Here it is.  Michelle

---------------------- Forwarded by Michelle Cash/HOU/ECT on 04/03/2000 11:43 
AM ---------------------------


FMackin@aol.com on 03/23/2000 11:50:42 AM
To: Michelle.Cash@enron.com
cc: pbutler@enron.com, kbolton@enron.com 
Subject: Deferral of Payouts under LTIP


To:  Michelle Cash

Date:  March 23, 2000

From:  Patrick Mackin

Subject:  Enron Investment Partners Long Term Incentive Plan;
    Deferral of Payouts Under Enron Corp. Deferral Plan


Michelle, Carol Jewett called me this morning about including a provision in
the long term incentive plan ("LTIP") being established for Enron Investment
Partners (old Enron Development Corp.) to permit deferral of payouts under
the Enron Corp. Deferral Plan.

I suggested to Carol that such a provision in the LTIP would not be
appropriate or sufficient; that the tail cannot wag the dog.  If such
deferrals are to be permitted, they would have to be authorized and made
under the provisions of the Enron Corp. Deferral Plan.  Also, there are some
additional issues discussed below.

Any compensatory arrangement that by design or practice defers payment of the
benefit until or beyond termination of an employee,s employment is considered
to be a "pension plan" under ERISA.

ERISA contains complex and challenging administrative, participation and
funding requirements  (which most employers want to avoid) for such non-tax
qualified pension plans.  The way to avoid these requirements is to design
such a compensatory program, such as a deferral plan, so that it is a "top
hat" plan which is exempt, not from ERISA, but from the more onerous
requirements.

For example, only employees who meet the "top hat" definition are permitted
to participate in the Enron Corp. Deferral Plan.  Enron Corp. is not willing
to let all employees who participate in the LTIP make deferrals to the Enron
Corp. Deferral Plan.  Any participant in the LTIP who wants to defer a payout
must first pass the screening test for top hat employees applied by Enron
Corp. Compensation and then make the deferral election on an approved form.
Also, any such employee must become an employee of Enron Corp. and then
reassigned or seconded to work for Enron Investment Partners.  This
employment requirement is to avoid multiple employer problems related to the
Enron Corp. Deferral Plan and its related trust.

Michelle, it may be "better, faster, simpler" to include a deferral feature
in the LTIP.  The same ERISA issues are present, but Enron Investment
Partners is in control.

Regardless, let,s discuss the design for the deferrals at your convenience.


Pat