Carlos:

I have visited with Lance Schuler on this matter.  The kind of provision you 
are talking about would need to be approved by Mark Metts, Tim Detmering, the 
President and General Counsel of ENA ( Lance has Haedicke's proxy to sign off 
for ENA), and the President and General Counsel of every affiliate that would 
be bound by the provision.  I suggest when you get in that you get a copy of 
the corporate policy on this kind of thing from Lance.

I trust all is well with you and your family.  Congratulations on the birth.

Jeff



	Carlos Sole@ENRON
	04/02/2001 01:40 PM
		 
		 To: Jeffrey T Hodge/HOU/ECT@ECT
		 cc: kay.mann@enron.com, Fred Mitro/HOU/ECT@ECT, Ben Jacoby/HOU/ECT@ECT, 
Sharon Hausinger/Enron@EnronXGate
		 Subject: Non-Compete Provision Binding Affiliates

Jeff, I am working on the divestiture of a project company that had been 
developing a power plant site in Illinois and as part of our proposed 
purchase and sale agreement, the purchaser has requested a non-compete 
obligation of 2.5 years with respect to the project and project company that 
we are selling that would bind both ENA and its Affiliates.  I recall that 
previously there was a policy which required certain approvals (including 
Mark Metts of Corporate Development) for non-compete agreements that were 
binding on other entities beyond the immediate business unit involved in the 
transaction.  Could you help us out and let us know whom we need to contact.  
Thanks. 

PS  I am working on a legal risk memo for this transaction and will forward 
it to you a draft later today or early tomorrow as we are hoping to DASH and 
close on it by the end of this week.

Section 7.9 Due Diligence; Competitive Activities. 
(a) NOTWITHSTANDING ANYTHING STATED IN THIS PURCHASE AGREEMENT TO THE 
CONTRARY, PURCHASER AGREES THAT (A) SELLER RELATED PARTIES HAVE MADE NO 
REPRESENTATIONS, WARRANTIES, COVENANTS OR AGREEMENTS TO OR WITH PURCHASER 
RELATED PARTIES RELATING TO THE TRANSACTIONS CONTEMPLATED HEREBY, OTHER THAN 
THOSE EXPRESSLY SET FORTH IN THIS PURCHASE AGREEMENT AND (B) PURCHASER 
RELATED PARTIES HAVE NOT RELIED UPON ANY REPRESENTATIONS, WARRANTIES, 
COVENANTS OR AGREEMENTS RELATING TO THE TRANSACTIONS CONTEMPLATED HEREBY, 
OTHER THAN THOSE EXPRESSLY SET FORTH IN THIS PURCHASE AGREEMENT. PURCHASER 
ADDITIONALLY ACKNOWLEDGES THAT IT HAS CONDUCTED ITS OWN EVALUATION OF ALL 
ASPECTS (INCLUDING, WITHOUT LIMITATION, ENGINEERING, ENVIRONMENTAL, 
TRANSMISSION, ACCOUNTING, REGULATORY AND LEGAL) OF THE COMPANY AND THE 
PROJECT, AND IS RELYING SOLELY ON SUCH INVESTIGATION AND EVALUATION OF SUCH 
MATTERS IN DETERMINING WHETHER OR NOT TO ACQUIRE THE  INTERESTS.  
ADDITIONALLY, PURCHASER HAS INDEPENDENTLY EVALUATED THE RISKS ASSOCIATED WITH 
THE DEVELOPMENT OF THE PROJECT AND THE PROSPECTS RELATING TO OBTAINING 
REQUIRED PERMITS, CONTRACTS, AGREEMENTS, AND ARRANGEMENTS NECESSARY FOR THE 
SUCCESSFUL DEVELOPMENT AND OPERATION THEREOF AND IS RELYING SOLELY ON SUCH 
INVESTIGATION AND EVALUATION OF SUCH MATTERS IN DETERMINING WHETHER OR NOT TO 
ACQUIRE THE INTERESTS.  PURCHASER ACKNOWLEDGES THAT THE KENDALL PROJECT 
DOCUMENTS DO NOT REPRESENT OR PROVIDE FOR ALL OF THE ASSETS, PERMITS, 
CONTRACTS, AND AGREEMENTS NECESSARY FOR THE PROJECT, AND, EXCEPT AS OTHERWISE 
EXPRESSLY PROVIDED IN THIS PURCHASE AGREEMENT, SELLER MAKES NO REPRESENTATION 
OR WARRANTY AS TO THE ABILITY OF PURCHASER OR THE COMPANY TO OBTAIN THE SAME 
OR ANY OF THE TERMS THEREOF, OR AS TO THE ABILITY OR LIKELIHOOD THAT ANY OF 
THE OTHER PARTIES TO ANY OF SUCH DOCUMENTS SHALL PERFORM IN ACCORDANCE WITH 
THE TERMS THEREOF.
(b) SELLER HEREBY AGREES THAT FOR A PERIOD OF ONE YEAR[THIRTY MONTHS] 
FOLLOWING THE CLOSING, SELLER WILL NOT DIRECTLY OPPOSE ANY ACTION BY 
PURCHASER OR THE COMPANY BEFORE THE CITY OF YORKVILLE OR KENDALL COUNTY 
AUTHORITIES IN CONNECTION WITH THE DEVELOPMENT OF THE PROJECT NO SELLER 
RELATED PARTY SHALL (i) TAKE OR SUPPORT ANY ACTION INTENDED BY SUCH SELLER 
RELATED PARTY TO (A) IMPEDE THE COMPANY,S ABILITY TO DEVELOP THE PROJECT IN 
THE MANNER CONTEMPLATED BY THE KENDALL PROJECT DOCUMENTS, (B) DELAY 
COMPLETION OF THE PROJECT BY THE COMPANY, OR (C) MATERIALLY INCREASE THE 
COMPANY,S COST TO COMPLETE THE PROJECT, OR (ii) TAKE OR SUPPORT ANY POSITION 
IN ANY PROCEEDING BEFORE ANY GOVERNMENTAL AUTHORITY DIRECTLY RELATING TO THE 
PROJECT THAT (A) CONTESTS OR SEEKS TO CONDITION THE ISSUANCE OF ANY 
AUTHORIZATION, APPROVAL OR CONSENT SOUGHT BY THE COMPANY OR PURCHASER, (B) 
CHALLENGES THE VALIDITY OF ANY AUTHORIZATION, APPROVAL OR CONSENT OBTAINED BY 
THE COMPANY OR PURCHASER OR (C) IS IN OPPOSITION TO THAT ASSERTED BY 
PURCHASER.    EXCEPT AS OTHERWISE PROVIDED IN THIS SECTION 7.9(b) AND SUBJECT 
TO COMPLIANCE BY SELLER WITH ITS OTHER EXPRESS OBLIGATIONS IN THIS PURCHASE 
AGREEMENT, (i) EACH OF THE SELLER RELATED PARTIES MAY ENGAGE IN WHATEVER 
ACTIVITIES IT CHOOSES (INCLUDING DEVELOPMENT ACTIVITIES OR POWER PROJECTS) 
REGARDLESS OF WHETHER THE SAME ARE COMPETITIVE WITH THE PURCHASER OR THE 
COMPANY, WITHOUT HAVING OR INCURRING ANY OBLIGATION TO DISCLOSE SUCH 
ACTIVITIES TO PURCHASER OR THE COMPANY OR TO OFFER TO PURCHASER OR THE 
COMPANY ANY INTEREST IN SUCH ACTIVITIES AND (ii) NEITHER THIS PURCHASE 
AGREEMENT NOR ANY ACTIVITY UNDERTAKEN PURSUANT HERETO SHALL PREVENT SELLER 
RELATED PARTIES FROM ENGAGING IN SUCH ACTIVITIES, OR REQUIRE SELLER RELATED 
PARTIES TO DISCLOSE SUCH PARTICIPATION TO PURCHASER OR THE COMPANY, AND AS A 
MATERIAL PART OF THE CONSIDERATION FOR THE EXECUTION OF THIS PURCHASE 
AGREEMENT BY SELLER, PURCHASER HEREBY WAIVES, RELINQUISHES, AND RENOUNCES ANY 
SUCH RIGHT OR CLAIM OF NOTICE OR PARTICIPATION IN SUCH ACTIVITIES.


Carlos Sole'
Senior Counsel
Enron North America Corp.
1400 Smith Street
Houston, Texas 77002-7361

(713) 345-8191 (phone)
713 646-3393 (fax)