My comments on the analyses (DCF models only):

Exchange DCF Analysis

Capital costs for years 1-3 are spent in year 0 (in years 0-2 maybe more 
appropriate)
Capital Avoidance is treated as expense savings (it is added to the total 
expensed cost)
No depreciation is considered for the capital cost
No income tax is considered for the operating cost savings

Cynet DCF Analysis looks OK except for Cash Flow Section: Should change 
"LESS" to "ADD" AMORT/DEPRECIATION




Rod Hayslett

11/01/2000 10:30 AM
To: Denis Tu/FGT/Enron@ENRON, David Rosenberg/FGT/Enron@ENRON, James 
Centilli/ET&S/Enron@ENRON
cc:  

Subject: Capital Asset Pricing Model

Comments?

---------------------- Forwarded by Rod Hayslett/FGT/Enron on 11/01/2000 
10:33 AM ---------------------------


Rudy Sutherland@ECT
11/01/2000 09:15 AM
To: Rod Hayslett/FGT/Enron@ENRON, Michael K Patrick/NA/Enron@Enron
cc: Chris Behney/Corp/Enron@Enron, Bob McAuliffe/Corp/Enron@ENRON, Deborah 
Kelly/Enron@EnronXGate 

Subject: Capital Asset Pricing Model

Gentlemen,
Please find attached two excel CAPM models which use Crystal Ball, an Excel 
add-in, to perform Monte Carlo simulations. The first tab in each workbook 
have details, however, if you have any questions please call me @ x39946.  I 
am hoping that you can validate and/or offer suggestions on refining the 
model and it's assumptions. 

Thank you in advance,

RS