Vicki, a few weeks ago a friend of mine, Steve Greenwald (a partner in Davis Wright Tremaine's San Francisco office), called to tell me that one of his clients, Texas-Ohio Energy, Inc., had entered into an agreement with an Enron entity, and was claiming that Enron had breached that agreement.  This client is allegedly preparing to file a petition against us.  Steve told his client that DWT could not represent Texas-Ohio in litigation against Enron, and Steve asked me to try to find out what agreement his client might be talking about (at that time, Steve did not have a copy of the agreement).  Steve asked his client to produce the agreement, and at the same we checked throughout Enron for the agreement (Vicki, you checked around and couldn't find any agreement between EES and Texas-Ohio).  We weren't even sure which Enron entity was involved.  We did kick around my proposal that Steve might be able to serve as a mediator between Texas-Ohio and Enron, to attempt to settle the dispute without litigation.

Now we have the agreement, and it is with EES.  I will send it to you when I get a good-quality copy (which is being sent to me today).  From my almost-illegible faxed copy, It is a Client Commission Agreement between EES and Texas-Ohio, Inc., dated October 13, 2000.  Timonthy J. Hamilton signed as Attorney-in-Fact for EES; there are no lawyers' initials on the execution block.  Texas-Ohio is entitled to recommend to EES prospective commercial and industrial customers served by SoCal, SDG&E, SWG (Southwest Gas), and PG&E.  If EES enters into an agreement with any such identified customers, Texas-Ohio earns a commission.  There are provisions concerning price quoting and commission calculation; I'm sure you are familiar with those.

I am not familiar with this agreement or the extent of its use, and I do not yet know the nature of Texas-Ohio's claim, although I would suspect it is for non-payment of commissions allegedly due.  I will forward the agreement to you, and I'll stand by to help on this, should you want me to.   And Steve Greenwald would be happy to try to broker a peace, if that offer becomes attractive (I'd be happy to introduce you to him, or to work with him, as you wish).

Sheila, this is FYI so that you'll know what's happened on this matter.  It's been a while since we discussed it.  Richard, this is FYI also, inasmuch as this could lead to litigation.

Thank you, 

Kenton