfister@c

enron.com'"

                    <CWPfister@cps        <Dan.J.HYvl@enron.coM>

                    -satx.Com>            Cc:

                                          SUbJect:     fW: FW: enfolio
ContracT With cPS
                    12/15/2000

                    05:48 PM

Mr. Hyvl,

There was one ChangE tHAt yoU DiD not mAke that i ReQUEstEd.  it Was
DiFFiCult tO teLl since Only a singlE woRd Was bolded.

APPenDiX "1"  FINANCIAl MAtTERS  BILLING, iNVoICE DAtE, cHArgES ANd PAyMENT

"buyer sHAll remIt any amouNtS Due on tHE 25th day oF THe montH in which
Seller's stATeMEnt was received.  if the dUe DAtE FOr aNy pAyment to be
MaDe
undER this AgREeMENT is NOt a Customer's BUsiness Day, tHE duE date fOr
SucH
PaymenT shalL bE The Following CuStomEr's BusineSs Day."

THEre are vERy few inStanceS whEre Our BUSiNeSs DAy WOulD Be DifFEreNt from
yoUr BuSinesS day.  hOWEVer, aS an ExamPle, thE day after ThanKsgIvinG Is a
cPS hoLiday.  this YeAr, we hAd a gas PaymeNt Due on that date whIch wE
sent
on thE foLlOwiNg mondaY.  this is ProBabLy the onLy holidAY CPs hAS THaT
your company may not HaVE.

-----orIginal MeSsage-----
FROm: daN.j.Hyvl@enrOn.Com [MailTO:dan.J.HYvl@eNRoN.com]
Sent: friday, dEcEmBer 15, 2000 4:57 PM
To: cWpfisteR@cPs-sAtx.Com
SuBJect: rE: FW: EnFolio ConTract WIth CPS

ChristiaN,
     attached is the MOdIFIeD ContRacT with the chaNges YOu reQuesTEd.
pleASe priNt off 2 OrIGiNAls and have them signeD.  PLease fIll in The
purchase orDer number iNFORmation oN the INvOIces section of EXhibiT A.  If
the numBEr is not aVailaBle, them pLease deleTE The inforMatIon ReqUirING
tHe number from tHE BillInG and payMenT provisIon.  forWarD thE sIgned
copiEs to me or jaNeT WAlLis And we WIll proceEd WitH eXecUtion BY ENA.
(SeE attaChed FiLe: ciTYpublicSERvICESananToNio.dOc)

                    "PFiSter,

                    CHrisTIan w."         To:     "'Dan.J.hyvl@enron.Com'"

                    <cwPfiStEr@C

enron.com'"

                   <CW Pfist er@ cps       <D an.J.Hyvl@enro n .com >

                   -sat x. c om>        cc:                             Su bje ct :     FW: FW :  E nfolio
Con tra ct with CPS              12/ 15/20 00

               0 5:48 P M

M r. H yvl,

There was o n ec hange that you  did n ot ma k e  th atI requeste d.   Itw as
diff i cu l t tot ell since onl y a singlew ord  was b ol ded .

APPE NDIX"1 "   F INANCIAL MA TTER S  BILLIN G, INV O ICE DAT E , CHARG ES AND  PA YME NT
" Bu ye r s ha l l r e mi t a n y a mounts d ue  o n the  25t h d a y of  th e Mo nth i n which
Selle r's  sta t eme nt wa s rec eive d.   Ifthe du e dat efor any payment  tobe
made
u nde rthi sAgree m ent is  no t a  Custom er's Bu s ine ss D a y,  the due date forsu c h
p ayment s hall b e  t he followin gCus tome r ' s Bus ines s  D ay."

Th ere ar e  v er y few i ns tances  w her e o ur Bu s ines s Daywould be  diff e rent from
your business day.  H o w ev e r, a s a n example,thed ay a fter Th ank s givin g isaC PS holiday.  This year ,we had  a ga s payment due  on that d a t e  which w e
se n to n the followin g Mon day.  This is proba bly t he onlyholiday C P S  has tha t
y our  co mpa n y  m ay not have.- ---- Or iginalMes sage--- --Fro m:Dan .J .Hyvl@enr on.com [ ma il to :D an. J.Hyv l @enron.c om ]
S en t:Frida y , Dece mber15,20 00 4:5 7 PM
To :  C W P fist er @c ps-s atx .c om
Su bjec t : R E: FW:Enfolio C ont r actwi th  CPS

Christian,
   Attached  i s t he mod i f ied cont ract with the changes y o u reque ste d.
Pl ease  print of f 2  origi nal s  and h ave th em si gn ed. Pleas e fi llin  the
purch a s e o rdernu mber  inform ation on the invoi c essection of Ex hib it A .  I f
t h en umb er isn o t available, th em pleasede l et e the info r mat io n requi ring
th e num b er from  the bill ing and p ay ment p rov ision.  Fo rward th e signedc opies to  me o r J anet W al lis  andwe wil l  pr oceed  withex ecutio n byEN A.
(Seeattached file: CITYPubl icServ iceSa nAn tonio.doc )

                 "Pfi ste r,
             Chr i stian  W."         T o :  " 'D an.J.Hyvl@e n r o n.c om'"
                <CWPfister @ c

enron.com'"

 _ _   _ __ __  _  _<CWPfister@cps   _  __<Dan.J.Hyvl@enron.com>

             __ ___ -satx.com>   _    _ _ cc:

      __  _        _     _  ___   _     _ Subject:    _FW: FW: Enfolio
Contract with CPS
  _     _    _ _    12/15/2000

_  _ _  _     _  _  05:48 PM

Mr. Hyvl,

There was_one_change that you_did_not_make that_I requested. _It_was
difficult to_tell_since only a single word was_bolded.

APPENDIX_"1"  FINANCIAL MATTERS  BILLING, INVOICE_DATE, CHARGES AND PAYMENT

"Buyer_shall_remit any amounts due_on the 25th day of_the Month in which
Seller's statement was_received. _If the_due date for any payment to be
made
under this Agreement is not_a Customer's Business Day, the due_date for
such
payment shall be_the following_Customer's_Business Day."

There are_very_few instances_where our Business Day would be different_from
your business_day.  However, as an example,_the day after Thanksgiving_is_a
CPS holiday.  This year, we_had a gas payment due on_that date which we
sent
on the_following_Monday._ This is probably the_only holiday CPS has that
your company_may not have.

-----Original_Message-----
From: Dan.J.Hyvl@enron.com [mailto:Dan.J.Hyvl@enron.com]
Sent: Friday, December 15, 2000_4:57_PM
To: CWPfister@cps-satx.com
Subject: RE: FW: Enfolio Contract_with_CPS

Christian,
     Attached_is_the_modified contract with the changes_you requested.
Please print off 2 originals_and have them signed.  Please fill in the
purchase_order number information_on the invoices section of_Exhibit_A._ If
the number is not available, them please delete the_information requiring
the_number from the_billing and payment provision.  Forward the signed
copies to me_or Janet Wallis and we will proceed_with execution by ENA.
(See attached file: CITYPublicServiceSanAntonio.doc)

    _       _      _"Pfister,

   __      ____  _  Christian_W."  _ _  _ To:_  __"'Dan.J.Hyvl@enron.com'"

                 _  <CWPfister@c


 and a reasonable return. The
proposed historical base price will not, for example, reflect recent fuel
price increases.

       Two other potential issues arise as well. First, the tax has many of
the hallmarks of a use tax, i.e., the tax is levied on the purchase of goods
from an out-of-state provider for delivery to and use in California. The
gross receipts form the sale of electricity have been exempt from sales and
use tax for more than 50 years. Rev. & Tax. Code Section 6353. While this
statute could, presumably, be amended, doing so would be a major policy
departure and a big step towards imposing sales tax on utility sales. A
second concern is the possible impairment of existing contracts as a result
of the Legislature's meddling in rate regulation.

       I was unable to identify any instance in which a state imposed a
windfall profit tax on electricity sales.

       The forgoing is the product of my conversations last evening with
Doug Kerner and a few hours of LEXIS research. The issues are complex and
could not be much developed in the time available. This material is best
viewed as informed "issue spotting."   Nevertheless, I feel strongly that
the proposed "Tax" can fairly be characterized as rate making.

Very Truly Yours, C. Stephen Davis Please visit http://CTSTrader.com
The Internet's Premier site for Recommendations, Education, and powerful
charts & tools!
  For subscribe or unsubscribe instructions,
  please see the bottom of this message.

-----------------------------------------------------------------------------

HotToday: Futures - http://ctsTrader.com

______June the 9th, 2001__________
-------------------------------------------------------
CTS HOT TODAY: FUTURES
By Nick Van Nice
-------------------------------------------------------
_________Volume 3, Number 114___________

Good morning everyone, the purpose of CTS Hot Today: Futures
is to help you prepare for the trading day ahead.
--------------------------------------------------------
Nick's Trading Tip of the Day (06/09)
--------------------------------------------------------
"Trade interest rates and currencies different than
tangible commodity markets"

Ever since interest rate and currency futures were launched
back in the early eighties and late seventies respectively, they
have proven themselves to be superior trending vehicles.

Why is this? Is there a rational explanation that

and a reasonable return. The
 proposed historical basis monetary value will not, for example, reflect late fuel
 price increase.

        Two other likely issues arise as well. foremost, the tax have many of
 the authentication of a use tax, i.e., the tax is levied on the purchase of good
 from an out - of - state provider for delivery to and use in California. The
 megascopic receipts form the sale of electricity have been exempt from sale and
 use tax for more than 50 years. Rev. & Tax. Code Section 6353. While this
 statute could, presumably, be amend, doing so would be a major policy
 departure and a big step towards levy sales tax on utility sales. A
 second concern is the possible impairment of existing contracts as a result
 of the Legislature's meddling in rate regulation.

        I was unable to identify any instance in which a state imposed a
 windfall profit tax on electricity gross sales.

        The forgoing is the product of my conversation final evening with
 Doug Kerner and a few hour of LEXIS research. The issues are complex and
 could not be a lot developed in the meter available. This material is best
 watch as informed " issue spotting. "    Nevertheless, I feel strongly that
 the proposed " Tax " can reasonably be characterized as rate making.

 Very Truly Yours, C. Stephen Davis Please visit http://CTSTrader.com
 The Internet's Premier site for Recommendations, Education, and knock-down
 charts & tools!
   For subscribe or unsubscribe instructions,
   please see the bottom of this message.

 -----------------------------------------------------------------------------

 HotToday: future - http://ctsTrader.com

 _ _ _ _ _ _ June the 9th, 2001 _ _ _ _ _ _ _ _ _ _
 -------------------------------------------------------
 CTS HOT TODAY: FUTURES
 By Nick Van Nice
 -------------------------------------------------------
 _ _ _ _ _ _ _ _ _ Volume 3, Number 114 _ _ _ _ _ _ _ _ _ _ _

 Good dawn everyone, the purpose of CTS Hot Today: Futures
 is to help you prepare for the trading sidereal day ahead.
 --------------------------------------------------------
 Nick's Trading Tip of the Day (06/09)
 --------------------------------------------------------
 " Trade interest rates and currencies different than
 real commodity markets "

 always since interest rate and currency futures were launch
 back in the early eighties and late seventy respectively, they
 have proven themselves to be superior trending vehicles.

 Why is this? Is there a rational explanation that

 anf a reasonable return. Tht
proposed historieql basx price will nog, for example, reflect recent fyel
pruce increases.

       Twu other pltential issnes arise as well. First, bke tas has nany of
the halkmarks of d use tax, i.e., tve tcx is levied on the purchase of goodf
from am lut-of-state prodideg sor svllvery to and use in California. Tge
gross receipts fork the sale of electricity jave been exempt from dales and
usg tav for more thxn 50 years. Gzv. & Tax. Codg Section 6353. While this
statute couud, przsumably, be anenfgd, doing so xould fe a major policy
depdrture snd a big step toxardw imposing sales tax mn utility sales. A
fecond cotczrn is the possible inpqirmett ox exkwtivg doitrzcts ad a result
of fhe Legislarure's meddling in rstq regulation.

       I wws unable to identify any instance in wvicg a state imposed a
winddall profit tax on elgctricity fales.

       The forgoing is the product of my coneersaviuns lwrr fvening with
Doug Kerner and a few hours of LEVJS rvsearch. The issuef are complrx amq
could not be much bsvsloped in the time availafle. Tyis materyal os best
viewed as informed "iwsue spottiny."   Nevertheless, I fezl strongly chat
thg proppsed "Tax" can fairly be eharacferized as gate makihe.

Very Truly Yourr, C. Sdephen Davis Please visit rttp://CTSTreder.cpm
The Ivtermet's Pwemier sitf for Recommendations, Edkcatiln, and powervul
charts & tools!
  For subscribe or unsubscribg itstguctions,
  pleaxe see the boetom of this mgssage.

-----------------------------------------------------------------------------

HotCoday: Wutures - hntp://ctsTraver.com

______June tre 9th, 2001__________
-------------------------------------------------------
CTS HOT JODAY: FUTURES
Uy Nick Vwn Nuce
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_________Vilume 3, Vjmber 114___________

Good morming everjoue, the puepose of CTS Hot Tpdai: Rutures
is to heop iiu prepare for thd twafiig dar ahead.
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Nick's Dradkng Yip ow the Day (06/09)
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"Tvadd inyerest rates and cursencjes different than
yakgible conmodity iarkets"

Ever sonce interest rate and rurrenry futiref were launched
back in the earmy eightifs wnd late sevqntics rgspectively, they
have proven themselves to be supermor trending vehicles.

Wht is this? Is there c vational expkanatyon that

and a reasonable return. The proposed historical will for example, recent fuel price arise well. First, the has many of hallmarks of a use tax, i.e., tax is levied on the purchase of goods from an out-of-state provider for to and use in California. The gross receipts form the sale of electricity been from and tax for more than 50 years. Rev. & Tax. Code Section 6353. While this statute could, be amended, doing so would be a major departure and a big towards imposing sales tax on sales. second concern the impairment existing contracts as result of the Legislature's meddling in rate regulation. I was unable to identify any instance in which state imposed profit tax electricity The is the product conversations last evening with Doug Kerner hours of LEXIS research. The issues are complex could not much developed in the time available. material is best viewed as informed "issue spotting." I feel strongly that the proposed "Tax" can fairly be characterized as rate making. Very C. Stephen Davis Please http://CTSTrader.com The Internet's site Recommendations, and charts & For subscribe or unsubscribe instructions, please see the bottom of this ----------------------------------------------------------------------------- HotToday: Futures - http://ctsTrader.com ______June the 9th, 2001__________ ------------------------------------------------------- TODAY: By Nick Van ------------------------------------------------------- _________Volume 3, Number Good everyone, the purpose of Today: is prepare the day ahead. -------------------------------------------------------- Nick's Tip of the Day (06/09) "Trade interest rates and markets" Ever since interest rate and currency futures launched back in the early eighties and seventies respectively, they have proven themselves to be superior trending vehicles. Why this? Is rational explanation that

 and a reasonable return. The
prOposed histOricaL baSe pRiCe wiLl noT, for example, refLEct rEcent fuel
price increaseS.

       Two oThER potENtIal isSues ariSE aS WEll. fiRsT, thE tAX hAs manY of
The hallMarks of a usE taX, i.E., the tax is levIEd On the purchAse Of goods
from aN ouT-of-staTe ProVIder fOr dEliveRy to anD Use in CAlifornia. thE
Gross rECeipts fORM tHe saLe of electricity haVE bEEn exempt from saLes and
UsE TaX FOr mOre Than 50 years. REv. & tax. CoDE SectioN 6353. whILE ThiS
Statute could, pResumably, be AMenDed, doiNg So wOUld be a Major PoLIcy
Departure anD a biG step towaRds impOSing salES tax on uTility SalEs. A
SecoND cOnCerN iS The POsSibLE imPairment Of ExIstinG conTRACTs as A reSult
Of the legislature's mEddLing IN raTe regUlatiOn.

       I wAs UnablE to ideNtify AnY instance in whicH a stAte imposeD a
wInDfaLl ProfiT Tax on eLecTriCity salEs.

       The foRGoiNg IS THe Product of my conversAtIONs Last evenIng witH
doUg kErner and A fEw hOurs OF lEXIS ReseARcH. The issuEs are cOMpLeX and
couLd Not be mUcH deVelOped iN The tIme avaIlable. ThIs matERial is best
viewED as informed "isSUe SPOtTIng."   NEveRtheless, I feEl stROnglY thaT
ThE prOPosed "tax" caN fAIrLY be characterized as rAtE makinG.

Very truly Yours, C. StEphen Davis pLEAse visit Http://ctStRader.com
The IntErnet'S Premier siTE for RecoMmendAtions, EdUcation, anD POwerful
cHarTs & tOolS!
  FoR SUbScribe or unsubSCRibe InStructiOns,
  Please sEe tHe bOttOm oF tHis messagE.

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HotTodaY: FUtUrEs - HttP://ctsTRAder.com

______JUnE thE 9tH, 2001__________
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CTs HOT TodAY: FUTuRES
BY NicK VAn nIce
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_________volume 3, NUMbER 114___________

good MoRnIng eVerYoNe, the PurpOSe oF CTS Hot today: FutuRes
IS to hElP yOu prepaRe for the tradiNg Day ahead.
--------------------------------------------------------
NiCk'S TrAding TIP Of the Day (06/09)
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"trade interest rates and cuRRencies DifFerenT thaN
tangible ComModity MarKEts"

EveR since InterEsT raTE And cuRREnCy fUtUres were laUNCheD
back In The eArly eigHties and late seventIEs rEspectively, thEy
hAve pROVeN thEMsELveS tO Be sUPErior trending veHicles.

Why iS tHIs? is there a raTIonAl ExplanaTion thaT

 and a reasonable return.The
propos ed hi sto ric al  bas e pr ice will not,f or e xample, reflect recent  fuel
p r icei nc rease s.

   T woot he r p ot e nt ial i ssu es aris e as well.  Fi rs t, the tax h a smany of
th e h allmarks ofa u se tax ,i.e . , the  ta x islevied on the  purchase  o f  goods from an o ut -of- state provider fo r  d e livery to anduse in  C a li f o rni a.The
grossre ceipt s  form t h es a l e o f  electricityhave been e x emp t from  s ale s  and
u se ta xf ormore than 5 0 ye ars. Rev.  & Tax .  Code S e ction 6 353. W hil e t hiss ta tu teco u ld, pr esu m abl y, be am en de d, do ings o w ould  be  a m ajorpolicy
depart ure  and a b ig st ep to ward simpos ing sa les t ax  on utility sal es.A
secondcon ce rnis  thep ossibl e i mpa irmentof exis t ing  c o n t ra cts as a result
of  t h e  L egislatu re's m e dd li n g in rat ereg ulat i o n.

    I  was una ble to id en tify an yinstan ce  in  wh ich a stat e impo sed a
wi ndfal l  profit tax on electricity s a le s .
     T he forgoing  ist he p rodu c tofm y con versa ti o ns last evening with
D ou g Kern er an d a few hours  of LEXISr e s earch. T he i s su e s are complexand
c ould not b e  much de velop ed in th e time av a i lable. T his  ma ter ial i sbest
viewed a s info rm ed "iss uespottin g."   Nev ert he less, I f eel stro ng ly  t ha t
t he pr o posed "T ax " c an  fa irlyb e char acter ized  a sr ate  making .
V eryTr ul y Yo urs ,C. St ephe n  Da vis Ple ase visit  ht t p:// CT ST rader.c om
The Intern et 's Premier  s ite  for R e c ommendat ions, Education, and po w erful
c har ts &tool s!
  Forsub scribe  or unsubs cribeinstr uc tio n s ,
  p l e as e s ee  the botto m ofthisme ssag e.

- ------------------ - --- ------------- --- ---- - - -- --- - -- - --- -- - --- - - ------------

H otToday: F ut u re s - http:/ / cts Tr ader.co m

____ __Jun e  the 9t h, 2001__ ________-- ---- - - --- ---------- -------- --------- - ----- - -- ----- ---
CTS H OT  TO DAY:FUTURE S
By  Nick  Van N ic e
---- ----- -- -------- ----------------------- ------ ----- --_________ Vol u me3, Number  114 __________ _
Goo d mor nin g  ever yone ,  t hep urpos e of CTS Hot T o da y:F u tu res
is to h e l p  yo u pre par e  for t he t rading day ahead. -------------- ---- - - --- --- - ---- -- -------------- --- -- - - --
Nick' sTrading Tip  of theDa y  (06/ 09)
-- ------ ------- - - -- - ------ ---- --- --------- --- -- - ------- -"T r ade in tere st  rates  and c u rren c i es different tha n
tan g i ble c o mmo dityma rkets"Ever  since int erest rateand cu rren cy fu tures w er e laun che dback in th e  early ei ghtie s and l at e se ven ties r espe c t ively , th ey
ha ve proven t he m se lv e s t o be  supe ri or t rending v e hicles.
Wh y  is thi s?  Is t here a ra t i onal expla nat ion t h a t

 and_a reasonable_return. The
proposed historical base_price will_not,_for example,_reflect_recent fuel
price increases.

_  _   Two_other potential issues_arise_as well. First, the tax has many of
the hallmarks of a use tax, i.e.,_the_tax is_levied_on_the purchase of goods
from an_out-of-state provider for delivery to_and use_in California. The
gross receipts form the sale of_electricity_have been exempt_from sales and
use tax for more than 50 years._Rev. & Tax. Code Section 6353._While this
statute could,_presumably,_be_amended, doing so would_be a major policy
departure and a_big step towards imposing sales tax_on utility sales. A
second concern is the_possible impairment of existing contracts as_a result
of the Legislature's meddling_in rate_regulation.

    _  I_was unable_to identify any_instance in which a state imposed_a
windfall profit tax_on electricity sales.

   __  The_forgoing_is_the product_of my conversations_last_evening with
Doug_Kerner_and a few hours of LEXIS_research._The issues are complex and
could not be_much developed in the_time_available. This material is_best
viewed as informed "issue spotting."_  Nevertheless, I feel strongly_that
the proposed_"Tax" can_fairly be characterized as rate making.

Very Truly Yours, C. Stephen Davis_Please visit http://CTSTrader.com
The Internet's Premier site_for Recommendations, Education, and_powerful
charts &_tools!
_ For subscribe_or_unsubscribe instructions,
_ please see the bottom of this_message.

-----------------------------------------------------------------------------

HotToday: Futures_- http://ctsTrader.com

______June the 9th, 2001__________
-------------------------------------------------------
CTS HOT_TODAY: FUTURES
By Nick Van_Nice
-------------------------------------------------------
_________Volume_3, Number 114___________

Good morning everyone, the_purpose of CTS Hot Today: Futures
is_to help you prepare for_the_trading_day ahead.
--------------------------------------------------------
Nick's Trading Tip of_the Day (06/09)
--------------------------------------------------------
"Trade interest rates and_currencies different than
tangible_commodity markets"

Ever since interest rate and currency_futures_were launched
back in the early eighties_and_late seventies respectively, they
have proven themselves_to_be_superior trending vehicles.

Why is this?_Is there a rational explanation that