With respect to agricultural trade options, the CFTC has specifically said 
that the swaps exemtion and the swaps policy statement are not available.  I 
will call you.

>>> <Sara.Shackleton@enron.com> 08/04 11:52 AM >>>

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]





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