Angela, if in your view, the issues brought up by Chase are an underlying dissatisfaction with the "entire" agreement, particularily the commodity "savings and advice" component, perhaps it would be advantageous for both Enron and Chase to sit down and re-negotiate.  From our point of view, given the execution and contract issues we currently have with the contract, this may be a win-win for the companies.  Let's sit down and discuss strategy - if you think it would be advantageous, I will replace Tom as senior level contact.

As per my voice mail from this weekend, I would like to get ahead of the potential issues brewing at a number of the other accounts particularily Starwood.  

Regards
Delainey
---------------------- Forwarded by David W Delainey/HOU/EES on 04/30/2001 08:17 AM ---------------------------


Chris Holmes
04/27/2001 06:48 PM
To:	Angela Schwarz/HOU/EES@EES
cc:	David W Delainey/HOU/EES@EES, Evan Hughes/HOU/EES@EES, Jeremy Blachman/HOU/EES@EES, Dag Joraholmen/HOU/EES@EES, Gayle W Muench/HOU/EES@EES, Peggy Mahoney/HOU/EES@EES 
Subject:	Re: Chase Marc Shapiro call to Jeff Skilling   

Dag talked very briefly to  Manny prior to my getting your email--Dag will not talk to him again until you and Dag talk. 

Manny told Dag that Chase wants all the holes filled in their  year 2000 data base-- Manny seemed to be at  a a loss to explain in more detail exactly what is bothering Chase.

I agree with your perception that Chase feels they are not getting financial and construction value; they also feel there was other  value promised them -- such as , in Manny's words, " strategic commodity management" , i.e.,  insights into, and advice on,  how to respond to changes in the commodity market. 

Chris




Angela Schwarz
04/27/2001 06:15 PM
To:	Chris Holmes/HOU/EES@EES
cc:	David W Delainey/HOU/EES@EES, Evan Hughes/HOU/EES@EES, Jeremy Blachman/HOU/EES@EES, Dag Joraholmen/HOU/EES@EES, Gayle W Muench/HOU/EES@EES, Peggy Mahoney/HOU/EES@EES 
Subject:	Re: Chase Marc Shapiro call to Jeff Skilling   

I am requesting that Dag hold off on contacting Manny until Dag and I have met.  I know that we were scheduled to meet  on Tuesday to discuss these very issues but I can move this up to Monday morning.  

 Dag and Cindy have dramatically improved the quality of our billing efforts but the basic contract structure precludes us from ever achieving  customer satisfaction (perfection).    

 I really believe the underlying issue here is that Chase perceives they are not receiving the financial value they had anticipated from the commodity and construction agreements.  We presented a report to them last week that would support their position.  The lack of value created coupled with the  billing issues and a vacancy in senior sponsorship seems to have created the tension that ultimately could put us in a good position to re-negotiate this deal.

 We have identified several areas of contract restructure that will create immediate value for Chase and Enron, eliminate the billing issues and provide them the visibility into the financial performance of the agreement they have been requesting.  

Jeremy has a strong relationship with Mark Shapiro and should be leveraged here.  We need to make sure our response to Mark maximizes the opportunity to get everybody back to the table. 

I am going to the esource conference nex t week with Manny Patino, where he is presenting .  The main reason I am going is  damage control as many of our competitors  will be there and it is my intention to stay close to Manny. (a great heads up from Peggy).

ams



Chris Holmes
04/27/2001 05:42 PM
To:	David W Delainey/HOU/EES@EES, Evan Hughes/HOU/EES@EES, Jeremy Blachman/HOU/EES@EES, Angela Schwarz/HOU/EES@EES, Dag Joraholmen/HOU/EES@EES
cc:	Gayle W Muench/HOU/EES@EES 
Subject:	Chase Marc Shapiro call to Jeff Skilling

Jeff Skilling called me this afternoon to say that he received a call from Chase Vice Chairman Marc Shapiro. Shapiro said that Chase was upset about:

1. Tom White and Gary Provo no longer being involved with the Chase account

2. Billing errors (unspecified problems)

I explained to Jeff that:

1. Chase wants someone at the Tom White level to continue to be their senior contact; Jeff said that that Dave might want to perform that function

2. We have made major improvements with the billing but we have not reached perfection; perfection is what Chase wants.

Next Steps:

1. We will have to let Chase know who will be their Tom White level contact.

2. Dag Joraholmen will contact Manny Patino at Chase to get specifics on the billing issues and with Evan's team determine what can be done to address such specifics.









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