----- Forwarded by Sara Shackleton/HOU/ECT on 12/20/2000 05:01 PM -----

	"Dranguet, Beth Ann" <badranguet@velaw.com>
	12/19/2000 09:52 PM
		 
		 To: "Shackleton, Sara (Enron)" <sara.shackleton@enron.com>
		 cc: "'Clint.Freeland@enron.com'" <Clint.Freeland@enron.com>, "Jim Armogida 
(E-mail)" <jarmogi@enron.com>, "Baird, Bob" <RBaird@velaw.com>
		 Subject: CSFB and UBS Confirmations


Sara,

I am still working on the share repurchase program question but wanted to
get to you what answers I had.

1. On UBS, the language we discussed could be drafted as follows:

"In the event the Trigger Price is increased to equal the Other Trigger
Price, the Determined Amount shall be reduced so that the Effective Share
Price is increased in direct proportion to the increase in the Trigger
Price.  The "Effective Share Price" shall be the result obtained by dividing
X by Y where "X" equals the product of the Price Per Share multiplied by the
Number of Shares, and "Y" equals the Number of Shares plus the Determined
Amount."

2. I was able to find a summary of the November 15-16, 2000 Emerging
Issues Task Force meeting discussing the "best efforts" language in
increasing the authorized shares.  I would propose revising the stricken
language in 3(a) to read as follows:

"In the event that, but for this Section 3, titled "Other Provisions," Party
B would be obligated to deliver a number of Shares equal to the Determined
Amount plus the Excess Shares, Party B shall have an ongoing obligation to
satisfy delivery of the Excess Shares; provided however that the number of
Excess Shares to be delivered hereby shall not exceed [________] shares.
Party B may, at its sole option, satisfy delivery of the Excess Shares by
using its best efforts to increase its Authorized Shares or by delivery of a
cash payment equal to the [product obtained by multiplying the Excess Shares
by the Final Price]."

Please confirm that the formula for the cash payment is appropriate.  Their
language puts a cap on the number of shares to be delivered but that cap is
tied to a value making the number of shares to be delivered indeterminate
and therefor outside your control.  The cap drafted above solves this
problem.  It is important to note that no interest can accrue while Party B
is waiting to get approval to increase its authorized shares, if so the
obligation would be accounted for as debt.

_________________
Beth Ann Dranguet
Vinson & Elkins L.L.P.
One American Center
600 Congress, Suite 2700
Austin, Texas  78701
(512) 495.8595
(512) 236.3226 fax
(888) 203.5056 pager
badranguet@velaw.com

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