Subject: PSCo Legal Risk Memo
From: [email-masked]
To: [email-masked]
Cc: [email-masked], [email-masked]
Date: Fri, 3 Nov 2000 05:34:00 -0800 (PST)

Mark--Here is the legal risk memo on the PSCo PPA.  I am also excepting below 
the two sections of the Agreement that present the timing issue that Dave 
Delaney noted regarding the PSCo  condition precedent for CPUC approval 
having a date of Dec. 21, while the ENA conditions for Board approval and 
satisfaction of due diligence having a date of Dec. 1.  

PSCO's dates for CPUC approval:

6.4 (A) PSCo shall have made commercially reasonable efforts to obtain any 
required approvals of the CPUC as described in Section 18.2(B) and, on or 
before December 21, 2000, shall have provided written notice to Seller 
stating either (i) that PSCo has obtained such approvals from the CPUC in 
final form, not subject to agency rehearing, without conditions materially 
modifying this PPA, or (ii) that PSCo waives the requirement for such 
approvals; provided, that if PSCo has not provided such notice to Seller on 
or before December 12, 2000, then the Commercial Operation Milestone Date for 
completion of construction and availability of the fifth and sixth turbines 
in the Facility shall be extended, on a day-for-day basis, for each day after 
December 12, 2000, through and including December 21, 2000, that PSCo has not 
provided such notice to Seller .  Any extension of the Commercial Operation 
Milestone Date for the fifth and sixth turbines in the Facility pursuant to 
this Section 6.4(E) shall run concurrently with, and shall not be in addition 
to, any extension of the Commercial Operation Milestone Date under any other 
provision of this PPA.

18.1 (A) This PPA is subject to review by the CPUC as part of PSCo's final 
1999 Electric Integrated Resources Plan (&IRP8).  Under the CPUC IRP Rules, 
the Commission must approve PSCo's proposed resource acquisition portfolio, 
of which this PPA is one part.  The CPUC may also review this PPA to 
determine whether it is consistent with the Request for Proposals issued by 
PSCo on January 28, 2000.  PSCo shall use its best efforts to obtain CPUC 
approval of its IRP and, if necessary, Commission approval of this PPA, as 
soon as reasonably practicable.  PSCo shall have the right to terminate this 
PPA by notice to Seller at any time on or before December 21, 2000 as a 
consequence of the failure of the CPUC to approve the IRP or this PPA by that 
date, and shall in any event be required to provide the notice set forth in 
Section 6.4(E).  Absent such notice by PSCo on or before December 21, 2000, 
this contingency shall be deemed waived and this PPA shall remain in full 
force and effect thereafter.

ENA's dates fpr Board approval and due diligence:

6.4 (A) Seller shall have received all necessary internal approvals, 
including, without limitation, the approval of Seller,s and Enron Corp.,s 
respective Boards of Directors according to such criteria as may be deemed 
appropriate by such governing bodies, provided that if Seller does not 
provide written notice to PSCo on or before December 1, 2000, stating that 
Seller has been unable to satisfy this condition (despite its due diligence 
to do so) and that this PPA and the other Project Agreements are therefore 
terminated, then this condition shall be deemed to have been satisfied;
(B) Seller shall have completed, to Seller's reasonable satisfaction, a due 
diligence review of the Site and all matters related thereto, including 
suitability, access, land use, zoning, permitting, noise, environmental, 
transmission access, fuel supply, utilities, and any similar or related 
matters with respect to the Site, provided that if Seller does not provide 
written notice to PSCo on or before December 1, 2000,  stating that Seller 
has been unable to satisfy this condition (despite its due diligence to do 
so) and that this PPA and the other Project Agreements are therefore 
terminated, then this condition shall be deemed to have been satisfied; 

As I said, the deal team intends to meet with PSCo next Wednesday Nov. 8 to 
attempt to amend the Agreement to match our off-ramp dates with the PSCo PUC 
offramp date, but the above provisions are the terms of the existing executed 
PPA.  If you have any questions, please call.
 Al Larsen