IN: This is an email
Hello Ken As we have not had a recent "daily update" from you - I write inquiring about the status of OUR company. We heard about the acquisition discussions with Dynegy through the press (NOT from Enron's management!). Clearly, this does not engender confidence in the management's communication philosophy. We also heard that there is a meeting planned with Enron's banks on Friday - again through the press! Communication failed again. Further reductions in confidence came as Enron restated it's financial statements for the period 1997 through 2000. Again this news was provided by the press! Couple of questions for you - who were the commercial folks putting together the LJM, Chewco etc. deals? Who were senior managers approving these deals? Perhaps Enron should part company with some of those folks too. Where was the board and where were you when these deals were being done? There appears to have been no corporate governance at the relevant periods! On a personal level, I have invested many years in this company. I currently have a holding of approx. 4,500 shares which I purchased because I believed in the company. I also have numerous share options. Unfortunately, this episode has obliterated my confidence in management and in particular in you and Jeff Skilling. I suspect you guys are ok - as you had the foresight (knowledge?) to cash out your holding during the latter part of last year and most of this year. Please be aware that the fate of thousands of people rests in your hands. I would be interested to hear your views.

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OUT: Update for Wednesday/Thursday?

IN: This is an email
Hey, What's going on? I've had a fabulous day...at least it hasn't been boring. Anything interesting in your world? It's the first night and I already want to skip my GMAT class. I may come visit you before I go to my class. I don't want to hang around down here until 6. That is if you aren't too busy today. Talk to ya later, Robin

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OUT: What'cha doin'

IN: This is an email
This provision is an election which we have added to the Schedule for governmental entities. I believe that it is intended to eliminate any confusion that historically arose during the debate between "First Method" (one-way payments) and "Second Method" (two-way payments) for Early Termination purposes. Although I can't find a good reason to continue to use this provision with an ISDA (except that it emphasizes the point), I can understand why we may have added it to a pre-ISDA agreement with a governmental. The only example that I could locate was our September 21, 1995 Master Agreement with Reedy Creek Improvement District. For those of you who have never seen this form, it was one of the two types of master agreements developed by ECT before we became conversant with ISDA. Because these forms didn't contemplate municipal counterparties, we had to add many of the ISDA U.S. Municipal Counterparty Schedule provisions. The Part 5(b)(k) provision originally appeared in this early agreement. It was included in the "Event of Change" section [5F(4)] (which is tantamount to the ISDA concept of "Illegality", a "Termination Event"). I think it was probably included because in the ISDA, Second Method is the automatic payment method if the parties fail to make a specific designation for Early Termination purposes, but there isn't a comparable provision in the old ECT form.

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OUT:
"Termination Payments" - Part 5 (b)(k) to the ISDA Master Agreement