Mark:

Below are some changes I would like to propose we make to our form of Master 
that we send to Mexican counterparties.

The issue is what documents do we request of Mexican counterparties in order 
to receive assurances of appropriate corporate authority for the execution 
and delivery of the Master.  Below is the current language and my proposal.  

Current
A Certificate certifying (a) resolutions of Party B,s and its Credit Support 
Provider,s (if any) board of directors (or other governing body) authorizing 
this Agreement and the Transactions contemplated hereby (or the Credit 
Support Document, as the case may be) and (b) copies of Party B,s and its 
Credit Support Provider,s (if any) articles of incorporation and bylaws (or 
other constituent documents)
A certified copy of a Power of Attorney authorizing a specified person or 
persons to execute and deliver on its behalf this Agreement (or the Credit 
Support Document, as the case may be)


Proposal:

A) Copies of Party B's and its Credit Support Provider's (if any) articles of 
incorporation and bylaws, as amended from time to time (escritura 
constitutiva y estatutos sociales vigentes) and, if required under Party B's 
bylaws and its Credit Support Provider (if any) or, if otherwise available, 
copies of the minutes of the meetings of the board of directors (or other 
governing body)  of Party B and its Credit Support Provider (if any) 
authorizing this Agreement and the Transactions contemplated hereby.

B) certified copy of a Power of Attorney granting a specified person or 
persons with sufficient powers and authority to execute and deliver this 
Agreement on its behalf (or the Credit Support Document, as the case may 
be).  

As you may know, most of our Mexican counterparties do not really pay 
attention to what they are signing.  The result is that, in most cases, they 
agree to provide certain evidence of authority that they really do not have 
(for example, in Mexico, officer certificates are not usual and they do not 
really mean much).  At the end of the day we receive executed Masters and all 
corporate documents that are required under Mexican law to adequately prove 
corporate authority but we are not receiving what the counterparty agreed to 
provide in the Master (again they agreed to this because they do not read it 
carefully).  I checked with our Mexican counsel both the issue and the 
proposed language and he agreed with both. 

The other issue is to add a paragraph in the form of legal opinion we request 
from counsel to our Mexican counterparty, limiting the legal opinion to the 
laws of Mexico.  The idea is to avoid wasting time with a change we 
necessarily must agree with and most importantly, end up with a legal opinion 
that "looks" more like a US opinion.  Language proposed: "The opinions herein 
expressed and statements herein made are limited in all respects to the laws 
of Mexico"

Finally, as I previously told you, I personally have no problems about 
receiving legal opinions from in-house counsel.  Are you okay with this with 
respect to Mexican counterparties?

I will prepare subordination language for the intercompany debt and will send 
it to you tomorrow.

Thanks
 
Francisco Pinto-Leite
Enron Americas
1400 Smith Street
Houston, TX 77002-7361

Tel: 713-345-7942
Fax:713-646-3490