Contract Review Meeting on Oct. 7th

I have scheduled a meeting for October 7th from 8:30 to 2:30 in room 3321 to
recommence the project we began in January to review the existing
Houston-based financial, gas and power trading forms. All of you should have
received a black binder labelled "Analysis of ECT's Finacial, Power, Gas
Forms" which contains all of the long and short forms used for trading (as
such forms existed in January 1999), as well as my summary comparison as to
how each of the forms handles certain legal issues (eg, termination, cover,
assignement, confidentiality ....). If you did not receive or cannot locate
this binder, let me know and I will forward to you another copy. This
analysis was done in January. I am aware that some of the forms may have
changed since then but have not undertaken to "update" the memo as we will be
able to discuss such changes at the meeting.

The purpose of the meeting is to review how each of the Houston-based
trading forms has been structured and to note where there are differences.
The ultimate goal is to determine what Enron's "model" trading provisions
should be and to determine a consistent approach unless there is a justified
rational for treating the commodities in a different manner. With this in
mind, I would hope to be able to create a "modular type" contract whereby
each legal issue would have a recommended approach, evidenced by language
that will be approved by the group. By way of example, Enron's gas contract
prohibits assignement without consent, which consent can be withheld for any
reason. The financial form provides that a party can not unreasonably
withhold its consent. At this meeting we would discuss what the preferred
approach is and then begin the process of drafting appropriate language,
which language would be approved at a seperate meeting. This "modular
assignment section" could then be dropped into all trading forms unless
differences were required due to the commodity/product involved.

You will note that the analysis performed to date does not include all areas
of a trading contract. Similiar steps will still need to be undertaken with
other provisions such as credit terms. At the meeting, I hope to further
discuss the additional areas everybody believes should be reviewed.

Aron Roffwarg, a lawyer from Bracewell, will also be at the meeting to
assist us in this effort.

Thanks