David,

Based on the e-mail that I sent out on June 30th (and that I have attached
below), I was under the presumption that the Enron party to the GTCs would be
Enron Australia Finance Pty Ltd.  This is because we are dealing with
Australian weather derivatives and I was presuming (right or wrong) that such
derivatives would be on the books of the Sydney trading office.  Please let
me know if this is not the case.

Best regards,
Susan

David Minns
07/06/2000 12:35 AM
To: John Viverito/Corp/Enron@ENRON
cc: Jonathan Whitehead/AP/Enron@Enron, Nicholas.O'Day@enron.com@ENRON, Susan
Musch/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Justin
Timothy/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Raymond
Yeow/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Mark Taylor@ECT

Subject: Re: EOL GTC's for Weather Derivatives In Australia

John please see attached GTCs for Australian weather. They are essentially
the same as the example that was forwarded to B&M when they got the brief to
advise on weather derivatives last month.

I understand that B & M are having second thoughts on the gambling question
and are due to come in with an advice on the point.

There is also a question as to whether the Enron party will be Enron
Australia Finance Pty. Ltd. or Enron Japan KK. From a tax perspective Susan
what would you prefer?

On a related issue what Enron company is on the Passwords Applications and
ETAs that are being sent out? Although from a legal perspective it does not
matter it may increase acceptance if it were Enron Japan KK.

From: John Viverito@ENRON on 05-07-2000 05:19 CDT
To: David Minns/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT
cc: Jonathan Whitehead/AP/Enron@Enron, Nicholas.O'Day@enron.com

Subject: EOL GTC's for Weather Derivatives In Australia

David-

Please forward an electronic copy of the EOL GTC's for weather derivatives in
Australia.  Thanks for your assistance.

Cheers,

John

Susan Musch
06/30/2000 11:30 AM
To: Jeff Blumenthal@ECT
cc: Heidi Mason/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, David
Minns/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Stephen H Douglas@ECT, Paul
Quilkey/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT (bcc: Susan
Musch/ENRON_DEVELOPMENT)

Subject: Tax Advice on AUS and JPN CDD and HDD Weather Swaps

Below is a summary of the tax advice that I received from our outside
advisors in Tokyo and Sydney on the Sydney trading office entering into cash
settled weather derivative trades with Japanese counterparties:

Japanese Tax Advice

1. Swap, Options and Other Financial Derivative Transactions

Based on the current practice of the Japanese tax authorities, standard
swaps, options and similar financial transactions with symmetrical payment
flows should not be subject to withholding tax. However, to the extent that
Enron transactions involve asymmetrical payments, concern exists that imputed
interest from the imbedded loan could be subject to interest withholding tax.

2. Consumption Tax (VAT) and Excise Taxes

Although Japan imposes a 5% consumption tax (VAT), financial transactions are
generally not subject to the consumption tax, so cash settled derivative
transactions should generally not be subject to consumption tax.  Japan
imposes various kinds of excise taxes.  These excise taxes generally apply to
physical importation and domestic sale and delivery of covered products and
should generally not apply to purely financial derivatives transactions which
reference commodity prices.

3. Collateral for Derivatives Transactions

If Enron entities will take collateral from Japan-based customers in
connection with derivative transactions, depending upon the specific
arrangements, withholding tax liability might arise.  For example, if an
Enron trading entity takes cash collateral from a Japan-based customer and
pays interest on it, such interest payments could be subject to local
withholding tax when paid to the Japanese resident customer.

Australian Tax Advice

1. Swap, Options and Other Financial Derivative Transactions

Based on the summaries of the products attached to Justin Timothy,s June 12th
e-mail to Mario Parra Cardoso and Dale Neuner:

(1) the swap income or deduction should be recognized on a due and payable
basis (rather than on an accrual basis over the term of the swap), and
(2) there should not be any interest withholding tax imposed on the swap
payments because there does not appear to be any linkage between the swap
payment and "interest" as defined for Australian tax purposes.

Note that there is an Australian tax proposal to impose withholding tax on
other Australian source income.  Although no details are yet available, it is
expected that the Australian government will not impose withholding tax where
the income would constitute "business profits" of any entity in a treaty
country (such as Japan) which does not have permanent establishment in
Australia.  Thus, based on the current proposal, it is unlikely that such a
withholding tax, if enacted, would apply to the swap payments.  However, this
could change depending upon the rules actually enacted.

2. GST (VAT)

Effective July 1, 2000, the Goods and Services Tax ("GST") will tax at a 10%
rate the consumption of most goods and services in Australia.  (It does not
apply to consumption outside of Australia, e.g. exports.)

A swap payment to a Japanese counterparty will be GST-free. This means that
the Australian trading office would be able to claim refunds on a portion of
the GST paid on its rents and other expenses.

Please let me know if you have any questions or need any additional
information.

Best regards,
Susan


Heart disease is the number one killer, but great strides have been made in the last fifty years.  Dr. DeBakey designed the first revolutionary procedure on his wife's sewing machine, and today, right on CNN, we can see the first human walking around with a completely artificial heart.  Many of you know someone who wouldn't be here without these advancements in medical technology.

On Saturday, November 3, Enron and other companies will be joining the American Heart Association for the Heart Walk.  The Houston Heart Walk is targeting over $750,000 for continuing the fight against heart disease and for rebuilding the many years of research that were lost as a result of this year's floods.

We are looking for 50 team captains.  The primary role of a team captain is to recruit approximately ten walkers.  The walkers can be friends, family, business associates outside Enron, or co-workers.  The walkers, in turn, solicit sponsors for the walk.  As a team captain, you may also walk, of course, and Enron's top walker (from a fundraising perspective) is eligible for two free airline tickets.  Additional incentives are currently being developed.

If you are willing to serve as a team captain or a walker, please email or call Sue Wadsworth (713-853-5105) or Melissa Becker (713-853-6641).  We look forward to seeing you November 3 and demonstrating Enron's commitment to fighting heart disease.


Through MArch '02

To: Chris H Foster/HOU/ECT@ECT
cc:
Subject: Re: Citizens

Are we still looking at June through Oct only?

To: Don Hawkins/ENRON@enronXgate @ ENRON
cc: Kim Ward/HOU/ECT@ECT
Subject: Re: Citizens

I am available on Wed.  Afternoon ias better for me say 3:00 Houston time?

C

From: Don Hawkins/ENRON@enronXgate on 03/26/2001 05:14 AM CST
To: Chris H Foster/HOU/ECT@ECT
cc:
Subject: Citizens

Chris, attorneys have indicated there is no affiliate problem with EAMR
negotiating a contract with ENA for the operation of the Citizens assets as
described in the contract I sent you Friday.   IF we can make it work it
makes more sense this way and tells a good story in support of the "One
Enron" message.

Please let me know what your availability is for Wednesday so I can set up a
conference call with legal and marketing services to discuss the work to be
done so we can flush out the liability issue.  You and I can continue our
discussion on price one on one.

Thanks,

Don