Merrill Lynch guaranty

Clem: Do you want to prepare or would you prefer that I handle? Sara

Sara Shackleton
Enron North America Corp.
1400 Smith Street, EB 3801a
Houston, Texas 77002
713-853-5620 (phone)
713-646-3490 (fax)
sara.shackleton@enron.com
----- Forwarded by Sara Shackleton/HOU/ECT on 01/17/2001 06:23 PM -----

Jason R Williams@ENRON
01/16/2001 11:07 AM

To: Sara Shackleton/HOU/ECT@ECT
cc:
Subject: Merrill Lynch guaranty

Sara -

I have spoken again to Merrill Lynch about the guaranty for FX trading. They
agreed with your assessment of damages as they relate to the swap agreement,
but they have asked us to provide a larger guaranty to cover the possibility
of damages related to non-transfer of funds at settlement (we can discuss
this issue, but I'm comfortable with their request on this).

So, the long and the short of this is that Merrill Lynch is asking for a $150
million guaranty from Enron Corp. to cover this trading. Can you please
prepare the guaranty document to reflect this? As we have discussed the
guaranty should be from Enron Corp. to cover FX trading of Enron North
America. The beneficiary of the guaranty should be Merrill Lynch
International Bank Ltd.

Please let me know if you have any questions on this.

Thanks for all your help,

Jay