Re: New Deals

No, in general there is a netting issue with French counterparties. The
"quick fix" is to only permit ONE Transaction using a deemed ISDA. The
broader issue to be resolved is that one of the parties must be a "financial
institution" under French law. We tried to push ECT into that defintion, but
without success. The next step is to require an opinion from outside
counsel identifying our counterparty as that financial institution.
SS
ps - Tanya is well aware of the situation

From: Mark - ECT Legal Taylor 09/27/99 10:00 AM

To: Sara Shackleton/HOU/ECT@ECT
cc:
Subject: New Deals

I'm pretty sure SITA is a French company. Have we decided that French
counterparties are ok?
---------------------- Forwarded by Mark - ECT Legal Taylor/HOU/ECT on
09/27/99 09:59 AM ---------------------------

Tanya Rohauer
09/27/99 09:24 AM
To: Marie Heard/HOU/ECT@ECT, Susan Flynn/HOU/ECT@ECT, Susan
Bailey/HOU/ECT@ECT, Mark - ECT Legal Taylor/HOU/ECT@ECT
cc: Jarrod Cyprow/HOU/ECT@ECT
Subject: New Deals

Please prepare a deemed ISDA for the SITA deal. Please forward to Jarrod
Cyprow on the confirm desk. Please note the only credit specification is a
cross default to third party debt. Let me know if you have questions.

Thanks,
Tanya

---------------------- Forwarded by Tanya Rohauer/HOU/ECT on 09/27/99 09:19
AM ---------------------------

Heather Alon
09/24/99 02:30 PM

To: Dale Neuner/HOU/ECT@ECT, Melba Lozano/HOU/ECT@ECT, Scott
Pleus/HOU/ECT@ECT, Jeff Harbert/HOU/ECT@ECT, Lisa Berg/HOU/ECT@ECT, Tanya
Rohauer/HOU/ECT@ECT, Michael Nguyen/HOU/ECT@ECT, Jarrod Cyprow/HOU/ECT@ECT,
Ana Correa/HOU/ECT@ECT, Greg Jay Martin/HOU/ECT@ECT
cc:
Subject: New Deals