Dresdner Bank Credit Issues

Rod:
These are the issues taht we need to talk about before our call on Wednesday
afternoon.
Carol
---------------------- Forwarded by Carol St Clair/HOU/ECT on 05/08/2000
02:36 PM ---------------------------

Carol St Clair
05/05/2000 10:36 AM
To: Rod Nelson/HOU/ECT@ECT
cc: Susan Bailey/HOU/ECT@ECT, Jason Peters/Corp/Enron@Enron
Subject: Dresdner Bank Credit Issues

Rod:
The following are the credit issues that they raised in their comments:

1. Cross default threshold - instead of $100,000,000 they want a 3% of equity
test.

2. Credit Event Upon Merger - they want to delete the amendment language in
our Schedule

3. MAC Trigger - this currently is an Event of Default. They want to make it
a Termination Event. Also, they want to add to the trigger going below a
Baa3 rating by Moody's.

4. In the financial reporting section, they want to add on our side a
requirement that we deliver to them any financial or business report that we
make available to our shareholders or that we file with the SEC or bank
regulatory authorities

5. In the Netting language, they have excluded FX and Currency Option
transactions.

6. In the setoff language, they have limited the trigger to the designation
of an Early Termination date because of the Termination Event Credit Event
Upon Merger. Alos, they want setoff to apply to "matured and unmatured"
obligations.

7. They don't want a cap on the Enron Guaranty

8. In the Termination section where we specify Loss and Second method that
have an interesting rider (insert 2) that modifies how the Second Method
works. I'm still trying to understand what this language does but it appears
to qualify any payments on termination that the Non-Defaulting Party would
have to make to the Defaulting Party.

I will send you a copy of their comments and hopefully we will talk to them
about this next week.

carol