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Enron Mail |
It looks a good deal to me. Mark
=09Peter Keohane =0905/09/2001 09:56 AM =09=09=20 =09=09 To: John J Lavorato/Enron@EnronXGate, Mark E Haedicke/HOU/ECT@ECT =09=09 cc: Rob Milnthorp/CAL/ECT@ECT, Sharon Crawford/CAL/ECT@ECT =09=09 Subject: NGX Final Settlement SOLICITOR/CLIENT PRIVILEGED COMMUNICATION John and Mark, we have finalized our negotiations with NGX and have receive= d=20 from them final executed paper for our execution. All of them (NGX, OM,=20 Enerdata and Zarzeczny) have agreed (with the exception of Westcoast, who i= s=20 not really relevant and who sold out their position in NGX to OM after=20 commencement of the litigation). =20 By its terms, we have until Friday to confirm our agreement. The key terms= =20 are: 1. EOL third-party transaction data will be included in the index on a=20 real-time basis; 2. Other electronic trading systems may have their data included in the ind= ex=20 if they meet the criteria for inclusion (similar product, audit rights) (i.= e.=20 we deleted the "most favour nations" requirement for inclusion of other=20 systems not being on more favourable terms); 3. Enron pays a one-time C$25,000 set-up fee; 4. Enron pays an index management fee of C$5,000 per month, unless Enron=20 trades at least 50,000 TJ=01,s per month on NGX; 6. Enron pays normal NGX trading fees; 7. Enron pays no audit fees or other fees or costs; 8. Lawsuit is released with everybody bearing their own costs; 9. Enron agrees to confidential audit rights to independent auditor =01) bu= t no=20 customer information is provided to NGX; 10. No non-compete. Enron is expressly allowed to: (a) develop, establish, publish or promote any alternative or competing=20 index:=20 (b) post, settle against, or use in any transaction, any alternative or=20 competing index; © provide information to Gas Daily and Inside FERC, etc; (d) display any transactional information on EOL;=20 11. Term is 3 years, commencing after information transfer systems are in= =20 place, but not later than Dec. 31 (failing which lawsuit is revived, but=20 against NGX only); 12. Enron can terminate at any time on 60 days notice (but lawsuit is=20 released); 13. Enron can terminate at any time for NGX breach (lawsuit is revived, but= =20 against NGX only); 14. NGX can change its products and Enron has the option to change and be= =20 included or not to change; 15. The method for calculating and compiling the index cannot be changed in= =20 the future without our approval, and the agreements between NGX and Enerdat= a=20 which give NGX the rights to the index cannot be amended or terminated=20 without our consent; 16. Deal is subject to ENA senior management approval by Friday; and 17. The above has been approved and executed by NGX, OM, Enerdata and=20 Zarzeczny. This has been a tremendous amount of work with little involvement by outsid= e=20 counsel. Both Rob and I believe it is an excellent deal for Enron given th= e=20 fact that pursuing the lawsuit will be extremely costly (both in terms of= =20 expenses and the time and effort of dedicating resources to the litigation)= =20 and difficult to litigate. The deal really amounts to an option to Enron t= o=20 have its EOL data included in the index for C$25,000 and releasing the=20 lawsuit. Please let me know by Friday if we want to execute. Regards, Peter.
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