What is the latest on this?  
---------------------- Forwarded by Sally Beck/HOU/ECT on 12/27/99 11:20 AM 
---------------------------


Shannon Bedrich@ENRON
12/20/99 09:13 AM
To: Sally Beck/HOU/ECT@ECT
cc:  
Subject: Credit Policy with AEGIS

Sally,
Cris asked me to follow up with you regarding the AEGIS insurance policy and 
Enron's reporting requirements which  we met about a couple of months ago.  
Below is a series of e-mail that talks about Enron's obligations as defined 
in the insurance policy.  Please let me know if I can be of assistance in 
pulling this information together.

Thanks,
Shannon Bedrich
X39172

---------------------- Forwarded by Shannon Bedrich/Corp/Enron on 12/19/99 
09:03 PM ---------------------------


Cris Sherman@ECT
12/17/99 05:08 PM



James L Bouillion
12/17/99 12:34 PM
To: William S Bradford/HOU/ECT@ECT, Jeffrey T Hodge/HOU/ECT@ECT, Joseph M 
Deffner/HOU/ECT@ECT, Cris Sherman/HOU/ECT@ECT
cc:  
Subject: Credit Policy with AEGIS

Please see below and advise. Cris had started some dialogue with accounting, 
however, I have seen nothing come forth.   It would not be good to have a 
loss with so many open items.  
---------------------- Forwarded by James L Bouillion/HOU/ECT on 12/17/99 
12:32 PM ---------------------------


Mary Harkins <MHAR@McGriff.com> on 12/16/99 01:00:35 PM
To: James L Bouillion/HOU/ECT@ECT
cc: Alastair Muir-Taylor <AMui@McGriff.com>, Paul Sparks 
<PSpa@mcgriffatl.com>, Darren Sonderman <DSon@mcgriffatl.com> 
Subject: Credit Policy with AEGIS



Jim, we are pleased to advise that AEGIS is putting the final touches on the
wording and we hope to have it to you shortly.  In working with them, we
made note of the obligations of both Enron and AEGIS as respects
documentation to support the contract.  In particular, AEGIS is obligated
pursuant to VIII. (c) to provide an accounting of the EAB from the date they
received the premium to the date six months after the policy incepted.
Thereafter, the accounting will be due every six months.  We have requested
this from AEGIS and will provide a statement to you when it is received.

Enron on the other hand is required to provide the following:

Page 4 of 13: IV. Definitions(i) Documents:

     Prior to each anniversary, INSURED
agrees to
     notify COMPANY of any material
change in the
     form of the agreements (ISDA,
Enfolio Master
     Firm Purchase/Sale Agreement, Master
Energy
     Purchase and Sale Agreement and
others which
     govern INSURED TRANSACTIONS).  The
     report shall consist of summary of
changes and
     red lined version of documents.

Page 7 of 13: VI. Conditions to Payment by the COMPANY(e)
     Evaluation of Creditworthiness by
INSURED:

     The INSURED hereby agrees to
promptly notify
     the COMPANY in writing of any
material changes
     in the process and procedures set
forth in the
     document titled XXXXXX (Credit
Procedures).

Page 7 of 13: VI. Conditions to Payment by the COMPANY (g)
     Report of Overdue Items:

     The INSURED shall remit a report to
the COMPANY
     no later than 45 days subsequent to
the end of each
     calendar month, a listing of all
past due amounts in
     excess of 60 days past due as of
that month-end
     date, which may be subject to
coverage hereunder.

Page 7 of 13: VII.  Settlement of Payments Due by the COMPANY
     or the INSURED (a):

     The INSURED shall provide to the
COMPANY within
     thirty (30) days after the end of
each half-year
     period a bordereau.....

Page 7 of 13: VII. Settlement of Payments Due by
     the COMPANY or the INSURED (c):

     Notwithstanding the foregoing, the
INSURED must
     notify the COMPANY in writing within
thirty (30)
     days after the INSURED first has
knowledge of
     any loss actually or potentially
subject to coverage
     under this policy....

There was some correspondence in October regarding the report of overdue
items (VI.(g)) and the bordereau (VII.(a)), both on page 7 of 13, however I
don't think that these reports have been generated.  We would appreciate
your assistance in obtaining these in order to provide them to AEGIS.
Additionally, we are obligated to provide underwriters with the revised
Credit Procedures and would appreciate an update on that process also.

Thank you for your assistance on these items.  Please let us know if you
have any questions or assist you in compiling these reports.