Subject: "IOU's: Online Trading".

Body: I have reviewed Tana's list of North American utilities and have the following comments: (1) I have tried to eliminate all governmentals and regulated entities. However, I suggest that we ask Kevin Leitao to take a quick review for obvious errors. (However, I don't want Kevin to prepare unlimited research on our behalf. I'll discuss with him). (2) I suggest that we ask Canadian counsel to review Canadian utilities on authority/regulatory issues. In my experience, Canadian outside counsel was reluctant to even comment on utilities located in provinces other than outside counsel's domicile. (3) The online omnibus does not contain the ISDA Section 3(c) rep as to absence of litigation. This rep drags in governmental bodies and all agencies (hence, a state PUC). Thus, online parties will rep as to authority to transact each time they trade but we will not know about potential PUC issues. (Under the ISDA, a party would have to notifiy us of a "Regulatory Development" and we may have an Event of Default for failure to notify; we may also have a Termination Event under our current format).

Subject: "Straddle Problem".

Body: Dan, I wanted to let you know that we are working on the problem that we are having with the straddle deals being booked into Tagg. I also wanted to bring to your attention that these deals tested correctly in Tagg Stage, so we are trying to sort out what is happening in Production. I am working with Tagg IT to resolve the issue. I will keep you posted. Thanks TARA

Subject: "Retention Agreement".

Body: Mich, Lavo wants to do following: Draft a cover letter that says "Attached is form of retention agreement which will be good at the conclusion of the auction on Jan 10/11, no matter who the counter party is, providing however that the successful bidder will at least 1. Have a bonus pool of at least 15% of EBIT if NETCO makes it forecasted earnings 2. Is at least AA credit rated 3. Agrees to the other provisions in the draft ASA relative to honoring Enron service and other employee matters. Take the Citibank doc we have been working on and make necessary amendments to remove references to counter party. We may need to give ourselves some wiggle room on how retention and bonus awards may vest. Can we get a draft of above this morning? David

Subject: "meeting with Ray Bowen".

Body:
Elizabeth, Andrea and I are scheduled to meet with Ray Bowen on Monday to review fundamentals trends and developments. To prepare for this meeting I need three things from you, today: The monthly benchmark prices (whether RISI, P&PW, Random Lengths or whatever) for your key product for this year starting with January, and coming up to date. Your forecast of those prices by month for the next six months. I need you to come by my desk some time today so we can spend a few minutes discussing current trends in your market. Thanks,