As you may be aware, the closing date for Highstar's purchase of North Carolina Power Holdings, LLC has been scheduled for July 12.  Pursuant to Section 7.4 of the attached Securities Purchase Agreement, if any factual circumstances are inconsistent with the representations, warranties and covenants made by ENA as of May 16, 2001, ENA must supplement or amend the Schedules (and provide Highstar with supporting documentation regarding such changes) at least 5 business days prior to closing.

Please review Section 4.1 and Section 7.1 of the Securities Purchase Agreement, together with the information on the companion Schedules referenced in these Sections, and notify me (with a CC to Steve Van Hooser) by 10:00 am on July 3 if you are aware of any misstatements or errors concerning these representations, warranties, covenants, or Schedules.

Please call or email me to discuss or if you have any questions.

Best regards,

Jay

Jay Sonnenberg
Bracewell & Patterson, L.L.P.
711 Louisiana St., Suite 2900
Houston, TX  77002-2781
(713) 221-1417 (Ph)
(713) 221-2158 (Fax)



 - #1269388 v17 - SECURITIES PURCHASE AGREEMENT (AIG).doc 
 - #1270266 v10 - EXHIBITS+SCHEDULES TO AIG SPA.doc