Re: Revised RM Policy

Hello again,

Makes sense to me. I would add "on behalf of MEH" after "Transaction" on the
first line of the second paragraph of VII.

I don't have the MEH Operating Agreement. Do you have an electronic copy of
it?

Thanks,

Kay

From: Gregg Penman 06/13/2000 07:50 AM

To: Kay Mann/Corp/Enron@Enron
cc:

Subject: Re: Revised RM Policy

Per my voice mail, will you please take a quick look at my edits to Vlady's
draft risk management policy attached below. I don't think any of them are
problematic, but Vlady has some concerns mainly because the base Enron Corp.
risk management policy was used as the template and therefore I am
effectively making edits to it.

I will be leaving the office today around 11:00 so I want to turn this to
Peoples before then if possible. On any other business, I will be
unavailable from 1:30 to probably 3:00 today, but can be reached via pager
800-980-1771 or cell phone 312-925-8888 at any other time.

As always - thanks for your help.

Gregg
---------------------- Forwarded by Gregg Penman/Corp/Enron on 06/13/2000
07:45 AM ---------------------------
To: Vladimir Gorny/HOU/ECT@ECT
cc:
Subject: Re: Revised RM Policy

Some comments on your comments:

Section II: I don't like the title "Commercial Development Manager" but
rather "Risk Manager"
Response: The title Commercial Development Manager comes from the MEH
Operating Agreement. We can amend the LLC Agreement if necessary, but it
seems burdensome since the title is only a formality. However, as currently
written, the Commercial Development Manager is the person responsible for
managing the daily business, i.e. similar to a desk director. In order to
maintain control of this position, it can only be filled by an Enron nominee
and will report directly to the MEH General Manager, Laura Luce of Enron.

Section VII: Majority of the wording came initially from attorneys, I would
recommend confirming that.
Response: I will run this by the attorneys. However, from a
technical perspective, Section VII refers to employees of MEH. No one in the
Chicago office is an employee of MEH, but rather we all remained employees of
our respective organizations. I will ask the attorneys if we need to limit
all Chicago based employees, both of Enron North America and Peoples Energy
Resources.

Section VIII: Who is the General Manager of MEH?
Response: As mentioned above, Laura Luce, Vice President of Enron
North America
Is Enron North America Corp. a legal entity?
Response: Yes, Enron North America Corp. replaced Enron Capital
Trade and Resources as the Wholesale business of Enron Corp. Unless you know
something different, I believe that to be a true statement.

Let me know if any of my responses don't make sense or you still have any
questions. I am still going to try to get this out by 10:00 or so.

Gregg

To: Gregg Penman/Corp/Enron@ENRON
cc:
Subject: Re: Revised RM Policy

Policy Comments:

Section II: I don't like the title "Commercial Development Manager" but
rather "Risk Manager"
Section VII: Majority of the wording came initially from attorneys, I would
recommend confirming that.
Section VIII: Who is the General Manager of MEH?
Is Enron North America Corp. a legal entity?

Vlady.

From: Gregg Penman @ ENRON 06/12/2000 02:03 PM

To: Vladimir Gorny/HOU/ECT@ECT
cc:
Subject: Revised RM Policy

Vlady - As we discussed, I am attaching my revisions to your initial draft.
They are mainly cosmetic attempts to make the RM Policy terms consistent with
the MEH Operating Agreement and separate MEH from any behind the scenes
reporting or controls that ENA chooses to place on Richard/MEH. Let me know
if you have any concerns about my edits. I would like to send this to
Peoples end of day today. I will follow up with Structuring to find a body
to model the underlying asset position.

Thanks - Gregg