Marty:  I will have a response to setoff shortly.  With respect to the CSA 
and calculation of the "Credit Support Amount," our change should not create 
any inconsistencies in the calculation of that amount among your 
counterparties since it would only change IF the calculation yielded a 
negative number.  The only reason for "specifying otherwise" in Paragraph 13 
is to capture the situation where the Pledgor MIGHT be holding Independent 
Amounts (if there are ever any specified in a particular Transaction) of the 
Secured Party as cushion (which is not meant to be returned until termination 
of Transactions) and subtraction of that amount would create a negative 
number when calculating the Credit Support Amount.  By specifying that the 
Credit Support Amount will be "the higher of" the amount calculated (deemed 
to be zero if a negative number) or the sum of the Pledgor's Independent 
Amounts, the latter would prevail.  This calculation method will make a 
difference if, for example, the Secured Party asks for a Return Amount when 
the Pledgor intends to retain any Independent Amounts as cushion (such that 
only Posted Credit Support exceeding the sum of the Independent Amounts will 
be returned).  I hope this helps.  Sara




Marty_Oelmann@cargill.com on 04/18/2000 04:53:26 PM
To: Sara.Shackleton@enron.com
cc: Marty_Oelmann@cargill.com 
Subject: Re: ISDA Master Agreement between Enron and CGLI


     Hi Sara,
     Confirming or conversation, only 2 issues remain unresolved.

     1.  Please remove subclause (B) in Part 5(g) Setoff.  As we discussed,
         this contemplates including all kinds of "obligations of any kind
         whatsoever" and it is our intent to include only Energy trading
         under this Agreement.

     2.  Please explain the reasoning for modifying the definition of
         "Credit Support Amount" in Paragraph 13(b)(C) of the Credit
         Support Annex.  We would prefer to retain the intent of ISDA's
         definition to maintain consistency in the way this amount is
         determined among our counterparties.

     Thank you for all your assistance and I look forward to receiving
     execution copies of the Agreement if these two issues can be resolved.

     Best regards,
     Marty Oelmann


______________________________ Reply Separator 
_________________________________
Subject: ISDA Master Agreement
Author:  Sara.Shackleton (Sara.Shackleton@enron.com) at admpom01-unix-mime
Date:    4/18/00 4:01 PM




Marty:  Also left you a voice mail.  Are we ready to send execution copies?
Sara