Sara,

Procter & Gamble has proposed that we start negotiating using their ISDA 
schedule.  Enclosed is a note (that addresses a few critical issues) from my 
business counterpart and a draft schedule.

P&G is the largest buyer of pulp and containerboard in North America - two 
key commodities for our business.  Executing a Master with them is very 
important.  If at all possible, I would like to accomodate their requests to 
negotiate from their schedule.

However, as you know, I am not a lawyer.  Please review and share your 
thoughts with me.  Thanks.

Ed Quinn


---------------------- Forwarded by Ed Quinn/HOU/ECT on 11/06/2000 10:19 AM 
---------------------------


larsh.rt@pg.com on 11/06/2000 09:27:56 AM
To: ed.quinn@enron.com
cc:  
Subject: P&G ISDA Schedule


Ed-

As promised, I have attached our standard ISDA Schedule.  All bank and 
non-bank
(commodity financial instrument) counterparties with whom we transact have
signed essentially the same ISDA Schedule without non-reliance and set off or
cross default.  As I have discussed previously, I think that it is beneficial 
to
both of us to work directly versus sleeving transactions through a third 
party.
Given our credit limit policies, we will require some form of credit 
enhancement
from you, but I think that cost effective alternatives exist beyond using 
banks
as stand-in counterparties.

I realize that our approach may differ from other companies, but I think that 
we
can dramatically assist in the development of the pulp and paper financial
instrument market.  Certainly, as Enron is an important market maker, we would
like to be in position to transact a significant portion of our volume with 
you.
Net, very positive results for both of our companies.

I will be interested in your response to the attached schedule.

Regards

Roger

(See attached file: 92SchedForm.doc)

 - 92SchedForm.doc