Brent-

I have spoken with Susan Musch and Baker & McKenzie regarding the tax 
provisions of the documentation.  As there is the possibility, though 
unlikely, that a non-Japanese counterparty will be permitted to trade 
Japanese weather, such possibility has been addressed in the tax provisions.  

Attached are the modified versions.

I also spoke with John Suttle today and he informed me that he was content 
with the provisions relating to credit.

Do you believe any further changes would be required in the GTCs, if the 
transactions are entered into with a non-Japanese counterparty? If not, 
please proceed with the loading process.

Also, I look forward to your response to my questions related to utilizing 
ENA as a counterparty for Japanese weather.  As mentioned, if ENA and 
Japanese counterparties (who may only have assets in Japan) were to enter 
into these types of transactions, the relevant GTCs should contain certain 
provisions to deal with Japanese legal issues.  

Best regards,

John


----- Forwarded by John Viverito/Corp/Enron on 09/12/2000 11:21 PM -----

	John Viverito
	09/11/2000 12:06 AM
		
		 To: Brent Hendry/NA/Enron@Enron
		 cc: Dale Neuner/HOU/ECT@ECT, David 
Minns/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, John Suttle/HOU/ECT@ECT, Jonathan 
Whitehead/AP/Enron@ENRON, Mark Taylor/HOU/ECT@ECT, Morten E 
Pettersen/AP/Enron@Enron, Susan Musch/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT
		 Subject: Re: Japanese Weather Derivative GTC's for EOL

Brent-

I have deleted the referenced Additional Event of Default language and attach 
the modified drafts.

I note that Susan Musch is reviewing the tax aspects of the GTCs and will 
revert to us shortly as to the sufficiency of the relevant provisions and 
following her sign-off, we should be able to load onto EOL. 

Thanks,

John





	Brent Hendry
	09/08/2000 10:02 AM
		
		 To: John Viverito/Corp/Enron@Enron
		 cc: Dale Neuner/HOU/ECT@ECT, David 
Minns/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, John Suttle/HOU/ECT@ECT, Jonathan 
Whitehead/AP/Enron@ENRON, Mark Taylor/HOU/ECT@ECT, Morten E 
Pettersen/AP/Enron@Enron, Susan Musch/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT
		 Subject: Re: Japanese Weather Derivative GTC's for EOL

The GTCs below still have the Additional Event of Default language in them.  
I was under the impression that John was agreeing to have the provision 
removed.  Please send the revised GTCs and we will approve it and send it to 
Dale for loading. 

Thanks,
Brent



	John Viverito
	09/06/2000 11:19 PM
		
		 To: David Minns/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, John 
Suttle/HOU/ECT@ECT, Brent Hendry/NA/Enron@Enron, Dale Neuner/HOU/ECT@ECT
		 cc: Jonathan Whitehead/AP/Enron@ENRON, Mark Taylor/HOU/ECT@ECT, Morten E 
Pettersen/AP/Enron@Enron, Susan Musch/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT
		 Subject: Re: Japanese Weather Derivative GTC's for EOL

David-

Thanks for your input.  I attach the EOL GTCs for Japanese weather 
derivatives (with Enron Japan Corp. as the Enron entity counterparty) with 
one version containing a collateral clause and one without.  I note that the 
documents are for HDD swaps.

Subject to both John Suttle's and Brent Hendry's agreement, Dale Neuner 
should be able to load the GTCs into EOL. The Japanese weather derivatives 
with EAF as counterparty should also then be removed.

Thanks,

John





	David Minns@ENRON_DEVELOPMENT
	09/06/2000 09:37 PM
		
		 To: John Suttle/HOU/ECT@ECT, John Viverito@Enron
		 cc: Jonathan Whitehead/AP/Enron@ENRON@ECT, Brent Hendry/NA/Enron@Enron@ECT, 
Dale Neuner/HOU/ECT@ECT, Mark Taylor/HOU/ECT@ECT, Susan 
Musch/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Morten E 
Pettersen/AP/Enron@Enron@ECT
		 Subject: Re: Japanese Weather Derivative GTC's for EOL

John and John,

Let me make a observation that may assist, The way additional credit support 
is handled in GTCs is through a "collateral clause". For every product there 
are 2 GTCs, with the clause and one without it.  Credit makes the 
determination of which one to use.





Attached is an example of a GTC with the clause in. (It is at the end.) The 
GTC same without the clause is given as a comparison. Hope this helps.

    


To: Jonathan Whitehead/AP/Enron@ENRON
cc: Brent Hendry/NA/Enron@Enron, Dale Neuner/HOU/ECT@ECT, David 
Minns/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Mark Taylor/HOU/ECT@ECT, Susan 
Musch/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, John Viverito/Corp/Enron@Enron, 
Morten E Pettersen/AP/Enron@Enron 

Subject: Re: Japanese Weather Derivative GTC's for EOL  

Sorry for the confusion.   No, I am not saying that an ISDA needs to be in 
place prior to transacting (Credit has already approved a list of potential 
Japanese counterparties with which we don't have master contracts in place), 
but we should do what we can to cover the credit issue that is being deleted 
from the GTC in masters when we have the chance.  If transactions are to take 
place on an ongoing basis, then we will want to pursue Masters ASAP.


Jonathan Whitehead @ ENRON   09/05/2000 09:23 PM

To: John Suttle/HOU/ECT@ECT
cc: Brent Hendry/NA/Enron@Enron, Dale Neuner/HOU/ECT@ECT, David 
Minns/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT@ECT, John Suttle/HOU/ECT@ECT, Mark 
Taylor/HOU/ECT@ECT, Susan Musch/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT@ECT, John 
Viverito/Corp/Enron@Enron, Morten E Pettersen/AP/Enron@Enron 
Subject: Re: Japanese Weather Derivative GTC's for EOL  

John, Not too sure I understand your note. Are you saying we need an ISDA in 
place with each counterparty to use these GTC's? 

Thanks,
Jonathan




	John Suttle@ECT
	09/06/2000 12:02 AM
		
		 To: Brent Hendry/NA/Enron@ENRON
		 cc: Dale Neuner/HOU/ECT@ECT, David 
Minns/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, John Suttle/HOU/ECT@ECT, Jonathan 
Whitehead/AP/Enron@Enron, Mark Taylor/HOU/ECT@ECT, Susan 
Musch/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT
		 Subject: Re: Japanese Weather Derivative GTC's for EOL

Brent, I am fine deleting 6 (a) (ix) (1), but credit covering this issue 
should be in place via either an ISDA or Deemed ISDA prior to transacting 
with any counterparty under this GTC.  

John


From: Brent Hendry@ENRON on 09/05/2000 07:01 AM
To: John Suttle/HOU/ECT@ECT
cc:  
Subject: Re: Japanese Weather Derivative GTC's for EOL

John, what is your opinion?

Brent
----- Forwarded by Brent Hendry/NA/Enron on 09/05/2000 07:00 AM -----

	John Viverito
	09/04/2000 01:08 AM
		
		 To: Brent Hendry/NA/Enron@Enron
		 cc: Dale Neuner/HOU/ECT@ECT, David 
Minns/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, John Suttle/HOU/ECT@ECT, Jonathan 
Whitehead/AP/Enron@Enron, Mark Taylor/HOU/ECT@ECT, Susan 
Musch/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT
		 Subject: Re: Japanese Weather Derivative GTC's for EOL

Brent-

If credit is content, we may consider deleting 6 (a) (ix) (1) altogether.  
Please let me know if this is the case and I will then produce the draft for 
loading on to EOL.

Thanks,

John




	Brent Hendry
	09/01/2000 04:54 PM
		
		 To: John Viverito/Corp/Enron@Enron
		 cc: Dale Neuner/HOU/ECT@ECT, David 
Minns/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Jonathan Whitehead/AP/Enron@Enron, 
Mark Taylor/HOU/ECT@ECT, Susan Musch/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, 
John Suttle/HOU/ECT@ECT
		 Subject: Re: Japanese Weather Derivative GTC's for EOL

The suggested change below takes care of the issue of not being able to 
modify the threshold level to be counterparty specific.  However, I question 
whether taking the threshold level to zero might prove to be too low a 
threshold, at least for Enron.  What is the danger of this provision being 
triggered by some nonmaterial disputed debt?  If having a bilateral zero 
threshold works from an Enron credit perspective then I think you could go 
forward with using this provision.  I am open to everyone's comments on this 
point.

Let me know if you have any other questions.

Regards,
Brent




	John Viverito
	08/31/2000 09:06 PM
		
		 To: Brent Hendry/NA/Enron@Enron
		 cc: Dale Neuner/HOU/ECT@ECT, David 
Minns/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Jonathan Whitehead/AP/Enron@Enron, 
Mark Taylor/HOU/ECT@ECT, Susan Musch/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT
		 Subject: Re: Japanese Weather Derivative GTC's for EOL

Brent-
Thanks for your quick response.  With regard to 6(a)(ix)(1), based on the 
fact that EOL is not able to handle counterparty specific threshold levels in 
the GTCs, I have considered modifying the provision as follows (the portion 
in red/brackets would be deleted):
"has a pre-judgment attachment ("karisashiosae"), post-judgment attachment 
("sashiosae") or other court order of enforcement issued in respect of any of 
its assets (other than its rights under the ISDA Agreement) in relation to a 
debt or debts [in an aggregate amount of not less than JPY[  ] (or the 
equivalent in any currency)] and such attachment or other court order of 
enforcement is not dismissed, discharged, stayed or restrained in each case 
within 30 days of the date of issue thereof; "
Please advise if you believe we should go forward on this basis.  Following 
Susan Musch's input, I will then contact Dale Neuner.
Cheers,
John




	Brent Hendry
	08/31/2000 05:56 PM
		
		 To: John Viverito/Corp/Enron@Enron
		 cc: David Minns/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Jonathan 
Whitehead/AP/Enron@Enron, Mark Taylor/HOU/ECT@ECT, Susan 
Musch/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Dale Neuner/HOU/ECT@ECT
		 Subject: Re: Japanese Weather Derivative GTC's for EOL

John,

Sections 4 (a), (b) and (d) cover the issues very nicely, I apologize for not 
making the connection before.  With respect to 6(a)(ix)(1) I am told that EOL 
is not able to handle counterparty specific threshold levels in the GTCs and 
I don't think a generic threshold level will work for everyone.  Is there a 
way to redraft this provision or leave it out and still accomplish what you 
need to?  

After the form is finalized then you will need to talk to Dale Neuner at 713 
853 9746 about loading the documents and removing the product from Enron 
Australia.

Let me know if you have any other questions or issues.

Thanks,
Brent





	John Viverito
	08/31/2000 01:08 AM
		
		 To: Brent Hendry/NA/Enron@Enron
		 cc: Mark Taylor/HOU/ECT@ECT, Susan 
Musch/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Jonathan Whitehead/AP/Enron@Enron, 
David Minns/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT
		 Subject: Re: Japanese Weather Derivative GTC's for EOL

Brent-

Thanks for your correspondence.  I have responded to your questions/comments 
below in red and attach a clean draft of the GTCs, which does not contain any 
further changes from the draft you have provided.

Please inform me, with regard to paragraph 6 (a) (ix) (1), as to what, if 
anything, should be inserted for the event of default threshold amount.  

I have also copied Susan Musch on this e-mail, so that she can determine if 
all is well from the tax perspective.

Once Susan signs-off from the tax perspective, please inform me as to what 
needs to be done to load the GTCs, noting that the existing EOL GTCs for 
Japanese weather, are utilizing Enron Australia Finance Pty. Limited as the 
counterparty.  My understanding is that those GTCs will then be removed.  I 
have also copied David Minns in Australia, so that he is aware of the status 
of this matter.

Cheers,

John






	Brent Hendry
	08/29/2000 10:47 AM
		
		 To: John Viverito/Corp/Enron@Enron
		 cc: Mark Taylor/HOU/ECT@ECT
		 Subject: Re: Japanese Weather Derivative GTC's for EOL

John,

I am attaching the GTC with a few changes marked in the draft.  Is this GTC 
only intended to be used between Enron Japan Corp. and a Japanese 
counterparty?  The GTCs have been tailored for Japanese counterparties.

With respect to footnote number 1 you are correct the issue is covered under 
4(f).  Noted. With respect to footnote number 2 unless one of the parties to 
a transaction is a US counterparty or there is a local law requirement I am 
not sure we need representation 5 (b).  We obtain essentially the same 
representation from the counterparty under representation 5 (d). Noted and 
agreed.

I would recommend reinserting the paragraph entitled "Early Termination" that 
you have deleted.  Enron prefers to have "Loss" apply for valuations upon 
early termination, especially in situations where there is not a liquid 
market or for unusual or longdated trades.  I think the weather market is one 
where Enron would prefer to use the "Loss" method of calculation.   See 4. 
(a) and (b) and inform me if this is sufficient.

I would also reinsert the designation that Enron is the Calculation Agent 
(unless there is a good reason to not designate a Calculation Agent).  See 4. 
(d) and inform me if this is sufficient.

I assume that the payee tax representations are not applicable because there 
is no withholding (for either residents or nonresidents of Japan) on 
derivative transactions.  Please let me know if this is not the case.  I have 
copied Susan Musch on this correspondence to receive her input regarding tax 
issues.

Please let me know if you have any questions regarding my comments.

Brent