Hi Ed,

I'm dusting this off to figure it out, and it looks like there are some open credit issues.  Any thoughts?

Thanks,

Kay

 -----Original Message-----
From: 	Denton, Rhonda L.  
Sent:	Monday, July 16, 2001 2:16 PM
To:	Fitzgerald, Genia; Sacks, Edward; Mann, Kay
Subject:	Aquila


Genia,

I am attaching a redlined version of the draft EEI agreement.  I have
incorporated Aquila's standard language and other changes, in addition to
those you proposed.  A little bit of explanation might be in order:

1.  Aquila's guarantor, "Aquila Energy Corporation", changed its name to
"Aquila, Inc." effective February 21, 2001.

2.  The language under Downgrade Event for Aquila is rather lengthy.  This
is due to the fact that Aquila, Inc. will soon be rated and at that time
part (b) will apply.  Part (a) applies until that time.  We have included
both in order not to have to change the agreement after we are rated.

3.  We have proposed $15,000,000 for collateral thresholds for both parties.
We would be willing to adjust this figure higher if you would like, as long
as the numbers are the same for both Aquila and Enron.

4.  We currently have guarantees in place for both parties for $100,000,000.
We can apply $15,000,000 of that to power trades, or another option would be
to execute new guarantees in the amount of $15,000,000 to be applied to
power only.

5.  Section 1.53 - We do not agree to add the last phrase.  Sales price,
absent a resale, is already defined as market price.  The proposed last
phrase contradicts that definition and is not acceptable.

6.  Section 2.2 - Exhibit B needs to be included.

7.  Section 6.2 - We prefer to leave payment terms as they are in the EEI
agreement, which is industry standard language.

8.  Sections 8.1(c), 8.2(c), 8.4, and 8.5 - We have inserted language to
clarify the collateral threshold and performance assurance process.

9.  Sections 9.3. and 10.12 - We have inserted language to cover new taxes
and imaged documents.

10.  Arbitration - We do not agree to be bound to mandatory binding
arbitration.

11.  Schedule P - CAISO Firm - We prefer to use the industry accepted
definition of CAISO Firm, which is the first sentence of your proposed
definition.  We do not agree to the additional language.

Please contact me when you have reviewed the redlined document.  I look
forward to working with you to execute this agreement.


 <<ENRONcoversheetredlined.doc>>


Sandy Rimmer
Contract Administrator
Aquila Energy Marketing Corporation
1100 Walnut, Suite 3300
Kansas City, MO  64106
Phone:  816-527-1625
Fax:      816-527-4625
srimmer@utilicorp.com
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