Sara,

Sorry, about the mix-up, but below are both their reply and our original sample confirmations.

Thanks,



Scott


  


Scott: here are the comments from the USFilter legal group. Please review
with your legal people and provide a response. The documents to which Keith
refers are the most recent Confirmation for the Deferred Premium call and
the associated Terms and Conditios Addendum.

Thanks,

Tom Fields
Director Strategic Sourcing
US Filter
847.706.6914
847.706.9025 (fax)
847.682.3836 (cell)

fieldst@usfilter.com

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>  -----Original Message-----
> From: 	Graham, Keith  
> Sent:	Thursday, September 13, 2001 11:34 AM
> To:	Fields Tom
> Subject:	Enron Confirmation
> 
> Tom:
> 	As best I could determine, the agreement and general terms are
> consistent with the industry standard and are not unreasonable.
> Nonetheless, there are a few minor points worth mentioning, per our
> specialist, as set forth below. 
> 2. The Transaction is more of a swap than an option. If Enron insists on
> still calling it a Deferred Premium Call Option, then I would make it
> clear in the Confirmation that (1) the "Swap" payment terms in Section 2
> of the GTC's apply and (2) the "Exercise Period" is inapplicable (given
> that the Confirmation specifies "Automatic Exercise" as being applicable).
> 
> 3. The term "Calculation Period" in the Confirm should be "Determination
> Period." I believe that use of the "Calculation Period" is a typo.
> 4. The representation in Section 1(b)(i) should be: " "Eligible Contract
> Participant" as defined in Section 1a(12) of the Commodity Exchange Act,
> as amended." 
> 5. Please note that the setoff provision allows setoffs of amounts owed to
> and from Affiliates.  This is a keen legal point because typically
> affiliates have no legal authority to bind one another.
> 6. New York law (not Texas) should apply, per our specialist. 
> 	  If you have questions or comments, please let me know.
> 
> Keith
> 
> 
> Confidentiality Note:   This e-mail message and any attachments to it are
> intended only for the named recipients and may contain legally privileged
> and/or confidential information.  If you are not one of the intended
> recipients, please do not duplicate or forward this e-mail message and
> immediately delete it from your computer.


Scott F. Griffin
Enron Global Markets, LLC
1400 Smith Street
Houston, TX 77002-7361

Office:     (713)-853-0973
Mobile:    (713)-503-5686