APS

FYI.

----- Forwarded by Michelle Cash/HOU/ECT on 06/09/2000 04:02 PM -----

Mark Holsworth@ENRON
06/09/2000 10:53 AM

To: Michelle Cash/HOU/ECT@ECT, Sharon Butcher/Corp/Enron@ENRON, Philippe A
Bibi/HOU/ECT@ECT, Tom O Moore/NA/Enron@ENRON
cc: Rex Rogers/Corp/Enron@Enron
Subject: APS

I received a call from Gene Diers today about what he believes may be going
on with changes to my Agreement for Project Services ("APS") and how we
operate. There are business and legal reasons for the APS being in the name
of Enron Corp. If we sell a company and the APS was in the name of a
subsidiary, we would have to get the sold subsidiary to license the computer
software to us. Given the inability to determine this at the time everyone
is pushing to sell the subsidiary, we could end up without any software or
having to pay a substantial amount of money to the buyer later on when we
discover the mistake. Secondly, allowing all subsidiaries to negotiate
different versions with vendors would be a nightmare and create five times
the number of agreements to file. I am opposed to this. Every time we sell
a company, the software has always been an issue. We are as I told you
before trying to fix something that is not broken.