The Assembler compile is working fine if we turn off the Xpeditor option and it fails only if we turn Xpeditor option on.
The errors that are being produced and a dump of these errors were transfered to Compuware for analysis.
PMC1X0012I STEP COMPILE INVOKING PROGRAM CONPARMX
C1X0011S STEP COMPILE PROGRAM CONPARMX ABENDED, CODE=S001
What is causing this problem.
Compuware reviewed the customers dump and the errors were caused by Compuware's Xpeditor software.
Fixes were created for the problem and the assemble now works when running Compuware's Xpeditor program in the Endevor processor.
For a list of fixes you would need to contact Compuware.