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Enron Mail |
Kim,
Stacy (Dickson) Granmayeh has reviewed the proposed Master Contract that y= ou=20 drafted for enovate, L.L.C. and I have likewise reviewed the proposed Maste= r=20 Contract that you forwarded to Enron North America Corp. As I indicated earlier, these contracts are similar to the contract we=20 started with last year in documenting the transaction that was ultimately= =20 entered into. I recall providing a copy of our Sample Enfolio Master Firm= =20 Purchase/Sale Agreement together with the credit departments requirements= =20 which they required in order to enter into the transaction. I am told that= =20 those credit requirements relating to triggering events and collateral=20 threshold will also be necessary before Enron North America Corp. can enter= =20 into a transaction this year. Unless I specifically state that a comment relates to enovate or to Enron,= =20 these comments relate to both entities. 1. The correct name for enovate is: enovate, L.L.C. 2. Change the Confirming Party in Section 3.12 to Seller. 3. Section 4.1 needs to be altered in such a way to make the verbal=20 agreement of the Parties binding at the time of the phone call. As written= ,=20 any agreement between the Parties is not binding until a Transaction=20 Confirmation is executed by both Parties. 4. The word "Contract" in Section 5.1.1.b. should be changed to=20 "Transaction". 5. The concept of "Point(s) of Receipt" and "Point(s) of Sale" need to be= =20 collapsed into Point(s) of Delivery at which point title and possession is= =20 transferred from the Seller to the Buyer. No need for two separate concepts= . 6. Delete Sections 6.5 and 6.6 in their entireties. 7. Alter Section 8.3.3 concerning Locked Prices in such a way to make the= =20 Locked Prices binding at the time of the phone call; not upon the passage o= f=20 48 hours for receipt of confirmation. 8. The term "Commodity Charge Index Adjustment" used in Section 8.1, 8.2 a= nd=20 8.3 needs to be defined. 9. The first sentence of Section 10.3 should be altered to delete the last= =20 phrase =01&of the negligence of the other Party=018 and include the followi= ng=20 phrase in its place: =01&the gross negligence, willful misconduct or bad f= aith=20 of the other Party.=018 =20 10. Delete the phrase =01&(not via facsimile)=018 from the first sentence = of=20 Section 12.1. 11. Add the following phrase at the end of Section 15.3: =01&; the loss of= =20 Buyer=01,s Markets; or Buyer=01,s inability economically to use or resell g= as=20 purchased hereunder.=018 12. Delete the phrase =01&or Buyer or Seller claims force majeure for a pe= riod=20 exceeding seven (7) cumulative days or five (5) consecutive days during the= =20 Transaction Term=018 in Section 16.1.b. 13. Add the following sentence to the end of Section 16.1.e: =01&Party fa= ils=20 to perform any covenant set forth in this Contract.=018 14. Delete the third sentence of Section 16.2 in its entirety. 15. Delete Section 16.3.d in its entirety. 16. The Corporate Guarantee in Section 19 should be a payment guarantee no= t=20 a performance guarantee. 17. With regard to enovate, change =01&Wisconsin=018 to =01&Illinois=018 i= n Section=20 21.5; and with regard to Enron, change "Wisconsin" to "Texas" in Section 21= .5. 18. Section 21.7 requires =01&mutual execution of an appropriate supplemen= tal=20 written Transaction Confirmation=018 for an effective modification. This= =20 conflicts with Section 8.3.3, which does not require execution of a=20 Transaction Confirmation for a Locked Price. 19. Delete Section 22.e in its entirety. 20. In Exhibit A, delete Section 12, Regulatory Contingency, in its entire= ty. Please review the foregoing and provide revised contracts to both enovate= =20 and Enron for further review in accordance with the foregoing matters.
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