Trade Option Exemption

Ken: In connection with our new product (and absence of any physical
activity in that product), I have the following question:

If neither ENA nor its counterparty is able to qualify as an offeree for
purposes of the Trade Option Exemption (17 CFR Sec. 32.13, as amended) but
each is an eligible swap participant (or better yet, each party has $10
million in net worth as per Sec. 32.13) can the option still be exempt from
CFTC regulation under the Swap Policy Statement or any CFTC interpretive
letters?

I have concerns about not relying fully on the Trade Option Exemption but I
also understood that the CFTC has informally said that the Swap Policy
Statement provides a safe harbor for both swaps and options.

I am available to speak at your convenience. Thanks. Sara [713/853-5620]