[ABB LETTERHEAD]

                                      ABB




Or. John G. Redef
Exmutv Voe Presidenr
(919) 212.45


October 28, 1997


Fax: 972-383-5733
Perot Systems Corporation
Attn: Mr. Ed Smith
12377 Merit Drve, Suite 1100
Dallas, Texas 75251

RE; California ISO

Dear Ed:

As you know. ABB Power T&D Company's President, Ake Almgren, was sent a copy of
the letter dated October 22. 1997 from Jeffrey D. Tranen, President of the
California Independent System Operator, to Mr. H. Ronald Nash of Perot Systems
Corporation. ABS is deeply concerned about the allegations in the ISO letter and
must request certain information and assurances from Perot We have taken note of
the fact that te ISO's letter was addressed to Perot and not to the ISO Alliance
LLC. Based on this fact, and the allegations contained in the letter, We believe
that the issues that have prompted the ISO's letter relate solely to actions
allegedly taken by Perot and not to any actions of ABB, Ernst & Young, or the
ISO Alliance. Nevertheless, the ISO's allegations concerning the erosion of the
integrity of the Calfornia energy market and the compromise of the work being
performed by the ISO Alliance, suggests that ABB's interests could be adversely
affected by the possible resolution of Issues raised by the letter. These
interests of ABB are both its long term interest in the successful completion of
the work under the ISO Contract and the short term interest of avoiding the cost
and disruption to the work of the ISO Alliance that could result from compliance
with some of all of the immediate demands set forth in the ISO's letter. In
order for ABB to understand the full implications of the ISO's letter, we
propose that we meet together promptly In order for you to provide the following
information and assurances to ABB:


                           ABB Power T&D Company Inc.
                          Information Systems Division

            201 S. Rogers Lane      Telephone;            Telema
            Flalolgh, NC 27610      919-212-4700          919.212-4821


     1.   Confirmation that Perot Systems has not Introduced or influenced the
          introduction of any changes or modifications to the Scheduling
          Applications design or Implementation that would create opportunities
          for profiting from Inefficiencies, congestion, or other potential
          weaknesses or shortcomings in the ISO systerns:

     2.   Confirmation or denial, with full supporting documentation and
          explanations, of the allegations In the ISO letter concerning the
          contact with a representative of San Diego Gas & Electric;

     3.   A list of all other persons and companies. if any, to whom any
          representative of Perot has offered assistance In profiting from
          Inefficiencies, congestion, or other potential weaknesses or
          shortcomings in the ISO systems;

     4.   Confirmation that Perot Systems, has not, in malding any offer of the
          type described in the preceding paragraphs, disclosed any information
          which is required to be maintained as confidential under any of the
          provisions of ISO Contract, as those terms are incorporated into the
          ISO Alliance Subcontract with Perot Systems.

Although we regard the allegations of the ISO letter to be of an extremely
serious nature, we fully understand that the allegations have not been
documented or otherwise proven. Nevertheless, if those allegations are
documented or proven, there is a risk that Perot would be In breach of its
obligations as a Subcontractor to the ISO Alliance. By proposing a meeting to
address the points noted above, we wish to give Perot every opportunity to
demonstrate to ABB either that the ISO's allegations are misplaced or, if based
in fact, that Perot will take every action necessary, at its sole expense, to
provide whatever remedy to which the ISO may be entitled. I will be able to meet
with you on Thursday, November 6, 1997. Please let me know if you can meet at
that time. Sincerely,

     /s/

     John G. Reckleff

   cc:   Perot Systems Corporation
         Attn: General Counsel
         12377 Merit Drive, Suite 1100
         Dallas, Texas 75251

         Ake Almgren
         Philip Curtis