In re ICTS

PRIVILEGED AND CONFIDENTIAL: ATTORNEY-CLIENT COMMUNICATION, ATTORNEY WORK
PRODUCT

Nicole and Bob:

This will confirm our telephone conference today regarding the issue whether
Enron Metals should be sending out 180-day notice of contest letters to the
various carriers who have tried to collect unpaid freight from Enron Metals
as a result of the reported insolvency of ICTS, Enron Metals' former shipping
agent.

Bob advised that the carrier's claims he has received in the New York office
total in the neighborhood of $30,000-$35,000. Of those, three carriers
apparently have claims of $5,400, $16,000 and $13,210. With respect to those
three carriers, Bob's office has sent some type of letter indicating that
Enron Metals already paid ICTS for this shipment and that those carriers
should look to ICTS for payment. The remaining claims are reportedly
relatively small (and Bob will be sending me his file containing those claims
shortly).

Nicole advised that the claims she has received in the Montreal office total
in the neighborhood of $40,000. Close to 90% of those reportedly involve
shipments that were completed prior to the end of April. It is Nicole's
understanding that she and her office were still a part of Barclay's until
the end of April. She is not, however, aware of how responsibility would
have been apportioned between Barclay's and MG Metals at the time for claims
such as these. Nicole will shortly send me an e-mail which sets forth what
bills concern shipments that occurred after the end of April. No notice of
contest letter of any kind has been sent to these carriers.

Both of you indicated that the telephone calls you had been receiving from
the carriers has tapered off.

Based on the foregoing, I recommended to you, and you agreed, that the best
strategy was to "let sleeping dogs lie"--i.e., not to attract attention to
Enron Metals by sending out 180-day notice of contest letters to the various
carriers. The risk here is that if one or more of these carriers does file
suit, you may not be able to assert any defense on behalf of MG Metals, such
as a late or inaccurate bill (and I have not researched your bills to
determine whether such defenses exist). Should a carrier file suit, you
would probably be liable for the principle and interest, along with
attorneys' fees.

However, given our preliminary impression that MG Metals is secondarily
liable on these bills if ICTS defaults, and the relevatively small size of
most of these bills, I think a "reactive" rather than "proactive" defensive
strategy makes sense.

Nicole and I agreed that I would run down exactly how Barclay's and MG Metals
decided to apportion liability for charges such as these at the time of that
transaction. By copy of this e-mail, I am asking Marcus if he knows the
right person to advise me on this (or if he has access to the relevant
documents).

I will continue to keep you advised.

Britt