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Estimated Intrinsic Valuation - Summary
Enron Corporation (ENE)
(Dollars and Shares in Millions, Except Per Share Amounts)

1.   Intrinsic Valuation Summary:
 
 A.   Estimated gross selling price of seller's assets at the end of first forecast year.$20,490
 B.   Estimated liabilities of the seller to be paid by the seller out of the gross selling price.(67,667)
 
 
 C.   Estimated intrinsic value of the seller's common equity at end of first forecast year.$(47,177)
 D.   Estimated fully diluted shares outstanding of seller at the end of first forecast year.814
 
 
 E.   Estimated intrinsic value per fully diluted share of seller at the end of first forecast year.$-57.96
 
 
2.   The Deal:
 
  A.   Gross selling price of seller's assets at the end of the first forecast year   $20,490
 
  Seller's forecast of year one operating earnings   $2,418
  Seller's forecast of year one EBITDA   $3,201
 
  Gross selling price, divided by forecasted year one operating earnings   8.47
  Gross selling price, divided by forecasted year one EBITDA   6.40
 
  B.   Total selling price of the seller's assets at the end of first forecast year
 
  Gross selling price of the seller's assets at the end of the first forecast year   $20,490
  Transaction expenses   $359
 
  Total selling price of the seller's assets at the end of the first forecast year   $20,849
 
  C.   Intangible assets recorded by the buyer at the end of the first forecast year
 
  Total selling price of the seller's assets at end of the first forecast year   $20,849
  Fair market value of the seller's assets at the end of the first forecast year   $76,150
 
  Intangible assets recorded by the buyer at the end of the first forecast year   $(55,301)
 
  Buyer's annual intangible asset amortization   $(3,687)
 
 
3.   Seller's Outcome:
 
  A.   Net pretax sales proceeds to the seller
 
  Gross selling price of the seller's assets at end of the first forecast year   $20,490
  Liabilities of the seller to be paid by the seller from the gross selling price   (67,667)
 
  Net pretax sales proceeds to the seller   $(47,177)
 
  Net worth of the seller's business at the end of the first forecast year   $12,121
 
    Net pretax sales proceeds to the seller, minus the net worth of the seller's business   $(59,298)
  Net pretax sales proceeds to the seller, divided by the net worth of the seller's business   (3.89)
 
 
4.   Buyer's Outcome:
 
  A.   Gross selling price of the buyer's assets at the end of four years of ownership   $100,680
 
  Buyer's forecast of year four operating earnings   $6,227
  Buyer's forecast of year four EBITDA   $6,712
 
  Gross selling price, divided by forecasted year four operating earnings   16.17
  Gross selling price, divided by forecasted year four EBITDA   15.00
 
  B.   Net pretax sales proceeds to the buyer's equity and subordinated debt investors
 
  Gross selling price of the buyer's assets at the end of four years of ownership   $100,680
  Liabilities of the buyer to be paid by the buyer from the gross selling price   $52,060
 
  Net pretax sales proceeds available to buyer's equity and subordinated debt investors   $48,620
 
  C.   Buyer's subordinated debt investors return on investment after four years of ownership
 
  Net sales proceeds to subordinated debt investors for equity warrants   $0
  Subordinated debt investors' original subordinated debt investment   $0
  Subordinated debt investors' fully diluted ownership interest in the buyer's sales proceeds   0.0%
  Subordinated debt investors' pretax annual rate of return   20.0%
  Subordinated debt investors' pretax annual rate of return target   20.0%
 
  D.   Buyer's equity investors' pretax return on investment after four years of ownership
 
  Net selling proceeds to equity investors   $48,620
  Equity investors' original equity investment   $6,255
  Equity investors' pretax annual rate of return   67.0%
  Equity investors' pretax annual rate of return target   15.0%