Attached is the legal risk memo for the proposed sale by certain Enron entities of their interest in UtiliQuest LLC.  This transaction has been given a legal risk ranking of 2.0 (on a scale of 1.0 to 5.0, with 1.0 indicating minimal legal risk), primarily due to potential post-closing indemnification obligations.  
 
The legal risks discussed in this memo were also set forth in the DASH; however, please note the following correction to the DASH:  while the Enron entities' pro rata share of the maximum potential liability under the seller indemnity is $20.7 million, Enron and the other sellers have joint and several liability for indemnification obligations which are capped at $30 million, and Enron will be liable for the entire $30 million if the non-Enron sellers cannot satisfy their pro rata share of the liability under the seller indemnity (note that Enron is not guaranteeing or backstopping the other sellers' share of this liability in any way; however, the purchaser may choose to hold Enron liable for the entire liability, and leave Enron to pursue the other sellers for their share).   
 
Please contact me if you have any questions.

Travis C. McCullough 
Enron North America Corp. 
1400 Smith Street EB 3882A 
Houston, Texas 77002 
Phone:  (713) 853-1575 
Fax:      (713) 646-3393/3490