FYI, still under discussions between Enron and Light.  This deal is similar to the Duke Call Options we closed last month.

I'd rather do it under a Master Agreement and will check with the business guys if we can do so.

Rgds,

Sami

---------------------- Forwarded by Sami Arap/SA/Enron on 10/15/2001 07:46 PM ---------------------------


Eduardo Cancian
10/15/2001 06:09 PM
To:	Paul Radous/Enron@EnronXGate, Xochitl Figueroa/Enron@EnronXGate, Tanya Rohauer/HOU/ECT, Mary Kimball/Enron@EnronXGate
cc:	Roberto Schloesser/SA/Enron@Enron, Dilma Lopes/SA/Enron@Enron, Sami Arap/SA/Enron@Enron 

Subject:	Light Call Option of 50MW

ECE is negotiating the sale of a Call Option to Light, the distribution company in Rio de Janeiro, owned by EDF. See below a summary of the main terms of this deal:

Seller: 		ECE
Buyer:		Light
Volume:	50 MW
Term:		January 1st, 2002 to December 31st, 2003
Structure:	Call Option (details below)

Premium:	R$ 38/MWh for the energy in 2002 and R$ 30/MWh for the energy in 2003. The total premium will be R$ 29.78 million and it will be paid upfront		on the date of contract signature.

Strike Price:	R$ 210/MWh for volume delivered during 2002 and R$ 130/MWh for volume delivered in 2003. Prices will be adjusted by IGPM from 			Sept/2001 until the Exercise Date in both cases.

Exercise Date:	Buyer will have the right to exercise the Option on a weekly basis. The notification of the exercise will have to be made until tuesday 			before beggining of supply week.

Guaranties:	Since it's very difficult to get Corp Guaranty from European Companies, we thought about asking Light's receivables as guaranty from 			Light and if necessary, Enron Corp Guaranty from ECE. Light has a 30 years concession for electricity distribution in the city of Rio de Janeiro and 		is rated as a BB- by S&P.
Since it is not a small transaction we need to know if Credit, Market risk and Tax are comfortable with the structure. I'm going to send more details about Light for Credit review. Please, let me know if you need any additional clarification.
Thanks. Eduardo