Re: Credit Agreement - Tax Section

Sara and Jason,

Section 2.2 of the Credit Agreement attached below provides that ENA will
make any payment of interest to ABN AMRO Bank N.V. net of applicable U.S.
federal withholding tax (i.e., ABN AMRO bears the burden of the tax). While
ENA can pay the generally required withholding tax equal to 30 percent of the
gross payment, it should obtain the appropriate U.S. federal withholding
certificate from ABN AMRO so that the withholding tax will be reduced to
zero. (I have assumed that ABN AMRO N.V. is a Dutch entity. If that is not
the case, can you let me know in which country it is formed?)

The appropriate form to obtain is either:

1. IRS Form W-8BEN (which provides that ABN AMRO is a non-U.S. entity with
no U.S. nexus and is entitled to the benefits set forth in the treaty entered
into by the country under which ABN AMRO is formed and the United States), or

2. IRS Form W-8ECI (which provides that ABN has a U.S. branch and that
interest earned by ABN AMRO is attributable to its U.S. branch).

It is in ENA's best interests to obtain a form since, if no form is obtained
an ENA does not withhold the appropriate amount of tax, then the IRS will
look to ENA for payment. Furthermore, I suspect that ABN AMRO would be
unpleasantly surprised if it receives only 70 percent of the payment that it
intended on receiving.

Please call me at ext. 35777 with any questions.

Best regards,

Jeff

From: Jason Peters@ENRON on 07/07/2000 10:35 AM
To: Jeff Blumenthal/HOU/ECT@ECT
cc:
Subject: Credit Agreement - Tax Section

Jeff,

Pursuant to Sara Shackleton's request, attached please find a copy of the
credit agreement which Sara described to you. Please review Section 2.2.

Thanks,

Jason