Message-ID: <5452885.1075861980976.JavaMail.evans@thyme> Date: Wed, 21 Nov 2001 07:26:35 -0800 (PST) From: legal <.taylor@enron.com> To: brent.hendry@enron.com Subject: RE: Chiricahua Assignments Mime-Version: 1.0 Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: quoted-printable X-From: Taylor, Mark E (Legal) X-To: Hendry, Brent X-cc: X-bcc: X-Folder: \MTAYLO1 (Non-Privileged)\Taylor, Mark E (Legal)\Sent Items X-Origin: Taylor-M X-FileName: MTAYLO1 (Non-Privileged).pst In my view an assignment is the common legal method for accomplishing a sal= e and purchase of a derivative transaction. If they want to use sale termi= nology that is fine but the assignment language should also be there.=20 -----Original Message----- From: =09Hendry, Brent =20 Sent:=09Wednesday, November 21, 2001 9:11 AM To:=09Taylor, Mark E (Legal) Subject:=09FW: Chiricahua Assignments Do you have a problem with the recharacterization as a purchase? -----Original Message----- From: =09Wells, Bret =20 Sent:=09Wednesday, November 21, 2001 8:34 AM To:=09Hendry, Brent Cc:=09Douglas, Stephen H. Subject:=09FW: Chiricahua Assignments Brent, Please review the attached suggested changes to the assignment agreement. = I have made changes to only one of the agreements, but I assume that any ch= anges designated below will be made to both agreements. Broadly speaking, = my changes are designed to accomplish the following: 1.=09We want to characterize the Chricicahua LLCs as "Purchasers" to the ex= tent possible and not an assignor. Much of the redefined terms seek to acc= omplish that objective. 2.=09The stated intent of Chircahua is to "invest" in the Transactions. Th= is language tries to bolster our argument that Chiricahua is wanting to inv= est in the weather derivatives market but in so doing it is not acting as a= market maker with customers in these instruments. I have no changes to the Master Agreement and expect that we want to minimi= ze any changes to the extent possible. I am happy, however, that we are tr= ying to execute separate masters and not simply amend ENA's existing master= . Bret Wells -----Original Message----- From: =09Hendry, Brent =20 Sent:=09Tuesday, November 20, 2001 6:43 PM To:=09Douglas, Stephen H.; Wells, Bret; 'jlynch@velaw.com'; Rohauer, Tanya;= Del vecchio, Peter; Korkmas, Deb; Bell, Rebecca; Abrams, Clement; Tawney, = Mark Cc:=09St. Clair, Carol; 'bhendry@houston.rr.com'; Taylor, Mark E (Legal) Subject:=09Chiricahua Assignments I was informed by Steve Douglas this morning that for tax reasons we need t= o assign a number of weather transactions ENA entered into with XL Trading = Partners Ltd. from ENA to Chiricahua III LLC and Chiricahua V LLC. These t= wo entities are ultimately wholly owned subsidiaries of ENA. It is intende= d that these entities will also enter into a few weather transactions direc= tly with XL Trading Partners Ltd. All of these transactions must have a te= rm that ends no later than midnight December 31 2001. My understanding is t= hat some time after these transactions are assigned or entered into the Chi= ricahua entities will be liquidated sometime during the month of December a= nd the weather transactions will be transferred to the parent entity which = will subsequently be liquidated and moved to its parent and so on until the= transactions end up at ENA. I would ask Bret or Steve to clarify the proc= ess to the extent that I have left anything out or misstated the proposal i= n broad terms. If anyone needs a detailed explanation of the process pleas= e call Bret at ext. 54390. I would ask that everyone review the attached documentation in light of the= proposal above to give their views from a credit, Dynegy merger agreement,= legal, operational, commercial, corporate governance, and guarantor perspe= ctive. I am proposing the following draft documents for the assignment of the ENA = trades to Chiricahua III and V entities. =20 << File: ChiricahauIIIAssignment11-19-01.doc >>=20 I am proposing the following blacklined draft master agreements to be enter= ed into between Chiricahua III and V and XL Trading Partners Inc. These ar= e based on the executed ENA/XL Trading master. Please note that Chiricahua= and XL Trading would be providing parent guaranties in the form previously= agreed upon by ENA and XL Trading. Deb, please note the documents to be d= elivered section for the Chiricahua entities. Will we need some new resolu= tions passed? I am attaching final drafts of the confirmations that were entered into bet= ween the parties. The first six will be assigned to Chiricahua III and the= second six will be assigned to Chiricahua V. Rebecca, please note that I = will need copies of the executed confirmations for these transactions or th= e document that we sent to XL Trading if they have not yet signed the docum= ent by tomorrow midday if at all possible so I can attach them as exhibits. Chiricahua III Chiricahua V Please let me know if you have any questions or comments on the documentati= on. If you have any comments or questions relating to the tax purpose or p= rocess of this series of transactions please call Bret Well at ext. 54390. Regards, Brent