Govt & Reg Affairs Update

Louise & John --

FYI.

1. Charles Yeung has decided to leave the company. He was in the ERCOT box support Doug Gilbert-Smith.

2. I met with UBS counsel today to discuss FERC and other licensing issues. I am scheduled to meet with Bob Dinerstein (sp?) sometime tomorrow to discuss the function and some other administrative issues.

3. We continue to gather tariffs, etc. to process the forms as soon as possible. Of course, the ability to sell physical power will be contingent upon FERC approval of Netco's MBR authority.

4. I have postponed the FERC meeting scheduled for Thursday until sometime next week. I still believe that it is appropriate to meet with FERC post-Bankruptcy Court approval (maybe HSR approval?).

Thanks,

Jim